A Tale of Two Crops

By Rishi Khalsa


Pineapple plantation in Buenos Aires, Costa Rica

It was the best of crops, it was the worst of crops, it was a system of equality, and it was a system of inequality. There was a crop heavily exported from the mountains of Costa Rica, there was a crop heavily exported from the valleys of Costa Rica. In both places this was and continues to be the expected order of things. It is accepted that for agriculturalists, coffee would be a crop of opportunity and pineapple a crop of last resort.

The production of pineapples and coffee alone makes up nearly 10% of Costa Rica’s total exports in an industry that employs almost 15% of the labor force. There are towns in Costa Rica that survive solely on the production of these crops and are surrounded by a vast sea of either coffee or pineapple plantations. Yet, the production systems in place around these two crops vary greatly to the benefit and detriment of their respective laborers.

Del Monte with its Gold Extra Sweet pineapple is one of the largest pineapple producers in Costa Rica. The pineapples are grown on third party farms that limit workers’ ability to unionize. Despite earning above the minimum wage in an average week, in part due to being pressured into long hours both on the fields and in the packaging plants, workers report needing a substantially higher wage to provide a decent standard of living for their families. The majority of profits in pineapple production go directly to the retailers and Del Monte. For example, Buenos Aires in the province of Puntarenas, one of the largest production centers for Del Monte, is in the third poorest county in all of Costa Rica.


Pineapple plantation in Buenos Aires, Costa Rica

On the other hand, coffee production tends to create greater benefits for a larger number of local producers thanks, in part, to the existence of coffee cooperatives. The labor is still grueling, but the profits reach more Costa Ricans.

So, why does coffee production benefit more Costa Ricans and allow for cooperatives to dominate the sector in comparison to pineapple production? The reasons are both historical and market-driven.

Costa Rica, diverging from many other Latin American countries, developed into a relatively egalitarian agricultural society because of its lack of mineral resources and mountainous terrain. Spanish settlers were left on their own with the remnants of displaced indigenous communities. This created an atmosphere ripe for the development of small Spanish family farms that were able to embrace the sudden growth in demand for coffee worldwide beginning in the late 1700s in Costa Rica and leading eventually to the formation of cooperatives. Many of these families chose to produce coffee in order to take advantage of a government policy that gave land being cultivated by coffee growers to those same people creating a market of small producers.


Sun setting on the coffee town of San Carlos, Costa Rica

Coffee plays an important role in Costa Rica’s cultural identity and was traditionally harvested by the families themselves or neighbors, especially around Christmas. Now coffee is more commonly harvested by migrant laborers but the benefits of production still stay with local producers.

In contrast, pineapple was introduced into the country much later and on land that was not cultivated by these small coffee producers, leaving control of pineapples mainly in the hands of large multinational traders. This has contributed to pineapple not holding the same status as coffee in the national psyche and potentially obscures issues around the crop.

Similarly, market conditions favor small coffee producers in comparison to small pineapple producers. It is possible to find coffee of many varieties (fair-trade, elephant digested, shade grown, organic, etc.) sold by supermarkets and coffee shops catering to consumer preferences, whereas pineapples for the most part suffer from the distinction of being known simply as pineapples. This contrast stems from coffee’s movement into a segment of the market in which producers more effectively capture the value added, whereas pineapples are treated like regular agricultural commodities and the value added in the supply chain is captured outside of Costa Rica.

From an outside perspective coffee and pineapple production may seem similarly labor intensive, but on closer inspection, it becomes apparent that the distribution of economic benefits varies greatly. In one industry profits are largely extracted from country and earth, in the other they remain closer to home. While coffee production may be a bitter struggle in the face of fluctuating market demands and crop diseases, it is often a far, far better sacrifice for Costa Rican producers.




Rishi Khalsa is a student in the Master of Development Practice program at UC Berkeley. He served in the Peace Corps in Costa Rica from 2013-15.

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Cuauhtémoc Cárdenas Proposes a Social Mobilization to End Corruption in Mexico

By Marcos Martínez

An organized social movement that exerts pressure over the government is the way to end corruption and establish a new national project in Mexico, said three-time Mexican leftist presidential candidate, Cuauhtémoc Cárdenas.

During a conference titled “Mexico Today: Paths to a Democratic Future”, organized by the UC Berkeley’s Center for Latin American Studies, Cárdenas said that crises and corruption are not eternal, and could be defeated if the Mexican society organizes and mobilizes. “Corruption and impunity are present more and more in government and in business,” said Cárdenas at the Booth Auditorium on UC Berkeley’s Boalt Hall.

Cuauhtémoc Cárdenas with Mexican students studying at UC Berkeley

Cuauhtémoc Cárdenas with Mexican students studying at UC Berkeley

“There has to be political decision on the very top of the state and the political will to implement all those measures necessary to really eradicate corruption. That’s the only way I see. There’s no formula to make corruption disappear.”

Cárdenas said he aims to fight against these problems through his new group called “Por México Hoy” (For Mexico Today), which was officially inaugurated on October 3 in Mexico City, and has received the support of political leaders and civic organizations.

The group aims to build an organized social movement, modify the Mexican Constitution, and establish an alternative to the neoliberal hands-off economic model implemented by Mexican governments since 1982.

Cárdenas said that if his group succeeds in its goals, the current situation in Mexico could be reversed. He blamed the neoliberal economic policies for Mexico’s stagnant growth.

In the last decades, Cárdenas said, poverty and violence have increased dramatically.“Large and important economic sectors have (been) drastically reduced or disappeared. Internal markets have been left to foreign producers, and violence has expanded all over the country, ” said Cárdenas.

Cárdenas also pointed out that the economy has barely grown over the last half century. The Mexican Finance Ministry estimates that the economy will grow a mere 2 to 2.8 percent in 2015. Cárdenas said his country needed to emulate governments in countries such as Uruguay, Brazil, Chile, and Bolivia, where administrations grew their economies by increasing government spending and cutting income taxes rather than taking a laissez-faire approach.

Cárdenas first ran for the Mexican presidency in the 1988 election as a candidate for a leftist movement called “National Democratic Front” after being expelled from the ruling Partido Reviolucionario Institucional (Institutional Revolutionary Party) for promoting democratic elections through a group called Democratic Current, which later became the Partido de la Revolución Democrática (Democratic Revolutionary Party). Even though Cárdenas’ father, Gen. Lázaro Cárdenas, who was Mexico’s president from 1934 to1940, had been one of the PRI’s founders, Cárdenas was opposed to the traditional practice of the party’s presidential candidate being appointed by the incumbent officeholder.

The 1988 election result was controversial because the government claimed the electoral system had crashed when it was counting the votes. The government declared PRI’s presidential candidate, Carlos Salinas de Gortari as the winner, but Cárdenas accused the government of electoral fraud.

To this day, Cárdenas and his supporters believe that the presidency was stolen from them.

“(The fraud) could not be reversed, not by legal resources nor by strong and wide popular mobilization, but it made people conscious that by participating and voting, things could be changed”, said Cárdenas during the conference at UC Berkeley. Cárdenas ran for president again in the 1994 and 2000 elections for the PRD, which he founded after the 1988 electoral controversy. He lost in both races.

In between, however, Cárdenas became the first elected mayor of Mexico City in 1997. Before this election, regents who were appointed by the president ruled the country’s capital. Cárdenas considers that election a milestone for Mexico’s democracy and its electoral system. He governed for two years. “The government respected the vote, opposition won the Mexico City (government), both the Mayor and the local assembly, and for the first time the official party, the PRI, lost absolute majority on the federal chamber of representatives”, he said.

In Cárdenas’ third run for the presidency in 2000, he placed third with roughly 17 percent of the votes. The election, however, was a triumph for democracy — the ruling PRI lost for the first time in 70 years to the Partido Acción Nacional’s (National Action Party) candidate Vicente Fox.

Cárdenas resigned from the PRD a year ago alleging profound differences with the party’s national leadership. His decision came amidst scandals of corruption in PRD’s state and municipal governments.

Despite the progress the country has made, Cárdenas said there’s still more work to be done as long as elections continue to be tainted with fraud and bribery claims.

Cárdenas said that his new group would only succeed if it has popular support. He plans to travel throughout Mexico to convince citizens to mobilize. “If you want to really eradicate corruption you have to start from the top, but you need social support, so we are trying, in the first place, to build this social support,” he said, adding that his group was proposing constitutional changes to empower citizens, so they have better access to jobs, healthcare, and housing.

“The improvement of living standards and equality in opportunities are at the root of any real and effective solution. I firmly believe (a) democratic Mexico — politically, socially, and economically — is possible”, Cárdenas said.

Cárdenas said people can contribute to his new group with ideas through the organization’s website (www.pormexicohoy.org).

Marcos Martínez is a student at UC Berkeley’s Graduate School of Journalism

Marcos Martínez

Marcos Martínez

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The Relationship Between the Soda Taxes in Berkeley, California and Mexico

Morelia, Michoac?n, Mexico

Morelia, Michoacán, Mexico

By Jasper Feinberg and Dr. Simón Barquera, PhD

Only two places in North America have enacted a soda tax: Berkeley, California and Mexico. Although Berkeley is often considered the most liberal American city, it was Mexico that first passed a soda tax, and served as inspiration to community members in Berkeley lobbying for the measure. The soda tax is an example of how laws in Mexico and Latin America can inspire effective change in the U.S.

Mexico and the U.S. are the two most obese developed nations in the world. According to 2012 data from the Organization for Economic Co-operation and Development (OECD), the adult obesity rate in the U.S. is 35.3% and 32.4% in Mexico. Several sources now report that Mexico has overtaken the U.S. in obesity. The two countries also have comparably high diabetes rates. Thus, the U.S. and Mexico face similar obesity and diabetes epidemics, and used nearly identical soda taxes to combat these issues.

The design of the two soda taxes is very similar. Both are excise taxes, meaning the distributor pays the taxes. In both locations the amount of the tax is based on the volume of soda sold, at a rate of one cent per ounce in Berkeley and one peso per liter in Mexico.

Fascinatingly, the soda tax campaigns themselves also shared certain key aspects. For instance, due to the power of industries like the dairy industry, in both countries the taxes are not levied on dairy products or drinks made in restaurants.

berkeley_soda_tax_measure_d_otu_imgThe Mexican soda tax was an important piece of evidence for the Berkeley campaign. The early success of the Mexican tax provided tangible evidence for the soda tax, and showed those who doubted the measure that such a tax could be effective.

The connection between the campaigns is especially interesting given the differences in the American and Mexican political systems. Mexico, which has a more centralized system at the national level, passed the tax in a Senate vote. Berkeley, on the other hand, enacted the tax through a local ballot measure, and thus built a diverse coalition to gain popular support. This shows a clear relationship between the two taxes despite key political differences, and proves that laws in Mexico and other Latin American countries can be used to enact parallel laws in the U.S. We must consider Latin American countries to be applicable examples in fighting certain issues in the U.S., such as obesity.

Moreover, the tax has been effective in both Berkeley and Mexico. In Mexico, initial data from the Carolina Population Center at the University of North Carolina and the Instituto Nacional de Salud Pública (Mexican National Institute of Public Health) showed a 6% average decline in purchases of taxed beverages over 2014 compared to pre-tax trends. This difference accelerated during 2014 and the reduction compared to pre-tax trends reached 12% by December 2014. The decrease was also more pronounced in low-income households, which saw a 17% decline in purchases of soda by December 2014.

In Berkeley, there were certain key differences that had the potential to reduce the effectiveness of the tax. First of all, the average discretionary income in Berkeley is much higher, and thus an increase of 10 to 20 cents in the price of a soda might not limit consumption significantly. Even that price increase does not account for producers or distributors paying the tax instead of passing the burden to consumers. Moreover, unlike in Mexico, a consumer in Berkeley could easily drive outside of Berkeley to purchase untaxed soda.

Yet, according to the latest statistics published in the American Journal of Public Health, prices of sugar sweetened beverages have increased in Berkeley, with approximately 70% of the tax being passed on to consumers. Furthermore, both taxes succeeded in raising national and local awareness for the obesity epidemics in the two countries. These two factors lead to decreased consumption in Mexico and are likely to cause comparable decreases in Berkeley.

The fact that both taxes had similar effects shows that despite economic and social differences between the U.S. and Mexico, nearly identical policies can successfully combat an issue shared by the two countries. This reveals the potential for increased exchange between Mexico, and other parts of Latin America, and the U.S. when planning and advocating for legislation.

Globalization is producing similar situations in the U.S. and Latin America beyond the obesity epidemic, such as widening economic inequality. Therefore, further opportunities exist for mutual learning from campaigns across borders. Just as the soda tax was a model applied here in Berkeley, we should be alert for other such models to emulate.

Jasper Feinberg is a student at Berkeley High School who interned at the Instituto Nacional de Salud Pública in Mexico and volunteered with the Yes on D campaign in Berkeley. Dr. Simón Barquera, PhD, is a director at the Instituto Nacional de Salud Pública focusing on the effectiveness of the Mexican soda tax.

DSCN0475 - Version 3images

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From the Field: Cal Alum Interns at the U.S. Embassy in Mexico City

2290156408_e052f74ebe_bThis summer I had the opportunity and privilege to intern with the Management Section of the U.S. Embassy in Mexico City. It was by far one of the most utterly unique experiences of my life! As someone who is dedicated to studying Mexico, this experience challenged me to understand the country from a new lens, gave me the chance to see firsthand the issues limiting its potential, and acquire the skills and knowledge needed to devise informed solutions to help initiate sustainable development.

Through weekly intern briefs, I engaged with top experts in their respective fields (State Department, the Foreign Commercial Service, Departments of Treasury, Energy, and Defense, U.S. Agency for International Development, U.S. Drug Enforcement Administration, and many more) to discuss their work in Mexico, the challenges they face, and the future of our bilateral relationship.

Interns and Fraud Prevention Team at the American Battle Monument in Mexico City. This cemetery holds and preserves the memory of fallen soldiers and staff from the Mexican-American War (1846-1848). (credit: Francesca Lichauco)

Interns and Fraud Prevention Team at the American Battle Monument in Mexico City. This cemetery holds and preserves the memory of fallen soldiers and staff from the Mexican-American War (1846-1848). (credit: Francesca Lichauco)

I also had the unique opportunity to accompany a consular officer on regularly scheduled visits of incarcerated American citizens held in Mexican prisons. This experience impacted me greatly because I saw firsthand the challenges facing Mexico’s justice system as inmates can wait upwards of one year or more for pre-trial sentencing. Through these visits, I realized that the ongoing shift from an inquisitorial system to an accusatorial system, like we have in the United States, was thus far not apparent in the prisons I visited. Inmates continued to experience significant delays in both meeting the judge and receiving judicial decisions. In addition to prison visits, I embarked on a consular “Fraud Tour” of Mexico City with the Fraud Prevention Team. It exposed me to the push factors prompting many to commit fraud and the harsh realities of human trafficking and prostitution that I knew existed in the Distrito Federal (D.F.), but was now forced to confront. I saw the Mexico that makes headlines; the Mexico that made many fearful to visit; but I also saw the Mexico that I hope to help change. This experience affirmed my commitment to a career in international relations, so that I can help build the institutions needed in Mexico to initiate sustainable development and alleviate poverty.

I also participated in a high-level dialogue between a California Senate Delegation, the ambassador, and top experts from the embassy. It was a phenomenal experience that I’ll never forget, because I had the chance to see diplomacy in action and make a contribution to the conversation. To deepen my understanding of the Foreign Service and international relations and hone in valuable leadership skills, I was invited to attend a small meet and greet with Ambassador Earl Anthony Wayne. During this meeting, I learned the Ambassador and I were both Cal Alumni Leadership Scholars, a scholarship given to U.C. Berkeley undergraduates who “demonstrate innovative, initiative-driven leadership impacting their academic, work, or community environment.” If this shared experience is any indication of my future, then I am on a great path towards becoming a leader and achieving my goal of advising on U.S. – Mexico relations. As our meeting with the ambassador came to a close, he said, “there are leaders and authority figures; a leader, can be anybody in the room with an idea and a creative solution, while an authority figure, although important, may not actually be a leader.” With this thought in mind, I left the ambassador’s office inspired and reassured that my creativity and out-of-the box thinking might just be what is needed to solve the most pressing issues in Mexico.

Equally important to this amazing experience, are the people who challenged me to grow, pushed my language abilities, and the Distrito Federal (D.F.) itself, all of which helped me gain a newfound confidence. One of my first assignments upon arrival to the Embassy was to help fundraise for the U.S. Independence Day celebration. Admittedly, I was a little nervous to reach out to potential donors in Spanish, but I put my fears aside and jumped in full force. My collaborative efforts working with my supervisor helped us not only reach our sponsorship goals, but exceed them. Moreover, working in tandem with the office of protocol I was able to ensure sponsors received their proper recognition and their guests were accommodated accordingly – it was a great team effort! Working alongside the local staff in the financial management center of the embassy, I observed their commitment to the U.S. Diplomatic Mission to Mexico. They helped me understand Mexico on a personal level, taught me new words in Spanish, and committed to only speaking to me in Spanish. But, more importantly, they showed me the Mexico that they and I dream is possible. I am grateful for their friendship and their bienvenida. The Distrito Federal was a teacher in and of itself. I learned daily to enjoy the simple things in life, to enjoy the moment, and more than anything, to be grateful for the beautiful journey.

Bernadette L. Carrillo-Hobson is a graduate of UC Berkeley and is currently pursuing an M.A. at Georgetown University’s School of Foreign Service 

Author with Ambassador Anthony Earl Wayne at his residence for the U.S. Independence Day celebration in Mexico City (credit: Bernadette Hobson)

Author with Ambassador Anthony Earl Wayne at his residence for the U.S. Independence Day celebration in Mexico City (credit: Bernadette Hobson)

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The Myth of Unified Unrest in Brazil

A March 15, 2015 protest in São Paulo, Brazil.

March 15, 2015: A protest in São Paulo drew more than 1 million participants, demanding an end to impunity and corruption and the departure of President Dilma Rousseff. (Photo by Radio Interativa.)

by Rebecca Tarlau and Liz McKenna

If you’ve been following the headlines about Brazil over the past several years, you’ve no doubt heard about the twin political and economic crises that have beset the proverbial país do futuro. After nearly a decade of boom years fueled by the commodity trade with China, select social and consumer spending, and the discovery of pre-salt layer oil fields, the Brazilian economy came to a screeching halt. The Brazilian real has fallen sharply since July 2011, when one US dollar bought 1.56 reais, to today, with one US dollar buying 3.85 reais. The outlook for 2016 is bleak: the economy is expected to shrink by three percent next year. Last week, the Brazilian Institute of Geography and Statistics (IBGE) updated the IPCA, Brazil’s equivalent of the Consumer Price Index, which measured inflation at 7.64 percent last month, the highest value since 2003. Energy giant Petrobrás lost 60% of its market value amid a massive scandal known as the Operação Lava Jato (Operation Car Wash) involving government officials from all of the country’s major political parties and a cartel of private contractors. And finally, impeachment proceedings against President Dilma Rousseff have proceeded on two separate fronts: faulty government accounting and misspent campaign funds.

Against this grim political and economic backdrop, Brazil has also been in the international headlines for the waves of protests that took the world by surprise in June of 2013 and subsequent moments of anti-government unrest throughout 2015 (concentrated on March 15, April 12, August 16). A common misunderstanding about these protests is that they reflect a united tidal wave of unrest in Brazil, culminating in recent demands for Rousseff’s impeachment. This trope about the current Brazilian moment is simplistic and misleading. A closer look at the still-unfolding protest events reveals them to be more reminiscent of an intense class dispute among particular organized sectors rather than a united and popular call for the end of Workers’ Party (PT) rule.

Most sources trace these waves of protest back to June 13, 2013, when military police in São Paulo used batons and tear gas to end a small protest organized by the Free Fare Movement (MPL) against increasing bus fares. Images of the scene circulated on social media and, four days later, one hundred thousand people were in the streets calling for free public transportation, decrying World Cup spending, and demanding political reforms. Internationally, these protests were interpreted as being part of a global trend of protests that were spontaneous, horizontal, and leaderless in character. The common catchphrase in the Brazilian case became, the “giant has awoken,” implying a now-activated public ready to exercise their voice.

Was this a new moment in the history of Brazilian social mobilization? Not according to many long-time activists, who have been struggling for rights since the mobilizations for a return to democracy in the early 1980s. However, there are several key differences between the 2013 protests and the social mobilizations of the previous three decades. First, many of the 2013 demonstrators were youth and middle class citizens fed up with the false promises of a “pragmatic left” that had attempted to appease both the upper classes and the poorest sectors of Brazil. Educational access has increased, but without the accompanying economic opportunities that the middle sectors expected. Second, there was a strong anti-establishment sentiment in the streets, against both parties and traditional social movements. In fact, party and social movement flags were often banned from the streets and a staggering 96% of probabilistically sampled June protest participants did not claim affiliation with any political party. Third, the June 2013 protests seemed to spark a conservative countermovement, attempting to direct the anger in the streets towards the Worker’s Party government. As Miguel Borba de Se describes the 2013 protests, “The movement is a battlefield. It highlights all the contradictions of Brazilian society.” Thus, as opposed to the organized social movement mobilizations of the previous decade, the June 2013 protests encompassed a range of ideologies, perspectives, demands, and opposing interests.

Fast forward to 2015. On March 15, 2015, between 210,000 (according to Datafolha) and 1.1 million people (according to the Military Police) marched in São Paulo calling for the President’s impeachment.  On April 12, hundreds of thousands of more protesters took to the streets throughout Brazil. The nominal reason for these protests was the Lava Jato scandal. Some of these protesters could be heard chanting Cold War era anti-communist slogans, and a minority even called for a military coup. The protesters placed the blame for the recent economic slowdown squarely on President Dilma Rousseff.

An impeachment protest in Brazil in early 2015. One banner is in English and another protestor is holding up a sign that says S.O.S FFAA, which is a reference to the armed forces (army, military, and navy). The protestors are dressed in Brazilian national colors, a typical feature of the 2015 impeachment protests.

An impeachment protest in Brazil in early 2015. One banner is in English and another protestor is holding up a sign that says S.O.S FFAA, which is a reference to the armed forces (army, military, and navy). The protestors are dressed in Brazilian national colors, a typical feature of the 2015 impeachment protests.

An impeachment protest in Brazil in early 2015. One banner is in English and another protestor is holding up a sign that says S.O.S FFAA, which is a reference to the armed forces (army, military, and navy). The protestors are dressed in Brazilian national colors, a typical feature of the 2015 impeachment protests.

What is clear is that the 2015 impeachment protests are very different from the 2013 earlier protests, which themselves were very different from the mass mobilizations that social movements have led for the past three decades.

A quick glance at some figures on the demographics of the April 2015 anti-government protesters illustrates that they were highly educated, overwhelmingly white, and aligned with the oppositional political party.

Demographic Characteristics of April 12, 2015 Protestors
Source: LAGE Laboratory, Ecology Department, University of São Paulo

 Table 1_Monthly IncomeTable 2_EducationTable 3_Race

As Oliveira writes, “These [2015 impeachment] protesters “perceive themselves as engaged in a life-or-death struggle to protect Western civilization (narrowly understood as being sustained by the twin pillars of economic liberalism and cultural conservatism) against the specter of a scheming authoritarian left.” The current target of this life-or-death struggle is, of course, Dilma.

Despite international media attention on this hostility towards President Rousseff, the current political moment should not be characterized as united unrest against the president. To the contrary, many labor organizations and social movements have begun their own counter-protests. On August 20, groups like the Unified Workers’ Central (CUT), the National Union of Students (UNE), the Landless Workers’ Movement (MST), the Communist Party of Brazil (PCdoB), and the PSOL staged anti-austerity protests in response to the August 16 anti-Dilma protests. On September 5, thousands of delegates from these organizations came together to found a new national coalition, Frente Brasil, which seeks to defend democracy, the rights of workers, structural reforms, and national sovereignty. The increasing class dispute between these mobilized social movements and the anti-Dilma groups was evident on September 22, when a group of protesters harassed the national leader of the Landless Workers’ Movement (MST), João Pedro Stédile, upon his arrival at the Fortaleza airport, shouting: “Ô MST, vai para Cuba com o PT!” (MST, Go to Cuba with the PT!). This open antagonism to the MST and Cuba, and Stédile’s response—which is that he supports Cuba without chagrin—is illustrative of the increasingly convoluted political divisions in the country.

A anti-austerity protest in São Paulo on August 20, 2015. The large banner reads “Stay, Dilma” and the UNE balloon in the background stands for União Nacional Estudantil, or National Student Union. As opposed to the impeachment march, most protestors are dressed in red.

A anti-austerity protest in São Paulo on August 20, 2015. The large banner reads “Stay, Dilma” and the UNE balloon in the background stands for União Nacional Estudantil, or National Student Union. As opposed to the impeachment march, most protestors are dressed in red.

In terms of event counts, the organized left has had more labor strikes and protests over the past few years than any other time since the fall of the military dictatorship. However, these mobilizations have been smaller in size than the anti-Dilma demonstrations, which, while less frequent, have rallied larger numbers of people in the wealthier metropolitan regions of the country. In light of the best evidence we have about both the head counts and demographics of these two types of events, the poor and working masses largely stayed at home. Why is this so?

On the one hand, political apathy and demobilization is the rule, rather than the exception in Brazil. Additionally, the anti-PT protests do not seem to resonate with many poor and working-class people. Public opinion polls show that the Brazilian underclass was less likely to approve of recent protests than upper class respondents, even the June 2013 protests, which were more socioeconomically diverse than the 2015 impeachment protests.  Over the past decade, extreme poverty has been reduced by 75 percent and overall poverty is down by 65 percent. Inflation-adjusted minimum wage has doubled. As Pitts argues, “a message decrying working class gains is not politically feasible.”

On the other hand, people are feeling the fallout of the economic slowdown—which disproportionately affects the poorest segments of the population—, and there has been a shift towards less popular support for President Rousseff. In December of 2014, 50 percent of families who earned up to two minimum wage salaries supported her presidency. In August of 2015 this number fell to ten percent. This decline represents concerns about both the real and media-inflamed economic crisis. However, the masses are still on the fence about the political future of their country. As Pitts writes, “A June [2015] survey revealed that 48% of Brazilians would still consider voting for a PT candidate, while only 39% ruled it out.”

The international media’s portrayal of unified unrest in Brazil is a myth. Here, we have highlighted three points that are critical for understanding the complexity of the current Brazilian conjuncture. The first is that Brazil is in the midst of a political and economic crisis, but not one that can be explained by the ruling party’s graft alone, a position Andres Oppenheimer advanced recently in the Miami Herald. (For a more nuanced analysis of the causes of Brazil’s current interregnum, see João Alexandre Peschanski and collaborators’ recent analyses in Revista Cult.) Second, the 2013 and 2015 waves of protest were far from homogeneous: the former represented a battlefield of interests, and the latter was organized by elite and right-leaning leaders who marched under the banner of impeachment and anti-corruption. At the same time, the organized left and labor unions continue to take to the streets, advocating for fairer labor practices and against recent austerity measures. Finally, the working-class masses, on the whole, remain demobilized. Each of these components reflect a fragmented left and an equally fragmented, albeit energized, right. No side is currently strong enough to win, and the result is a political stasis ripe for media manipulation.

Brazil’s crisis thus consists “precisely in the fact that the old is dying and the new cannot be born,” as Antonio Gramsci famously wrote in the Prison Notebooks. For the “new to be born,” the left may need to find a voice that “is both steadfastly critical of the PT’s [Workers’ Party’s] transgressions and is as engaging as the new right” as Patrick de Oliveira observed earlier this year.  If the foregoing analysis is correct, impeachment would hardly prove the antidote for what ails Brazil.

Rebecca Tarlau is a Postdoctoral Scholar in Education at Stanford University, affiliated with the Lemann Center for Educational Entrepreneurship and Education in Brazil.

Liz McKenna is a Doctoral Student in Sociology at the University of California, Berkeley.

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Argentina’s Presidential Election and the Energy Sector

By Luis Ferreira Alvarez

Oil drilling in Argentina. (Photo by Nestor Galina.)

Oil drilling in Argentina. (Photo by Nestor Galina.)

Argentines will go to the polls later this year and elect a new president, ending 12 years of ‘Kirchnerite’ rule. A change in administration could lead to a revolution in Argentina’s energy sector, which has seen drastic changes under the presidencies of Néstor (2003-2007) and Cristina Kirchner (2007-2015). Under President Cristina Kirchner, investor confidence in both energy and the economy deteriorated as the government implemented interventionist policies, including the expropriation of Yacimientos Petrolíferos Fiscales (YPF) in 2012. The government’s justification for the renationalization of YPF was to expand natural gas production in the Vaca Muerta field. However, despite the government’s claim, production of both crude oil and natural gas have declined 10% and 12%, respectively, since 2010 (Figure 1).

Figure 1

The fall in oil and natural gas production, combined with the slowdown of Argentina’s economy, and the promise of substantial oil and natural gas reserves in Vaca Muerta, have pushed the government to make reforms. The reforms (discussed below) are critical for Argentina’s energy sector, which has seen an investment increase of 107% since 2010 in anticipation of production in Vaca Muerta. The primary investor has been YPF, whose investment share rose to 46% from 30% since 2010 (Figure 2). Although YPF’s investment in developing Argentina’s hydrocarbon reserves is a welcome sign, YPF cannot reverse the decline in output alone. Without foreign investors, Argentina’s energy capacity is unlikely to materialize. This makes the upcoming presidential election an important moment for the energy sector.

Figure 2

Recent polls put Daniel Scioli, governor of the Buenos Aires province and member of the governing Justicialista Party, at 45.2%, just above the 45% winning threshold set by Argentine electoral law. The other main candidates, Mauricio Macri and Sergio Massa, polled at 32.4% and 13.8%, respectively. Furthermore, Scioli’s lead has been consistent for the past few months, increasing his chances of being sworn-in as president on December 10, 2015. Finally, the Peronist-Justicialista Party is likely to win a majority of seats in Congress. This would make governing Argentina very difficult for Macri or Massa, whose parties (Commitment to Change and Renewal Front, respectively) do not have substantial national support like the Justicialista Party. Governing Argentina for any non-Justicialista president would be extremely difficult with a Peronist-dominated Congress.

With the Justicialistas set to remain in power for the next four years, Argentina’s energy sector could capitalize on reforms that are aimed at attracting international investors. In October 2014, the government overhauled Argentina’s hydrocarbon law. The law aims at simplifying foreign investment in the country, and provides multiple incentives for foreign companies, such as capping royalties at 12%, increasing the concession time for unconventional (35 years) and offshore (30 years) exploration and development, and allowing firms that invest over US$250 million in Argentina to export 20% of their production, which is exempted from an export tariff. The law also curtails the power of the provinces to tax producing firms and to change their auction rules. Instead, the provinces and the federal government will work together to set new national rules. The government also reduced oil export tariffs to encourage production and export, and to show its commitment to the new hydrocarbon law. The Argentine government has taken other steps to mend its relations with foreign firms, such as the US$5 billion settlement with Spain’s Repsol, from which Argentina nationalized YPF in 2012.

These are steps in the right direction, and the next administration needs to uphold the reforms. Furthermore, the next president’s task will be to work on the details of the recent reforms and attract more investors despite the current low oil and natural gas prices. The commitment by foreign firms such as Chevron, Petronas and DOW Chemicals is a good sign that companies remain interested in Argentina’s energy potential.

Similarly, energy subsidies need to be reformed to ensure that the sector becomes competitive. Currently, Argentina’s domestic market subsidizes producers with oil prices set at US$77.50 per barrel and natural gas at US$7.5 per million British thermal units (BTUs). While the subsidies help producers, it does not help exporters, who find their profits reduced as they are constrained by international prices. These domestic prices remain a challenge for producers in the long run, as oil and natural gas prices are likely to rise above the Argentine price cap, making it uncompetitive to produce and export oil and natural gas. The new government will have to reform the subsidies so that firms are able to adapt their production according to market forces instead of government price mandates.

Finally, the next administration will need to keep the hydrocarbon producing provinces in line. Although the reformed hydrocarbon law limits provincial power over energy concessions, the pushback the provinces (especially hydrocarbon-rich Neuquén, Rio Negro, Mendoza and Chubut) mounted against the federal government in the run up to the overhaul of the law is likely to resurface once production picks up. The new government should not only enforce the new hydrocarbon law, but also ensure that the provinces are treated as equal partners when taxes and concessions are negotiated.

Argentina has the chance to become a regional energy powerhouse, but it will all rest with the decisions of the next government. Although the Kirchner-era saw turmoil in the energy sector, last year brought a fury of reforms and reconciliation with private companies. The next president needs to uphold these steps and move forward with more concrete plans for the energy sector. However, strong state presence related to energy and the overall economy is likely to continue, not only because the Peronist Scioli seems likely to become the next president, but due to the overwhelming support for state intervention that exists within Argentine society (Argentine polls show that 79% of Argentinians prefer the state to control public services). For the Argentine energy sector to capitalize on the fortune it is sitting on, moderation and compromise will need to become the norm between the government and foreign investors.

Luis Ferreira Alvarez is a research analyst for an energy consulting firm and a UC Berkeley alum.

Luis Ferreira

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Fin del populismo en Argentina… (por ahora)

(Cristina Kirchner, presidente de Argentina en el Encuentro de los Jefes de Estado de Mercosur, Brasilia, Brasil. Diciembre, 2012. Foto: Eduardo Aigner.)

Fin del populismo en Argentina… (por ahora)
Por Roberto Guareschi

La Argentina llega boqueando a las elecciones presidenciales de octubre. Cristina Fernández de Kirchner deja un país en recesión económica, con instituciones debilitadas y una sociedad crispada y polarizada por su estilo confrontativo. El saldo de 12 años de gobierno (Cristina se alternó con su esposo, el fallecido Néstor) es negativo.

Néstor Kirchner llegó a la presidencia con viento de cola gracias a la suba espectacular del precio de la soja, casi un monocultivo en Argentina. En 2010, el mejor año, el Banco Central llegó a acumular reservas internacionales por 52 mil millones de dólares. Pero hoy las reservas suman 33 mil millones de dólares. Una caída vertiginosa cercana al 35% en apenas cuatro años.

Durante los años de crecimiento a tasas chinas, a los Kirchner no le importó la caída de la industria y el déficit energético que obligó a importar combustibles. La pareja gobernante desaprovechó la bonanza económica en subsidios, excesivo gasto público, y también por mera ineficiencia. Y hoy, cuando el precio de la soja se viene abajo y se termina el “dinero fácil,” Argentina sigue siendo, sobre todo, un productor de materias primas.

También en el plano político hay graves problemas.

  • Cristina se atribuyó la potestad de modificar el presupuesto a su antojo.
  • Tomó “préstamos” del Banco Central para enfrentar el desequilibrio fiscal.
  • Frenó investigaciones por corrupción.
  • Confrontó a los medios opositores y a la Corte Suprema con un estilo que no se veía en democracia desde mitad del siglo pasado, en el primer gobierno de Perón.

Peor aún, encontró un atajo que le permitió compartir la presidencia con su esposo sin violar la ley en lo formal. La Constitución permite una sola reelección y ellos se alternaron cada cuatro años hasta que murió Néstor.

Cristina no quiere un sucesor. Apoya tibiamente a Daniel Scioli, peronista pragmático y ex corredor de lanchas, que hoy tiene la mayor intención de voto. Su carisma está construido sobre un accidente que le costó un brazo, y no por su gestión deslucida como gobernador de la provincia de Buenos Aires.

El otro candidato con posibilidades es Mauricio Macri, jefe de gobierno de la Ciudad de Buenos Aires, donde la gente le reconoce eficiencia. Tiene un perfil neoconservador.

Ambos están casados con ex modelos. También comparten un extremo sometimiento al marketing: recientemente se prestaron a hacer el ridículo en un reality show, el programa de televisión más visto del país. Finalmente, comparten los mismos desafíos:

  • Domar el segundo porcentaje de inflación del mundo.
  • Reducir un gasto público sideral: aumentó 2.675% desde que asumieron los Kirchner.
  • Revertir el descrédito de la política: en 2003 Cristina declaró una fortuna personal de dos millones de pesos; hoy tiene 55 millones (además, su vicepresidente está procesado por aprovechar su cargo para hacer negocios).
  • Atraer inversiones extranjeras y créditos, algo hasta hoy impensable.

Macri y Scioli son ortodoxos en economía. ¿Pero podrá el que triunfe aplicar los remedios dolorosos que eso implica para los sectores más necesitados? ¿Podrá resistir las presiones de los poderosos sindicatos peronistas?

Cristina no puede ser reelecta más de una vez. Por eso tendrá que esperar cuatro años, por lo menos. En caso de que gane Scioli, piensa conducirlo desde el llano y así ser un árbitro de la política argentina. ¿Podrá? Su alto índice de popularidad –aproximadamente 40%-, su audacia y su energía en un país sin líderes quizás la ayuden.

DSC_0021.JPGEl populismo se va hoy como ocurre cada vez que termina la expansión económica. Pero un mito dice que cada diez años hay una crisis seria en Argentina. Si se cumple la profecía, es posible que vuelva el populismo. Pero en todo caso faltan unos cuantos años.

Roberto Guareschi fue director de la redacción de Clarín, de Buenos Aires, 13 años. Es columnista, docente y consultor en medios digitales

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