The Economist - USA (2020-06-27)

The EconomistJune 27th 2020 The Americas 25

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Bello Lessons from history

T

he covid-19pandemic has still not

peaked in Latin America, and it is

likely to last for several more months.

Apart from the toll in human lives, the

virus and the efforts to fight it through

lockdowns have hammered economies

and forced tens of millions of Latin

Americans into poverty. The imfexpects

the economy of the region (including the

Caribbean) to contract by 9.4% this year,

with only a moderate recovery next.

Harder to divine are the political impli-

cations of this hardship. But if history is a

guide, they will be great.

Latin America has seen slumps on

this scale only twice in the past century.

The first was triggered by the Wall Street

crash of 1929. By 1932, many of the re-

gion’s economies had shrunk by 20%

(and 40% in the case of Chile and Cuba).

Export earnings and investment col-

lapsed. In most cases recovery came only

in 1933. The second slump was in the

1980s, when a string of countries de-

faulted on their foreign debts after inter-

national interest rates soared. For Latin

America as a whole, gdpper person

shrank by almost a tenth between 1981

and 1983. Recovery was much slower than

in the 1930s. The 1980s became known as

the “lost decade”.

Both these periods saw political

upheaval. Between 1930 and 1933 the

armed forces pushed aside civilian gov-

ernments and took power in eight Latin

American countries. In Chile the reverse

happened: a popular uprising overthrew

the government of General Carlos Ibáñez

in 1931. Over the next 18 months Chile

suffered nine successive governments,

two general strikes and several coups

before settling down under civilian rule

for the next 40 years. The 1980s saw the

opposite trend. Dictatorships, which had

prevailed in the region, yielded to elected

democratic governments in eight coun-

tries between 1982 and 1989.

Covid-19 struck Latin America as it was

already suffering political strains because

of several years of slow economic growth

and popular discontent over corruption

and poor public services. This discontent

manifested itself in the defeat of incum-

bent parties in many recent elections, the

rise to power of populist outsiders in

Brazil and Mexico in 2018 and a wave of

street protests last year, notably in Ecua-

dor, Chile and Bolivia.

The immediate effect of the pandemic

has been to strengthen presidents in sever-

al countries. The public has generally

applauded rulers who have tried to save

lives with lockdowns. And these lock-

downs have made it harder for opponents

to fight back, either in the streets or in

hampered legislatures. When the pandem-

ic ebbs but its economic consequences

linger, anger is likely to resurface and may

be directed at governments. “Rally-round-

the-flag is a very short-term effect; in a

couple of years people won’t connect the

economic crisis with the virus,” says Dan-

iela Campello, the co-author of a forth-

coming book on the links between eco-

nomic volatility and political instability

in South America. “It’s hard to see any

kind of [political] equilibrium or mainte-

nance of the status quo.”

What political direction will popular

anger take? One answer might be that it

will breed more populism. That is pos-

sible, but it may not apply where popu-

lism is the status quo. And populists tend

to have a hard time when money is short.

Optimists think that the overriding

lesson of covid-19 is that democratic

governments, armed with science and

openness, are doing a better job than

populists, and that voters will reward

them. That may be so in richer parts of

the world. In Latin America opposition to

incumbents, whether populists or demo-

crats, is more likely to be the trend.

If the 1930s and the 1980s are any

guide, the current slump may prompt

regime change. After three mainly demo-

cratic decades, the risk is of a return to

authoritarian rule. Already some presi-

dents, such as Nayib Bukele in El Salva-

dor and Jeanine Áñez, Bolivia’s interim

ruler, have used the pandemic as a pre-

text to grab extra powers.

The biggest threat is that the army

returns as a political actor, as it already

has in Brazil under Jair Bolsonaro, Vene-

zuela under Nicolás Maduro and to an

extent in Mexico and Bolivia. That is

partly because police may struggle to

maintain public order in the face of

popular anger. It is also because satis-

faction with democracy and its institu-

tions, already low in many countries,

may fall further, and would-be authori-

tarians, civilian or military, may spy an

opportunity. History need not repeat

itself. Nevertheless, Latin America’s

democrats will have their work cut out.

The risk of regime change and a new authoritarianism

called it “perhaps the single most success-

ful international agreement to date”.

Yet a gap has emerged between how

Canada sees itself and how the world sees

it, observes Bessma Momani of the Univer-

sity of Waterloo. Canada has recently con-

tributed less to unpeacekeeping missions

and given less aid to developing countries

than its European rivals. It had 34 active

peacekeepers at the end of May; Ireland,

with an eighth of its population, had 466.

Canada’s development assistance last year

amounted to 0.27% of gross national in-

come, well short of the un’s target for rich

countries of 0.7%. Norway gave more than

1%. Canadians’ perception of their country

as a model global citizen may be coloured

by “historical memory”, says Ms Momani.

Mr Trudeau was late to build relations

with African leaders, who have more than

50 votes at the un. His whirlwind tour of

the continent in February, which included

promises of aid and a stop at the head-

quarters of the African Union in Addis Aba-

ba, smacked of opportunism.

More bad news followed the Security

Council disappointment. On June 19th Chi-

na announced that Michael Kovrig and Mi-

chael Spavor, Canadian citizens, have been

charged with spying. China detained them

in December 2018 after Canada, acting on

an extradition request from the United

States, arrested Meng Wanzhou, the chief

financial officer of Huawei, a Chinese tele-

coms giant. The new memoir by John Bol-

ton, President Donald Trump’s former na-

tional security adviser, confirms that Mr

Trump dislikes the Canadian prime minis-

ter. Mr Trump called him a “behind-your-

back guy”. Canada, to paraphrase the lyrics

of an early hit for Ms Dion, is searching for a

hand that it can hold. 7