Thu, Jan 31, 2019 - Page 9 News List

Venezuelan chaos unites new right in Latin America

By Mac Margolis  /  Bloomberg Opinion

The distance is considerable between Bolsonarismo and the more shape-shifting conservatism of his neighbors. Consider Chilean President Sebastian Pinera, a former credit card tycoon, whose political tin ear and early faith in market solutions collided with public fury and nearly crippled his embattled first term.

Elected for another term in late 2017, he pivoted to the center and has calibrated his belief in open markets to embrace socially liberal banners such as gender rights, protection for LGBT people and indigenous groups, and tough new fines for environmental violations.

The view gets murkier still from Argentina, where the pro-business independent Macri was elected to rescue the economy from the miscreant populism of former Argentine president Cristina Fernandez de Kirchner, only to find that his fiscal gradualism pleased neither the nation’s investors and business elite nor the general public frustrated by a chimeric recovery.

And how to peg Colombian President Ivan Duque, a protege of the angry rightwing former president Alvaro Uribe, but far closer in sensibility to the more conciliatory centrism of his maligned and somewhat feckless predecessor, Juan Manuel Santos?

“If this is a blue tide, there are many shades,” Schuler said. “Instead of a prevailing tone, we are likely to see many gradations coexisting in the region.”

Matias Spektor, a professor of international relations at the Getulio Vargas Foundation in Sao Paulo, draws a line between two claques of the political right competing for ascendancy in Brazil that could be stretched across the region.

One is the global right, which defends the rule of law, democratic institutions, and greater liberties for both markets and individuals. Think Pinera, Duque, Macri and perhaps Peruvian President Martin Vizcarra.

They stand in sharp relief to the woolly populist conservatism of Bolsonaro and, say, Paraguayan President Mario Abdo Benitez, a staunch pro-business champion who opposes same-sex marriage and decriminalizing abortion.

If there is a common skein to the many strands of the new right, it is an appreciation that balanced budgets can also be good politics. Encomiums to fiscal temperance are not new, but the recent consensus grew out of collective disappointment over classic Latin American boom and bust economics.

Nowhere is the failure more abject than in Venezuela, the once marquee oil producer which has seen its output more than halved under the chaos of Bolivarian economics.

Most Latin American nations have scrapped or are in the process of undoing the expansionary economic policies they eagerly adopted during the world financial crisis. Years of public overspending drove El Salvador’s right and left to sign on to fiscal conservatism, though financial analysts expect that ardor might flag as this year’s presidential race approaches.

“There’s a growing perception that economic stability and governability matter, and that these are the metrics that are going to strengthen your credit profile,” said Aristodimos Iliopulos, a Latin America analyst with Barclays Investment Bank. “There’s been a huge shift to fiscal responsibility laws in large and small countries.”

It is not that Latin America’s conservatives suddenly have become paladins of sound economics. Look no further than Bolsonaro, who spent nearly three decades in the legislature decrying privatization and boosting state interventionism.

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