When Neoliberalism Rears Its Head, Ecuador Fights Back

Ecuadorean President Rafael Correa speaks to teleSUR during the Non-Aligned Movement summit in Margarita, Venezuela, Sept. 17, 2016/Photo: Presidencia de Ecuador

The progressive president argued that neoliberal economics, not socialism, has failed.

Ecuadorean President Rafael Correa kicked off the the third annual Latin American Summit of Progressives Wednesday championing 21st Century Socialism as the economic model capable of confronting the “perfect storm” of difficult global economic conditions rocking Latin America and pushing back against neoliberalism with a focus on lifting up the well-being of poor and working-class people.

Correa took the podium after Ernesto Samper, UNASUR secretary-general and former president of Colombia, to unpack questions concerning the Left and the economy in times of change, an issue he said from the outset is a complicated one.

The progressive economist argued that the main economic challenge facing Latin America after generations of underdevelopment vis-a-vis the global north is balancing the inequality of a small number of elite and what he called “popular power,” represented by left-wing political movements of the region.

Correa reflected on the so-called socialist “Pink Tide” that swept South America after the 1998 election of President Hugo Chavez in Venezuela, and the eventual rise of the left in the majority of countries in Latin America, including for the first time in the post-dictatorship history of some, like Paraguay and El Salvador.

“The economic, social and political advances weren’t only positive, but historic,” Correa said, adding that efforts to assert sovereignty and independence and promote Latin American integration through new regional bodies marked an important turning point. “Without a doubt, it helped sew the global economic fabric.”

But the social gains ushered in by the Left, including lifting millions of people out of poverty — more than 1.5 million in Ecuador alone since 2007 — also sparked a right-wing backlash in the region that has spurred conservative destabilization campaigns in several countries with the old elites looking to grab back power.

“In 2008, undemocratic attempts against the progressive governments intensified,” said Correa, pointing to the coups in Honduras in 2009 and Paraguay in 2012 as the prime examples. “In South America right now, we only have five progressive governments.”

He said that economic strife in countries such as Venezuela and Brazil has been manipulated to herald the failure of progressive policies, but argued that many major advances prove that 21st Century Socialism is a viable model.

“We are here, stronger than ever,” he said. “Maybe we are victims of our own success.”

Correa criticized, as he has in the past, the dollarization of the Ecuadorean economy, arguing that the country’s lack of a national currency cripples its ability to confront economic challenges and be agile in the face of global dynamics. He argued that Ecuador, in particular — due to its economic reliance on the external sector — has faced a “perfect storm” of dollar appreciation, falling global commodity prices, especially oil, and natural disasters, namely the devastating earthquake that devastated the coast in April.

But despite the challenges — combined with a reactionary opposition and political manipulation of the situation in the media — Correa celebrated his government’s commitment to weathering the storm by defending the interests of the most vulnerable by maintaining public investment.

“The most important thing is the well being of the people,” he said, pointing to advances in public education and health care under his government and its so-called Citizens’ Revolution. “We will never be competitive if we don’t invest enough.”

He called for governance of the market and putting people and society above profits, arguing that “social protection does not contradict the market, it compliments it.”

“The truth is in these 10 years of revolution, everyone has won,” he said, praising the success of 21st Century Socialism and the Citizens’ Revolution for making gains in wealth redistribution since his government took office in 2007.  “The poor and working class won the most, but the business class has also won.”

“We are one of the most successful countries in Latin America is reducing the structural causes of poverty,” he added, highlighting the fact that the government of his Alianza Pais party has tripled tax collection through more efficient processes, slashed multidimensional poverty, and made advances in controlling unemployment. “The economy is reactivating to face the perfect storm.”

Correa added that aside from the economic challenge of asserting sovereignty and championing redistributive policies in the face of neoliberalism — which he described as ideology disguised as economic science — there are also political elements to the struggle in the form of “new attacks” on left-wing democracies.

In that context, he called for creating a “new aesthetic” of the “modern left” by moving beyond a politics of rejectionism based solely on a discourse of anti-capitalism, anti-imperialism, anti-neoliberalism and other “antis,” toward building ways to speak to a next generation that wants solutions. “We need to be in favor, not just against,” he said. “In favor of justice, life, peace.”

“We are always ready to defend our democracies against internal and external threats,” he added. “We will be victorious, comrades.”