(1) Bolivia - Revolt Of The Rich
(2) South American Leaders Hope Diplomacy Can Save Bolivia
(1) Bolivia - Revolt Of The Rich
By Michael Miller
Newsweek Web Exclusive
September 13, 2008
Relations between Bolivia 's President, Evo Morales, and
the country's wealthy easterners were tense from the
start. Since Morales's election in 2005, the eastern
provinces, known as the "Media Luna," or half moon,
which have grown rich on natural gas, have fought
bitterly over a new constitution that would redistribute
some of that wealth to the western provinces. The
opposition has requently waged disruptive strikes.
Protests began to take a more violent turn after Morales
trounced the opposition in last month's recall election.
This week at least eight Bolivians were killed in
clashes. Opposition groups blew up part of a natural gas
pipeline and vandalized government offices, causing
millions of dollars worth of damage. They have also
succeeded in disrupting trade with Brazil and Argentina ,
which rely on Bolivia 's natural gas.
Relations between Bolivia and the United States have
quickly deteriorated as well. Bolivia expelled U.S.
ambassador Philip Goldberg for "conspiring against
democracy" and in response the Bush administration
sent the Bolivian ambassador in Washington packing. In
a show of support, Hugo Chavez, Venezuela 's president
and staunch Evo ally, ejected the American envoy from
Caracas. On Friday, Morales sent troops into the
eastern provinces to restore order. To find out where
it's all headed, Newsweek's Michael Miller talked with
economist and Bolivia expert Mark Weisbrot, co-director
of the Center for Economic and Policy Research in
Washington, D.C. Excerpts:
Newsweek: How serious is the fallout between the United
States and Bolivia ?
Weisbrot: I think it's serious. I think that this thing
was coming for a long time. There had been a number of
incidents. There was the incident with the Peace Corps
and the Fulbright scholar [asked to spy by the U.S.
Embassy]. And then there are the meetings between
the ambassador and the opposition. Obviously he's the
ambassador: he should meet with everybody. But the way
he did and the timing of it was considered unfriendly.
I think you have a bigger structural problem, which is
that you have USAID funding groups in Bolivia but they
won't disclose who they are. They are doing this now in
Venezuela too. These are polarized countries. So on that
basis both of these governments [ Bolivia and Venezuela ]
just assume that Washington is doing what it has always
done, which is to fund the people that they are sympathetic to.
How much influence do eastern Bolivia 's large estate
owners have? What kind of pressure do opposition groups
exert in Bolivia ?
Quite a bit. That's what this conflict is really about.
You have the most concentrated land ownership in almost
the entire world in Bolivia , with around two thirds of
the land owned by six tenths of one percent, not even one
percent of the landowners. Obviously Evo Morales ran on
a platform of land reform. He is not talking about
confiscating huge amounts of land, but there is going
to be some redistribution. There is the hydrocarbon
revenue, which goes disproportionately to the Media Luna
states with the opposition governors. So those are the
two big economic reasons for this conflict.
Which one, land or hydrocarbons, is really the central
That is a tough question. The hydrocarbons are
more immediate because [the government has] already
begun some redistribution there. Morales has not
touched the landowners. So I guess you could say that
[hydrocarbons] are the bigger issue.
I was in Bolivia a couple months ago and I met with the
Central Bank and the ministries. The government has $ 7
billion in reserves right now in the Central Bank, which
is an awful lot [considering] their whole GDP is only
$13.2 billion. Most of it is owned by the prefectures,
the provinces, so they have a lot of money. So it is
hard to explain why they would raise such a fuss over
the government wanting to take a small part of that and
use it for some pensions for people over 60, which also
goes to their own residents.
How does this tie into the recent recall election in
Bolivia? Wasn't that election meant to resolve this
impasse between the Morales government and the
It did show some things. First of all, Morales got 67
percent of the vote, which is as big as you get in
politics in the world without fixing the election.
And the other thing it showed is if you look
at the Media Luna provinces, while it's true that the
opposition won, the vote for Morales also went up
enormously as compared to what he got in 2005. So his
support, his mandate, really increased quite a bit
since the 2005 election. What you are seeing right now
is that the people who could not win anything at the
ballot box are trying to use other means. They are
cutting off the gas, which is very serious.
What are the financial consequences of opposition groups
disrupting Bolivia 's natural gas pipeline?
It's huge. It's more of a problem for Brazil than it is for
Bolivia: they get half their gas from Bolivia and more
than half in the industrial region of Sao Paolo. For
Bolivia it is quite a lot of money. It is a $100
million estimated just to fix [the gas pipeline] and $8
million per day of revenue lost as well. But it is even
worse than that because the opposition can really
sabotage the whole economy. Everything that the
government is doing in terms of the next five years as
far as extending gas supply to Brazil and Argentina ,
if Bolivia can't be a reliable gas supplier then those
countries are going to have to look elsewhere. So it is
a form of serious sabotage. The [Morales government] is
calling it "terrorism."
Will Morales's mandate enable him to act more forcefully
toward the breakaway provinces or is he going to have
to wait for the constitutional referendum in December?
I think he is going to have to do something. The
government has been very pacifist and I think they don't
get enough credit for that. Most governments in the
world would have sent in the military in force and a
lot of people would have been killed. He has been
extremely restrained. He has tried to avoid violence at
all costs and the opposition has been emboldened by
that. They just keep escalating. Now they are taking
it to a different stage and I don't know how much more
the government can just try to ignore it. They really
depend on these gas exports, as do Brazil and Argentina .
Brazil issued a statement the other day that said they
will not tolerate an interruption in the constitutional
order in Bolivia . Whether that means they will send
troops, I don't know.
Does this have a financial impact on the United States ?
Or is the decision to expel the Bolivian ambassador
simply a quid pro quo response? Is there real money at
stake for the United States ?
I don't think there is really anything at stake for the
United States. If [by antagonizing Morales] they push
Chavez too far, there is always the chance that he could
cut off oil. But it is unlikely.
What type of fallout will there from Morales' use of
troops in the eastern provinces?
It depends on what the [government forces do] and on
their capacity for crowd control and using non-lethal
weapons. Look at what happened prior to Morales: they
are still trying to extradite the former president
[Gonzalo Sanchez de Lozada] for all the people who were
killed in the demonstrations back then. Morales has been
on the other side of this and he knows that things can get out of
control. So he is trying to do everything to avoid that
but it's not easy when you have an opposition that is
not operating by the same rules.
(2) South American Leaders Hope Diplomacy Can Save Bolivia
By Monica Vargas
September 15, 2008
SANTIAGO, Sept 14 (Reuters) - South American presidents
are racing to prevent a deeper political crisis in
Bolivia, where President Evo Morales has accused right-
wing opponents of trying to topple him, but diplomacy
may not be enough to avert more deadly protests.
Regional leaders will gather in the Chilean capital
Santiago on Monday, hoping to repeat a diplomatic
success scored in March when they coaxed Andean nations
away from armed conflict that would have pitted
Colombia, a U.S. ally, against Venezuela and Ecuador .
At that time, like now, the United States , which has
seen its influence in Latin America wane because of
President George W. Bush's war on terrorism and the rise
of leftist leaders in the region, was not at the
Other regional heavyweights, especially Brazil , are
stepping in to fill the void. And virtually all South
American leaders, be they left-wing or conservative,
have rallied around Morales, Bolivia 's first indigenous president.
The Bolivian government said on Sunday that Morales
would fly to Santiago for the meeting with the leaders
of Argentina , Brazil , Chile , Colombia , Ecuador , Uruguay and Venezuela .
"A civil war in Bolivia would be terrible not just for
Bolivia but for the region. It would would affect the
national security of many countries," said Ricardo
Israel, a professor of international relations in Chile .
"Expectations are too high. The only thing the leaders
can do is encourage both sides in Bolivia to negotiate,
and it's not clear they will agree to do that."
Bolivia, a volatile country in the center of South
America, has suffered chaos in the past week during
clashes between supporters of Morales and right-wing
governors who want more autonomy. About 30 people have died.
The summit will be a test of the nascent South American
Union of Nations, or Unasur, a 12-member group created
in May. Its key members participated in a Group of Rio
summit in March that quickly ended the Andean crisis.
Both groups are seen as alternatives to the U.S.-
dominated Organization of American States , or OAS.
In an unusual move, right-wing governors opposed to
Morales' plans for deep socialist reforms demanded a
seat at the table in Santiago with regional heads of
state, though their plea could be denied.
The leaders may have their hands full just trying to
craft a diplomatic response that pleases everybody.
Brazil, which depends on natural gas imports from
Bolivia, is keenly worried about energy security, while
Venezuela's Hugo Chavez, a close ally of Morales, has
entered a loud diplomatic dispute with Washington .
Chavez expelled the U.S. ambassador on Thursday -- after
Morales threw out the American ambassador in La Paz and
accused him of fomenting protests against his leftist government.
Washington, in retaliation, sent home diplomats from the
two countries and imposed sanctions on Venezuelan
officials it accused of helping Colombian rebels smuggle drugs.
"The Unasur leaders are in somewhat of a trap. On the
one hand, they want to show their support to a
democratic, unified and stable Bolivia . On the other,
they need to distance themselves from Chavez's personal
feud with the U.S. ," said Patricio Navia, a political
scientist at New York University .
(Additional reporting by Ray Colitt in Santa Cruz, Bolivia; Writing by Terry Wade; Editing by Fiona Ortiz and David Wiessler)