![]() The social and political consequences of the crisis were felt throughout the continent. Tens of millions were thrown into poverty while governments were forced to pay billions of dollars to imperialist creditors abroad. The only recourse they had was to the IMF, which intervened by demanding the implementation of brutal austerity packages, massive cuts in government spending and privatisation of state assets, all in the name of paying off foreign debt. Foreign lenders were not prepared to renegotiate and demanded their money back. By 1982, Mexico defaulted on its foreign debt, provoking a generalised debt crisis in the continent. ![]() ![]() In per capita terms, GDP contracted by 9 percent between 19. GDP stagnated in 1981 (growing 0.8 percent), and contracted in 1982 (-0.3 percent) and 1983 (-1.9 percent). This combination of factors produced a sharp economic contraction in the continent as a whole. This made interest on Latin America’s foreign debt much more expensive. Added to this was the raising of interest rates in advanced capitalist countries to fight runaway inflation that had developed during the 1970s. The contraction of the world economy led to a collapse in the prices of oil and other raw materials, hitting Latin American economies that exported these commodities to the world market. The immediate causes of the crisis related to the world capitalist crisis of the late 1970s. The crisis of the 1980sĭuring the 1980s, Latin America went through what became known as ‘the lost decade’. However, as we will explain, many of these governments are not left-wing at all several include open representatives of the ruling class and none of them has a clear programme for challenging capitalism.īut before we go into that, it is worth analysing the character of the first wave of ‘progressive governments’ and the reasons for their downfall. Some, like Jacobin, in their enthusiasm for these governments have gone as far as to say that this new wave will be stronger than the first one. On the surface of it, this seems like quite a powerful array. These are also the main countries constituting the ‘Lima group’, an ad hoc organisation created in 2017 to carry out regime change in Venezuela on behalf of US imperialism. ![]() This is quite a turnaround from the openly right-wing governments of Macri (Argentina), Bolsonaro (Brasil), Peña Nieto (Mexico), Piñera (Chile) and the coup governments in Honduras and Bolivia. To these we could add the short-lived government of Pedro Castillo in Peru (the sixth largest nation), Bolivia (2020), and Honduras (2021). These are Latin America’s five largest countries. ![]() It is indeed the case that governments described by the bourgeois media as being, in one way or another, centre-left have been elected in Argentina (2019), Brazil (2022), Chile (2021), Colombia (2022), and Mexico (2018). It is necessary to examine the character of that first wave, the reasons that allowed it to last as long as it did, why it came to an end, and the different conditions facing this new wave. It is perhaps apt that these governments are described as a ‘pink’ tide, as they are certainly far from being socialist ‘red’. This is a reference to the wave of so-called ‘progressive’ governments that ruled for a number of years in several countries of the continent between 1998-2015. The election of Lula in Brazil and Petro in Colombia in 2022 have led to increased noise in both the media and left-wing circles about a second ‘pink tide’ in Latin America. ![]()
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