By Beatrice E. Rangel
It is the law of politics that economic downturns are to be followed by populism whether their theater is Argentina, Germany, the Philippines or the USA. The difference lies in the relative strength or lack of thereof of the institutional framework.
Argentina and the Philippines being nations created by empires solely interested in extracting wealth were endowed with an institutional framework completely inadequate to aggregate interests and resolve conflicts.
On the other extreme of the political spectrum is the U.S. -- founded to create wealth. Accordingly, its institutional framework was built to prevent power accumulation by a single player and power fragmentation under conflict generated pressures. This provided the necessary resilience to absorb economic and social shocks like depressions and wars.
The system operates by means of deploying checks and balances every time any particular actor accumulates too much power.
It is this system that accounts for the existence of the first and most enduring freedom promoting entity in the world -- that is the United States of America.
The entity was tested during the American Revolution, the Civil War and the two Great Depressions (1873 and 1928). The aftermath of both depressions saw populism rise with strength to be defeated by the emergence of centered driven political leaders that restored balance to the system.
In Latin America, populism has led to systemic collapse (Mexico, Chile; Uruguay; Venezuela) or profound economic restructuring (Colombia, Brazil, Argentina).
This is the result of institutional architectures designed to extract economic value for a foreign power. These structures are rigid, sector specific, resilient to change as well as being exclusionary.
As a result, economic downturns create conditions for the rise of virulent forms of populism that, instead of correcting the system, place irresistible pressures that either fracture or bring the system down.
This explains the cycles of dictatorship and democracy that the region has lived ever since Christopher Columbus set foot in the Western Hemisphere.
Globalization however has begun to modify these dynamics by means of promoting the rise of middle classes, the emergence of value creating entrepreneurial business leaders, and introducing transparency into the state apparatus throughout the region.
And while change proceeds at a slower pace than democratic expectations, recent developments in Argentina and Brazil and those of Chile and Peru in the 1990s give reason to hold democratic hope for Latin America.
The doubt however remains as to the extent of the damage that populism could effect on the United States.
The 21st century brand of populism has a very particular mix that has taken the U.S. commanding heights by surprise.
To begin with, that ruling class is mostly part of an Atlantic urban culture that resides in the great American metropolis (New York, Chicago, Boston, Los Angeles, San Francisco, Philadelphia, Boston). They are thus immersed in a global blending machine that gives them an international culture.
Populism however is brewing in America's heartland and in white urban lower income sections that are far removed from the paths of the elites. This explains the sudden and powerful emergence of two outsiders to the political establishment (Trump and Sanders) as standard bearers of White and Young America offended with a system that denies them entry jobs and meaningful salaries and fails to protect them against a rest of the world that they perceive as hostile and dangerous.
This segment of the U.S. population does not seem to have any connection with the country's elites and in particular those running the two main political parties.
The question thus arises: will these elites promote systemic changes that allow these people to obtain the skills that will bring value to their pay checks? Or will they just continue to try formulas of the past that have given solid proof of their inadequacy.
Will the elites understand that the Mexican Wall is a killer to the badly needed U.S. industrial redeployment calling for the introduction of robotics into manufacturing? Mexico, as the world leading exporter of flat TV screens, is the place to develop the robots that need to be introduced in manufacturing.
Crippling Mexico will cost the U.S. several decades in development impetus. And with that it will be impossible to train white non-college educated America to operate these robots thereby gaining a better compensated place in the income scale.
And the final question. Will the wonderful American experiment survive a strain of populism that brings higher TV ratings while unleashing the demons of isolationism and segregation?Beatrice Rangel is President & CEO of the AMLA Consulting Group, which provides growth and partnership opportunities in US and Hispanic markets. AMLA identifies the best potential partner for businesses which are eager to exploit the growing buying power of the US Hispanic market and for US Corporations seeking to find investment partners in Latin America. Previously, she was Chief of Staff for Venezuela President Carlos Andres Perez as well as Chief Strategist for the Cisneros Group of Companies.
For her work throughout Latin America, Rangel has been honored with the Order of Merit of May from Argentina, the Condor of the Andes Order from Bolivia, the Bernardo O'Higgins Order by Chile, the Order of Boyaca from Colombia, and the National Order of Jose Matías Delgado from El Salvador.
You can follow her on twitter @BEPA2009 or contact her directly at BRangel@amlaconsulting.com.
Also by Beatrice Rangel in her Latin America from 35,000 Feet seriesBeatrice Rangel: A Skipped Journey, a Reaffirmation and a Clearing of Path in the Americas
Beatrice Rangel: The Demise of Civility in the Americas!!
Beatrice Rangel: The Americas from Boutros Boutros-Ghali to Ban Ki Moon
Beatrice Rangel: The Pope's Difficult Stopover in the Americas
Beatrice Rangel: Farewell to The “Diplomacy of Reason”
Beatrice Rangel: 2 Diseases in Latin America -- Different Prescriptions, Very Different Outcomes
Beatrice Rangel: On Health Alerts and the Long Arm of Justice in the Americas
Beatrice Rangel: When Crime Meets Glory
Beatrice Rangel: Playing Hansel and Gretel in the Americas
Beatrice Rangel: Good News/Bad News Starts The Monkey Leap Year
Beatrice Rangel: The Gifts of Christmas!!!!!!
Beatrice Rangel: Crying Wolf in Venezuela
Beatrice Rangel: A 21st Century Tale of Two Cities
Beatrice Rangel: Are the Americas Ready for President Trump?
Beatrice Rangel: On Predictions of War & Global Confusion
Beatrice Rangel: Paris and the Return of Fear
Beatrice Rangel: Marijuana & Latin America's Next Trade Corridor
Beatrice Rangel: Of Burning Airplanes & Argentinean Tsunamis
Beatrice Rangel: The Good, the Bad, and the Ugly in the Americas!!
Beatrice Rangel: Buena Vista's Magic Covers the Americas
Beatrice Rangel: Pride and Perjury in the Americas
Beatrice Rangel: Trompe L’oeils Proliferate in the Americas
Beatrice Rangel: The Economic Consequences of Peace in Latin America
Beatrice Rangel: Colombia, the FARC & the Makings of Gangland in Latin America
Beatrice Rangel: When Extreme Weather Meets Extreme Politics Calamities are Bound to Happen
Beatrice Rangel: When Ladies Hit 70
Beatrice Rangel: About Uninformed Elites and Gullible Leaders
Beatrice Rangel: On US-Engineered Soft Landings in Cuba and Venezuela
Beatrice Rangel: On the Many Ways Cecil Matters
Beatrice Rangel: Blue Moons Lead to Extraordinary Happenings in the Americas
Beatrice Rangel: On Why Embassy Openings Do Not Necessarily Herald Different Policies
Beatrice Rangel: When Jupiter meets Venus
Beatrice Rangel: When Markets and Manners Crash
Beatrice Rangel: From Grexit to Exit, Contagion is in the Air
Beatrice Rangel: An Infuriated God & An Environmental Crusader Mark the Summer Solstice
Beatrice Rangel: Between Ionesco & the Falklands Syndrome
Beatrice Rangel: The Ugly Americas
Beatrice Rangel: How FIFA Corrupted the Beautiful Game in the Americas and World
Beatrice Rangel: Could the US RICO Act Be Applied to Latin America?
Beatrice Rangel: On the Discreet Charm of Commodities for Latin America
Beatrice Rangel: The End of the Chinese Free Lunch in the Americas!!
Beatrice Rangel: The Crooked Twig of Democracy in the Americas
Beatrice Rangel: Of a White Knight for Three Latin American Ladies in Distress
Beatrice Rangel: Withdrawal Symptoms?
Beatrice Rangel: The Un-Mannered Summit
Beatrice Rangel: Easter Miracles in Latin America and the World
Beatrice Rangel: Two Islands, Two Legacies & One Challenge - Modernity
Beatrice Rangel: Killing Me Softly -- the Obama Administration’s Legacy in Latin America
Beatrice Rangel: Of Upcoming Dynasties and Exhausted Ideas in Latin America
Beatrice Rangel: Of Thunderous Silences, Quiet Noises and Flash Backs in Latin America
Beatrice Rangel: Latin America's Dangerous Exports to Europe & the Demise of an Old Fox
Beatrice Rangel: Of Sweet Deals, Sugar Daddies, Direct Mail & Obama’s Care
Beatrice Rangel: Of Latin American Singing Birds, Femme Fatales & Empty Shelves
Beatrice Rangel: When Flying Dragons & Rage Infusions Turn Against Their Latin American Masters
Beatrice Rangel: Holy Haberdashery!!! Is Fire Building Under the Surface in the Americas??
Beatrice Rangel: 2015 -- A Year for Balance in the Americas???
Beatrice Rangel: Pope Francis Looks at the Americas In His Christmas Remarks
Beatrice Rangel: The Paint Brush Hanging from the Wall in Latin America
Beatrice Rangel: A Future for the Americas??
Beatrice Rangel: Going Forward, Going Backward -- It's the Americas!!
Beatrice Rangel: An Eerily Familiar Week in the Americas
Beatrice Rangel: Tale of Two Walls
Beatrice Rangel: Across the Americas, We the PEOPLE
Beatrice Rangel: Across Latin America, The Populist Beat Goes On!!
Beatrice Rangel: Oh My, The Patron of the Eternal Feminine Has Left Us!!!
Beatrice Rangel: Communism from China to Cuba Finds Corruption!!!
Beatrice Rangel: From Rio to Hong Kong Discontent Taps the East to Find a New Way
Beatrice Rangel: Will Latin America Miss the Broadband Development Target?
Beatrice Rangel: Kissinger’s World Order and Latin America
Beatrice Rangel: The Third Attempt -- Will Modernity Prevail in Latin America?
Rangel: While US is Away, Latin America Rethinks Development Paths
Rangel: In the Midst of Riots, a Star is Born in Brazil
Rangel: In Mexico Cinderella Gets to the Ball while Colombia Gets a Chance at Peace