Lula: The End of Latin American Populism?

Essay by courlove7 November 2003

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Whether authoritarian or democratic, rightist or leftist, populism has been the most pervasive political ideology in Latin American politics for nearly a century. Yet populist leaders, while extremely effective at attracting mass support, have also contributed decisively to the region's failure to develop economically and politically. Populism, especially when practiced by undemocratic leaders, has been one of the biggest impediments to the adoption of policies that these countries need to meet their peoples' aspirations for well-being and social justice. Populist leaders exhibit an eloquent, charismatic and unlimited capacity to promise a better life for their people simply by wishing for it--never as the result of discipline, thrift and hard work. In practice the populists' expansionary policies have usually delivered short-lived prosperity, immediately followed by painful financial collapse. This reality, coupled with the socially divisive rhetoric loved and employed by populists, has sometimes led to violence and opened the door to even worse authoritarian regimes.

Interesting Evolution

Before this year, Luiz Inácio "Lula" da Silva had campaigned unsuccessfully for Brazil's presidency three times, each on a populist platform. Consequently, when polls showed him to be practically undefeatable in this year's election, it should have come as no surprise that foreign and Brazilian investors became anxious, with the real depreciating 33% in just four months and interest rates increasing over levels already devastatingly high. (The markets' overreaction to Mr. da Silva's electoral popularity was also a spillover effect from Argentina's irresponsible default on its foreign debt last December.) In one respect at least, polls and markets were both right: Mr. da Silva was elected by a huge margin. The question now is whether the usual tale of populist failure will repeat itself this time around. The short answer is no. I sincerely believe that, paradoxically, the president-elect will prove both the skeptical...