And ushered in a new era of socialist government
Throughout the 20th Century, Latin America experienced a consistent pendulum shift between left and right political and economic systems of government. Whether through revolution, election, or coup, one side of the political spectrum would usually follow the other in short order. Neoliberalism is an era of economic change that began in the 1980s and gained favor following the Cold War and collapse of the Soviet Union.
By embracing a faith in the liberal free-market economy, neoliberals dismantled nationalist economies and encouraged free trade throughout the region. In turn, this reduced government spending, but at great cost to social programs. Despite its advantages, neoliberal free-trade policies are not enough to support the entirety of peoples in Latin America.
With neoliberalism came many positives for Latin America, including free and regular elections, a marginalization of the political violence and repression that plagued the area, and the disappearance of most guerilla movements. It also brought with it a growing middle class, and today about one-third of Latin Americans are considered middle class.
Neoliberalism accomplished this, in part, because its economic principles managed to curb the hyperinflation that had plagued the region. Chile, for example, became a great success story in this period and experienced steady growth, low inflation, good credit, and a worldwide exports economy.Neoliberalism also reduced inefficient government bureaucracies by privatizing services such as the telephone, railroad, and others that had previously been government funded.
The positives of neoliberalism, however, did nothing to prevent the widening inequality and income gap around Latin America. While the middle-class grew, neoliberalism and the free-market economy offered very little to the poorest citizens.
In Chile, while the country enjoyed a stable economy and a growing middle-class throughout the 1990s, its distribution of wealth remained one of the most unequal in the world. Due to low import and export tariffs, Latin America, especially Mexico, saw the rise of the maquiladora during this period. A maquiladora is a manufacturing plant that assembled parts imported from Asia before exporting the completed product north into the United States.
Much like their predecessors, United Fruit and others, the transnational corporations that operated the maquiladoras eschewed working conditions in favor of revenue. They prioritized profits over people.
The presence of these corporations encouraged the local governments to keep wages low to maintain their presence. They also hired mostly women laborers and fired those that became pregnant. Neoliberal policies led to governments cutting many social programs as they attempted to curb spending, but this only served to make many items out of reach as costs of telephones and other modern items went up markedly. Neoliberalism was great for the middle class, but much like neocolonialism, left little for the poorest classes.
By the turn of the century, many in Latin America grew tired of the empty promises and ugly realities of neoliberalism. Much like the middle of the 20th Century, people in the region began clamoring for change and began voting for leaders with nationalist overtones. Hugo Chavez of Venezuela among the most famous because of his use of Bolivarian imagery and socialist policies to suggest Latin American solidarity against U.S. influence.
By 2010 the majority of Latin American governments were ran by left-leaning nationalist politicians.
Once again, socialist governments promising a focus on nationalistic policies rose to prominence on the backs of the poor.
