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Proceso 1152
July 6, 2005
ISSN 0259-9864
Editorial: Without authority and without law
Politics: How to help mitigate the African pain
Economy: The agricultural situation in Central America
Without authority and without law
The answer of the Saca administration to the last
demand of the public transportation businessmen is confusing. It can be
discussed if this inconsistency is due to the governmental improvisation, or if
it is just a plan to get out of a trap that the President set himself. This
confusion is not good for the country. The owners of the public transportation
system wanted to increase the bus fare. And it seems that the government
responded that the administration would grant a subsidy (in relation to the
users). Outside the negotiation table, the government added as a condition that
a contract had to be signed, something that the businessmen of the public
transportation system have always refused to do, since they do not accept any
kind of commitments. There is no way to clarify this situation, because the
parts did not sign any agreements that would reflect the obligations of both
parties.
The situation got worse when the government of ARENA announced that the subsidy
would be granted with each gallon of combustible and for one year, while the
businessmen replaced diesel with a blended gas or another alternative
combustible. Even when the government insists on the idea that this second
proposal is the same one offered by the negotiation table, it does not seem
quite the same. Unless the press did not print the right declarations of both
parts. However, since there is no document available to prove this, it is
impossible to say what is the truth, and there are reasons to doubt about the
honesty of businessmen and officials. It is probable that, after making the
counter proposal, the Saca administration had time to study the numbers and
realized that such subsidy was not sustainable. In fact, this administration
still does not know where it will get the funds to subsidize some companies
that, on the other hand, are evidently not efficient.
The governmental improvisation can be noticed in the temporary condition of the
subsidy that was offered. Since it is not easy to go from one kind of
combustible that comes from petroleum to an alternative one. In this case, there
are no numbers available either, and there are no providers to supply the needs
of the public transportation system; the only thing available is questionable
projects. This might be a way to buy some time, while the international prices
of combustible drop and everything goes back to normal. The confusion turns
worse when the government offers in exchange of its proposal to tolerate the
circulation of vehicles that should have been turned into scrap metal already.
This way it would negotiate the security of the users with a total sense of
tranquility. The position of the traditional ally of ARENA weakens the position
of the government. The congressmen propose to suspend the Value Added Tax when
it comes to purchase combustible (in the case of the public transportation
system). The FMLN supports this proposal or the direct subsidy per user. The
left-wing party thinks that this might be favorable for the population; however,
it is actually supporting the interests of some opportunistic businessmen. The
proposal of these businessmen, that is to increase the minimum wage to enable
the user to pay for the increasing bus fares is shameful. What seems more
rational is to find an integral solution, a sustainable solution, and not just
try to put some make-up on the problem.
Although it is not official yet, the increase in the bus fare is a fact. And if
this is not resolved soon enough, it will not be modified, even if President
Saca does not approve it. To this challenge, the government reacts with the
promise to make the rebels respond to the law; however, the law is not strong
enough because the government itself is not powerful enough to use the law, and
it might not even have the necessary political will to use the law. A proof of
this is that by the second semester of 2003, the government of ARENA forgave the
businessmen of the public transportation system that owed more than 800,000
fines, that is, close to $20 million. Since then, those businessmen owe more
than $100,000 because of the fines that have not been paid since the debt was
forgiven. However, their companies are operating normally, and the government is
not using its authority to stop this. They are not afraid of the fines, because
they know that they will not have to pay them since the authorities will not
make them pay. Therefore, the law is not strong enough in that sense. The
attitude of the government before the challenging conduct of the businessmen is
similar to the one it adopts with the business elite. The weight of the law only
falls on those that are unprotected. This means that if they do not reach an
agreement, which the businessmen will have to accept first, the increase on the
bus fare will become a reality and it will be any price that the businessmen
decide.
The Saca administration intends to keep negotiating, but the businessmen do not
want to keep talking. Before the weakness of the government, they have chosen to
see how far they can go. They do not like the offer made by Saca, and the
government does not have an alternative. For the owners of the buses, the
increase in the bus fare is not negotiable; the government does not want to
negotiate the subsidy either. In these terms, there is no agenda to negotiate
with. In the mean time, the government is advising the users not to pay the
increased bus fare, and report the situation. The government is advising the
people not to use the service if they charge them for the increase. To report
this kind of abuse is useless, there is not an exemplar governmental action to
sanction the abuser or to promote among the citizens the adoption of a more
critical position. All of the privatized public services show an authoritarian
attitude.
The worst part is the attitude of the Saca administration, which goes beyond its
apparent firm position and has no alternative. Therefore, it is subjected to the
will of the owners of the public transportation system. They know this and they
take advantage of it. Neither the government, nor ARENA can allow an increase in
the bus fare in a pre-electoral year. The wear and tear that something like this
represents could make its position tremble. The weak spot of the government is
that it does not have any choices. And the problem is so complex, that it is not
possible or reasonable to improvise. That is why it is choosing to subsidize a
an inefficient private company, against its most precious Neo-Liberal
principles. The other problem is that this administration does not know where to
get the millions that subsidy will take. No one even knows how much it is or how
to use it. Perhaps the attitude of these businessmen is not right, but then, it
is not right either to take the inexplicable and the inconsiderate increase on
the electric energy charges, or the abuse of the telecommunication companies. It
is cynical to demand from a business sector what is not demanded from all of the
private business companies. Therefore it is a mistake to condemn the
inconsiderate attitude of the owners of the public transportation system because
it is a generalized attitude that can be seen in all of the important business
companies. Most businessmen think about profitability first, they put in a
second level of importance their other obligations: taxes, labor, the society.
The most important businessmen take advantage of the absence of authority.
How to help mitigate the African pain
For the celebration of the G-8 Summit in Great Britain –the
annual meeting of the eight wealthiest countries of the planet-, there will be a
series of international concerts, known now as Live 8, to claim the annulment of
the debt of the poorest countries of Africa. These musical demonstrations around
the world have gathered dozens of thousands of people that wanted to be heard to
end with the social, the economic, and the political injustice of the continent.
The motto has been: solidarity with Africa to eradicate poverty and sickness.
The leaders of that continent were gathered in Libya, the country of Colonel
Kadafi, at the same time, to support the efforts made in the Western world in
favor of their countries. They offer a struggle to eradicate corruption, a
visible cancer that is eating the dying African economies. The African Union
promises to “promote transparency and a good administration”, and that it will
not tolerate corruption. On the other hand, the leaders of the continent have
declared that they are willing to “accelerate the regional integration through
the elimination of frontiers for the inter-African trade, and make a priority
out of the prevention and the solution of conflicts”. In summary, the black
continent is fashionable these days.
The British Prime Minister, Tony Blair, is at the top of the list of the
defenders of the African cause in the reunion of the G-8. While his colleagues
discussed how it is necessary to help the poorest continent in the world, Blair
tried to convince George Bush that the world cannot live with just bombs and
missiles. To sustain the defense of the African cause it is necessary to use
ethical, economic, and political ideas. This article will review these main
ideas to establish some of the responsibilities in the drama that this continent
lives.
Political conveniences
From a political perspective, the wealthiest countries of the world do intend to
help Africa. Since the terrorist attacks of September 11th in the United States,
a new conception of international security has been implemented. Among other
components, the new doctrine of security of the most powerful countries
contemplates the need to permanently follow the events in the states that could
become the targets of international terrorism.
This is not just about making political pressure over the leaders of these
countries or eventually invade the nations that could become a sanctuary for the
international terrorists –as it happened with the American invasion in
Afghanistan-. This is also, to put it in the words of several European leaders,
about ending with the social conditions that might favor terrorism. Among these
social conditions, poverty is one of the most important ones. The portion of
African young people that have no perspective of life would be easy targets for
the recruiters of the international extremist organizations.
To have an idea of the importance of this threat it is necessary to remember,
for instance, how Osama Bin Laden stayed in Sudan for five years, and the
connections his organization had with the attack against the American Embassy in
Oriental Africa in August of 1998. For the founder of Al Qaeda, all Muslim
individuals have to fight against the occidental people that are not only
unfaithfully stepping on the sacred places of the Islam, but that also keep them
in a situation of injustice and iniquity. “To kill Americans and its military
and civilian allies –indicated the leader of the international terrorist
organization- is a religious duty for all and each one of the Muslims, that has
to be accomplished in any country they might be at until the mosque of Al Aqsa
is free from their claws and until their armies have abandoned the Muslim
lands”.
On the other hand, the anti-terrorist struggle of the wealthiest countries
requires the collaboration of stable reliable allies in the different regions of
the world. However, some miserable African countries, regularly shaken by the
internal crisis cannot fight against the terrorist. The terrorists, just like
those who promote illegal activities in the world, move better in an environment
of misery, political instability, and institutional chaos.
The economic convenience
From an economic perspective, the wealthiest countries are also interested in
helping the African people to improve their living standards. Africa counts with
35% of the world’s population, and only has 13.08% of the world’s GNP. Despite
the fact that it counts with abundant natural resources, fossilized combustibles
such as coal, petroleum, natural gas, it is the poorest continent of the planet.
The average income per inhabitant is much lower than $7,442. On the other hand,
25 countries of that region barely have a GNP of 25% per inhabitant (in
reference to the rest of the world).
That is why the objective is to improve the living standards of Africa. If this
objective is achieved, the most developed countries will also be favored. Their
companies can invest in these countries and improve the margin of their profits.
In other words, some have suggested that a higher level of development for
Africa will favor the wealthiest Occidental nations and their economies.
The World’s Trade Organization (OMC, in Spanish) reported in 2003 that “there
are powerful reasons to improve the access of the products of the poorest
countries to the markets and to also improve the level of equity in the
regulations of the OMC”. They keep thinking that the poor can promote the
liberalization of commerce and the African countries are invited to participate
in the multilateral system of trade.
If the countries are willing to take advantage of trade, there can be four
reasons to explain why a country would be favored by the international
cooperation through engagements connected with the openness of the markets and
the regulations about trade. The first reason is connected with the economic and
the political advantages of reciprocity, even when the less developed countries
do not act in a reciprocate manner. A second reason has to do with the cost of
the transactions. In the third place, it can be assumed that trade will expand
itself, and that it will be more profitable in a regime of certainty and
security as far as the conditions to access the market and the regulations are
concerned; the previous engagement in reference to a set of regulations also
reduces the role of power and the amount of it when it comes to determine the
results. In the fourth place, the international commitments are an arbiter to
strengthen the position of a government against the pressure of the special
interests”.
The declaration of the African leaders in reference to the objective of
eliminating the commercial barriers has to be interpreted in the line of this
worldly conception about the advantages of free trade. However, as it was
admitted by the document of the OMC, it is necessary to defeat the barriers
created by the developed countries that can be considered as obstacles for the
commercial interests of the less developed countries.
You can agree or not about the effects of the economic Liberalism on the
long-term development; however, undoubtedly, the most developed countries do not
respect the rules of the game. This brings-up the questions about the hypocrisy
of those who make the poorest countries open their agricultural markets to favor
the subsidized exporters of the North.
Ethical responsibility
From an ethical perspective, the contemplation of the African drama offers to
the developed countries of the North an opportunity to pay their debt with the
continent. Not many of them can say that the wealth they have today is not a
product of the direct extortion against the African people. The most powerful
European countries became rich through the African slaves or by corrupting their
leaders in order to take away their main natural resources. More than a helping
hand, this is asking them to return some of what they took in the past. That is
why, more than a feeling of compassion towards Africa, it is necessary to speak
about the need to display a sense of solidarity with the victims of those that
became the owners of humankind.
The inhabitants and the leaders of the occidental countries might not like to
hear this, that is why it could be counterproductive to make a campaign in favor
of the restitution of the goods that were stolen or taken away. Thieves do not
usually acknowledge the rights of their victims, especially when they have so
much power in their hands, as it is the case of the occidental countries of the
present. However, for those who reflect about these facts, it is necessary to
make the necessary clarifications.
The African case can be interpreted from many angles. There is no doubt that
many of the causes of the misery in this continent reside in the negligence of
its own sons. All sorts of corrupt people have taken advantage of their power in
the different countries to promote terror and plundering. The wealthiest
countries of the world are in a way responsible. In most of the cases, they have
not only helped to strengthen the force of the powerful people, their banks, and
their companies, its citizens have taken advantage of this organized chaos.
The agricultural situation in Central America
The agricultural sector is playing an important role in the
performance of the economy. It produces food and basic materials that are
necessary for the industrial production of merchandise. Agriculture is the first
step in the productive chain, and the stagnation of this sector can also turn
into a depression of the national economy, causing a lack of employment
opportunities in the rural areas where the economic activities are concentrated.
When this happens, the national industry can considerably depend on the imported
goods. If the agricultural apparatus is not reactivated, the importation of food
and basic materials can consolidate itself through time and allow the growth of
the deficit of the commercial balance.
The local industrial field can keep the production process active, taking what
it needs from the international market, but it could increase the international
competitiveness levels and promote the elimination of deficits of the commercial
balance if the business companies were to develop a productive field of
expertise.
However, even if the stagnation of the agricultural production allows –under the
premise that there are competitive companies- the creation of new areas to
obtain basic materials abroad, it also increases the level of unemployment in
the rural areas. To reassign resources would be a process that –at least
theoretically speaking- would have to be easily assimilated by the businessmen;
however, the rural labor force, with a low educational profile, can hardly
confront this situation.
That is why it is important that the State adopts a policy of sectors able to
increase the investment levels in the country side. The development of new
activities in the agricultural environment could create a better income level
for the poor people of the rural areas. When the proposal is a complete
strategy, there can also be created a rural agricultural industry that, based on
the logic of a chain of value, could improve the life of a community.
The problems of the Central American agriculture
The Economic Commission for Latin America (CEPAL, in Spanish) presented a study
called The Central American Isthmus: The Evolution of the Agricultural and the
Cattle-Raising Sectors 2003-2004. The document mentions that the most important
factors that explain the low level of agricultural productivity in the last
decades are the disasters caused by hurricane Mitch, the presence of armed
conflicts in several countries, the reduction of the prices in several
traditional exportation products, and the lack of clear policies for the sector.
The combination of these aspects has prevented the economic development from
reaching the people that live in the rural areas. The plantations affected by
the excess or the lack of rain, the insecurity to develop productive activities
in the country side, the low level of profitability in the production of food,
and the lack of support from the State have all affected the growth of the
Agricultural GNP (PIBA, in Spanish). In the last 24 years it has grown only by
1.7%. The low economic growth only represented a 0.9% in the income of the
laborers. This growth is way below the increasing prices of the agricultural
products. In other words, the actual income of the rural workers has been
deteriorated in the period between 1980 and 2004. This situation partially
explains the conditions of extreme poverty in several areas of the region that
can be translated, in most of the cases, into severe levels of malnutrition.
If the performance of the agricultural sector is observed through the
sub-sectors that represent it, it can be noticed that it is the non-traditional
products the ones that have had the most active behavior during the nineties.
However, on the other hand, the situation of the traditional agricultural
exportation products has not been quite as positive, due to the instability of
the prices of such products in the international market. The less active area
was the sub-sector of basic crops.
Through this analysis it can also be predicted that there are other reasons that
can explain the low level of economic development in the rural areas. In the
isthmus, between 1995 and 2003, the expenses on the agricultural field as a
proportion of the total expense of the central government was close to 2.3%.
This means that the Central American governments destined less than 5% of the
national budget to that productive activity that can be considered as the source
of employment of almost half of the population of its respective countries. The
marginalization of the agricultural sector from the State’s policies can be
noticed in the lack of credits assigned to that sector, since in the last eight
years the level of credit lines for the agricultural sector ha been close to
7.0%.
Another important aspect that explains the ineffective fight against poverty in
the rural areas of Central America, is the structure of the conditions in which
the land is owned. In the region, less than 3% of the producers has more than
40% of the total surface area. In these cases, it is probable that the owners of
large portions of land make an inadequate use of it due to a considerable lack
of activities. In other words, in the one hand there is a considerable amount of
agricultural laborers in search of lands to work at; and, on the other hand,
there are abandoned portions of land. In these cases, the solution might be to
reassign the assets, a solution that the governments generally try to avoid.
The situation of the agricultural sector in El Salvador
In El Salvador, over 40% of the population economically depends on agricultural
activities. In spite of it, the State destined for the agricultural sector just
a little more than 1% of the national budget in 2004. The growth rates of the
PIBA have been negative in several years. The stagnation of the agricultural
economy has led the GNP to present negative figures. However, for this year a
better economic performance is expected due to a slight increase in the credits
granted to the sector. El Salvador presents higher levels of credit in reference
to other countries of the isthmus. This is a good indicator, however, it is
still not clear if the increasing expenses of the government and the credits in
favor of the sector will be enough to try to keep 40% of the population
agriculturally active. In this context, it is necessary to adopt a systematic
policy that can activate the sector in order to improve the life standards of a
considerable amount of people. If the policy intends to be truly effective, it
might be necessary to reassign the assets to eradicate the increasing labor
supply in the rural areas.
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