I am very happy to attend one more meeting of LASA. This Association has been for many years the main forum for all those interested in Latin America, attended by social scientists from all the hemisphere and friends from the entire world. I wish you all an excellent stay in Washington DC and a very successful Congress, and I thank the organizers for the honor of addressing you at this inauguration.

It is encouraging that this event takes place at Georgetown University, which among its many outstanding qualities, has a long history of studying the Americas and educating future leaders in Latin America and the Caribbean.

Our Organization has a tradition of engagement with universities. Our fellowship program is over 50 years old and has given thousands of students of the Americas the opportunity to study abroad and create new international networks. To increase our capabilities in this field, we have recently reached agreements with many Universities across the region, that offer our applicants more choices in different countries. We also cooperate with universities to expand commitment to the rule of law and human rights, which includes joint ventures with law schools and training of judges. Our Model General Assemblies acquaint students across the region with international controversies and negotiating skills in realistic atmospheres.

Many other projects meet universities in fields that have to do with democracy, governance, social development and security, which are the core of our mandate as a hemispheric organization. For example, in preparation of our just-launched report on the drug problem in the Americas, we had a chance to interact with specialized units in several universities and we are preparing an extensive campaign to discuss the issues stemming from the report in university campuses across the region. We look forward to this exciting engagement through the Latin American Studies Association meetings and to a long and fruitful exchange with the LASA university community.

Se ha hablado de esta década como “la década de América Latina”. Aunque la afirmación puede ser algo prematura, no faltan razones para ello. En medio de una crisis global, generada en el mundo desarrollado, nuestros países se desempeñaron mucho mejor de lo esperado, sobrellevaron la recesión con éxito y la mayoría de ellos reiniciaron muy pronto su crecimiento. Los resultados de la década de los 2000 fueron mejores que los de las dos décadas anteriores y permitieron reducir la pobreza de manera significativa.
En la década de 2002 a 2011, las economías de América Latina, crecieron tanto como en las dos décadas anteriores, a pesar de los efectos de la crisis en 2009. En ese mismo periodo, más de 70 millones de latinoamericanos dejaron atrás la pobreza y un número similar pasó a ser considerado en la clase media.

Aunque estas realizaciones son aún insuficientes, tuvieron el efecto de generar un nuevo optimismo e impulsar, una vez más, la esperanza de que, esta vez, el período de crecimiento sea más prolongado que en similares ocasiones anteriores.

Some analysts have tried to diminish the many achievements of this past decade, by pointing out to the remaining problems and by assigning all the merits to the increased exports of commodities that have benefited several countries, especially in South America. I believe this is unfair: while it is true that a large part of the growth was triggered by a substantial increase in exports of commodities, it is also true that the Latin American economies were much better prepared than others, even in the developed world, to withstand the heavy winds of recession and even take advantage from them. Most economies were sound, external debt was not a problem in most countries, our banking systems were generally less exposed, we had no fiscal deficits and even surpluses that allowed some governments to adopt successful counter cyclical policies. All this speaks well about the increased macroeconomic capacities of our governments, something we probably learned from the bad experiences of past crises, in which new were the main protagonists.

It has not been easy, therefore, to have positive growth in these years and it is reasonable to be proud of our achievements. But it is also true that the immediate future will be more difficult and the big question that our countries face is whether the growth can be sustained and increased in a changed world.

The most recent forecasts on the world economy show that, in spite of recent signs of recovery in the US, the projected growth of the OECD countries will remain low for some years, with rates of an average of 1 to 2%, motivated mostly by the continued recession in Europe. At the same time, while China’s economic growth will continue to be robust, slightly below 8% in FM estimates, this is not the same size of a decade ago, when the commodity boom started.
In general, we can say that the demand for commodities from Latin American countries will, at best, remain stable and probably see some decline in prices. The big export motor of the recent past will not be there in the near future with similar strength.

This is by no means a tragedy, but rather a challenge to solve many of the structural problems that have historically hampered a more sustainable development. A challenge to increase productivity, strengthen internal markets, increase investment in infrastructure, develop innovation, science and technology, improve the quality of education; provide market access to all our citizens by a fairer income distribution and make a real effort towards economic integration.

Savings and investment are still inadequate, and have negative repercussions on job creation. Even though exports have grown enormously in the past period, Latin America is not yet fully inserted in the global economy, while regional and sub-regional economic integration processes have seemed to stagnate in the past ten years.

Nuestros países tienen mucho espacio para crecer, sin necesidad de un mayor impulso exportador de materias primas, si se hacen cargo de estos problemas. Es interesante notar que, en el período de crecimiento reciente, aumentó también la demanda externa, lo cual significa que nuestra producción interna no abastece suficientemente nuestro propio crecimiento. Y para que recordar los records de inversión extranjera de estos últimos años, que compensan las bajísimas tasas de ahorro e inversión interna.

El proceso de integración económica ha dado paso a una nueva tendencia a privilegiar la integración “política” (ni la CELAC ni la UNASUR) abordan temas económicos). El MERCOSUR enfrenta conocidas dificultades, mientras le Comunidad Andina se debilita por el retiro de Venezuela y el probable paso de Ecuador al MERCOSUR.

A estas carencias de iniciativas económicas colectivas se debe el interés generado por el surgimiento, entre cuatro países de la región de la Alianza del Pacífico, que incluyen un tercio de los habitantes de América Latina y la mitad de su comercio. Creada con el fin explícito de coordinar la acción de países con intereses comerciales hacia el Pacífico (tres de ellos son miembros de APEC), la Alianza ha ido creciendo en propósito y capacidad de acuerdo hasta suscribir un Acuerdo Marco en junio del año pasado que incluye la creación de una zona de libre comercio de mercancías, servicios, personas y capitales. Una Alianza basada en estos acuerdos iniciales, y en las visiones comunes de sus miembros, puede crecer a medida que sus nuevos desarrollos abran paso a nuevos socios, dando así a este nuevo integrador un carácter más realista y progresivo.

There is a certain correspondence between the optimism with which the future of the economies in Latin America is perceived, and the feelings towards the political process, or in other words, the state of our democracies. Just as we said about the economy we have made important progresses in the past decades, but it is premature to say that democracy is definitely consolidated throughout the region.

Electoral processes have made considerable headway.
Governments are created through clean, secrete, universal elections, and regularly change hands among different political groups, without entailing a significant disruption. I can speak from experience here, since in just the past five years, the OAS has observed over 50 election processes of all kinds in different countries of the region, and every one of them has more than fulfilled the requirements for a democratic election. We have not observed them all, and there are some important exceptions, where the results are still hotly contested. But the main trend in this direction is quite clear.

In recent years, governments have also increased their staying power, while in the 1990s many of them ended before the conclusion of their term of office. In the fifteen years from 1990 to 2005 eighteen elected governments ended their mandates prematurely, by coups, resignations in the midst of severe upheavals or impeachments. From June 2005 to this day, only two such events have occurred. Certainly these two situations, of a different nature, have been unfortunate; but if we compare the previous period and the last eight years shows, it is clear that governability has greatly improved in Latin America.

But these democracies, generated in legitimate elections and much more stable than ever, still face severe challenges if they are to really deliver on the promises of three decades ago. Let me mention a few of them.

1.- Poverty and inequality. Despite the recent advances, one-third of Latin Americans continue to live in poverty, and this is not consistent with a region with our level of development. The fact that 10% of the population accounts for more than 50% of the national income does not fit with our democratic discourse. Neither tax systems nor labor laws have been reformed to provide for a better distribution of wealth, as shown by recent OECD studies. Poverty is accompanied by discrimination; poverty has gender and color. The indigenous poor, the Afro-American poor, poor persons with disabilities, and poor female heads of household are the true reality of our poverty.

The paradox is that as political democracy develops, segmented and unequal societies are being defined on a social and economic plane, on common ground where some observe the ostentatious consumption of others and lack the capacity to imitate them. The higher-income minority enjoys the benefits of quality education, health, and private security, which the rest do not have access to, but are aware of.

2.- Today crime is a threat to democracy and a general feeling of public insecurity has become a major concerns of citizens in our Hemisphere. The rates of crime are very uneven, but some countries of Latin America and the Caribbean have crime rates four times as high as the global average.

The increase in drug trafficking, with its related crimes of money laundering and other highly lucrative criminal pursuits, such as arms trafficking and trafficking in persons, has given rise to actual criminal corporations that are in conflict with each other for control of areas of our territory and form criminal armies that fight the monopoly of our police and armed forced with imported weapons.

Organized crime does not hesitate to resort to crime to deal with its opponents, or to buy those persons open to corruption. It is critical today to defend a clean political process, not only to ensure the equal participation of citizens, but also, and especially in the most vulnerable countries, to combat drug trafficking and organized crime in the public sector.

En la última Cumbre de las Américas en Cartagena, Colombia, en Abril del año pasado, se encargó a la OEA un Informe sobre el Problema de las Drogas en las Américas, que acabamos de entregar. En ese documento, que no resumiré aquí, se argumenta la necesidad de fortalecer las instituciones y buscar una mejor salida al tema de las adicciones, que supere la idea de la “guerra a las drogas”, priorizando el aspecto de salud pública, la reducción de la violencia y el fortalecimiento de las instituciones, como componentes de un enfoque holístico.

4. While democracies are stable, the institutions are still very fragile, and this is a crucial problem for democratic governance. We have weak and poorly financed governments to tackle such serious problems. Our governments, in response to their citizens (and exaggerated electoral promises), take on social and security responsibilities that they are not in a position to fulfill, because they lack the necessary resources, as well as strong and reliable institutions to spend them. Government reform should start with fiscal reform that will increase government revenue and, at the same time, become a legitimate method for redistribution of revenue, as occurs in all countries of the developed world.

5.- In the context of a legitimate political struggle, the democratic fallacy that the majority has the right to change the system as it sees fit has been gaining force, and so it tends to accumulate power and to disregard the participation and rights of minorities. The justification for this temptation is always the need to “complete a task” or to deal with urgent crises in society. But if institutions and laws are changed for this reason, institutions are weakened, as is ultimately the democracy they claim to defend.

Latin America is in a constant process of review of its political institutions, and it gives cause for concern that in some countries, this does not occur as a result of a legitimate desire to create a broader consensus and greater stability, but rather to take advantage of electoral advantages to preserve or enhance an administration’s power. Especially worrisome are attempts to control the Judicial Branch. When a political sector controls the judicature, it leaves its opponents defenseless and illegitimately alters the political equilibrium of society.

Although political success has to do with results, these results cannot be the sole justification for changing the rules. In a democracy, all power must have limits; otherwise, leaders would replace institutions, giving rise to new forms of “caudillismo,” which we have already seen in the Hemisphere too many times in our history. This period of our democracies has also seen, in most countries, a weakening of political parties and a centering on individuals. And even if these leaders are or not democratic, their successive reelections and reproductions are not the best path to stable democracy in the long run.

The eminent Charles Tilly referred, in one of his last books, to three large-scale processes that give form to democracy or, on the contrary, can represent historical setbacks destructive of democracy when they are prolonged or reappear. These are suppression of power centers outside the government, elimination of inequalities between categories, i.e., rigid divisions between social sectors, and the generation of “trust networks” within society. In our own language, we could speak in terms of suppression of real powers, elimination of inequalities between categories (I am retaining this expression), and the creation of basic consensus that can sustain a process of institutionalization.

There is no doubt that our societies have made important progress in their road to democratization. Many limitations can be attributed to the still short time in which all these events have developed; democratic governments have taken a long time to develop in other regions of the world and there is no reason to expect full success in the Americas in a few decades.

Nonetheless, the risks of de-construction (destruction) are therer. Because criminal groups today are a seed of independent power; they control their own territories and of course obey their own laws, which they impose on others outside the authority of the state. Because the privileges that some people enjoy and the existence of social systems (health, education, and security) that are differentiated in terms of access and quality lead to the creation of distinct categories of citizens. And because in some countries, the necessary measures of consensus that should exist in every democratic society, are giving way to extreme political polarization, and this is not a good foundation for the urgent reforms still required in Latin America.