Building Democracy in Latin America

03/21/2011 01:00 pm ET | Updated May 25, 2011

On Saturday, President Obama met with business executives in Brasilia, a modernist architectural marvel, and on Sunday he visited City of God, a notorious shantytown in Rio de Janeiro. This daring juxtaposition of progress and poverty suggested a clear agenda, shared by Brazil and the United States, of fostering dynamic economic growth and fighting poverty simultaneously.

Obama's economic team focused on US trade and investment opportunities in Brazil's booming economy, poised to expand still further in energy, infrastructure for the 2014 World Cup and 2016 Olympics, agricultural and mineral exports, and consumer goods for the growing middle class. And as the President watched a capoeira performance and played soccer with neighborhood kids in City of God, he looked out over one of the hemisphere's most poverty-stricken and violent landscapes and called for inclusion.

But if Obama keeps these agendas separate, he will miss the chance to contribute to a genuinely new future. In Latin America, as in most of the developing world -- and the US today -- economic growth all too often perpetuates inequality. As Latin American countries have emerged from military dictatorships to embrace both democracy and markets, levels of inequality have remained the highest in the world, and urban drug trafficking and gang-violence have spiraled upward, not decreased.

Latin America's exports are booming, as China buys mineral and agricultural exports at record levels, but so are hunger, urban poverty, environmental degradation, and abuses of human rights. High growth rates and profound exclusion and violence go hand in hand. If China were to suffer its own economic downturn, and Latin America's exports plummeted, the scenario of growth and relative peace would likely shift overnight, as it has repeatedly in the past, to one of violence, rebellion, and military repression.

Democracy can change this pattern if key players agree that economic growth needs to fight poverty as it proceeds, contributing to enduring social reform in innovative and sustainable ways from the get-go. For the first time in forty years, Latin Americans have elected reform-minded, leftist governments seeking to combine market-led growth with innovative policymaking. What's needed is to bring businesspeople, Latin American and foreign alike, on board in new forms of problem-solving. That's the effort to which President Obama's Latin America visit could contribute. But the hoopla about growth, investment, consumers, and markets on its own won't do the trick.

Instead, President Obama and the presidents of Brazil, Chile, and El Salvador should encourage businesspeople to think in new ways about how societies advance and how governments, civil societies, and private sectors can together foster well-being and inclusion in the short term, as a part of growth, not a long-term result. Fortunately, examples of such partnerships abound in Latin America today. Amidst recurring violence and crisis, activists in social movements, neighborhoods, workplaces, and government offices have drawn creatively on the turmoil around them to develop out-of-the-box responses to exclusion and inequality. Through a range of alliances with governments, NGO's, and political parties, these innovations have encouraged people to move from the "streets" to the "institutions" in collective efforts to secure basic political rights and economic well-being.

Successful reforms that demonstrably improve people's lives include worker-owned factories in Buenos Aires, neighborhood controlled budgeting-programs in Brazilian cities, "four-for-one" programs that combine money sent home by migrants with government and private sector funds in Mexico, Afro Reggae music groups that fight violence and racism in Rio de Janeiro, and Mayan transportation, policing, and marketing networks in San Cristóbal de las Casas in Chiapas, Mexico.

All of these efforts go beyond the growth-plus-philanthropy model to change the ways in which business is done, money allocated, and neighborhoods strengthened.

Unfortunately, for most of the twentieth century, Latin American business elites opposed progressive reform, to the point of supporting brutal military dictatorships. In democratic contexts today, however, Latin American businesspeople must grapple with and at times endure changes they do not welcome, and their responses differ markedly from the routine repressions and violences of the past. As activists press for reform that is in many cases neither anti-market nor anti-state, businesspeople, challenged by globalization and constrained by democratic norms, begin to perceive the societal landscape differently and to make new bargains.

It turns out that the principle constraint on within-the-system, progressive reform today is not capital. How businesspeople respond to progressive reform depends not only on their economic interest but on their political beliefs and cultural views. These range from the languages businesspeople use to describe reform, to how they "see" reform initiatives and characterize poor people, to their beliefs about the nature and procedures of electoral democracy and democratic citizenship.

How these issues are represented culturally, through the creation of ideas and public debate, sets the parameters for both electoral politics and the wielding of economic power in democracies, in Latin America as in the US. At a time when vibrant and enduring democratic politics is widely seen as essential for international security and human well-being, it is crucial that we understand the intertwined economic and cultural dimensions of progressive activism and business visions of change.

This is the conversation that Obama must enter, as he addresses US and Brazilian corporate executives in Brasilia and community residents and activists in City of God. We are all citizens of great democracies grappling with formidable economic challenges. Our task involves how to envision the world and then how to transform vision into action.

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