CHAPTER 2
Llama Fetuses, Latifundia, and La Blue Chip Numero Uno
“White” Wealth in Latin America
IN THE FALL of 1999 a graduate student from Bolivia named Augusto Delgado raised his hand in my Law and Development seminar. Always frank and incisive, and one of the best students I have ever had, Augusto said: “I believe, Professor Chua, that my country is a perfect counterexample to your thesis. In Bolivia, we have all the conditions you mention. A very small light-skinned minority dominates the economy, while 65 percent of the population are impoverished Aymara and Quechua Indians. But in Bolivia today there would never be an ethnic movement against the market-dominant minority. The reason for this is because ethnicity has no appeal in Bolivia. No Indian would ever want to identify himself as an Indian. They are willing to think of themselves as campesinos, or peasants, but as indios—no.”fn1
Augusto’s comments are typical of a sentiment that has prevailed in Latin America for many decades: that “there is no ethnic conflict” in Latin America, certainly by comparison to Africa or Southeast Asia. There may be class conflict, or political conflict, but little distinctively ethnic conflict. The reason most commonly given is that almost everyone in Latin America, high and low, is “mixed-blooded.”
Less than two years later, when Augusto was back in La Paz working as a corporate lawyer, he contacted me by e-mail. He explained that he was writing to take back his earlier words. At that very moment, angry indigenous coca peasants were marching on La Paz, protesting the government’s decision to eradicate coca—for Bolivians, a “sacred plant,” widely used in legal, nonaddictive forms; for the U.S.-sponsored anti-drug campaign, the source of cocaine. Calling for a constitutional assembly to organize a new “majority-based” government, the peasants had set up road blockades, paralyzing the country’s major cities. Meanwhile, seemingly from nowhere, a powerful Amerindian movement—led by Felipe Quispe, an Aymaran Indian known as Mallku, or the Great Condor in Aymaran—was threatening to take over parts of Bolivia. The worst thing about Mallku’s movement, wrote Augusto, was that it was explicitly antiwhite. “For the first time in our history, an organized Aymara leader is asking those who are not ‘indigenous’ to leave the country. … Boredom is easily swept away by the passion I feel for my country and by the intense historical movement we are living in.”
Bolivia’s elites, of which Augusto is one, were stunned by the bitterness and venom of Quispe’s rhetoric. Bolivia’s land “belongs to the Aymara and Quechua Indians and not the whites,” Mallku declared at several points.1 After negotiations between protesting Amerindian farmers and the cabinet broke down, Quispe shouted at the (white) ministers: “The whites should leave the country. We cannot negotiate the blood of my brothers. Kill me if you are men!”2 Years before, when asked by a journalist why he was engaging in terrorist activity, Quispe lashed back, “So that my daughter will not have to be your maid.”
Despite a tendency for Westerners to romanticize indigenous leaders—the Financial Times recently described Quispe as a “natural-born rebel with a cause”—Quispe is not an altogether savory character. He was jailed in the 1990s for guerrilla warfare, has been accused of corruption, and may have participated in blowing up electrical infrastructure a few years ago.3 The Bolivian establishment was thus appalled by the level of Amerindian support, at least in certain rural provinces, for Mallku, who, as one government minister said incredulously, “is encouraging acts of violence” and “operating under a mentality of 400 years ago.”4 Another view common in Latin America (although not in Bolivia, whose history includes many indigenous insurrections)5 is that Amerindians, perhaps because of years of exclusion, are apathetic and “fatalistic.” As a Chilean professor put it a few years ago, “They don’t seem to care about politics—they are totally out of the system.”
What Latin American elites are learning is that poor, “apathetic and fatalistic” masses are prime targets for charismatic demagogues. Increasingly, indigenous leaders like Mallku are offering the region’s demoralized majorities a package that is hard to beat: a natural scapegoat (rich, corrupt “whites”) and a sense of pride, ownership, and identity. Sometimes that identity is “Aymara”—the Aymara are a fiercely independent people whose ancestors created architectural marvels many centuries before the Incan conquest; other times, it is “Quechua,” “Mayan,” “Inca,” or just “indio.”
But however charismatic, indigenous leaders like the Great Condor face formidable obstacles, including the entire weight and momentum of Latin American history since the European conquest. The last lines of Augusto’s e-mail to me are revealing. “The political conflict will surely be over by June,” he concluded, “and that would be a wonderful time for you to finally visit Bolivia. Lake Titicaca is especially beautiful then, and we can visit my friend’s vacation house overlooking the water.” Even in the midst of immense turmoil, Augusto was confident that within a few months, things in Bolivia would be “back to normal.” And so they were.
Bolivia and Other Countries with Amerindian Majorities
At Augusto’s urging, I visited La Paz in June 2001 along with my husband and two daughters, and gave a lecture at the Catholic University of Bolivia. La Paz is breathtaking, literally and metaphorically. The city rises up out of a gigantic crater, surrounded by the Andes, with the magnificent Mount Illimani towering over the other snow-capped peaks. Despite its stark beauty, La Paz attracts relatively few tourists, in part because its eleven-thousand-foot altitude leaves the unaccustomed with headaches and even the locals with low energy. My family and I were no exception. Arriving in early June 2001, we spent most of the first day resting, as Augusto had advised, downing aspirin and mate de coca (tea from coca leaves), venturing out only late in the day to do some exploring. As it happens, the first souvenir I bought was a dried llama fetus.
Revolting as it may sound, my poor stillborn llama is actually rather cute. Frozen in the fetal position and dried stiff like beef jerky, it has the gentle, smiling face of a camel and plenty of soft, if slightly formal-dehyde-scented, fur. I bought the llama fetus partly because it horrified me, but also for educational purposes, so that my eight-year-old daughter Sophia could show it to her class. (She refused to bring it in.)
Bolivians buy llama fetuses to ward off evil in its many guises. Bolivian miners—who, with a life expectancy of forty-five years, basically live their entire adult lives dying—look to llama fetuses for protection against dynamite explosions and the lung-destroying silicon particulates they inhale all day. Downing high-proof alcohol also helps. “The purer the alcohol, the purer the minerals I find,” one miner told me wryly.
Llama fetuses can be found everywhere in Bolivia if you just know where to look. (So can live llamas and, at least in La Paz, llama steaks.) I bought my llama fetus at the Mercado de las Brujas, or Witches’ Market, on Calle Sagárnaga. Like virtually all the market vendors in Bolivia, the person who sold me my llama fetus was an Amerindian woman: in this case an Aymara wearing the distinctive bowler hat and ruffled skirts seen all around La Paz. (Along with most tourists, I assumed that these wonderful hats and skirts were traditional, indigenous costumes; in fact, they reflect early indigenous efforts to look more “Spanish.”) Our vendor was friendly and inquisitive. Her skin was typically sun-leathered—La Paz is the highest, most radiated capital in the world—and to my untrained eye she could have been anywhere between thirty and sixty years of age. She spoke almost no English and a nonstandard Spanish, infused with numerous Aymara words.
Nevertheless, it was obvious that this vendor of fetuses—pig and lamb as well as llama—and other traditional amulets was an adroit entrepreneur. After five minutes of her marketing, cajoling, bargaining, and lifetime guarantees, I eagerly paid the woman twenty dollars (about 8,000 percent the going market price, I later learned) for a souvenir that, it turns out, scares the living daylights out of everyone I know.
Legend has it that Amerindians are famous traders, long used to money and markets. The vendors in La Paz’s open markets work hard, wheedling and charming locals and tourists alike from dawn to dusk. They are frugal and aggressive; one Mexican anthropologist said fifty years ago that they have a distinctly “commercial libido.”6 Yet, along with the rest of Bolivia’s 65 percent indigenous majority, these Aymaran booth vendors are part of the country’s entrenched, appallingly poor, Amerindian economic underclass. Compared to the West, this ethnic “underclass” is, relatively speaking, huge, encompassing the great majority of the Bolivian people, most of whom have no access to heat—not even in the high plateau areas, where it is freezing cold at night—clean water, or medical care. “Only the rich can afford real doctors,” a Quechuan driver said to me. “For most of us Bolivians, if you get sick, you pray to pachamama (Mother Earth). But you probably die.”
THE SAME DAY that I bought the llama fetus, I met some of Augusto’s friends at a dinner party at his apartment. They were an urbane and witty group. Two were descended from former presidents of Bolivia. Several held notable political positions. A cabinet-level minister was there; she was a beautiful woman whose parents had been schoolteachers. Her husband, also present, had been head of a different department in a previous administration; his family once owned what is now an entire neighborhood in La Paz (although at the time, he explained, the land was not valuable). Another guest, a jovial, self-made cement magnate, was a vice presidential candidate in the coming election, who had a few years earlier survived a harrowing kidnap. Not all of Augusto’s friends were well-off. One was a quirky, erudite polyglot, who had co-taught with the philosopher Adorno in Frankfurt for many years. “Augusto and I come from one of the oldest families in Bolivia,” he whispered to me at one point, “but we were not businesspeople, and today we are the poor cousins here.” “I can’t bear this horrible Indian folk music,” he announced loudly at another point, requesting that Augusto put on a different CD. Another guest was a newspaper columnist who made ends meet by acting as a guide for European and North American tourists.
We dined on quail eggs, homemade pâté, and fresh trout from Lake Titicaca, all prepared by Augusto’s Aymaran housekeeper. The conversation was principally in English. Although Bolivians typically stress that everyone in the country has some indigenous blood (“no one is pure white,” as one of Augusto’s friends put it), and although one guest at Augusto’s dinner looked distinctly indio, most were what North Americans would consider “white”—light-skinned, blond and blue-eyed, auburn-haired and green-eyed, and so on. They were also disproportionately good-looking and on average about a foot taller than the indigenous maid and manservant serving us. Most had European ancestors, and not just from Spain. Augusto’s mother, for example, was of Scottish descent.
Characterizing Bolivia’s ethnic makeup is tricky, given the high historical rates of “racial mixing” and phenomena such as “encholamiento,” in which a white man and an Amerindian or mestiza woman (a chola) have a son, who, if successful, marks his success by marrying a white woman. Today, Bolivian society is loosely divisible into three layers. To use the terminology of Bolivia’s census as late as 1976, “whites” make up 5 to 15 percent of the population, “mestizos” make up 20 to 30 percent, and “Indians” 60 to 65 percent. These classifications are of course highly artificial; wealth can turn a “mestizo” or even an “Indian” into a white. As the Bolivian intellectual Tristán Marof wrote decades ago, “‘Whites’ are all that have fortune in Bolivia, those that exercise influence and occupy high positions. A rich mestizo or Indian, although he has dark skin, considers himself white.”7
Nevertheless, the bottom line in Bolivia is this. The country’s Amerindian majority, many of whom lived as serfs until 1952, are largely excluded from the modern economy. Most live in poverty, with no secondary education, no access to sanitation, and terrible teeth. According to the government’s own statistics, 90 percent of rural Bolivians—overwhelmingly Amerindians—cannot satisfy basic necessities.8 Among the “mestizo” group, economic success is more mixed. But Bolivia’s whitesfn2 enjoy wildly disproportionate wealth and status.
Together with foreign investors, Bolivia’s white elite, defining itself through European or North American cultural habits, controls the vast part of Bolivia’s wealth, including the country’s most valuable natural resources and its most modern and advanced economic sectors. Private schools, foreign degrees, international business contacts, and fluency in English (as well as French and German, in many cases) reinforce the market dominance of this minority over Bolivia’s Aymara and Quechua Indian majority, many of whom speak only indigenous languages.
The market dominance of the white minority in Bolivia does not necessarily imply superior entrepreneurialism on their part. Most of the people I met through Augusto—even those in business—did not pride themselves on being particularly good entrepreneurs (although some clearly were). “Corporate law in Bolivia is not like in New York,” explained Augusto, who is also an essayist and political commentator. “I could, I guess I probably should, work harder—go out and find new business perhaps. But I prefer to spend my time reading books and writing.” Observers have long noted a disdain for commerce and industry among Hispanic elites. Some have attributed this disdain to Spain’s and Portugal’s eight-hundred-year conflict with the Moors, in which soldiers and priests were glorified while merchants and bankers—roles often occupied by Jews or Muslims—were denigrated. Whatever the reason, the Spanish and Portuguese colonizers of Latin America were famous for proclaiming their contempt for business and manual labor.9
Something of this “gentleman’s complex” may persist today. On the other hand, many families in the Bolivian elite have strong entrepreneurial roots as well. In the late nineteenth and early twentieth centuries, small but enterprising waves of immigrants from Germany, France, Italy, England, and Spain developed Bolivia’s—indeed much of the Andean region’s—import-export, finance, mining, transportation, and manufacturing sectors.
In the 1980s and 1990s, Bolivia, following the dictates of the World Bank and IMF, and advised by U.S. economists like Harvard’s Jeffrey Sachs, pursued aggressive privatization and free market policies. These policies were spectacularly successful in many respects. Under President Gonzalo Sanchez de Lozada—a mining tycoon educated at the University of Chicago—annual growth rose from negative rates to 4 to 5 percent, and foreign investment more than doubled between 1996 and 1999.10 Globalization, moreover, has definitely created opportunities for “mestizo” Bolivians; among the upper crust today there are those with darker skin and unmistakably Amerindian features. Globalization has even produced some benefits for the indigenous majority. Growing tourism means that Amerindian entrepreneurs can sell more animal fetuses, peddle more Coca-Colas, even act as tour guides if they learn a little English. On a less wholesome note, there are an increasing number of Aymaran merchants prospering from illegal contraband businesses.
Yet global markets have, if anything, intensified the economic dominance of Bolivia’s white elite—the natural business partners of Western investors—over the country’s growth-stunted, impoverished indigenous majority. Certainly globalization has intensified the visibility of Bolivia’s wealth disparities, as condominiums and tony art galleries boom in the major cities of La Paz, Cochabamba, and Santa Cruz while the rural parts of the country continue to be mired in abject poverty. Indeed, for many indigenous Bolivians, market reforms have meant infuriating increases in utility rates, layoffs—to reduce hyperinflation a few years ago, the government slashed social spending and closed state-owned tin mines, sending the unemployment rate soaring—and hollow promises of trickle-down.11 “Free trade?” scoffed a Quechuan tour guide named Osvaldo, who accompanied us to the surreally beautiful Uyuni salt flats after we left La Paz. “That just means that we now sell our gas to Brazil, while there is no heat here in Bolivia.” Osvaldo added with a shrug, “The same families make all the money in Bolivia, whatever policies we have.”
Bolivia is one of only four countries—the others are Peru, Guatemala, and Ecuador—in which Amerindians still constitute a majority or near majority of the population. In all these countries, the same basic ethnic reality holds. Centuries of racial intermixing and immigration have produced the ethnic complexity distinctive to Latin America. In Cuzco, for example, the former Inca capital of Peru, many among the elite have Amerindian features and speak Quechua. Similarly, the most recently elected Miss Peru publicly celebrated her mixed heritage, including a dark-skinned mother, a Chinese grandfather, and a great-grandmother who was a Spanish vice countess. Nevertheless, the fact remains that in all these countries, Amerindians represent a distinct, recognizable, mass underclass, often the object of condescension, controlling only a tiny portion of the nation’s wealth. Meanwhile, whites—however artificial the term and however permeable the category may sometimes be—are a starkly market-dominant minority.
“Pigmentocracy” in Latin America
But the phenomenon of white market dominance in Latin America is not confined to these four countries. It is equally visible even in countries where indigenous communities are much smaller and the vast majority of the population is “mestizo.” With the exception of Argentina, Chile, and Uruguay (where from early on indigenous peoples were largely extinguished), Latin American society is fundamentally pigmentocratic: characterized by a social spectrum with taller, lighter-skinned, European-blooded elites at one end; shorter, darker, Indian-blooded masses at the other end; and a great deal of “passing” in between. The roots of pigmentocracy are traceable to the colonial era.
Unlike their (evidently more repressed) British counterparts in, say, India or Malaysia, the Spanish colonialists freely and prolifically procreated with indigenous women. From the outset, Spanish and Portuguese chroniclers waxed enthusiastic about the charms of Amerindian women, who were “beautiful, and not a little lascivious, and fond of the Spaniards” by one account and “very handsome and great lovers, affectionate and with ardent bodies” by another.12 In an important sense, the Spanish Conquest of the Americas was a conquest of women. The Spanish obtained Amerindian girls both by force and by peaceful means—sometimes, for example, as tokens of friendship from the Indian caciques. Intermarriage, concubinage, and polygamy were common.
Although this “racial mixing” might suggest a readiness among Latin America’s colonizers to transcend ethnic boundaries, in reality it was nothing of the sort. On the contrary, what emerged was an invidious social system known as the Society of Castes (sociedad de castas), in which individuals were classified in accordance with the lightness of their skin, with whites occupying the highest stratum.
The names of the specific castas that emerged in Spanish America varied across different regions and changed over the years. The following list is illustrative of eighteenth-century New Spain:
That the Spaniards were supposed to be “pure-blooded” is, to say the least, ironic. Among the numerous groups that, by the Middle Ages, had inhabited and commingled with each other on Iberian soil were Celts, Phoenicians, Greeks, Carthaginians, Romans, Visigoths, Jews, Arabs, Berbers, and Gypsies.14
Nevertheless, the disdain of a “pure white” Spanish elite for the “colored” masses is a deeply ingrained feature of the history of every modern Latin American nation. In Mexico, mixed-blooded mestizos were for years prohibited from owning land or joining the army or clergy. In Peru, even intellectuals believed that “the Indian is not now, nor can he ever be, anything but a machine.” In Chile, victory in the War of the Pacific (1879–83) was often attributed to the “whiteness” of the Chileans, as compared with the “Indians” of Bolivia and Peru, the defeated nations. In Argentina, a popular writer wrote in 1903 that mestizos and mulattos were both “impure, atavistically anti-Christian; they are like the two heads of a fabulous hydra that surrounds, constricts and strangles with its giant spiral a beautiful, pale virgin, Spanish America.” And throughout Latin America, landowners preferred their daughters to marry penniless peninsulares (arrivals from Spain) rather than wealthy criollos (American-born Spaniards). The fact of being born in the Old World was supposedly good proof of being “pure white”—something that could not be assumed of even the wealthiest members of the colonial aristocracy, “whose ancestors had been living for years alongside not just the Indians but also the blacks.”15
Today, while ethnic lines in Latin America are much more muted than elsewhere in the developing world, the phenomenon of a market-dominant, ethnically distinguishable minority—here, the light-skinned, landowning (and increasingly, stockowning), Western-educated elite—remains an important feature of all but a few Latin American countries.
Mexico: Dark-Skinned Poverty, Light-Skinned Plutocrats
Pigmentocracy certainly thrives in Mexico, where I spent a good deal of time between 1989 and 1991. During that period I was an associate with a Wall Street law firm, working around the clock representing the Mexican government in the landmark privatization of Teléfonos de México (Telmex), Mexico’s national telephone company. Almost without exception the Mexican officials, lawyers, and business executives we dealt with were light-skinned and foreign educated, with elegant European names. Meanwhile, the people doing the photocopying and cleaning the floors were all shorter, darker, and plainly more “Indian-blooded.”
While considerable social fluidity exists in Mexico, it is also true that lightness of skin correlates directly and glaringly with increasing wealth and social status. Mexico’s roughly 9 to 10 million indigenous peoples, about one-tenth of the population, have the highest rates of illiteracy and disease in the country. In the state of Chiapas, just thirty-five years ago, Amerindians were forbidden to walk on sidewalks or look lighter-skinned Mexicans in the eye. Not surprisingly, according to Mexican writer Enrique Krauze, Indian women desire to have children with mestizos—“not to betray their race but out of a desire to spare their progeny a bleak future.”16
At the other end of the spectrum, all of Mexico’s most lucrative corporate sectors—oil, finance, media and telecommunications, heavy industry, luxury hotels, transportation—are controlled by a small, clubby, light-skinned market-dominant minority who play golf with each other on weekends (and often weekdays). While working on Telmex, I remember being a little surprised when our local counsel, an elegant, baritone-voiced, European-looking man by the name of Alejandro Duclaud Gonzalez de Castilla, married the daughter of one of Telmex’s (equally elegant) senior officers. I was even more surprised when, in the spring of 2001, I learned that Alejandro—whom I liked enormously and had spoken with regularly for two years—was being sued by the U.S. Securities and Exchange Commission, along with his wife, his brother, and other family members, for allegedly making nearly $4 million from insider trading. He settled with the SEC without admitting or denying the charge after judgment was entered against him.17
My surprise, however, was probably naïve. Although insider trading is of course illegal, insider profiteering from developing-world privatization is the rule rather than the exception. Back in the early nineties, I believed that the proceeds of privatization, as a World Bank official put it, would go to roads, “potable water, sewerage, hospitals, and education to the poor.” Like many in the 1990s, however, I was viewing emerging-market privatization through a rose-colored lens. Just a few years after the Telmex privatization was completed, Mexico City’s La Jornada reported, “The booty of privatization has made multimillionaires of 13 families, while the rest of the population—some 80 million Mexicans—has been subjected to the same gradual impoverishment as though they had suffered through a war.”18
In retrospect, I still believe that privatizing Telmex, and bringing in Southwestern Bell to modernize the company, was on balance a good thing for the Mexican people. Since Telmex was privatized in 1990, more than $13 billion has been invested to upgrade and extend phone service, including in remote rural areas. A fiber optics network stretching more than twenty thousand miles has been built, and callers no longer have to wait two minutes for a dial tone. At the same time, many believe that the principal domestic beneficiaries of Mexico’s privatization process were former President Carlos Salinas de Gortari, his family, his cronies, and multibillionaire Carlos Slim.
Slim, who has been outplaying his blue-blooded counterparts at the game of globalization, merits a brief digression. Before the Telmex privatization, Slim was unknown in the United States. I knew only that he was around fifty and the son of a Christian Lebanese immigrant, that his name was incongruous in light of his rather substantial figure, and that his investment bank Grupo Carso, along with foreign partners Southwestern Bell and France Telecom, were planning to bid as a consortium for a controlling stake in Telmex.
Slim’s successful acquisition of Telmex catapulted him to international prominence, at least in financial circles. With Slim at the company’s helm, Telmex stock—once worth only pennies a share—soared after the privatization, and unlike many non-U.S. stocks, kept on soaring. Telmex’s market capitalization today hovers around $37 billion, making the company, as the Financial Times put it, “la blue chip numero uno” in Latin America. After Salinas’s presidency ended in 1994, there was a flurry of reports exposing pandemic corruption within Mexico’s ruling PRI. Because of his close identification with Salinas, Slim was often mentioned in the U.S. press, but always vaguely, hintingly, never with any concrete allegations.
In any case, whereas Salinas is now in disgrace and exile, Carlos Slim has never been wealthier. Forbes magazine recently listed him as Latin America’s richest man—every two minutes Slim reportedly makes $5,000, more than the average Mexican earns in a year—and he is popularly compared to the legendary American investor Warren Buffett. In the last few years, Carlos Slim has become an increasingly prominent figure in the United States as he continues to buy up large blocks of CompUSA, Barnes & Noble, OfficeMax, Office Depot, Circuit City, Borders, and other major U.S. retailers.
The bulk of Slim’s holdings, of course, are still in Mexico, where he controls most of Mexico’s local phone service, long distance, and Internet access, not to mention half of the nation’s stock market. Slim also owns Sanborns (Mexico’s most popular restaurant chain), a major ATM network, a mining company, numerous factories engaged in tire, metal, and other forms of industrial production, massive resort developments in Cancún, and Grupo Financiero Inbursa, a financial services company that sells insurance to, and invests the savings of, millions of ordinary Mexicans. The running joke about Slim is that he began investing abroad because there was nothing left to acquire inside Mexico.19
Slim’s focus these days is on the Internet and global markets. To attract Spanish-speaking web surfers, Slim began offering bilingual service through Prodigy, the U.S.’s third-largest Internet service provider, which Slim bought outright in 1997 for $100 million in cash and $150 million in debt assumption. After Slim took over, Prodigy’s subscriber base in the United States increased by 1,000 percent. Meanwhile, a month after acquiring CompUSA, Slim launched what he predicts will be the largest Spanish-language portal in all of North and South America, a joint venture between Telmex and Microsoft called Tlmsn. Most recently, Telmex spun off its fast-growing cellular phone and international division in a $15 billion listing of America Movil SA on the New York Stock Exchange; the Slim family still indirectly controls both companies. In addition to its U.S. holdings, America Movil has telecom, wireless, and broadband interests in nine Latin American countries. Slim’s goal is reportedly for America Movil to dominate both the U.S. Hispanic and Latin American cellular and Internet markets.
Needless to say, Slim has no Amerindian ancestors. As elsewhere in the world, the Lebanese community in Mexico is very tight: Slim’s late wife was also Christian Lebanese, and, reportedly, most members of Slim’s extended family have married other Christian Lebanese; virtually all are extremely wealthy.20
As Carlos Slim illustrates, the line separating rich and poor in Latin America is not as simple as “old Spanish” landowning families on the one hand and Amerindian and mestizo masses on the other. Instead, white wealth takes two very different forms: old Spanish (or in Brazil’s case, Portuguese) wealth, typically rooted in the plantation, or latifundia, system; and more recent immigrant wealth, often reflecting enormous entrepreneurialism. Although both result in white market dominance, the history and economics behind them are totally different.
Latifundia and Global Markets: Nonentrepreneurial White Dominance
The market dominance of Latin America’s European-descended landowners owes as much to colonial oppression as to commercial dynamism. By all accounts the Spaniards easily conquered the vastly more numerous Amerindians they encountered in the New World. They managed this through a combination of superior technology, European germs that decimated an estimated 95 percent of the pre-Columbian indigenous population—and sheer trickery. In Guns, Germs, and Steel, Jared Diamond describes, in the words of a contemporary observer, the trap set by conquistador Francisco Pizarro for the Incan emperor Atahuallpa:
On the next morning a messenger from Atahuallpa arrived, and [Governor Pizarro] said to him, “Tell your lord to come when and how he pleases, and that, in what way soever he may come I will receive him as a friend and brother. I pray that he may come quickly, for I desire to see him. No harm or insult will befall him.”
Later that day, when Atahuallpa arrived with his squadrons of “Indians dressed in clothes of different colors, like a chessboard,” some dancing and singing, others bearing great quantities of gold and silver furniture—Pizarro’s troops ambushed them. “Cavalry and infantry, sallied forth out of their hiding places straight into the mass of unarmed Indians crowding the square, giving the Spanish battle cry, ‘Santiago!’” Once Atahuallpa was captured,
Pizarro proceeded to hold his prisoner for eight months, while extracting history’s largest ransom in return for a promise to free him. After the ransom—enough gold to fill a room 22 feet long by 17 feet wide to a height of over 8 feet—was delivered, Pizarro reneged on his promise and executed Atahuallpa.21
Similarly, in 1572, another Inca ruler, Tupac Amaru, a nephew of Atahuallpa, was seized by the Spanish and converted. At the Plaza of Cuzco he eloquently asked his subjects to abandon paganism. “After he finished his address,” as a Spanish chronicler put it, “his head was cut off; this caused the Indians incredible pain.”22
Through the colonial period, small numbers of Spanish administered and exploited vast indigenous populations through the encomienda, a notorious institution by which Amerindians were distributed among and forced to pay heavy tributes to conquistadores, or encomenderos. The theory was that the encomendero would “protect and civilize” (i.e., Christianize) his Amerindians. In reality, the Amerindians served as pools of forced labor for the encomenderos, who quickly amassed huge amounts of wealth. The encomiendas were often very large; in Peru, for example, some conquistadores had as many as ten thousand Indian heads of household under their control.
The psychological effects of the Spanish Conquest were crushing and lasting. “The death of the sun—the strangulation of the Inca,” writes sociologist Magnus Mörner, was a “profound shock, reinforced later on by the beheading of Tupac Amaru.” Contemporary indigenous dances still reflect the profound “Trauma of Conquest.” Meanwhile, the missionaries, backed up by Spanish military force, did their best to destroy indigenous rituals, traditions, and kinship systems, all viewed as incompatible with the Christian faith, again with devastating effects. For example, before the conquest, consumption of intoxicating drinks among the Andean Indians was confined to ceremonial occasions. After the conquest, alcoholism became an outlet for indigenous frustration and has remained so ever since.23
At the same time, the Spanish confiscated indigenous land wholesale. Conversion of communal properties into private holdings occurred in Mexico, Guatemala, Ecuador, Peru, Bolivia, and elsewhere in Latin America. Bit by bit the communal landholdings of Amerindians were turned over to the expanding plantation economy. By 1910 over 80 percent of all rural families in Mexico were landless while Amerindians in Guatemala had such minuscule holdings (minifundia) that most of them came under the vagrancy laws requiring them to work for subsistence wages on coffee plantations. In virtually all of the Latin American countries, latifundios—large agricultural estates owned by a handful of Spanish-blooded families—grew more and more immense at the expense of an increasingly demoralized, expropriated rural proletariat.24
Today, Bolivia, Mexico, and Peru are the major exceptions in Latin America. Because of extensive agrarian reforms, these countries (along with Cuba) have largely dismantled their latifundia systems, at least to a much greater extent than elsewhere in Latin America. Virtually everywhere else in Latin America, the latifundia system is not only intact but poised to boom with each new round of pro-market, pro-globalization reforms.
Export-oriented plantations of over one thousand hectares represent just 1.5 percent of all farms in Latin America yet account for 65 percent of the region’s total farm acreage. The exclusive social clubs of Latin America’s major cities—where multimillion-dollar business deals are casually arranged and foreign investors are often wined and dined—are typically still controlled by men whose families derived their original wealth from plantation farming.25 Not surprisingly, the market-oriented reforms of the 1990s disproportionately benefited Latin America’s Spanish-blooded latifundistas, who because of their capital, education, foreign connections, and conservative social policies historically have tended to be the soul mates, if not the relatives, of political leaders championing economic liberalization.26
Throughout Latin America’s countrysides, from Guatemala to Costa Rica, from Venezuela to Paraguay, the same stark pigmentocratic reality holds. Tall, light-skinned, Voltaire-steeped owners of latifundios dominate—and in many cases browbeat and brutalize through private militias—the vastly more numerous, shorter, darker, Indian-featured peasants who labor for them, usually barefoot, alongside children whose bellies are bloated with parasites.
In Brazil, which I’ll say more about in a moment, 50,000 (less than .01 percent) of the country’s 165 million population still own most of the country’s land. Again, the latifundio owners are unmistakably white; the peasants, however, are typically descendants of African slaves. The bodily differentiation between higher-class and lower-class Brazilians in the countryside is not marked solely by skin color and facial features. In the sugar-producing Zona da Mata, many of the dark-skinned plantation workers have lost a limb or several fingers due to the gruesome dangers of caning. Moreover, according to the late Brazilian nutritionist Nelson Chaves, even slaves were better fed than the contemporary sugar workers of the Zona da Mata. “[T]he rural worker of today,” Chaves wrote in 1982, “is primarily a carrier of worms, and his stature is diminishing considerably over time, so that it is actually approaching that of the African pygmy.”27
Latin America’s Immigrant Entrepreneurs
The other form of white market dominance in Latin America stems not from plantation wealth but from the entrepreneurial energies of relatively recent immigrant groups, who are dramatically overrepresented among the region’s business elite. Thus, a study from the 1960s found that of Mexico’s thirty-odd outstanding business leaders, almost half reported a foreign paternal grandfather. Similarly, a 1965 survey of Bogotá executives revealed that although Colombia has had relatively little immigration, 41 percent of the country’s leading entrepreneurs were foreign born.28
Some of Latin America’s most stunningly successful immigrant entrepreneurs have been Lebanese or Jewish. In terms of numbers, both groups are tiny, representing almost negligible minorities in their countries of residence. In terms of economic dynamism, however, both groups have been extraordinary. In addition to Slim, a surprising number of Latin America’s wealthiest businessmen are Lebanese. Moreover, Lebanese Latin Americans have held high-profile political positions. Both Ecuador’s recently ousted former president Jamil Mahuad, for example, and Argentina’s recently ousted former president Carlos Menem, were Lebanese—and avid proponents of privatization and market reform.
From the 1890s on, most Jews entered the countries of Latin America as poor peddlers. In Judith Elkin’s words, with “packs on their backs and account books in their pockets,” they trudged the streets of major cities and towns, selling small items of mass consumption such as matches, razor blades, scissors, sandals, cloth, tableware, and jewelry. Even the mountainous Andean countries were tackled by the indomitable Jewish peddler. As one foreign visitor observed in 1940:
In Bolivia you see the Eastern Jew who does not attend courses to learn Spanish, but who speaks the dialect of the Indios. They appear in the most outlying villages, where hardly any Europeans have ever been, and manage to eke out an existence, sleeping in their wagons under the stars. Hardly a German immigrant has dared or would dare to do this. … Without wishing to be critical, but to complete the picture, I must say that the first care of each German is to get an apartment. As far as the German is concerned, an apartment must have a bath.29
Jews are no longer peddlers in Latin America today. In a matter of a few generations the Jewish communities of Latin America have transformed themselves from struggling immigrants into financially powerful businessmen and professionals. In 1994 nearly 53 percent of employed Jews in Mexico identified themselves as directors, managers, or administrators while another 26 percent identified themselves as professionals. Throughout Latin America the rate of upward social mobility among Jewish communities has been astounding over the last century. In Brazil, the Jewish Klabin and Lafer families, linked by marriage ties, are among the wealthiest in the country; their jointly owned, diversified industrial firm is the largest newsprint producer in Latin America. More generally, approximately two-thirds of Brazilian Jews belong to the “elite.” In Panama, the minuscule Jewish minority—only .25 percent of the population—disproportionately dominates the country’s wholesale, retail, real estate, and services sectors and represents 40 percent of the traders in the Colon Free Trade Zone (after Hong Kong, the world’s second largest free trade zone), through which in 1997 alone over $5 billion worth of goods was imported and re-exported.30
In Argentina, the largest landowners and producers of beef in the country are now two Jewish brothers, rather startling in light of Argentina’s long, proud tradition of cattle raising. In fact, Eduardo and Alejandro Elsztain—who in 1997 doubled their rural landholdings to 1.1 million acres—are revolutionizing Argentine ranching with biotechnology. Their farm company Cresud recently entered into a joint venture with the Texas-based Cactus Feeders to begin fattening one hundred thousand head of cattle a year with corn rather than traditional pampas grass. Argentina’s gauchos were incredulous: Corn-fed cattle produce marbled beef, and as anyone who has tried (and been disappointed by) bife de lomo knows, Argentinians like their beef very lean. The Elsztains, however, have their eye on global markets. Cresud’s cows are being corn-fed both to increase yields and to appeal to the multibillion-dollar, fat-loving markets of North America and Asia.31 (Think porterhouse and Kobe beef.)
THE PRESENCE OF commercially dynamic immigrant populations—not just Jews and Lebanese, but also Germans, Italians, Palestinians (in Belize and Honduras), and other groups—is observable in virtually every country in Latin America. These relatively recent arrivals are important in that they have broken up the traditional economic stranglehold of the old, “Spanish-blooded” landowning oligarchies. But they have not altered the basic pigmentocratic reality of Latin American society. These immigrant groups have become part of the tiny white minority that, in almost every Latin American country, controls nearly all of the nation’s wealth, including the most advanced, lucrative sectors of the economy.
Countries without Market-Dominant Minorities
The major exceptions to the rule of pigmentocracy in Latin America are Argentina, Uruguay, and arguably Chile. These countries have only small or negligible Amerindian populations. In Uruguay, for example, the indigenous and famously fierce Charrúa and Guaraní Indians largely perished in seventeenth-century battles with Spanish and Portuguese forces. The last Charrúa Indian died in 1948, and supposedly only 8 percent of present-day Uruguayans are mestizos.32 Furthermore, all three countries saw enormous waves of European immigrants around the turn of the twentieth century.33 Unlike in the rest of Latin America, the descendants of these immigrants eventually came to represent a majority of the population. Consequently, the wealthy in Argentina, Chile, and Uruguay are not ethnically distinguishable from the less-well-off majorities around them. Indeed, by Western standards, most people in Argentina and Uruguay, wealthy or not, are “white.”
Chile is a slightly more complicated case. Chile’s indigenous peoples, including the increasingly activist Mapuche Indians in the south, currently number roughly 1 million out of a total population of 15 million. Compared to Argentina and Uruguay, a much greater percentage of Chileans are mestizos, but still this percentage is nowhere near a majority. Precise figures are difficult to obtain, in part because of the deeply subjective dimension of ethnic identity: Many Chileans who have some Amerindian ancestry would be the last to admit it. Throughout Chile, many among not just the upper, but also the middle classes, pride themselves on their “whiteness” and, according to historian Frederick Pike, “by and large believe[] in the inferiority of Indians and mixed bloods.”34
Unspoken White Dominance in Brazil
Brazil, famous for being a “racial democracy,” offers perhaps the most fascinating example of a deeply internalized but suppressed color hierarchy. For generations, Brazilians of all classes have been told, and to some extent have apparently believed, that centuries of racial mixing had erased the color line, making racism impossible. For many Brazilians, the contrast between the racial harmony in their country and the racial conflict in the United States has long been a source of pride.
But in fact, as throughout Latin America, the stark reality in Brazil is that a tiny, light-skinned, market-dominant minority has always had a stranglehold on economic and political power. Throughout Brazil the most prestigious and highest-paying jobs in business, politics, and universities are held by those with light skin.35 Brazil’s exclusive private schools are glaringly white. In a country where a vast majority of the population is (by U.S. standards) black, writes Eugene Robinson in his recent book Coal to Cream, the leading tycoons, wealthiest landowners, fanciest neighborhoods, and toniest social clubs, not to mention the virtual entirety of Brasilia’s limo-riding bureaucratic elite, are wildly disproportionately white.
In the opening scene of Coal to Cream, Robinson describes a remarkable exchange he had with acquaintances on Ipanema Beach. Robinson, who is African-American and an editor at the Washington Post, asked his colleague’s Brazilian girlfriend Velma—a small woman with “flaring nostrils, high cheekbones, and brown skin at least a couple of shades darker than mine”—what it was like being black in Brazil. Velma responded with a look of genuine surprise. “But I’m not,” she said. “I’m not black.”
To Robinson, however, “it was obvious at first glance” that Velma was primarily a descendant of African slaves, and he blurted out, “But you must be, Velma. I’m black, and you’re as dark as I am.” Velma, however, maintained that she most definitely was not black and, moreover, that as far as she was concerned, Robinson wasn’t really “black” either. Later, after Velma had left, another Brazilian explained to Robinson “that Velma had long, straight hair, and that she also enjoyed the considerable status and income that came from her job as a lawyer. So naturally—and this was said as if it were the most natural thing in the world, though it made no sense at all to me—she called herself white.”
At first Velma’s reaction causes Robinson to question his own American inclination to identify as “black” anyone who has a visible African heritage. Gradually, however, Robinson sheds his initial infatuation with Brazil, which, on first encounter, seemed “a great black nation—unadvertised as such,” a wonderful “mélange of blacks and browns and tans and taupes, of coppers and cinnamons.” As Robinson looks deeper into Brazil, he begins to see a startling degree of racial inequity combined with pervasive racial denial.36
The millions of African slaves brought over to work Brazil’s plantations far exceeded the number brought into the United States. Slavery in Brazil outlasted that in the United States by a generation. Today, Brazil’s tens of millions of grotesquely impoverished, slum-dwelling or cane-cutting pobres are, again by U.S. standards, overwhelmingly black. Dark-skinned Afro-Brazilians occupy Brazil’s lowest-rung jobs and fill Brazil’s disease-ridden prisons. As late as 1988, poor blacks in Brazil were disenfranchised on illiteracy grounds. Meanwhile, “mulattoes” or persons of “mixed race,” although said to enjoy slightly greater mobility than their darker-skinned counterparts, are starkly underprivileged as compared to the “white” minority.37
For years the myth of racial democracy has covered over these stark ethnic disparities in wealth. It may be wondered whether the poorest, dark-skinned Afro-Brazilians ever believed in this myth. Nevertheless, many Brazilians high and low often insist that “race” is not an important factor in Brazil, because “people are always passing” and because “people can essentially become ‘white’ by becoming wealthy.” They argue that the distinctly African influences on Brazil’s music, food, religion, even standards of beauty have gone a long way in eliminating the harshest aspects of racism.
In emphasizing that poor African-blooded Brazilians can achieve upward mobility by “lightening themselves”—for example, by making a fortune (which almost never happens) or by marrying someone with lighter skin (which more often does)—Brazilians don’t seem to see the extent of racism and ethnic self-hatred that pervades Brazilian society. As Eugene Robinson eventually realized, “In Brazil, most people with some measure of African blood”—again a large majority of the country’s population—“demanded to be not thought of as black.” As a result, concludes Robinson, there was no black consciousness or indignation: “[N]obody saw these neighborhoods that were running with blood as black neighborhoods. Nobody saw that blood that was flowing as black blood.”38
Brazil, moreover, is not exceptional in this regard. Throughout Latin America, centuries of ethnic degradation and discrimination, not to mention disenfranchisement and violence, have left deep, lasting psychological scars. A dashing blond, water-skiing Bolivian recently assured me that “in my country everyone is mestizo, everyone has some Indian blood,” then later in the same conversation asserted, with equal equanimity, that “no member of the upper class would even think of marrying a Quechua.”
Treated as “subhuman,” even “bestial,” Latin America’s indigenous populations have internalized a profound and debilitating sense of inferiority. It is no wonder that throughout Latin America—right up to the cusp of the twenty-first century—ethnicity had little appeal. During most of the second half of the twentieth century, Latin America’s poor have not wanted to think of themselves as “Indian” or “indigenous.” Political, even populist movements have been organized around class, almost never ethnic, lines. And because in election after election, despite coup after coup, political and economic power always remained in the same light-skinned, “illustrious-blooded” hands, “apathy and fatalism” among the indigenous populations spread and deepened.
Globalization and the Kindling of Ethnic Resentment
All this, however, is changing. To the extent that ethnicity has been downplayed in the last several decades in Latin America, globalization, together with the demise of Marxism, is revitalizing it. Capitalism, it is often said, “transcends national boundaries,” but so too can ethnic consciousness, ethnic demagoguery, and ethnic anger—with just as much speed and even greater intensity and passion.
Along with global markets and global media, “Indian-ness” is spreading across Latin America with technologically unprecedented zeal. Particularly in those countries where Amerindians constitute a majority of the population—and even in countries like Mexico, Chile, or Venezuela, where they do not—Latin America’s poor masses are being ethnicized, increasingly through radio, television, and most recently the Web. They are being reminded—by cellphone-wielding leaders like Bolivia’s El Mallku, Venezuela’s Hugo Chavez, or Mexico’s Zapatista leader Subcomandante Marcos—that they are Aymaras, pardos, Indians, cholos, whatever identity best mobilizes great numbers of frustrated, long degraded, dark-skinned masses.
Peru’s Amerindian Alejandro Toledo, who swept to landslide victory in the 2001 presidential elections, offers the best of examples. “You’re one of us—win for us!” shouted thousands of wrinkled Amerindian women in bowler hats, weeping as Toledo campaigned through the streets in a truck emblazoned with the ancient Inca symbol of the sun. Reversing five hundred years of ethnic degradation, Toledo—who many insist resembles Pachacutic, the Incas’ greatest ruler—highlighted his indigenous origins, wearing Indian garb, calling himself el cholo, and appealing explicitly to Peru’s dark-skinned majority “who look like I do.” Indeed, reclaiming ethnic pride was Toledo’s central campaign message. “After so many years of bowing our heads, it’s time we all held them up in pride,” declared Toledo, who rose out of poverty in Peru’s coastal slums to study at Stanford University. “For as long as I can remember, we have been taught to hate the Indian inside us,” explained a Quechuan supporter of Toledo’s. “But now I see that self-hate fading. After so many servile years, we are finally asking important questions like ‘How dare they look down on me because I am proud of my culture?’”39
But there are dangers, too—dangers that the region’s white elites have always been aware of. (“Bolivia’s rulers have always harbored a deep fear that the country’s Indian majority might one day rise up and kill them in their beds—or more realistically, trap them in their cities,” William Finnegan recently wrote in The New Yorker.)40 Alejandro Toledo’s approval ratings have plummeted to 32 percent, as it has become increasingly clear that his pro-market policies will not immediately improve the lives of Peru’s impoverished majority. Meanwhile, elsewhere in Latin America, distinctively ethnic resentment against market-dominant light-skinned elites is on the rise.
In Ecuador, for example, the vigorously pro-market government led by President Jamil Mahuad was toppled in January 2000 by an Amerindian uprising that turned into a military coup. At the time of the uprising President Mahuad’s approval ratings had dropped to just 6 percent, and the coup appears to have been supported by a majority of Ecuador’s impoverished population, 40 percent of whom say they are “pure Indians” and 90 percent of whom are increasingly identifying themselves as “indigenous-blooded.” One triggering event for the coup was the decision by Mahuad—who is ethnic Lebanese, Harvard-educated, and part of the country’s white business elite—to replace Ecuador’s currency with the U.S. dollar as part of a larger plan to open up the country’s battered economy to international investors. The “dollarization” program was bitterly opposed by Ecuador’s largely Amerindian peasant majority, who saw “the measure as just another scheme by bankers and businessmen to further impoverish them.” “The dollar may be fine for mestizos and the big folks, but we are peasants and do not know how to manage dollars,” seethed Apolinario Quishpe, one of thousands of Amerindian farmers who marched on Quito.41
Ecuador’s recent upheaval was intensely anti-market and anti-globalization. It was also an explicitly Amerindian-based movement, led by the National Confederation of Indigenous Nationalities of Ecuador (Conaie), and deeply, angrily ethnic in its mobilizing rhetoric. “The shamans say change is coming,” thundered Fernando Villavicencio, one of Conaie’s leaders. “They say we are entering the age of the condor; they say that the Red Warrior has returned!”42 In a country where not long ago newspaper advertisements offered haciendas for sale with Indians and cattle included in the price, Villavicencio’s championing of Amerindian blood has galvanized large, formerly “apathetic” segments of the population, unifying urban and rural poor alike, and pitting them against an “arrogant,” often corrupt white elite that represents only 7 percent of the population.
Even in Brazil, globalization is increasing racial and ethnic consciousness. Black identity and black power have begun to hit Brazil’s marginalized youth, in part through the ripple effect of American popular culture. Throughout the country’s garbage-filled favelas, or shantytowns, the angry lyrics of a U.S.-influenced but distinctly Brazilian rap and hip-hop movement can be heard. This movement is openly “un-Brazilian” in its relentless attacks on the country’s racial inequality. In songs like “The Periphery Continues Bleeding,” “Just Another Wake,” and “Surviving in Hell,” rappers aggressively expose social injustice against blacks, emphasizing that only 2 percent of Brazil’s university students are black, that three out of four people killed by the police are black, and that every four hours a black man dies violently in São Paulo.
In place of a “racial democracy,” Brazil’s urban favelados increasingly see an impoverished, humiliated black majority and a privileged, powerful white minority. Almost overnight, the hot group Racionais—which recently won a number of prestigious Brazilian MTV awards—has popularized expressions like “4P” “poder para o povo preto” (“power for the black people”) and “preto tipo a”—literally “class A black” but referring to blacks who are proud and fight for their rights. Similarly, in “Stop Sucking Up,” hip-hop star MV Bill scathingly attacks Brazilian blacks who deny their African heritage. A recent poll revealed that a startling 93 percent of those surveyed in Rio de Janeiro now believe that racism exists in Brazil.43
Nonetheless, the reality so far is that racial consciousness remains surprisingly muted in Brazil, with the myth of Brazilian racial democracy still broadly defended by many Brazilians spanning different social classes. As a Brazilian graduate student recently said to me, “For better or worse, there is no serious sign of ethnic conflict or ethnic mobilization in Brazil. Poor favelados are totally marginalized and Brazilian rap is certainly not changing that or posing any real threat to whites. In fact, Brazilian hip-hop is extremely popular among white university students.” Most Brazil watchers agree that the economic and political dominance of a white elite in Brazil is probably guaranteed for a long time to come.
OBVIOUSLY, LATIN AMERICA differs from Southeast Asia in countless respects. Because of extensive miscegenation, ethnic and racial lines in this region are not nearly as starkly drawn, and Latin America has been able to avoid the extreme ethnic animus and violence seen in Southeast Asia. Moreover, throughout Southeast Asia economic and political power have historically been divorced, with entrepreneurial Chinese minorities always at the political mercy of the indigenous majorities around them. By contrast, in Latin America a small landowning and to a certain extent hereditary elite has historically held both economic and political power.
Nevertheless, despite these and other differences, the same striking phenomenon holds. Like the indigenous populations of Southeast Asia, the uneducated, disease-ridden, desperately poor but numerically vast Indian- or African-blooded majorities of Latin America experience little or no economic benefit from privatization and global markets while finding themselves suddenly filled with contradictory new materialistic and consumerist desires. Meanwhile, along with their foreign investor partners, a tiny, well-connected, ethnically distinguishable minority dominates virtually every aspect of the modern economy, from export agriculture to wireless telecom, and uses liberalization, privatization, and globalization to increase its advantages. Moreover, despite the vast incidence of ethnic intermixing in Latin America, Latin America’s white elite tend, like the Chinese in Southeast Asia, to be surprisingly endogamous, intermarrying only amongst themselves. As in Southeast Asia, so too in Latin America these by-now hypercapitalized market-dominant minorities are, as a practical matter, economically untouchable.
They may not, however, be politically untouchable. In 1998, to the shock of Venezuela’s business elite, former paratrooper Hugo Chavez swept to landslide presidential victory, attacking free markets and “oligarchs” and championing the rights of the country’s brown-skinned pardo majority. A silver-haired tycoon I met in Bolivia predicted worse for his country. “Bolivia,” he said, “is a country where 3 percent of us control everything, and 65 percent of the population have no future. This place is definitely going to blow. It’s only a matter of time.” Most of my former student Augusto’s other friends were not nearly so pessimistic. But this is the subject of Part Two.
fn1 Unlike in Argentina, Chile, and parts of the United States, no mass slaughter of the indigenous population ever took place in Bolivia. On the contrary, powerful Amerindian uprisings in the 1780s and 1890s have helped shape the country’s history. The revolution of 1952 led to universal suffrage as well as large-scale expropriation of land from the Spanish elite and redistribution to Amerindians. After the 1952 revolution, however, as part of an effort to unify the country, explicitly “ethnic” identity was downplayed, and instead the idea that “everyone is a mestizo” emphasized.
fn2 For the remainder of this chapter I will use the term “whites” without quotation marks, but it should be understood that this term is not only highly artificial, but may have a somewhat different meaning in Latin American usage than it has in the United States.