THE CURSE OF THE MIDDLE CLASS IN LATIN AMERICA

Arrived to the power in April 2009, the government of Rafael Correa impels the Citizen Revolution. The country is entering a post-neoliberal phase where human needs take priority over corporate profits. This new distribution of wealth is based mainly on oil rent, the main export product (53% in 2014). 

While this policy has produced undeniable results, with over two million people lifted out of poverty, it has also had a surprising backlash. In June 2015, the government proposed two new laws: the first aimed to introduce a capital gains tax and the second to reform estate taxes. These new levies are intended to affect only the wealthiest class: the final bracket of the estate tax will tax inheritances over $849,600 at 77.5%, which affects 2% of the population. However, it will meet a much larger opposition… The conservative right succeeded in mobilizing several thousand people to oppose these laws by exploiting the Ecuadorian conception of the family and presenting these policies as confiscatory. But the most striking thing was the identification of the new middle class with the upper bourgeoisie, the famous 2%. 

Renaud Lambert, a journalist at Le Monde Diplomatique, details this phenomenon of assimilation in a feature devoted to Latin America in the January 2016 issue.⁽¹⁾ We discover a comparable situation in Venezuela where a lady says that it is « thanks to Chavez » that it is out of poverty, before announcing: « Now that I’m not poor anymore, I’m voting for the opposition. »⁽²⁾ It also explains why Uruguayan President José Mujica has not pushed ahead with reforms in his country: « Because people want Iphones! »⁽³⁾

To end poverty without promoting personal enrichment, without reinforcing the consumer society, is the challenge of the left in Latin America and throughout the world. This challenge is all the more complex for the Latin American left because their strategies are based on a productivist system. 

Sébastien Gillard