Causes of the backwardness of Latin America

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Originally posted by Aryaman
Admiral Yi, the problem with pension system is not aging population, in fact third world countries can´t afford them not just because they are poor but because an smaller percentage of their population do work, they have a large young, dependant population, and that´s the problem.

I would characterize the typical third world pension problem as overly generous for the small number of workers who actually get one (usually civil servants) combined with a too narrow tax base, meaning too many people working gray.

Aging in Europe will be counterbalanced by:
1) Delaying retirement, people today is healthier and fitter at 65 than before, they can keep working more years.

2) Productivity is another factor, as long as it keep increasing, less people could maintain more dependant population

3) The arrival of inmigrants.

Productivity i'll give you, but let's keep in mind that mature industrialized nations are happy to have 1-2% productivity gaines/year. Demographic trends will swamp this if you don't get #1 and #3. And #1 is politically loaded in each and every country--didn't the French recently strike over proposed changes to pensions? #3, I wish you the best of luck.

BTW, Chile has a pension system backed up by real assets; it is not pay-as-you-go like most countries.

 

[Aetius]

Originally posted by Admiral Yi
I repeat for any Euro within hearing: every single one of your countries is going to have very, very serious problems with its pension system.

The Swedes have already started moving over to system based on paying for yourself rather than expecting later generations do it. In Japan on the other hand there you have a big problem, government has run up 140% of GDP in debts, the entire banking system is insolvent, the postal system with another 150% GDP in debts or so is insolvent, companies all basically in debt to their ears and all Japanese basically have their money in Japanese government bonds or in the postal system. So the Japanese have assets on paper but there is no way they can get it... Oh yes the entire pension system is also unfunded and the life insurance (i.e. private pension system) is insolvent

 

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Originally posted by Admiral Yi

I would characterize the typical third world pension problem as overly generous for the small number of workers who actually get one (usually civil servants) combined with a too narrow tax base, meaning too many people working gray.

I think Aryaman is closer to the mark, Admiral. Even Venezuela, a middle-income country, has problems in meeting pension payments for ex-government officials, most of whom receive ridiculously small pensions, when they get them (some people have not received the first payment of 2002!)

The narrow tax base is actually evidence of the demographic imbalance of many developing countries, although the pyramid is beginning to approach the Christmas tree.

 

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If so, two points to consider: Argentina is a racially homogenous, largely middle class country that has been as unstable as any of the competition. Second, while there are some cash crops that are subject to economies of scale, and therefore to the hacienda system, there are a number that are not and could have as easily been cultivated by small freeholders. (Coffee comes to mind.)

wrong argentina is not racially homogeneous, there´s a clear unadmitted diferrence within the families who have been in the country for 2 or 3 generations (mostly spanish and italian inmigrants),and the original mestizo population.
i´d recommend to anyone who speaks spanish or can read spanish to read " Martin Fierro" of Jose Hernandez, it depicts the story of a gaucho (something like a cowboy) there you can see clearly the difference between people.and this is a general rule for all south american countries

 

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Originally posted by Admiral Yi

Seems like you are tossing a bunch of separate questions into the salad bowl. Yes, most LA countries have a tiny white ruling class and varying proportions of mestizo and Indian underlings. OK, so what? How does this relate to your original assertion that Latin America's civil wars were a result of 1st world advisors?


This is one point of view.

which civil wars? the ones of the 19th century of the ones of the 20th century) most of the 19th century wars were over the organization of the countries (i´m taking argentina as an example here) between the progressist, well educated and idealist parties following the u.s example,encouraging relations with europe and inmigration, and the popular parties leaded by rich landowners,(sounds crazy huh?) which mantained order and kept the peasant populace happy.

 

[Aetius]

Originally posted by gusti


which civil wars? the ones of the 19th century of the ones of the 20th century) most of the 19th century wars were over the organization of the countries (i´m taking argentina as an example here) between the progressist, well educated and idealist parties following the u.s example,encouraging relations with europe and inmigration, and the popular parties leaded by rich landowners,(sounds crazy huh?) which mantained order and kept the peasant populace happy.

If you are rich you have more to lose perhaps...

 

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Originally posted by gusti


which civil wars? the ones of the 19th century of the ones of the 20th century) most of the 19th century wars were over the organization of the countries (i´m taking argentina as an example here) between the progressist, well educated and idealist parties following the u.s example,encouraging relations with europe and inmigration, and the popular parties leaded by rich landowners,(sounds crazy huh?) which mantained order and kept the peasant populace happy.

I was talking about the 19th century wars. Were there actually any civil wars in the 20th? I can think of plenty of coups, but no civil wars in that century come to mind.

Do you have any more information on the "mestizo-ness" of the original settlers? I was always under the impression (mostly from SPI's "Conquistador" board game ) that Argentina's Indian population was very small when Europeans showed up.

 

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i referred to 20th century civil wars to the fought between military coups and the left marxist/communist movements, not full fledged open wars but dirty ones, where bombings and kidnappins were frequent,ie: The condor plan between the military governments of chile,argentina and uruguay, this was conceived to eliminate the dangerous elements of the populace of the three countries.


referring to the mestizo population in argentina, i´d like to point out that there were several currents of inmigration into the country.
Colonization here started from the already secured virreinato del peru, with the the first settlement of argentina being santiago del estero and tucuman founded in 1553 (Buenos Aires was first foundeed in 1536 but the spanish were forced to abandon it by the natives.)so here we have a current of people on spanish-incan ascendance.

another current comes from the rio de la plata, they can´t secure buenos aires, but they found asuncion (capital of paraguay) the natives here were the friendly tupi-guaranis which were also incorporated to the population.
then we have slaves brought from africa which were also included in the population(the majority of the pure black people dying later in the independece wars).

so when the new inmigrants began to arrive in the later XIX century, argentina was a country with a vast majority of mestizos, this led to further difficulties about founding a national identity

 

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Originally posted by Aryaman
Well, I see here at least 4 classic historical theories

1) Max Weber, and the calvinist ethic. How do you explain then the poor backward northern Germany against the industrial catholic Germany?

Catholic South of Germany is richer than the North only now, right after the HEAVY INDUSTRY in the whole civilised world collapsed. Bavaria, having a small, modern, clean industry mainly of food processing and software development looks much better compared to the bankrupt mines and shipbuilders of the north. But up to the 1980's the situation looked quite opposite. I daresay that even in Germany one can clearly see the north-south dichotomy: still, the PRUSSIANS (or Eastern Germans ) are much more industrious (while working foe Western German enterprises, of course) than Bavarians, who behave much more like Italians.

2) Geographical determinism, Why countiries with the same climate, like Argenitne and the US, or Poland and Germany, or Austria and Romani, had such a different development level.

Beside of climate there is a historical background. I tend to agree with the opinion that northern harsh conditions favour the industriousness of an individuall far more than the south mild clima, where you can just take a fruit from a tree instead of tending your fields the whole yaer long.

The situation in Eastern Europe developed in such way that people living there seldom could enjoy a government they could call 'theirs'. The nations overe there were ruled either by foreign nations or by government quite opressive towards the PEOPLE. Thus, the people developed a kind of mind where all the organisation (at work, at the state level, etc) is treated as oppressive and must be avoided. You can clearly it when you observe Poles, Czechs and such working for foreign companies, where the organisation is given and they can show their hard work, as opposed to situation when they try to organise something themselves.

 

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Originally posted by Pirate Scum
King, your argument ties in nicely with mine. Structural, internal causes could explain LA's backwardness throughout WWI. Then your analysis would kick in, postponing development even more. It was only after WWII that most LA nations really began to industrialize, with some exceptions (Argentina and México comes to mind).

...their progress was slowed again, since the wealth was divided faster by the populist governments than it could be produced, even with the booming exports from L.A. to the post war Europe.

It is just that the societies (and the govts) failed to realise the fact, that you have to work hard first, and after that you can spend your money. This observation is stressed in the West European (Protestant? Germanic?) life philosophy.

However, the contemporary Western Europe seems to step back from this philosophy, just look at the growing (internal) debt of the E.U. countries.

 

[King]

Originally posted by Browning

...their progress was slowed again, since the wealth was divided faster by the populist governments than it could be produced, even with the booming exports from L.A. to the post war Europe.

It is just that the societies (and the govts) failed to realise the fact, that you have to work hard first, and after that you can spend your money. This observation is stressed in the West European (Protestant? Germanic?) life philosophy.

However, the contemporary Western Europe seems to step back from this philosophy, just look at the growing (internal) debt of the E.U. countries.

Internal debt need not be a major issue. US internal debt skyrocked under Regan but this did not hold backthe US economy. As long as you are willing to pay the cost of having a high internal debt then you can quite happly have one.

This arguement is a total red herring. The problem with Protestant work ethic arguement is that no can quite explain why the Protestant God gave his people coal fields while Catholic one didn't. In fact if we go to Catholic areas with large numbers of Coal fields (like Bohemia for example) we seen a quite an impressive work ethic.

 

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Originally posted by King



This arguement is a total red herring. The problem with Protestant work ethic arguement is that no can quite explain why the Protestant God gave his people coal fields while Catholic one didn't[...]

Well I do not necessarliy call it a Protestant philosophy (I put a question mark and another option, see?)

However we call it, it is a difference in approach:
1. Let's work now so that we are rich later on
versus
2. Let's spend the whole money now even before we earn it.

I see the second approach across the L.A. countries, and I am affraid that I observe it also in the E.U. - but not so in the U.S.A.

 

[King]

Originally posted by Browning


Well I do not necessarliy call it a Protestant philosophy (I put a question mark and another option, see?)

However we call it, it is a difference in approach:
1. Let's work now so that we are rich later on
versus
2. Let's spend the whole money now even before we earn it.

I see the second approach across the L.A. countries, and I am affraid that I observe it also in the E.U. - but not so in the U.S.A.

I disagree here. The USA under Bush right now is cutting taxes and increasing expenditure, spending money now even before we earn it. Now I ain't sayign its wrong but you can't claim the US isn't doing it. What you are describing and social and poltical situations in a country not cultural. In Europe a lot of countries remember the truma of World War II and remember that the rise of Hitler was aided by large scale social dislocation caused by the great depression. Many countries believe than investing money preventing this, is money well spent. In Latin America we see different forces at work leading to large scale corrpution in the societies but it is not linked to religion.

 

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King, Browning...one second here.

I don't think your respective positions are far from each other.

King, It is a Protestant philosophy. I would suggest re-reading Max Weber's "Protestant Ethic and the Spirit of Capitalism" and "The Pilgrim's Progress" by John Bunyan. You will see that the Protestant Work Ethic (PWE) is very much a, well, Protestant ethic.

Nevertheless, you still raise a valid point in questioning the reasoning behind the PWE. Why would "God" validate one's salvation through economic success? And only Protestant salvation at that...

Browning, I likewise agree that one of the prime differences between North and South America is the absence of the PWE as a driving philosophy in countries of (let's call it) Latin origin.

Yet, these positions are reconcilable.

In countries where the people were influenced by the Protestant work ethic (Northern Europe and America) there is a more developed tradition of market economy as PWE thinking went something along the lines of, "if I am to be among God's chosen he will show me I am saved by making my life better here on earth. Therefore I will risk capital to see if God will make my investment pay off and prove my salvation de facto."

This thinking did not permeate the "Latin" countries and thus began the great divergence we witness today.

However, arguments about Shrub (um, Bush jr.) and contemporary American politics can only distract us from the central issue and are a waste of time debating in this context.

 

[King]

Originally posted by Petrus
King, Browning...one second here.

I don't think your respective positions are far from each other.

King, It is a Protestant philosophy. I would suggest re-reading Max Weber's "Protestant Ethic and the Spirit of Capitalism" and "The Pilgrim's Progress" by John Bunyan. You will see that the Protestant Work Ethic (PWE) is very much a, well, Protestant ethic.

Nevertheless, you still raise a valid point in questioning the reasoning behind the PWE. Why would "God" validate one's salvation through economic success? And only Protestant salvation at that...

I just can't buy it. I do not see work ethic being linked to religion. Belgium was a very sucessful industral country and yet is not protestant. I think we should look else where. In Britian the governments key duty was defend the right of private property this allowed industral progress. As other countries adopted this idea so too did they begin to advance industraly. This is not based on religion, the Anglican communion is the closest of all protestant faiths to Catholism. In Scotland where the Kirk was all powerful up untill the late 1950's there was no major difference compared to England. So I see it as a social politcal posistion wand using the word protestant is misleading in my opinion.

Originally posted by Petrus

Browning, I likewise agree that one of the prime differences between North and South America is the absence of the PWE as a driving philosophy in countries of (let's call it) Latin origin.

Yet, these positions are reconcilable.

In countries where the people were influenced by the Protestant work ethic (Northern Europe and America) there is a more developed tradition of market economy. This tradition began PWE thinking went something along the lines of, "if I am to be among God's chosen he will show me I am saved by making my life better here on earth. Therefore I will risk capital to see if God will make my investment pay off and prove my salvation de facto."

This thinking did not permeate the "Latin" countries and thus began the great divergence we witness today.

No that is not protestatism at all or at least not the sort I got taught. As far as I knew yes it was gods will if you failed but success or failure did not valid your faith. We all knew that Catholic swould burn in hell, God had ordained it that way. The real reason that non-comfomists proved so successful in business was because political power was denied to them in Britain so they had to turn to business. It is the same reason that Jews became sucessful bankers, they had no choice.

Originally posted by Petrus
However, arguments about Shrub (um, Bush jr.) and contemporary American politics can only distract us from the central issue and are a waste of time debating in this context.

I do think they are valid. The situation still exists and thus contempary situation is just as significant as the situation 200 years ago.

 

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Originally posted by Browning

...their progress was slowed again, since the wealth was divided faster by the populist governments than it could be produced, even with the booming exports from L.A. to the post war Europe.

It is just that the societies (and the govts) failed to realise the fact, that you have to work hard first, and after that you can spend your money. This observation is stressed in the West European (Protestant? Germanic?) life philosophy.

However, the contemporary Western Europe seems to step back from this philosophy, just look at the growing (internal) debt of the E.U. countries.

I think that Weber's argument, though suggestive, is off the mark. It appears to "explain" the successes of Northern Europe, yet does not explain the development of France, Belgium, and Italy. Yes, the North and the South of Italy are vastly different, yet they're both Catholic.

To think that societies and/or governments go through thought processes like "Let's spend before we earn" is probably not fruitful. If LA countries have shown any specific "Latin" trait, it's not laziness, but fickleness. They have gone through innumerable economic models (all foreign, i.e., European) without sticking to any one in particular: Keynesianism, liberalism, neoliberalism, you name it...

 

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Why one God should favour the economical development, while another should not... There are some possible explanations. Say, one religion tells you "Everything is in your hands" and that it is nothing wrong in getting as rich as possible while observing the commandments. Say, another religion tells you "ora et, maybe at some point later, labora". Or "everything is God's hands" so let's better sit and wait what happens. What's even more important, the clergy of the other religion focuses their whole energy on maintaining the status quo rather than stimulating (or just not hindering) the progress. The rules of that other religion strictly forbide lending money for interest, which is, we all agree, a necessary condition for the development of capitalism. The only class of people allowed for making money out of money in the catholic countries were the Jews, and they had quite a low status. Yes there were exceptions from this rule but they were exceptions.

So, it was not catholic God, nor the catholic Holy Books etc. that influenced the economy - it was the philosophy practiced in these countries.

Besides, I am Catholic...

Yes, Belgium is a highly developed country, but it fades out in comparison with the Netherlands. Yes, France is a highly developed country, but Germany is even more so. Thus my argument that it is either the protestant or germanic culture that stimulates the development holds.

Anyway, I would name religion just one of the decisive reasons, not the only one. The most decisive reason is work ethic, and it is linked to religion - consider the work ethic in the islamic countries - and the property issues, where I agree with the King in 100%.

 

[Dark Knight]

Originally posted by Browning
Yes, Belgium is a highly developed country, but it fades out in comparison with the Netherlands. Yes, France is a highly developed country, but Germany is even more so. Thus my argument that it is either the protestant or germanic culture that stimulates the development holds.

Belgium in the 19th century industrialized far faster and to a much greater extent than the Netherlands (it had 45.5% of its population engaged in manufacturing, mining, and building in 1910 as compared to 32% for the Netherlands) and even today you couldn't say that the Netherlands is more 'developed' than Belgium (or vice-versa). Moreover, Scandinavia, a Protestant and 'Germanic' was relatively slow to industrialize. Sweden, for example, had only 9.5% of its population engaged in 'manufacturing, mining, and building' in 1880 as compared to 25.4% for Italy.

Anyway, I would name religion just one of the decisive reasons, not the only one. The most decisive reason is work ethic, and it is linked to religion - consider the work ethic in the islamic countries - and the property issues, where I agree with the King in 100%.

I would argue that the most important factor affecting development are the institutions that a country possesses. Religion certainly affects the evolution of these institutions as does culture more generally, but I think that 'work ethic' is principally determined by these institutions, not by religious beliefs.

 

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Weber et alii

I think we should stop discussing Weber theories, they are totally outdated in modern historical research, no one takes them seriously any more. I imagine it is the same in other disciplines, but at least in History old theories long ago forgotten by scholars still are "common knowledge" and they die hard, this is one example, the Turkish expansion blockading species trade as a cause for the discovering portuguese and spanish expeditions is another that comes to my mind, but sure there are lots and lots.
And for Germany, Browning, think that the western, catholic Germany is, and has always been, the more developed part of that country.

 

[Dark Knight]

Originally posted by Aryaman
I think we should stop discussing Weber theories, they are totally outdated in modern historical research, no one takes them seriously any more.

I think Weber is still important in certain fields of political science and sociology. I quite agree, however, that his historical ideas should be laid to rest. His theory of a Protestant work ethic explaining the industrial revolution and differences in economic development between countries is a rationally constructed argument that superficially appears to explain certain historical developments, but, as with so many other purely rational arguments, it was generated by coming up with a nice-sounding theory first, rather than examing the empirical evidence and then deriving a theory from it and can be seen to be quite mistaken on any close examination of the evidence.