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The Return Of The Old Caudillo

 
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But good times come to an end—and troubles already loom. Until recently, Venezuela and Argentina boasted near "Chinese rates" of growth, with GDP expanding 7 to 9 percent a year. Now their governments are trying to hose down their overheated economies with price controls and taxes on exports. Invariably, manufacturers and farmers respond by withholding goods from the market or selling them abroad for a higher price. Empty larders spur even greater discontent. Food shortages in Venezuela have helped push Chávez's popularity to record lows. Industrialists and soybean planters in Bolivia's lowland eastern provinces have defied Morales by supporting a May 4 referendum on regional autonomy, in the hope of breaking free of what they see as La Paz's iron grip and a surge of tax-and-spend populism. In response, indigenous peoples and peasants are marching east, with Morales's blessings, to combat the "threat to national unity."

Last month, when Argentine farmers were on strike to protest scorching export taxes, President Cristina Fernández de Kirchner did what any self-respecting member of the ruling Peronist Party would: she played to the crowd. "Never have I seen so many attacks on a government elected by popular vote," she intoned from a dais at the Plaza de Mayo before thousands of cheering boosters. But the farmers have warned that if their demands are not met, roadblocks will paralyze the countryside again. It seems there are some things not even a balcony can fix.

With Brian Byrnes in Buenos Aires and Lucy Conger in Lima

© 2008

 
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