A President Gets The Boot

Gonzalo Sanchez de Lozada was an inviting target. The wealthy owner of Bolivia's largest private mining company grew up in the United States and embraced globalization with unmitigated gusto. When the 73-year-old tycoon was first elected president of Bolivia in 1993, he sold off state-owned companies, slashed the government payroll and cut import tariffs. One of the public enterprises he sold to foreign investors was the government's gas and oil company, YPFB--and upon his return to power in last year's presidential election, "Goni," as he is known, antagonized political opponents with plans to build a $6 billion pipeline to export natural gas through a port in neighboring Chile. "Bolivians saw Goni as defending foreign interests more than their own," former senator Andres Soliz Rada says. That perception proved his undoing. Last week, after days of mounting protests that left more than 70 people dead, the embattled president was forced to resign from office.

How did things fall apart so quickly? One problem was the government's ham-fisted response to antipipeline protests: soldiers replaced police on the streets of the capital, La Paz, after the demonstrations began in mid-September--and a series of bloody confrontations ensued. Beyond that, Goni's free-market ideas were greeted with public scorn. In February the government tried to raise income taxes at the urging of the International Monetary Fund, but after a mutiny by disgruntled policemen and others, the idea was scrapped.

Sanchez de Lozada's promotion of the pipeline project seemed especially insensitive. Ordinary Bolivians were outraged by the president's proposal to pump natural gas through a historic enemy instead of nearby Peru. Their anger is part of a backlash throughout Latin America against the U.S.-backed economic policies that Sanchez de Lozada and many other presidents in the region adopted in the 1990s. "This is a consequence of the imposition of an unfair economic model," Evo Morales, the leader of the country's coca farmers, who finished a close second in last year's voting, told NEWSWEEK.

Carlos Mesa, Bolivia's vice president, will succeed Sanchez de Lozada. The 50-year-old Mesa, a former journalist and part owner of a Bolivian television network, is well respected and politically independent. But he has a tough task ahead. He'll have to promote dialogue between disparate political parties on the key issues of privatization and constitutional reform. Last week he said he'd hold a national referendum on the issue of natural-gas exports. Morales says he will support Mesa so long as he promises to boost social investments and revise Bolivia's energy policies. He may have little choice. Mesa--as well as other presidents in a disgruntled region--has been put on notice.