Dependency and Development in Latin America, Fernando Enrique Cardoso and Enzo Faletto

reviewed by Tomi Castle

Background

*written in Chile, 1965-67, while FHC was in exile from Brazil (military dictatorship under Castello-Branco began in 1964)

*first published in English in 1979, eight years after original publication

*both authors were working for the UN’s L.A. Institute for Economic and Social Planning

*FHC was a member of the PCB at the time; became Finance Minister in 1994 (and the 12^th since 1985), under Itamar Franco, and created the Real Plan (the 5^th economic plan since 1985)—which introduced the 4^th new currency (the real/reais) since 1985;

*elected president—as part of a center/far right coalition (yikes!) with a big neo-liberal platform (where do the ideals go!?)—over the pre-election favorite (as usual), and current president, Lula; elected largely on the basis of the Real Plan’s success (and it was a big success—inflation dropped from about 2500% in 1993 to less than 1000% by the end of 1994 and all the way to about 4% in 1997)

The Work

*authors seek to reestablish a “comprehensive social science” because domination, socio-cultural relations, ideology (yes!), and economy are not independent “dimensions” of life, but are fully interdependent; thus, they follow the political economy approach (like Marx)

*focus on the relationship of internal political struggles to international conflicts between states—they are not unrelated;

*use the terminology of dependency theory, best known through Wallerstein—“center” and “periphery” or “core” and “periphery”; also really like to discuss things in terms of “hegemony” (remember Gramsci?)—it’s either U.S. or British hegemony…

*criticize a lot of economic thought popular at the time (and much of which is still heard today):

            1. idea that “development,” given that certain conditions existed, depended on the ability of each country to make the “right” policy decisions (=neoliberal decisions)

            2. idea that “developed economy” = “modern” society: 1^st b/c the term “modern” is nebulous and 2^nd b/c a society can modernize (education, culture, etc.) without economic development

            3. notion that “peripheral” “countries would have to repeat the evolution of the central countries in order to achieve development”; this totally ignores the sociohistorical contexts of each country—which are always particular; -> idea of the “demonstration effect”

            4. focus on dependence as an external factor; they show that dependence must be examined internally as well as externally—by looking at the relations of social classes within the nation and at the relation of the dominant classes with foreign interests

            5. (connected with #3) idea that the “peripheral” countries are just at a different place in history (=behind); the history of the core IS the history of the periphery—says that “underdevelopment came about when commercial capitalism and then industrial capitalism expanded and linked to the world market nonindustrial economies that went on to occupy different structural positions in the overall capitalist system”; so, b/c of this system, you HAVE to have underdeveloped/peripheral countries.  Otherwise, there would be no one there to support core/developed countries.  (Much like capitalism within a country demands lower classes to support the upper classes.)

*after laying out these points, they focus on the specifics of Latin American dependency (and the development of dependency) from the colonial period on, focusing mainly on the late18th century on.  Seriously ambitious!  They breeze through everything from the Bourbon reforms in Spain (and the companion Iberian/criollo clashes in the colonies), to the caste war in Peru and present-day Bolivia, to the independence movement in Mexico, to conflicts over slavery in Venezuela and the rise of caudillos in Argentina (Manuel Rosas especially).  It’s almost dizzying.  Basically, as Spain was being cast off, England stepped in to supply goods to the new countries—mostly b/c it wanted a bigger market.

*Chronicles increasing United States invention and involvement; # of U.S. monopolies and oligopolies increases dramatically through first part of 20^th c.—United Fruit Company (Guatemala, Honduras) as key example.

*Throughout all of this, what is most important to remember is that, although this “hegemonic core” controlled production to a greater or lesser extent, it did NOT replace local elites.  Essentially, it colluded with them.

*Because locally-run ventures are not able to compete with foreign-owned companies, enclaves began to spring up—revolving largely around mining and plantations.  These only served to increase, not decrease, wealth disparities.  When they relied on skilled labor (mining, sometimes), it benefited only a few; while they relied on unskilled labor (plantations), it kept wages low.

*Looks at the rising middle classes (those not directly tied to the export economy) in different countries; different ways to incorporate them—1. confrontation (Argentina), 2. cooptation (Uruguay, Colombia), and 3. incorporation through breakdown of oligarchy (Mexico). 

*Subtly criticizes the military dictatorship in Brazil.  They’re fighting off the great “Communist threat.”

*Emphasize the balance between external control and historical particularity in determining dependence.  Not wholly an either/or.

*Say that there are three things necessary for development: 1. open market, 2. exclusion of the dependent economies from the markets of the most developed countries, and 3. continuous transfer of external capital (in the form of technology) to the developing countries.

Problems

*The sheer scope of the thing causes two main problems: 1. it makes it dizzying to read (and, if you haven’t had a bit of Latin American, and in particular Brazilian and So. Cone history—yikes!) and 2. it gives a cursory look at so many things.

*Although Faletto and Cardoso are loathe to generalize about Latin American countries, they have no problem whatsoever generalizing about “the masses.”  Any variation, within or between countries, is virtually obliterated.

*Ideological aspects get brushed aside, although they made a point of mentioning how important they are.  Partly, there just isn’t time/space to go through all of it.

*Although the book is about “Latin America” and includes date and analysis on a wide variety of countries, its focus is heavily skewed toward Brazil, Argentina, and Mexico.  (Surprise, surprise.)

*Although they stress that what is important to look at is the relation of various social groups/classes (internationally), they still focus on certain countries as “hegemonic.”