Autonomies Here and There

Things have calmed down considerably in Bolivia since last week. The political conflict between President Morales and the eastern Governors has all but disappeared from the front pages of the daily papers. Most people are focused more on Christmas and the expected arrival of their annual ‘aginaldos’ – the 13th monthly salary that is customary here. The political battling will surely resume once again in January.

So, the temporary respite offers a bit of a chance to reflect. And one of the issues that I would like to reflect on – this is the policy wonk in me – is the notion of ‘regional autonomy.’

Public Policy 101

The issue of decentralizing government away from national bureaucracies, and into the hands of more local authorities, is a classic in public policy. Everywhere that I work in the world, from the Balkans to Brazil, decentralization is an issue. In Bolivia, a serious policy debate has gotten lost in what is more a game of power politics between Morales and his Media Luna adversaries.

A reminder of how universal this issue is comes this week from the U.S. The issue of state vs. national control is in the headlines over an issue that affects the whole planet – carbon emission standards for cars. The Bush Administration announced yesterday that it is interpreting a new U.S. energy bill in a way that will eliminate the ability of the states, and in particular California, from setting their own standards. While the Bush administration has lagged consistently on pushing for higher standards, Governors including Arnold Schwarzenegger have led the way. U.S. automakers don’t like that, and never one to miss a chance to put corporate interests over the environment, Mr. Bush wants to block the aggressive state standards in the name of a “clear national solution.”

Public Policy 101: What powers should be left to a national government and what powers should reside with states (or in Bolivia, the nine regional departments)?

In the U.S. the Bush ruling breaks with years of states being able to push their own standards, recognizing the different needs in each state. Air pollution in California, for example, is a much more serious problem than it is in Vermont. Mr. Bush’s fellow Republican from my home state, Governor Schwarzenegger responded, “It is disappointing that the federal government is standing in our way and ignoring the will of tens of millions of people across the nation. We will continue to fight this battle.”

Like a lot of issues, “states’ rights”, ends up being less a mater of consistent principle than one of political convenience. The right wing in the U.S. has a long history of demanding respect for states’ rights on issues like civil protections against race discrimination, where the national government has led the way. And the right has been dead set against giving states latitude on issues like environmental issues and consumer protections, where states have led the way. The political left has taken a similar stance of flexibility, the other way around. In politics where you stand usually depends on where you sit.

A Bigger Slice of the Pie

Which brings me back to Bolivia. On the one hand, Morales backers and MAS need to recognize that, among some, the call for regional autonomy is a completely reasonable demand in the face of a long history of national governments in La Paz that, through bureaucracy, corruption and incompetence, burn up a sizeable chunk of the cash sent to there from the other regions. And the Morales government hasn’t shown itself especially more competent or less bureaucratic than others, thought it does clearly have different priorities.

Nevertheless, in Bolivia, autonomy is also code for two basic desires by the leaders of eastern regions. One is to block any real plan for land reform. The other is to take a share of the country’s growing gas and oil revenues greater than the region’s portion of the population. The east’s latest proposal is a cut of 50% off the top. Santa Cruz leaders were more than content with a national approach in the 1970s and 1980s when all of Bolivia was saddled with massive foreign debt used largely to finance economic development in Santa Cruz. It helps when you have a dictator, Hugo Banzer, who comes from your region.

The eastern regions, in demanding a bigger-than-their-share cut of gas and oil revenue, are not doing anything unusual. Civil wars are being fought in Africa over similar regional revenue disputes, and the division of oil revenue is behind much of the ongoing violence in Iraq as well.

It is a curious demand, really. To my knowledge, no one currently living in Bolivia’s gas and oil rich east herded dinosaurs or planted ancient forests or did anything else to contribute to the geologic accident that the nation’s oil and has is in Tarija instead of El Alto. The regions’ claim of entitlement to a bigger slice of the pie smacks of the story of the man born on second base who thinks he hit a double.

There is another irony here that I never hear mentioned in this debate. The conservative political leaders now leading the opposition, including Jorge Quiroga and Manfred Reyes Villa, spent years in governments that steadfastly refused to raise taxes on oil companies, adhering to what Carlos Mesa once described to me as “the great myth” that raising taxes would chase the companies away. The bigger pie of revenue now available – nearly $1 billion – owes itself directly to tax increases on the foreign companies forced by the left, both before Morales became President and after, combined with record world prices. And the companies haven’t moved away. They all signed new contracts and this week Brazil announced that it will invest $1 billion in gas and oil projects here.

The left in Bolivia still has a long way to go to prove that it can manage Bolivia’s gas and oil industry competently, but there is little question that it was the left here, not the right, that called the bluff of no new taxes on foreign oil companies and brought in the piles of new cash the regions are now fighting over.

There is no surprise here that the regions would fight over oil and gas revenue. Revenues are tight here and they fund not only public services, but also public graft and political patronage. But again, beneath this all are legitimate ‘democracy’ issues of what the national government should do and what regions should do.

That question of good governance may form a part of the rhetoric here from time to time, but it is really no more the heart of things here than Mr. Bush’s claim that he wants to lower standards for auto emissions in the name of national consistency.

To borrow a phrase: “It’s about the oil and gas money stupid.”