April 22, 2012
In keeping with its new journalism model of eviscerating the distinction between news and editorial positions, the Washington Post told readers in a news article that “populism is running out of gas in Latin America,” using the words of Arturo Porzecanski, a Uruguayan economist who teaches at American University in Washington. Mr. Porzecanski is one of several critical voices used as sources for the piece. (The only statement from a supporter of the populist governments is a comment from Venezuela’s oil minister, which appears to have been given at a press conference.)
The data do not seem to agree with Mr. Porzecanski. The piece mentions 11 countries in Latin America, 5 of which (Argentina, Bolivia, Ecuador, Nicaragua, and Venezuela) it identifies as populist. The chart below shows per capita GDP growth in each country either from 2000-2011 or from the year when a populist government assumed power until 2011.
Source: International Monetary Fund.
There is certainly no case here that the populist governments, as identified by the Post, are doing worse than the Post favorites. Argentina ranks first among the whole group with an average per capita growth rate that avearges almost 6.0 percentage points above WAPO favorite Mexico. Bolivia and Ecuador are very much in the middle of the pack, even though the relatively brief period of populist rule includes the years of the world economic crisis. (Ecuador’s growth would put it above both Chile and Colombia for the period that overlaps with populist rule and Uruguay’s growth puts it above Chile for the period of overlap.) Even relatively slow-growing Venezuela has seen more rapid growth under populist rule than in the prior two decades when per capita GDP fell.
There has also been a substantial reduction in inequality in the countries the Post identified as populist (as opposed to an increase in inequality in Mexico). This means that the typical person in these countries has likely seen a sharp improvement in living standards.
Ironically the context for this piece is the decision by Argentina’s government to re-nationalize the largest oil company in the country. (It had been privatized in the 90s.) Several of the countries held up by the Post as models, notably Brazil and Mexico, already have state owned oil companies.