By Alicia Sagra
After having gone through a period of economic growth that was called the “Bolivian miracle”, the country is now in the midst of a major economic crisis. The main expressions of the crisis have been in the shortage of dollars, the difficulty of maintaining the fuel subsidy (gasoline and diesel) which has lead to shortages, the fall in exports, especially gas, and the generalized rise in the prices of basic goods and services for working families.
Since Bolivia imports a large portion of its consumer goods and inputs for production, the shortage of dollars affects industry in general, but especially the self-employed who absorb unemployment (80% of the economically active population is self-employed in Bolivia). Large companies and importers, although affected, have also taken advantage of the situation, speculating in the parallel market and benefiting from the Central Bank’s plans to give them preferential access to dollars at the official rate. On the other hand, small traders (guilds), artisans and micro-enterprises have resorted to the parallel market, buying dollars at up to a 100% increase in relation to the official exchange rate.
For more than two decades there has been a policy of subsidizing gasoline and diesel (gasoil). This measure was adopted to benefit the agro-industry (the main consumer of diesel) and to contain social protest, due to the various effects the increase in fuel has for everyday people. Annually, the State has allocated two billion dollars to cover the subsidy and in 2024 it is expected to reach four billion dollars.
In one decade, between 2014 to 2023, the value of natural gas sales, the State’s main source of income, plummeted from US$ 6,011.1 million to US$ 1,880.4 million.
All of the above factors have led to an increase in the prices of basic goods and services, known as the “family basket.” The consequences have been felt in the popular economy with layoffs and an increase in the price of food and medicines.
According to a report of the Ministry of Labor, in the last two years, labor complaints have increased by 57%[1], of which a large number are related to dismissals and labor harassment.
The bureaucratic control of the unions by the ruling party MAS (Movimiento al Socialismo) has slowed down an organized response
This situation of the economy, in addition to government policies, such as the reform of the retirement law, are provoking workers’ and popular responses.
So far in 2024, there have been several different expressions of struggle, which include the following:
Road and border blockades by transporters and merchants, which have been provoked by the shortage of dollars and fuel.
Since April there have been strikes, marches, and confrontations with the police by teachers, doctors, and health workers against the “mandatory retirement” that is to be imposed.
On August 19, 2024 the unions held a march in La Paz demanding solutions to the lack of dollars, fuel and prices of basic goods and services. They declared that they do not feel represented by the current leader of the Central Obrera Boliviana ((COB), or Bolivian Workers’ Center in English), Juan Carlos Huarachi. They also said they would go to a hotel near Plaza Murillo to hold an assembly where they would define other pressure measures, saying “almost all Bolivians and all people are marching from different sectors for the same thing: the lack of dollars, the increases of the family basket, the issue of Customs, the issue of taxes, (all of these things) are what really worry us.”[2]
However, the unions have been treating all of the issues and the measures to address them in isolation. The union leaders have done nothing to unify them or coordinate across them. The workers’ and popular demands are not the central concern of these leaders, who are divided around the Evo-Arce confrontation for the presidential race.
In the sphere of trade unions and social movements, the grassroots organizations are divided between Evo and Arce, but at the level of the leadership, support for the government predominates. The communication secretary of the Central Campesina, Efraín Mollo, made assurances that the CSUTCB (The Unified Syndical Confederation of Peasant Workers of Bolivia)[3] will defend the Political Constitution of the State that proposes only one reelection of the president, and that it agrees with the referendum announced by President Luis Arce. He also pointed out that the CSUTCB is ready to defend the Bolivian Constitution and not to let the right and the new right trample on it. “What they want to do is to shorten the mandate of President Luis Arce. They want to trample democracy. We are going to continue fighting to defend the Constiution because it has cost blood and tears.”[4][5]
Meanwhile, the COB, in an unprecedented decision which expresses a total lack of class independence, invited the President and the Minister of Economy to participate in its National Assembly, held in the city of Tupiza. At the inauguration of the national meeting, Juan Carlos Huarachi[5], said: “For the first time, comrades, a president is attending a national meeting of the Central Obrera Boliviana (Bolivian Workers’ Central). Our president, comrade Lucho, is affiliated with the COB, he has been part of several congresses and national meetings in his university days, when he was in the FUL (Local University Federation)[6], he has been active in organic and union life”[7].
The confrontation for the presidential candidacy
Despite the fact that popular support for the ruling party MAS (Movement Toward Socialism) has decreased in relation to what it was when Evo Morales took office, polls show that it is still the party (to the extent that it is united) which is most likely to win in the presidential election of 2025. Hence the confrontation between the two main figures of that party, who like the leaders of the bourgeois parties, fight over who will be the future president of Bolivia.
As a by-product of the revolutionary processes of 2003-2005, Evo Morales governed the country from 2006 to 2019, when a military coup promoted by the Bolivian right wing forced him to resign.
The workers’ and popular mobilization prevented the coup government of Jeanine Añez from stabilizing, and in the elections of 2020, Luis Arce, who was the candidate for MAS, won with the support of Evo Morales.
Arce was Evo’s Minister of Economy and was known as the author of the “Bolivian miracle”. But, electoral desires have led them to this confrontation. The constitution states that there can only be one presidential reelection, so in that case Evo would be prevented from running. But Evo has argued that this refers to consecutive elections, which, if that were the case, would allow him to run again. On the other hand, Arce has argued that the constitution must be complied with.
In this battle that has been going on for several months, neither of the two leaders has been shy in their efforts to divide union and social organizations, and in resorting to any method to defend their electoral ambitions. Thus, Evo promoted road blockades, playing with the lives of peasants and provoking shortages in the cities. And for his part, there are strong suspicions that Arce was the leader of the military movement of June 26.
In addition to the political crisis created by the Evo-Arce confrontation, there has not only been an economic crisis, but also a judicial crisis marked by ongoing accusations of corruption and prevarication. The election of judges by universal suffrage, which created many expectations, did not solve this crisis; as the continuing validity of the popular saying attests, “The Bolivian justice system, like a snake, only bites those who are barefoot”. It should be clarified that this is not only a characteristic of Bolivian justice, but of all bourgeois justice.
Arce’s referendum: Passing the hot potato to the working people
During the presidential address of August 6, the anniversary of national independence, Arce announced that he would call for a referendum. Days later, the government sent to the Supreme Electoral Tribunal four questions which in essence raise three issues. The first clarifies that a president can only seek reelection once, even in a discontinuous manner, which is a measure oriented to prevent the qualification of Evo in the 2025 elections. The second deals with the lifting of gasoline and diesel subsidies (questions 3 and 4), which he wants to do with prior social approval, and which will let him raise the price of fuels. And the third seeks to increase the current number of representatives, this measure aims to avoid a conflict over the redistribution of representatives among the regions according to the result of the Population and Housing Census 2024, the results of which will be published on August 30.
It is evident that the referendum is intended as a preventive measure as it seeks to accomplish the following: apply an economic adjustment, control the protest of the civic committees from the eastern part of the country that will demand to increase their parliamentary representation, and to cut Evo’s path to the presidency, leaving Arce as the only option for the MAS presidential candidate.
Several sectors have expressed their rejection of the referendum, especially in reference to the subsidy. Business leaders have argued that it is up to the government to make the adjustment measures, and the popular and workers’ sectors have demanded that the finances of working families should not be affected even more.
For his part, Evo Morales has declared the following; “In his betrayal of the indigenous and popular movement, with the sole objective of banning us and trying to divert attention from the serious economic crisis, he [Arce] is asking a misleading question by imposing a constitutional interpretation that does not correspond to him. Luis Arce should be braver and ask the following questions: Do you agree with the prohibition of Evo Morales as a candidate? Do you agree with Luis Arce’s administration?”[8]
Recently the Supreme Electoral Tribunal returned the questions with technical observations and requests for clarity and impartiality, now it is up to the government to adjust and resend them. There is no deadline, but if the purpose is to do the referendum this year, it should hurry up.
What Bolivian reality teaches us
The MAS phenomenon and the “plurinational state” awakened great expectations not only among Bolivian peasants and workers, but also in a great part of the world’s left, especially in Latin America.
But the current Bolivian reality shows (as the “21st century” socialism of Chávez and Maduro, and the governments of Lula have already shown), that it is impossible to put an end to social inequality, to the corruption of the justice system and bourgeois politicians, without putting an end to the capitalist system.
To achieve this, a new revolution is necessary, similiar to the one of 1952, but it should go even further. It must be a revolution that puts the workers of the city and the countryside in power, expropriates the bourgeoisie, imposes a planned economy at the service of the majorities and the broadest workers’ democracy and promotes Latin American solidarity and mobilization to confront imperialism. It is a very difficult task, but it is the only possible way to advance in the solution of the problems facing workers and the people, on the road to the construction of socialism. In order to achieve this, it is necessary to begin the construction of a revolutionary party that will allow us to successfully face this task.
[1] La Razón Newspaper- 8-07-2024
[2] Mercedes Quisbert, leader of the National Confederation of Trade Unions – Los Tiempos Newspaper – 19-08-2024.
[3] Central Sindical Unica de Trabajadores Campesinos de Bolivia (Bolivian Peasant Workers Union Central)
[4] La Razón, 23-08-24
[5] Main leader of the COB.
[6] University Federation of La Paz
[7] La Época- 22-08-2024
[8] CNN, 23-08-2024
