Ecuador: The Construction of a New Model of Domination
by Raúl Zibechi*
Friday, 05 August 2011
Translation by Alex Cachinero-Gorman
“If in neoliberalism, the violence of the Washington Consensus has its locus in the market, in post-neoliberalism that locus has returned to the State.” — Pablo Dávalos
Ecuadorian politics show clear signs of schizophrenia. The government employs a revolutionary rhetoric, appealing in all its pronouncements to the “Citizens’ Revolution”, but the executors of that very process—the ones who, with their struggles since the revival of Inti Raymi in 1990, delegitimized neoliberalism and caused three presidents to step down—are now accused of being “infantile” and of being “terrorists”. The same indigenous and trade union leaders that fought for Rafael Correa to become president now suffer trials and prison sentences. More than 180 indigenous leaders have been accused of “terrorism and sabotage”, among them the president of CONAIE, Marlon Santi, and the Ecuarunari Delfin Tenesaca, who head up the two most important social organizations in the country.
The president is accusing personalities like Alberto Acosta, ex-president of the Constituent Assembly and ex-friend of Correa, who worked to include concepts like Buen Vivir (Sumak Kawsay) and the “rights of nature” in the Constitution, of being “traitors”. On the other hand, when he was interviewed by Ignacio Ramonet, Correa never referred to those police who were—according to him—intent on carrying out a coup d’etat and assassinating him as terrorists. Correa, allied with traditional, right-wing businessmen, reserves his most poisonous darts for the Left, something that shouldn’t be news for anyone who is familiar with the history of workers’ and socialist movements.
In the last few months, the repugnant whiff of McCarthyism, of Stalinism has begun to reek in certain ‘reforms’. Alvaro García Linera, vice-president of Bolivia, said that Trotskyism “is not ultra-left, but rather ultra-right in camouflage. Dangerous. Some of those union leaders give revolutionary speeches so that things will go back to the way they were—and make no mistake, those who would return would take the Wiphala, burn it, and step on it, because that is what the right does”. At the 40-year celebration of the Union Confederation of Intercultural Communities of Bolivia, he insisted to the gathered leaders that they unmask union traitors and seek unity around the leadership of president Evo Morales against Trotskyism, which is “the advanced politics of the extreme right”, which in the past put an end to popular governments like that of Juan José Torres and Hernán Siles Zuazo, only to give way to Hugo Banzer and Víctor Paz Estenssoro.
In Ecuador president Correa is convinced that the biggest threat to “Socialism of the 21st century” comes from what he calls the “childish” left — environmentalist and indigenous groups, which (he claims) reject modernity. On this basis, he criticizes those who say “no to oil, to the mines, and to not using our non-renewable energy. That’s like a beggar sitting on top of a sack of gold”. When the Amazonian population of Dayuma organized a work stoppage and a highway blockade in November 2007, he declared a state of emergency and put boots on the ground in the region, treating inhabitants roughly and having dozens of them tortured. On national television, Correa said, “Zero tolerance to all those who seek to carry out stoppages and generate chaos, anarchists who are accustomed to other governments that allow them to paralyze the country’s development when they feel like it. We will prosecute them to the fullest extent of the law”. He then directed his comments to communities affected by mining that have been mobilizing against the handover of their territories. “These communities are not the ones protesting, but rather a group of terrorists”.
This kind of rhetoric that’s been mobilized against leftist movements always gets stronger during periods of popular mobilization. It happened with the recent “gasolinazo” [“big gasoline hike”] in Bolivia, as well as each and every time indigenous people decide to rise up in defense of their territory against mining and oil interests. Thus, attributing Correa’s repressive measures and the ideological content of his speeches to personal characteristics—it is often said the Correa is ‘fired up’ and that he ‘runs his mouth’—is a flimsy argument. The test is rather to explore those characteristics of the Citizens’ Revolution regime in such a way that it allows us to see the rationale behind these policies of criminalization and simultaneous alliance with multinational corporations. As a kind of hypothesis—since it is too soon to say and reality forces us to be cautious—but trying to take it one step further, I intend to broach three central aspects of this regime: the relationship between the hegemony of financial-‘extractivist’ capital and the imposition of a “state of economic emergency”, following Brazilian economist Leda Paulani’s analysis of her country; the political hegemony of a sector that, once installed in the government, does the opposite of the mission it was charged with (for which I use Chico de Oliveira’s concept of “reverse hegemony”); and, finally, the establishment of a new political model, here taking the lead from the writing of Ecuadorian economist Pablo Dávalos.
Financial capital and neo-extractivism
Neoliberalism landed on our Latin American continent with a kind of “economic state of emergency” in hand, which has become permanent with our progressive governments. Leda Paulani finds inspiration in the well-known work of Giorgio Agamben (State of Exception) and in particular in that moment in 1933 in which Roosevelt exercised unlimited power to confront the difficulties of the crisis, making a parallel between military emergency and economic emergency. In the opinion of this economist, which I share, the democratic restoration of the 1980s was only possible under the premise of instantiating a permanent state of economic emergency, “turning this exception into the government’s paradigm”.
This exceptionality allowed Fernando Henrique Cardoso’s government to begin the (ocasionally scandalous) process of privatization, with the justification that the grave economic situation demanded it. If one does not privatize—said the neoliberal discourse—the country will march straight into catastrophe. Deregulation, then, was a fundamental measure if one was to ‘save’ the economy. The same argument has been used to justify ‘saving the nation’ from the brink of being destroyed by an outside enemy. Already under Lula’s government this logic was being applied to impose a primary surplus greater than the one demanded by the IMF, an increase in the amount of companies that ravage the country, and regressive pension reform, to name a few of the most egregious examples. She concludes that “Lula’s government made that permanent state of emergency, which was a deliberate creation, into the most essential practice of his government”. An example: when the president of the Central Bank, Henrique Meirelles, was accused of corruption in August 2004, Lula tested out a Provisionary Measure to give him the status of minister and therefore save him from any legal accusation.
Finally, she maintains that the hegemony of the regime of financial accumulation—accumulation by dispossession in David Harvey’s terms—imposes a permanent state of economic emergency with its “short-termism” and its eagerness for profits, which actually generate permanent instability. In that sense, Lula’s provisional reform, which fractured the PT with the departure of senator Heloisa Helena (among others) and led to the creation of the PSOL, “immediately opened up space for private accumulation in the immense territory of social speculation”, offering speculators the highest salaries in the public sector. Today, pension funds are the main tool that the government has to influence the economy, such that it controls a decisive portion of the biggest private and, of course, state-run companies.
In Ecuador, the “state of economic emergency” was the grand excuse for imposing “dollarization” in January 2000, in the midst of the biggest economic and political crisis the country had ever known. The crisis ended with the fall of president Jamil Mahuad, the creation of “popular parliaments” in the provinces, and the takeover of the government in a matter of hours by an alliance of indigenous and military groups. This is how the country lost its monetary sovereignty. The dollar, as a new national currency, provoked a fierce rise in prices, did not end up stopping the rise in cost of living, made investment more difficult, and could only sustain itself on remittances sent by immigrants and the high price of oil. Of course, “dollarization became the forbidden debate during the Alianza Pais period”, according to Pablo Dávalos. Under Correa’s government the topic is not discussed, though one sees speeches about “sovereignty” and “revolution”. Arguments to not dial back dollarization ensure that serious economic and social tensions will come to a head, since the middle classes have benefited from the process, seeing their capacity to consume multiplied.
The second question is related to the hegemony of the financial-extractive sector. The country continues to rely on oil exports, which represent 60% of total exports and close to half of all fiscal resources available to the state. The flipside of that is that upwards of 60% of the economically active population suffers from un- and sub-employment. In 2008 the banking and financial sector had the biggest profits in its history in the midst of a big consolidation of the industry, to the point where one single group controlled 40% of all assets in the country. In Correa’s four years (2007-2010) “the processes of concentration and centralization of capital of economic groups was never impeded”, while nine business conglomerates represent 15% of gross domestic product.
But new groups have been created as a consequence of Alianza País’s economic management. Among the ten most important groups, one is run by Rafael Correa’s brother. The president defended this company, which has over 300 million dollars in assets, despite the fact that it had run up over 80 million dollars in illegal contracts with the State. Instead of explaining the contents of the illegal contracts (which Correa assured he would suspend), the president attacked the leftist Popular Democratic Movement party that had denounced the contracts for being “the right’s best ally”. The financial sector is untouchable because it has the capacity to destablize the country, something which the Citizens’ Revolution hopes to avoid. Faced with such limitations, the best option is starting to become forming alliances with that very same capital.
The third question in which the state of economic emergency appears as a constricting factor is that of mining concessions. These are usually made in the name of “desperate need”, and are followed by the militarization of any territories or communities that resist these decisions. For such resistance the regime has charged almost 200 social leaders as terrorists. Alberto Acosta said it quite transparently in an article in which he analyzes the arrest of various Shuar leaders. “The use of the justice system as a mechanism of terror” is the result of not having legislated to adopt the legal corpus to the new Constitution:
The rights established in said Constitution have still not been transformed into legal tools that could be used to eradicate the repressive practices with which the government has spread terror in communities and held them for ransom—in this case, Shuar communities. We have a penal code in which the crime of ‘terrorism’ is classified so generally that it does not even fit with actual cases of terrorism. In this sense, article 160.1 of the penal code says that it considers anyone who ‘individually or through association, armed or not, under the pretext of patriotic, social, economic, political, religious, revolutionary, protesting/proselytizing, racial, local, regional, etc., ends, commits crimes against the common security of people or groups of humans of whatever class or their property…and anyone who constructs barricades, embankments, trenches, obstacles, etc., with the aim of confronting the forces of public order as a fulfillment of their intentions, plans, theses, or proclamations”.
The reasoning seems clear. Whoever opposes development—personified in this case in mining concessions—is agitating against the State, stability, and the future of the country. So much so that they deserve to be considered a “terrorist”. What is omitted in this discourse is the reason why mining concessions are so important for stability in the first place: accumulation by dispossession, despite how destructive it can be for communities, assures a minimal fiscal stability for a State that depends on oil exports and mining concessions to make ends meet. Because the government of the Citizens’ Revolution has not promoted fiscal reform that would require the financial sector, for example, to be taxed responsibly. Meanwhile dollarization has laid waste to the already scarce national industry.
Depoliticize and co-opt
When Brazilian sociologist Francisco de Oliveira—founder of the PT and later the PSOL—coined the concept of “reverse hegemony” four years ago, he was looking for answers to a disconcerting reality that did not resemble other experiences, like those which came to a head with ‘social democracy’ in Europe. Two years later, in a new article titled “The Reverse of the Reverse”, he confessed that he had wanted to issue a provocation based on Gramsci’s concepts in order to try and understand political regimes like Lula’s Brazil and South Africa under the African National Congress, which once it arrived in the seat of power began to enact policies that were the opposite of the class mandate they had been given in the polls.
The state of “reverse hegemony” is established “when the dominated classes become the ‘moral compass’ of society, and bourgeois domination begins to appear more shameless”. To explain this paradox she focuses on three aspects. The first is the dilution of conflict (class enemies disappear, she says), as part of a larger process that makes party politics irrelevant in contemporary capitalism. In the second place, social policy, which plays a central role in the cooptation and neutralization of movements. Here the question of poverty and of inequality is depoliticized and is turned into an administrative and technical problem. The synthesis of these two, then, is that one can reduce poverty without touching inequality, or the brutal concentration of wealth that one observes in Latin America, if one only takes up the appropriate instruments to deal with them, like the Bolsa Familia plan.
This dual combination of social policy and the reduction of social conflict foments an even worse process of accumulation by dispossession, so that those who interfere in this process—whether they are protesting against the Belo Monte dam in Brazil or against the exploitation of the Amazon in Peru and Ecuador—are put to one side as obstacles of progress. “Everyone who opposes the country’s development is a terrorist”, said Correa on national television on December 1st, 2007. And here is where the third and corollary aspect comes in, opening up new levels of comprehension of our realities:
In Marx and Engels’s terms, the “force” element in the “force+consent” equation that constitutes hegemony disappears. And consent transforms into its opposite: the dominated are nothing more than those who consent to their own exploitation. It is the dominant class—the capitalists and capital—that consent to be politically driven by the dominated, on the condition that this “moral compass” doesn’t question capitalist exploitation. It is an epistemological revolution for which we do not have the appropriate theoretical instrument. Our Marxist-Gramscian inheritance can be the point of departure, but it is no longer the point of arrival.
We know that on this point social policy plays a double role: by alleviating poverty it demonstrates to those below that the government really is concerned about their situation, while at the same time it expedites the social consensus necessary to increase financial accumulation. In one way or another progressive governments, and in particular Correa, continue forward with policies designed in the 90s by the World Bank—although they have expanded them and now use them to create their own demobilised and clientlist social base. In Brazil, this new architecture rested effectively on policies like Bolsa Familia, and (this is the novel part) on the ascendancy of the new social actors that are trade union leaders (particularly in the banking sector) turned administrators of pension funds. These funds are the locus of the most consistent capital accumulation in Brazil, reaching around 16% of the country’s GDP.
An example so that it doesn’t stay so abstract. Previ is the Bank of Brazil’s pension fund, ranked 25 globally. During Lula’s government Previ was presided over by Sergio Rosa, ex-bank director and a member of the PT. Previ controls 78 Brazilian companies, among them Vale do Rio Doce, the second biggest mining company in the world, the biggest private company in Brazil (privatized by Fernando Enrique Cardoso in 1997) and the biggest producer of iron ore in the world. It has 115,000 employees, its market value is 170 billion dollars, and in 2009, it listed 20 billion in profits. The “trade unionists” that run Previ control Vale’s Administrative Council, where people like Sergio Rosa decide who to makes up the board and what investments it makes.
In Ecuador things are different. The new ruling elite needs process; it does not come from the same background of trade unions like in Brazil but rather from a body of professionals integrated into the state apparatus. After having just barely reached the presidency, Correa presided over a “de-corporatization” of the State and oversaw a massive clearing of business sectors that were strongly controlled by the state apparatus. But things did not stop there. One of the principal targets of Correa’s anti-corporate campaign was public sector worker’s unions, in an attempt to stop the unionization of that sector and to only allow collective contracts to be negotiated with companies. The fiercest conflict was with teachers, who the government considers “mafias that keep education isolated and protect mediocrity”, to the point where they blame teacher’s unions for the poor quality of instruction.
The other big conflict is with indigenous peoples. In February 2009 the government abolished the autonomy of the National Directorship for Bilingual Education and centralized appointment- and decision-making powers in the Education Ministry, displacing the role that indigenous organizations were playing. The same was done in all institutions where CONAIE and a few other organizations had some kind of presence. The idea that guides this strategy is that “groups regulated by the State should not participate directly either in the design or the application of regulations”. And what’s more: in March of 2008, the government modified the rules regulating social organizations, most notably indicating that they will now be subject to dissolution if they “go back on or stray from the stated goals for which the organization was founded”, or if they “compromise the safety of State interests, such as repeatedly contravening injunctions communicated to them by ministries or organisms of control and regulation”.
In sum, control over social organizations and expulsion from the state apparatus. But the Citizens’ Revolution lays down a new mechanism of participation. This mechanism is no longer anchored in movements that choose their representatives to participate in certain institutions, without taking into consideration the selection of citizens based on merit. As the official rhetoric claims that the State is everyone’s, it appeals to the individual, non-organized citizen to occupy these spaces. The state closes the organized sectors (because they are gatekeepers for corporatism and, consequently, inefficiency and corruption) and in their place chooses, or co-opts, people little by little, assuring that they do not have even the most remote social or political representation. Those who get selected form the alliance of functionaries and technocrats that sustains the Citizens’ Revolution. Researcher Pablo Ospina concludes: “the citizen’s government seems to want to support itself with the handful of intellectuals that form their decision-making nucleus. A nucleus more and more dependent on the leadership, authority, and electoral support of the intellectual and academic figure of the President of the Republic”.
A new model of domination
The return of the State, the new State centrality, now purified of social movements, gives way to a governmentality centered on the figure of the president/caudillo—bearer of power and knowledge, who designates all who confront him or dissent as “public enemies”. What drives these new regimes (which Dávalos would call ‘post-neoliberal') to place the construction of a strong State in such a high place on their agenda? “To assure juridical security and normative convergence”. Dissent and questioning provoke juridical insecurity, which damages foreign investment and employment, and brings the country to a new “state of economic emergency”.
It is that state which makes territorial concessions for mining firms or for infrastructural works for South American integration, and so resistance now no longer faces multinational corporations, but rather the state apparatus. A legal trap also appears here. The Constitution can talk about Buen Vivir and the “rights of nature”, but it is never made into a law or code of any kind. At the same time laws are being passed which hand over water or territories over to multinational speculation. The most advanced Constitution of the world remains diluted because its declarations have been turned into neither resolutions nor even the remotest public actions.
A strong State which would guarantee the juridical security of investments, which basically means mining firms. David Harvey has told us what accumulation by dispossession means. But he has not explained what type of State is necessary in countries in the South where movements have grown to the point of actually becoming a threat to accumulation. We continue to discover this as we go. And the first thing that we’ve discovered is that, while in the first phase of neoliberalism the market was the organizing principle behind accumulation by dispossession, now that work is incumbent upon the State—whether it be conservative, progressive, or a follower of “Socialism of the 21st century”.
If the financialization of the system put an end to the welfare State, in the South accumulation by dispossession puts the breaks on and reverts the development process of import substition. Beyond the political leanings of those who administer the state apparatus lie the mega-entrepeneurial mining and monocultural firms, and the exploitation of hydrocarbon, all of which give back centrality to the State. But not just any state, nor any centrality—this is about the capacity to turn movements into terrorists. Or, in the least aggravating of cases (Lula, Mujica, Kirchner…), in obstacles to progress. In either case, enemies to defeat.
And not only that. It is also a State which is capable of controlling and integrating, of infiltrating society and its autonomous organizations—a “capillary State” complementary to the “strong State”. The Ecuadorian government has created the Registry of Civil Society Organizations (RUOSC), which deals with tax registration. The registration process requires all organizations to sign up in such a way that the regime now has detailed information about them and has flagged peasant and indigenous leaders who have not properly paid their organization’s taxes.
The registration is overseen by the Secretary of Communities, Social Movements, and Citizens’ Participation, a ministry which movements never asked for and which has turned against them. According to the Registry’s director, it is meant to “find out where each organization is as well as its mission, in order to help it participate in the programs and projects that RUOSC offers”. On a local level, the Secretary’s objective is to use the registry in order to “allow decentralized governments to direct their power towards different organizations which make up the social, economic, and productive domains”. This translates into going from parish to paris, neighborhood to neighborhood to “help” grassroots organizations.
De Oliveira’s final phrase in “The Reverse of the Reverse” distills all the pessimism and the fury pent up in someone who, for their whole life, placed their bets on the Left: “Lula is a political regression”. It is not easy to agree with his diagnosis. From the point of view of inter-state relations, Lula’s government has been a step towards multilateralism as Brazil is impelled towards becoming a global and regional power. Nevertheless, from the point of view of the social movements and emancipatory struggles, no one can say that things have gotten better. On the contrary, movements have been weakened in all those countries which count themselves as ‘progressive’ and ‘leftist’, with the exception of Bolivia. And what’s more, in light of the debate spurred by the Arab uprisings in Latin America, De Oliveira’s sentence should be heeded even more carefully than before.
*Raúl Zibechi is an international analyst for Brecha of Montevideo, Uruguay, lecturer and researcher on social movements at the Multiversidad Franciscana de América Latina, and adviser to several social groups.
 [Translator’s Note] Both of these phrases mean “Good Living”, which has been explicitly articulated as a political framework in Ecuador in recent years. It is usually written as such, in Spanish followed by the Quechua rendering. Here is an article by Pablo Dávalos explaining the concept – http://alainet.org/active/33609&lang=es
 Jornadanet, February 19th, 2011, at http://www.jornadanet.com/n.php?a=59813-1
 Reuters, July 6th, 2010
 Rafael Correa, national broadcast on December 1st, 2007, at http://www.oilwatchsudamerica.org/petroleo-en-sudamerica/ecuador/1178-ecuador-rafael-correa-insiste-en-que-quien-se-opone-a-las-actividades-pertenece-a-un.html
 Paulani, Leda “Capitalismo financeiro. Estado de emergência econômico e hegemonia às avessas no Brasil”, in Hegemonia as avessas, Francisco de Oliveira, Ruy Braga and Cibelle Rizek (ed.), Sao Paulo, Boitempo, 2010, pp. 109-134
 Ibid., p. 115
 Ibid., p. 124
 [Translator’s Note] Partido dos Trabalhadores, or Worker’s Party
 [Translator’s Note] Partido Socialismo e Liberdade, or Socialism and Liberty Party
 Ibid., p. 132
 [Translator’s Note] Known as the PAIS Alliance (Proud and Sovereign Fatherland) in English, a political movement led by Correa.
 Dávalos, Pablo. Alianza País o la reinvención de la derecha, Quito, 2010, (unpublished), p. 215
 Ibid., p. 77
 Le Monde Diplomatique, January 2011, Cono Sur edition, Ignacio Ramonet interviews Rafael Correa
 Alberto Acosta, “El uso de la justicia como mecanismo de terror”, ALAI, February 4th, 2011
 Revista Piauí, Rio de Janeiro/Sao Paulo, No. 37, October 2009.
 De Oliveira, Francisco “Hegemonia às avessas”, in Hegemonia às avessas, op. cit. p. 24
 I dealt with this issue in my book Latin America: Counter-insurgency and poverty, Desde Abajo, Bogotá, 2010 (also edited in Mexico, Chile, and Uruguay)
 “Vale tem segundo mayor lucro”, Folha de Sao Paulo, February 25th, 2011
 Ver, Ospina Peralta, Pablo, Corporativismo, Estado, y Revolución Ciudadana, Flacso, Quito, 2010, at www.flacsoandes.org/web/imagesFTP/1263401619.Corporativismp.pdf
 Ibid, p. 5
 Ibid., p. 13
 The concept of “post-neoliberalism”, for Dávalos, should be opposed to Emir Sader’s. While Sader maintains that it is a progressive circumvention of the Washington Consensus, Dávalos believes that it is merely an ‘update’, where the centrality of the market is ceded to the State.
 Dávalos, Pablo. Alianza País o la reinvención de la derecha, op. cit. p. 192
 El Universo, Guayaquil, Decembter 29th, 2010
 The Loja daily, Crónica, March 6th, 2011 at http://cronica.com.ec/index.php?option=com_content&view=article&id=14104:secretaria-de-pueblos-efectua-taller&catid=34:locales&Itemid=56
 Piauí magazine, op. cit.