Still, there are some who challenge this benign
interpretation, pointing to two recent opinion
surveys, one conducted by the UN’s Development Program
and the other by the Chile-based Latinobarómetro, that
reported that most respondents would choose a dictator
over an elected leader if it provided economic
benefits. In fact a closer reading of the surveys
shows that although it is true that respondents are
fed up with the slow way market reforms are working,
support for democracy as the form of government and
generic support for market policies has actually
grown.

At last the sacrifices of the last few years appear to
be paying off- in part because the "Washington
Consensus" has been implemented and secondly because
the authors of the Consensus have revised their model
in the light of experience and they have become more
tolerant of social democratic priorities.

The "Washington Consensus" was an attempt in 1989 by a
group of bankers and development experts brought
together by John Williamson of the Institute for
International Economics to design a 10-point package
of reforms that could put Latin America on a path to
sustained growth. Its essentials were healthier
budgets, lower inflation and lower external debt
ratios.

It did not work quite as planned — unemployment rose,
poverty remained widespread, while its emphasis on
market openness made countries vulnerable to surging
flows of short term capital that often disappeared as
quickly as they arrived.

The appeal of the Consensus was dissipated and the
Bush administration’s disdain for anything that
smacked of income distribution contributed to giving
it an even worse name. Whilst the World Bank and the
International Monetary Fund have worked to adopt a
refined Consensus the Bush Administration continues
forward blindly with its free market nostrums — for
example still using bilateral free trade agreements to
bully Chile (and Singapore) into ridding themselves of
necessary capital controls.

John Williamson in his latest book has sought to
refresh the Consensus in the light of this somewhat
confused and sometimes bitter experience. One
important step, he writes, means emulating the Chilean
example of limiting the influx of "hot" money. Second,
it means avoiding the early mistakes of a too
simplistic implementation of the Consensus’ original
prescriptions — taking steps to make sure
privatisation is not substituting a private monopoly
for a public one; ensuring proper supervision of a
liberalised financial system; not just liberalising
trade by lifting tariffs but working to improve export
market access; establishing a competitive exchange
rate; and although loosening union protection of a
small core of organised workers at the same time
extending health insurance, pension rights and
unemployment safeguards to the half of the workforce
that works in the shadows of the informal market.

Not least, in a confession of the original Consensus’
great omission, it demands tackling the world’s worst
income distribution — which means more educational
opportunities for the poor, giving them title to their
assets however small, including their shanty town
houses, so that they are eligible for micro credit,
and in some cases pushing through land reform too.

The hopeful news from Latin America is that Brazil,
its largest country, appears to be setting about doing
most of this. Other countries like Chile, Argentina,
Mexico, Uruguay, Costa Rica and El Salvador are also
at varying stages going down the same road. At last
these Latin American economies after years in the
doldrums are beginning to show significant growth
again. Even better news is that, although they may not
call it that, the revised Washington Consensus has
appeal to the modern day Latin left, which should
ensure its longevity- as long as the Bush
administration doesn’t work to undermine it.

©Jonathan Power=al jazeera