As you surely know, Ecuador is in the process of putting together a new constitution. And this week’s report on Ecuadorean politics and economics from Analytica Securities in Quito (you are on their email list, right?) outlines few of the things which are likely to go into it.
Top of the list is "the
principle of conditional property rights". What does that mean?
Individual property rights would be guaranteed
by the new Constitution, but property rights
would have to be consistent with public
welfare and the upkeep of the environment… Expropriation
could take place not just to build public
infrastructure, but also to guarantee food
security, promote equality or to conserve the
Yes, that means what you think it means:
The committee on food security
within the Constituent Assembly intends to
classify the unequal distribution of agricultural lands as a threat to the food security of peasant and indigenous communities. And it
wants to guarantee peasants access to
agricultural lands. The upshot of these
principles could be to render agro-industrial
assets, prominent in both the coast and the
highlands, vulnerable to expropriation in the
context of a new land reform designed to
replace agro-industry with a peasant based
And let’s not forget the "strategic
sectors of the economy":
According to this notion, the
government should control key public
services and natural resources and harness
them for national development. Included
are oil and mining, telecoms, electricity,
water and radio and television frequencies…
The definition of banking as a "delegated
public service" has met with stern opposition
from the private banking sector.
Yes, that means what you think it means too: that banks would essentially stop making their own credit decisions, and simply become vehicles by which the government outsourced top-down lending decisions. Oh, and the government is likely to strip the central bank of its independence, too, which means the end of reliable statistics or arm’s-length banking-industry regulation.
All of this, incidentally, comes from president Rafael Correa, who still has a popularity rating of 60% despite having been in power for a year and a half. (Fun fact: his vice-president is named Lenin.) And all of this, too, is coming from an oil-exporting country which has done really rather well by global capitalism of late.
I think it’s fair to say that the Washington Consensus is dead.