Quito, October 29, 2004

The association between democracy and State is as old as modern is old. Although the two concepts are not the same, it is obvious that a modern democracy –a democracy of the masses-- cannot exist without the underpinning of a National State. In saying this, we not only want to go beyond the level of minimum or formal democracy –that which is defined as a series of rules and procedures-- and which in the UNDP report on Democracy in Latin America finds one of its most important expressions in so-called “electoral democracy” –but, rather, to emphasize that democracy should also be understood as a form of relationship between the State and society --in other words, democracy as a social order or an organization of society.

This difference between democracy as a sum or series of procedures and democracy as social order is vitally important if we want to discuss the subject of democracy or, as the UNDP report states, of a “democracy of citizens,” in Latin America.

The Presidents of all of the Latin American countries, with a single exception, are elected today through processes that meet the minimum requirements and standards acceptable to the international community. It is even true that over the years those processes have not only improved and become more sophisticated, but also that they enjoy clearly defined protection mechanisms, like the Inter-American Democratic Charter and the new role of the election observation missions conferred on them by that instrument (the Charter was put to the test a couple of years ago, for example, and emerged unscathed).

If we add to this the removal of the danger –hopefully for a long time-- of military coups d’état, then we can conclude that democracy has taken momentous steps in comparison with our immediate past.

Despite this favorable context, however, we must ask ourselves why democracy continues to be an unstable system and regime. Why do broad sectors of our societies show a certain disenchantment with, or even rejection of, democracy, despite its continued existence over time? And why, as the UNDP report states, does the specter of authoritarianism continue to loom over our democracies?

Several answers can be given. Here we will only summarize some of the causes for the existing situation that troubles us all and will try to offer some possible solutions.

Generally speaking, democratic transitions are processes that consist of the replacement of one system by another, and not merely of one government administration by the next –in other words, of an authoritarian regime by a democratic system. For that reason, the change in rules –and, within them, the process and the way it is chosen (electoral democracy)-- is a key aspect of the transition process.

Academic literature on the subject of transitions reveals them to be more complex, however. Vicente Palermo points out that transitions must be understood as processes that involve a dual movement: on the one hand, a change in system (from an autocratic regime to a democratic system) and, on the other, a change in the rules by which the activities of the State and society are governed.

For Palermo, the consolidating of democracy that follows and, at the same time, is simultaneous with the transition, can be conceived “conventionally as the culmination of a changeover in system from a military-style regime,” but can also be conceived “as a broader and more profound process involving a break with decades-old patterns of political interaction in our countries, irrespective of whether or not their representative institutions exist.” (2).

For this author, as we can see, transition –and that includes also the consolidating of democracies--has a duality, on the one hand an institutional change –the replacement of the institutions of the autocratic regime by democratic institutions noted for their autonomy, independence, and inclusion-- and on the other, a change in the patterns of political interaction, such being understood as relations and mediation between parties, politicians, and society.

These clarifications, I believe, will help us to better understand situations like those that exist now and in which, with a change in regime, the disillusionment with politics and with political parties over the continued existence of old patterns of political interaction explain the increase in indifference to the political situation and malaise toward democracy and the authoritarian threat.

To make this problem of democratic transitions even more complicated, we could add that in actual fact there is a third level of change: change in the social order. In other words, the need to move from an unjust to a just social order, irrespective of whether or not the system of government is democratic or authoritarian. When unease over the continued existence of old forms of political interaction is combined with demands for a socially just order –the rejection by society of the existing order-- , the likelihood is enormous that democracies will always be unstable –on the verge of a social outburst, which is the case today –where the possibilities for the appearance on the scene of “outsiders” and of what Guillermo O’Donell termed “delegator democracies,” multiply.

The crisis of the State is the second element that is responsible for the instability of our democracy. By crisis of the State, I mean not only the absence of a healthy oversight that would help to cope with and resolve social demands or the lack of strong institutions or the absence of higher levels of decentralization, but also –and above all-- the lack of new and better forms of mediation between the State and society, an aspect that is crucial because it has a direct bearing on the State’s legitimacy.

A hypothesis that needs to be explored and elaborated on is that the old State, also called the populist State, which withered away to a large extent following the debt crisis and the reforms of the nineties, has been unable to be replaced by a new one encompassing the complex mediation network of the old State in its relations with society. That does not mean that it is necessary to return to the old State, but, rather, constitutes the verification of a fact that is related not only to the changes that have taken place in the State itself, such as its shrinkage and its reduced economic role, but also to the changes in society itself following the reforms and the rising poverty and inequality they have engendered.

In actual fact, as Juan Carlos Portantiero argues, the crisis of the economies designed following World War II and the policies applied in the nineties ended up by disinstitutionalizing not only the social fabric produced by the corporate integration of the different social groups, but also drastically modified the relations between State and society and the very functions of the political system.

The result has been a crisis in the State’s legitimacy --in its capacity to include and represent all social sectors-- and the continued existence of age-old political practices, like clientilism and mercantilism. At the same time, it has also caused problems in putting State reforms aimed at rebuilding those lost links into effect. The crisis in legitimacy is complicated further by the emergence of so-called “factual powers” that have taken over some of the State’s functions or that have placed limits on them.

This is actually a longstanding issue in our region. The World Bank pointed out in its “World Development Report” in 1990 that in no other region of the developing world are the contrasts between poverty and wealth as glaring as in Latin America. It went on to say that despite having per capita incomes five or six times larger, on average, than those of South Asia and Sub-Saharan Africa, almost one-fifth of the Latin American people continue to live in poverty, as a result of a distressingly large disparity in income distribution. The World Bank’s 2003 report on Latin America (“Inequality in Latin America and the Caribbean: Breaking with History?”) ratifies this statement when it affirms that the region is one of the most unequal in the world.

Information on the subject is plentiful, but I would like to cite only three facts. The first is taken from last year’s World Bank Report and reveals that the inequality of income distribution and consumption in Latin America has risen over the past twenty years in comparison with other world regions. The second is that over one-half of the Andean population lives below the poverty line and the third has to do with the growth of informal employment: according to figures published by the ILO, during the nineties, about seven out of every ten jobs that were created were in the informal sector.

And although the inescapable conclusion is that one of our region’s most serious problems is the continued existence of, and rise in, poverty and inequality, we should ask ourselves why, after so many years, this situation now creates major political crises and jeopardizes our governance, when it did not do so in the past.

Quite possibly, the growth of poverty and inequality makes it more difficult to represent politically a society with these characteristics. What we are living today is a deterioration of the legitimacy of political parties and their proliferation –in other words, the fragmentation of political representation itself. Also the impossibility of turning the social conflict into a political one. What we mean here is the difficulty in transforming the social identities, at the root of any conflict, into collective and public political identities, which are the only ones a society may submit to democratic procedures.

People do not vote in an election for social representations, but for political ones, which are those that in the final resort organize and give meaning to a society. When that happens –when the political is blocked or the social takes precedence over the political, the processes of democratic transition and consolidation also end up being blocked.

The hallmark of these societies is conflict, which may turn violent in some cases, as experiences and events in our region have shown. And if we add to this the cultural and ethnic fractures that take place in some of our societies –and about which the UNDP report issues a warning-- the likelihood is that this conflict will take on other dimensions that will fuel the political crisis.

This point is not only related to the lack of a legal tradition, both among our elites and of the State itself, and which is expressed in a continuous legal insecurity that affects both politics and the economy (in some countries the State is the first to break the law), but also –as Guillermo O´Donnell (3) says-- “in the little power of democratically elected governments in Latin America and of the States in general to move toward the democratizing of their respective countries.”

The problem lies not only in the existence of a cultural ethos resting on the belief that individuals are unequal “by nature” and that as a result the law is applied unequally, as was the case in some countries in the region, but also in the existence of weak and poor States that are incapable of penetrating and installing themselves legitimately in our societies and enforcing the law.

Frequently when States are poor, for either fiscal or other reasons, the societies are equally poor. Furthermore, a vicious circle is put into play that affects the development of legality and, particularly of people’s rights: “the poor have no rights because they are poor and they are poor because they have no rights.” The problem lies in how to break out of this vicious circle.

One possibility for breaking out of the vicious circle is to implement a State reform that includes a decentralization process, in addition to the necessary fiscal reform.

Decentralization processes are a given fact in the Andean region. All of the countries that comprise the Andean Community today are involved in decentralization processes and some are more advanced than others. Another important fact is that these processes are irreversible. There is no turning back, --nor will there be, I am convinced.

Decentralization means not only a new and better distribution of power, but also moving away from what we could call “executive power” to a “national government.” And although its objectives are more closely associated with the search for comprehensive and regionally balanced development, it does open the possibility for bringing the State and society –the citizens-- closer together.

In talking about “national government” as a replacement for “executive power,” we want to highlight the inclusive and representative nature of a State that becomes decentralized. Decentralization is, therefore, an instrument that will help to establish a culture of legality and, above all, to expand the radius for the State’s political and territorial action. In other words, decentralization, being based on a pact that makes all of its members equal and turns them into citizens, constitutes a contribution to the building of a democratic State in our region. In order for this to happen, it is necessary for the central power to have the political will to distribute and share power with the rest of the country.

In this connection, the Andean Community is extremely interested in encouraging the decentralization processes that are underway in all of the countries in the subregion. To accomplish this, it has set up an Andean Consultative Council of Municipal Authorities in order to reinforce the integration process and local development, and the Andean City Network that is intended to expand intra-Community relations even further.

We are also making efforts to intensify public cooperation in building up democracy in our region. These include creating the Andean Forum on Political Parties and disseminating and implementing the Andean Human Rights Charter. Furthermore, the Comprehensive Social Development Plan (PIDS) was recently approved in order to promote, from the vantage point of the integration process itself, active policies to overcome poverty, exclusion, and inequality and thereby reach the United Nations Millennium Goals.

The Andean Forum on City-Regions and the reactivation of the Andean Committee on the Small and Medium-size Enterprise are carrying the integration process to the subnational level. The integration and development of border regions is being sought through the integration and development hubs of the IIRSA program, which is aimed at the physical integration of South America and at giving due value to our countries’ domestic markets.

Reality has shown us the limitations of recent models that for the laudable purpose of overcoming decades of economic mismanagement end up subordinating the State and society –in order words, politics-- to the economy. The time has come to build a new Latin American consensus that, while safeguarding fiscal responsibility and macroeconomic balances, will commit itself unwaveringly to democracy and development.

In this context, it is a question of moving State efforts away from the “macro” to the “meso” level, with an approach that, grounded in the citizens’ well-being, will incorporate active policies and a territorial development outlook that will lead to development and social cohesion.

In short, what is sought is the construction of a new legal and legitimate State capable of boosting equitable growth and ensuring social cohesion and democratic governance.

We feel certain that the UNDP will offer an essential navigation chart for this undertaking.

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2. Palermo, Vicente: “Temor y temblor. El dilema entre conmover las reglas y quebrar las coaliciones”. In: Estudios Sociales Nº 13. Instituto de Pesquisas de Río de Janeiro, Brasil.

3. O´Donnell, Guillermo: “Acerca del estado en América Latina contemporánea: diez tesis para discusión” in La Democracia en América Latina. Contribuciones para el debate. UNDP. Buenos Aires, 2004.