The central insight of this slender, fact-studded, and generally excellent volume is that the Movimiento Nacionalista Revolucionaria (MNR) was not revolutionary at all in financial policy during its tenure of power from 1952 to 1964. Rather, the MNR continued the policies actually established by the revolutionary leader Víctor Paz Estenssoro while Minister of Hacienda of Gualberto Villarroel’s government in 1945. These policies were continued by interim governments until the successful MNR revolution of 1952.
As a result, outlays for social needs during these years greatly overshadowed expenditures in basic economic development, whether from the Bolivian central government or later from the U.S. Agency for International Development (USAID). The latter contributed between a fourth and a third of the entire Bolivian operating budget in the peak years of 1957 to 1962.
Yet to a large degree aid to Bolivia should not have been called “economic assistance,” the author points out, for of the 275.9 million dollars disbursed from the beginning of USAID programs through 1964, shipments of surplus agricultural commodities comprised between one-third and one-half of all assistance.
Still, the author finds, “there is no doubt that USAID has been successful in helping Bolivia to reestablish economic growth while encouraging tax reform and modernization” (p. 38), and he warns against abrupt curtailment of USAID programs. At the same time, however, there is a great need for central planning (particularly a census) and executive check on disbursements of funds, if Bolivia is to move into an institutionalized revolution such as Mexico has experienced.
Wilkie makes an excellent case that analysis of budgets and actual expenditures or incomes can test the ideology of political movements, insofar as such information is available. For example, he finds that the fluctuating real prices paid for tin financed the Chaco War to some extent, thanks to a sharp rise in 1933.
The author’s use of oral history also sheds new light on some important questions. Why did Paz opt for a third term in 1964? Wilkie found that Paz claims to have offered former President Hernán Siles Zuaso the “effective presidency” in 1964, so that Paz could carry out his program of economic development, but the badly split MNR went under nonetheless.
It becomes clear through the author’s analysis that Bolivia was caught in a vicious circle: “The need for economic activity generates social tensions which must be resolved immediately if a ‘revolutionary’ government is to stay in power, and thus no funds are free for commitment to resolve basic structural problems” (p. 42).
In short, this is the kind of superb economic analysis which is greatly needed to understand revolutionary developments in Latin America today.
