Victor Bulmer-Thomas’ new book, with 485 pages, 72 tables, and nearly 1,400 bibliographic entries, provides material to enable us to rethink the issues that arose with particular urgency in the 1960s, but now with a great lot of new research at hand. And because the book brings the story into the 1990s, the author can offer a perspective formed not by the dependency theories of fading memory but by the current trend toward neoliberalism and the experience of the Asian Tigers. The question, still valid if one accepts the notion of a historical norm, is, Why is Latin America poor? This, of course, means, Why has Latin America not become more like us—and on our timetable? Bulmer-Thomas likes to call “us,” meaning the developed part of the world, the “charmed circle”; and he endeavors to show why, in another favorite metaphor, the “engine of growth” (which hauls or drives or is occasionally “nurtured” or, alas, not “harnessed”) is slow to get under way or runs off the tracks. He has no doubt about the final destination. Argentina, for example, which roared along until the Peronist years, “will now have to wait until the twenty-first century to join the club. . .” (p. 416). Let’s hope that the station’s not torched before the train pulls in.
Three central explanatory themes run through the book: the “commodity lottery”; the mechanics of export-led growth; and the economic-policy environment. Bulmer-Thomas is able to show the economic implications of different kinds of exports, such as nitrates, sugar, or wheat. These turn-of-the-century “traditional” exports, essentially “dictated” by geography or geology, led to various kinds of “forward or backward linkages.” These concepts, developed earlier by Albert Hirschman, are developed again here in valuable detail drawn from newer research. As Latin America today returns with a vengeance to desarrollo hacia afuera, the author seems to believe that the new exports, say, wood chips or fish meal, are “nontraditional” (as surely nitrate and oil were last century) and more a matter of policy choice. The author recognizes that surplus generated in the export sector is no guarantee of capital accumulation, nor is its transfer into productive investment automatic. Paul Barans work nearly 40 years ago on the Political Economy of Growth (not cited in this book) was brilliant on that point. This is where the “policy environment” becomes important, so that in some countries, the author believes, it is “the principal determinant of success or failure.” Latin American policymakers, if they actually had time to reflect on the history of these enduring problems rather than having to deal with crises that arise every day, might benefit as much as our academic colleagues from reading this intelligent and informed book.
But to return to the original and central question, why is Latin America poor? Have 30 years of research on the region’s economic history provided a convincing explanation? Some might object that the question itself is the granddaddy of all those questions mal posées that plague our field. Is not the notion that “peripheral” countries must follow the schedule of liberal capitalism inexcusably Eurocentric and historically short-sighted? I confess that when Bulmer-Thomas nods approvingly at the economic exertions of Latin Americans in the nineteenth century but then remarks that they don’t measure up in recent decades because “the goalposts had been moved,” I grind my teeth. Who moves them and by what right? Is this the only game in town? A lot of recent academic work, outside economics, has objected to the narrative implicit in Bulmer-Thomas’ book, criticizing the very notion of a historical norm. The author might respond, I imagine, by pointing out that over the past two centuries, people not only in the developed “center” but also on the periphery, at least those with the power to make policy, have mainly agreed on the name of the game. Besides, this is not a book on imagined utopias.
As for the explanation of underdevelopment itself, the author’s discussion, while telling us, in fine detail informed by theory, about how things happened and the implications of policy, does not, I believe, advance our understanding of the central question very much. Perhaps that is because an explanation for many of the key questions he raises lies outside economic analysis, in the social, cultural, or psychological realm. Although the author claims to draw on the “huge literature” covering sociology and anthropology as well as economics in order to bring an interdisciplinary perspective to bear, I failed to find a single reference in his enormous bibliography to any of the recent work in, for example, social or cultural anthropology.
The passive voice is dominant in this book: the goalposts are moved, policy is made. There are no, or very few, actors and very little social or cultural explanation for their actions. Policy seems to be made in a vacuum, isolated from special interests. To this, the author might rightly reply that his is a work of economic, not cultural analysis. Don’t ask, as the Chileans say, for pears from an elm tree. Fair enough, and a good economic history it is; a valuable service to all of us. Yet it is dispiriting to see that the new approaches to society and culture apparent everywhere in modern intellectual life have not been applied to the big and important questions raised in this book.
