LA PAZ ‒ Populism in Latin America is at a low point. But, though mounting economic problems facing Venezuela and Argentina might presage a return to market-based economic policies in the short term, this will not end the familiar cycle of populism, profligacy, pain, and pragmatism that has long characterized the region.
Populist parties’ rise to power in recent decades benefited from soaring commodity prices, which generated an export windfall that allowed political leaders to spend generously on the poor. However, with prices now softening, revenues can no longer cover the social subsidies that have underpinned populist rule. Furthermore, ineptitude and corruption in redistributing wealth have become more apparent as the region’s economies deteriorate, weakening governments’ legitimacy.