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Agrarian Capitalism and Struglle Over Hegemony in Bolivian Lowland
Agrarian Capitalism and Struglle Over Hegemony in Bolivian Lowland
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Agrarian Capitalism and Struggles over
Hegemony in the Bolivian Lowlands
by
Qabriela Valdivia
In 2006, President Morales announced that his administration would end land
inequality in Bolivia. Agrarian elites in the lowlands department of Santa Cruz, known
as the economic engine of Bolivian agriculture, strongly oppose this position and have
vowed to counter it to safeguard the agrarian order. Prom visions of a capitalist moral
compass of production to the promotion of sector unity to safeguard production, agrarian
elites are seeking to maintain a hegemony that allows them to control the agrarian sector
in the lowlands. Attention to the ways in which agrarian elites ground their struggles
over agrarian hegemony is necessary for evaluating the possibilities for the resource
democracy advocated by the current administration.
In May 2006, President Evo Morales promised to rectify the profound land
inequality that exists in Bolivia. While this project is supported by historically
disadvantaged groups in Bolivia, staunch opposition is prominent among
agrarian elites in the Department of Santa Cruz, where large landholdings,
land speculation, and deep-seated struggles over resources contentiously
coexist (Hecht, 2005). These actors see Morales's proposal as a challenge to
what they call "Cruceno institutionality": hard-fought for, locally governed
politico-economic relations that have allowed the development of capitalist
agriculture in Santa Cruz. The Morales challenge against the agrarian order in
the lowlands is being taken seriously by agrarian elites, who argue that it goes
against the moral constitution of Cruceno agriculture. This paper examines
the views of these elites and the insights they provide into the agrarian pro
duction order in the lowlands.11 draw on archival research and 130 interviews
conducted in La Paz and Santa Cruz between 2007 and 2009 with former
members of Congress, nongovernmental organizations, officers of the Instituto
Nacional de Reforma Agraria (Institute of Agrarian Reform?INRA), officers
LATIN AMERICAN PERSPECTIVES, Issue 173, Vol. 37 No. 4, July 2010 67-87
DOI: 10.1177/0094582X10373354
? 2010 Latin American Perspectives
67
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68 LATIN AMERICAN PERSPECTIVES
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Valdivia / AGRARIAN CAPITALISM AND HEGEMONY 69
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70 LATIN AMERICAN PERSPECTIVES
TABLE 1
Land Tenure in Santa Cruz, 1984
In the mid-1980s, state-led capitalism promoted growth but also high fisca
deficits (Sandoval, 2003). After an economically tumultuous period of hype
inflation and the return to democracy in 1985, the Bolivian government imple
mented a "New Economy," a free-market model of production and trade tha
would open production and services to foreign investors. The resulting influ
of foreign capital?specifically, Argentine, Brazilian, and U.S. investors?led
to what agrarian elites refer to as the "internationalization" of the lowlands
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Valdivia / AGRARIAN CAPITALISM AND HEGEMONY 71
Agrarian capitalists who until then had depended on the state to support their
economy now looked to transnational capital to maintain it. Internationalization
further channeled incoming capital to export-oriented, larger landholders
(Gill, 1987). Projects sponsored by the World Bank, the International Monetary
Fund, and the Inter-American Bank, for example, promoted extensive defor
estation and land appropriation in the name of agricultural development,
specifically for soy production (Perez, 2007). The most significant of these was
the World Bank's Lowlands Project, which financed new "areas of expansion"
east of the city of Santa Cruz (essentially, the appropriation and clearing of
state land and land used by the Ayoreo, Guarani, and Guarayos peoples) and
infrastructure that vertically integrated the international trade in soy. In addi
tion, USAID, through the PL-480 program, funded extension and seed pro
grams and technological improvements that allowed more than one harvest a
year and reduced labor requirements (Kreidler et al., 2004).
The results legitimized Santa Cruz's reputation as an "engine of produc
tion." While in 1988 the surface cultivated in soy was 70,000 ha, by 1994 it had
grown to 307,000 ha. Santa Cruz accounted for 97 percent of the total produc
tion of soy in Bolivia (Sandoval, 2003). The manufacturing and commerce
sectors also flourished with the influx of capital. By the mid-1990s, Brazilian,
Argentine, and Peruvian industrial conglomerates and casas comerciales (trad
ing houses) dominated the agricultural complex, financing loans for soy
production, providing agricultural inputs to producers (fertilizers, pesticides,
seeds), and later collecting and transforming their product for further
commercialization.
Today's soy producers recognize that success in commercial agriculture
resulted from this greater international investment, increased productivity,
and above-normal international prices. Further private investment in cultiva
tion technologies, large mechanized equipment, "direct sow" techniques
(already implemented in Argentina and Brazil), and the use of herbicides
(and, much later, genetically modified soy varieties) followed, leading to a boom
in production in the mid-1990s. Thus, to the Cruceno agricultural elites, pri
vate investors (particularly, Brazilian agri-businesses) are responsible for the
economic success of the Cruceno model of production. The profit generated
by soy?the "golden bean" (Perez, 2007)?contributed to never-before-seen
economic growth, prompting many to feel that modernity was achieved
through private and transnational, not state, investment.5
Less recognized is the fact that growth in the soy complex also deepened
inequalities among producers. Growth in the soy sector, for example, increased
differences between small, medium-sized, and large producers based on
access to land and capital?a pattern initiated with the land distribution pro
cesses of 1953 and continued through state incentives in the 1960s and 1970s.6
Large soy producers have significantly greater access to investment capital;
they capture loans at lower interest rates to invest in production and partici
pate in vertically integrated systems of production that allow them to trans
form and commercialize value-added products such as soy flour and oil (Ortiz
and Soliz, 2007). They are also able to mortgage land to secure larger invest
ment loans. Small producers, on the other hand, are risky investments for
lenders and pay higher interest on loans for the purchase of the same basic
inputs (e.g., seeds, fertilizers, and insecticides). Their status as small producers,
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72 LATIN AMERICAN PERSPECTIVES
according to the law, prohibits them from mortgaging land, which is consid
ered "family patrimony." Once small producers yield to an intermediary, they
do not participate in transformation or commercialization, and this limits their
ability to negotiate prices (Ortiz and Soliz, 2007).
The internationalization of the lowlands in the early 1990s also led to struc
tural inequalities associated with changes in the labor market. All producer
classes in the lowlands?small, medium-sized, and large?hire salaried work
ers, though their hiring patterns vary according to production needs and
access to capital. Often, small producers support each other by sharing pro
duction costs, rented machinery, and hired labor (Ortiz and Soliz, 2007). Medium
sized and large producers, having greater access to capital, own their equipment
(and rent it out) and often maintain a proletarianized and specialized work
force (Ormachea, 2007). Moreover, the technification of production that resulted
from internationalization reduced larger producers' need for labor in the soy
sector (Pacheco, 1994)7 Demand decreased for jornaleros (salaried workers)
employed in cultivation, sowing, and land clearing and increased for skilled
workers such as machinery operators and individuals with experience in
industrial processing. Together with the "flexibilization" of labor contracts in
1989 (in number of hours worked, pay, and type of work according to the
needs of employers) and the entrenchment of enganche, the regional decline
in labor demand limited the ability of workers to negotiate employment terms
vis-a-vis employers (Pacheco and Ormachea, 2000).
Class differentiation also increased with land dispossession. Many small
producers sold their land because it had lost its fertility or because they could
not afford to cover the costs of production or repay their debts. More eco
nomically powerful producers bought and rehabilitated these "tired"
lands, which led to land consolidation. The newly landless producers
sought to acquire new lands farther from roads, thus further expanding the
agricultural frontier (Pacheco and Mertens, 2004), became landless work
ers, or moved to urban areas. Similarly, some indigenous groups lost lands
as self-interested leaders sold communally held lands to private individu
als (primarily, large-scale producers) without community consent, in exchange
for personal favors and/or political alliances (Ormachea, 2007; Postero, 2007;
Rojas, 2008).
In the face of the increasing dispossession associated with internationaliza
tion, lowlands indigenous groups in the 1980s organized against agricultural
expansion. Armed with the language of citizenship and the expectations of
rights that it implied, in 1990 lowlands indigenous activists marched from the
lowlands to La Paz to demand recognition of their culture and territories
(Postero, 2007). This highly publicized March for Territory and Dignity pushed
the "indigenous issue" onto the national agenda and provided urgency for
reforms. In response to this escalating pressure and growing evidence of ille
gal land appropriation, in 1992 a new set of state and civil society representa
tives was charged with creating a more "technical" and "inclusive" land law.
Law 1715 (the INRA Law) was approved in 1996 amidst intense mobilizations
and criticism. President Gonzalo Sanchez de Lozada hailed the new law as a
mechanism of social transformation that would end the rampant corruption
that had developed in the lowlands (NotiSur, 1996).
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Valdivia / AGRARIAN CAPITALISM AND HEGEMONY 73
The INRA Law sought to provide juridical security over property, recognize
the rights of indigenous peoples to their ancestral lands, establish principles
of sustainability as a way of securing access to land, and create a new set of
institutions through which to manage land issues in a transparent manner.
Above all, it aimed to perfect the right to property according to the agrarian
divisions existing in the lowlands. Article 2 of its General Dispositions identi
fies the actors that can claim the right to land according to social background
(indigenous and nonindigenous) and size of landholding (large, medium
sized, and small). Medium-sized and large landholders are actors with full
property rights. Small producers and indigenous groups do not have full
property rights. Small landholders cannot transfer or sell land because, accord
ing to Article 169 of the constitution, small landholdings are "family patri
mony." Indigenous territories are recognized as communally held property
that cannot be transferred.
The INRA Law introduces three "technical principles" through which the
right to land is to be perfected: the function of the property, the "best uses" of
the land, and saneamiento, the provision of clear title to land through proper
measurement. Article 2 identifies the function of the property as the way
of assessing how it is being used. Small and communal landholdings are
expected to fulfill a social function: supporting the reproduction of house
holds and the economic development of individuals. If land is not visibly used
or lived on or is abandoned, it is subject to expropriation. Medium-sized and
large landholdings, in contrast, must fulfill a socioeconomic function: the
"sustainable use of land for the development of agri-business, forestry, and
other productive activities, as well as for the conservation and protection of
biodiversity, research, and ecotourism, and according to its best use capacity,
for the benefit of society, the collective, and its owner." Evidence that supports
the right to land includes both actual and future uses. The performance of
actual work is not necessary; evidence of future or potential uses (such as
cattle birth certificates) and promises of greater production (e.g., plans for
improvements) also guarantee the right to land. Article 52 also recognizes
timely tax payments as fulfilling a socioeconomic function (small and indige
nous landholders are tax-exempt) even if the land is not actively being used.
Expropriation occurs when land is not being worked and tax payment is not
evident, and reversion occurs if the work is "detrimental to the general pub
lic." The "best use of land" is determined by a land-use plan for each depart
ment devised by the Ministry of Sustainable Development and Environment
with the goal of governing the sustainable transformation of land. A set of
technical norms and maps, the land-use plan establishes the spatioecological
"limiting factors"?topography, drainage systems, soil structure and chemis
try, vegetation, rivers, lakes, rangelands, etc.?that will determine the "use
capacity" of land. On the basis of this plan, a property-ordering plan can be
devised for individual medium-sized and large properties to identify their
present and future "best uses." Not following one plan or the other may result
in the loss of the right to land. Finally, saneamiento involves the production of
cadastral surveys that map the boundaries of "properly functioning" property.
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74 LATIN AMERICAN PERSPECTIVES
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Valdivia / AGRARIAN CAPITALISM AND HEGEMONY 75
TABLE 2
Examples of Extensive Land Grants in Santa Cruz
Owner Number of Grants Hectares Province
Since its beginnings in 1964, the CAO has successfully lobbied the Bolivia
government for credit allocations and price levels that benefit lowlands pro
ducers (Gill, 1987). Today it is a major Cruceno institution that claims to re
resent close to 70,000 agrarian capitalists from 16 producer organizations
ranging from fruit growers to cattle ranchers.10 Of these, 70 percent are consi
ered small, 24 percent medium-sized, and 6 percent large. Not all small pr
ducers in the lowlands are affiliated with the CAO; some are affiliated wit
other locally based organizations (e.g., agrarian syndicates, associations, an
cooperatives) that they see as better reflecting their interests. Despite the fact th
the CAO considers itself to represent the interests of commercial agricultur
regardless of scale of production?and that a significant proportion of its
constituency is small producers, its policies and loyalties have historically
served larger producers, often contributing to "internal class frontiers" tha
reproduce the marginalization of some members by those with more influen
within the organization.11 Moreover, its current board of directors, which large
shapes the organization's views on change in the lowlands, is dominate
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76 LATIN AMERICAN PERSPECTIVES
On July 31, 2008, the president of the CAO, Mauricio Roca, in an address
to representatives of his constituency, declared the lowlands agrarian sector
in crisis. The rate of increase of land under cultivation had declined from
16.5 percent in 2004 to -3.2 percent in 2008 (CAO, 2009). Roca, a rice producer
with a family history of landed privilege in Santa Cruz, cited chronic problems
in transportation infrastructure, losses due to climatic effects, and a lack of
adequate access to energy resources and markets as crippling Cruceno agri
culture. Above all, he argued that policies spearheaded by Morales were at the
heart of this crisis of production. First, he said, the "nationalization" of the gas
industry in 2006 had dismantled established networks of diesel distribution
and led to moments of diesel scarcity that interfered with timely harvesting
and commercialization schedules. Second, Law 3545 had made producers afraid
to invest because there was no assurance that the land they had title to would
remain theirs. Finally, the Morales administration's program on food sover
eignty and security, which guaranteed a "fair price" for basic foodstuffs, lim
ited the export of a variety of agricultural products (to counter the rising price
of food products in the Bolivian market), and opened Bolivia's protected mar
kets to food imports (rice, wheat, soy products, maize, and meat), was viewed
by Cruceno producers as compromising their competitiveness in the interna
tional and national markets.
Variously described as "political impositions," a "lack of a state production
vision," and the "politicization of realities," the changes promoted by the
Morales administration are seen as dangerous. The CAO suggests that the
central government, in its effort to improve the conditions of indigenous
and campesino Bolivians, fails to understand the "production realities of
the lowlands." These "realities" are the centrality of private property, access
to international markets, and control of the factors of production?the foun
dations of capitalist agriculture. State intervention, moreover, places at risk
an important tenet of the capitalist self: the right to produce at liberty. The
reforms challenge the principle of production as a natural right of this
agrarian class.
Underpinning these views is the position that agrarian capitalists have
a right to the factors of production because they "have worked for them."
For example, according to Tadeo,12 who arrived from Oruro in 1964 with
only "the clothes on his back" to work in sugarcane fields and now is a
medium-sized soy producer, the central government does not understand
that to succeed in the lowlands people have to be "willing to work hard."
When asked why not all who work hard are now successful like him,
Tadeo responded that they are lazy and do not have a "vocation of produc
tion." The problem is, he explained, that the current government is spon
soring a culture of poverty; it "is not helping them be more productive. . . .
It is Evo [Morales] giving money to his followers. That is their costumbre
[their way of doing things]: they expect the government to do things for
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Valdivia / AGRARIAN CAPITALISM AND HEGEMONY 77
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78 LATIN AMERICAN PERSPECTIVES
through laws of labor flexibilization in the late 1980s that provided the legal
framework for limiting juridical guarantees for laborers. According to the
Confederation of Rural Workers of Bolivia (Confederation de Trabajadores
Asalariados Rurales de Bolivia?CTARB), labor arrangements perpetuate a
situation in which most laborers have no guarantee of decent working condi
tions or pay or that due process will be followed in the negotiation of work
contracts, though these conditions vary according to the employer (CTARB,
2009). The sugar sector exemplifies these inequalities (Simon, 1980). A survey
conducted by Pacheco (1994), for example, found that among larger sugar
enterprises (plantations over 50 ha) in Santa Cruz, 63 percent of the labor force
was hired through a contratista and involved some form of enganche. Bedoya
and Bedoya (2004) estimate that 63 percent of sugarcane field workers (zafreros)
are subject to coerced labor contracts and that 28,000 of temporary workers
(85 percent of zafreros) gain these contracts through enganche and peonaje
(collective work contracts). Despite this wide range of estimates (63 percent
vs. 85 percent), the trend seems to be that forced labor contracts are heavily
used in recruiting temporary workers. While some workers have organized
into unions to secure better working conditions, better access to education,
health services, and social security, and reduced dependence on enganche,
many others have been unable to do so. Thus, suggesting that the position
of the temporary worker is a positive experience, as David and Tadeo do,
despite the inequalities that temporary labor structures reproduce, relies on
"forgetting" the limited rights available to workers and the fact that very few
workers actually "make it."
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Valdivia / AGRARIAN CAPITALISM AND HEGEMONY 79
These are the "technical" arguments at the core of the CAO's opposition
to reform. By focusing solely on the factors of production (how much land,
technology, and credit are available and how these are affected by agrarian
reform), the CAO obscures the sociopolitical world within which production
is embedded. This is clear in its response to the inclusion of labor relations
in the evaluation of socioeconomic function. The CAO sees the focus on labor
relations as unnecessary?even misguided?because these relations are not
fundamental to the circulation of capital. In other words, it is investment in
technology, the clearing of lands appropriated (legally and illegally), and the
creation of protected markets that have made Cruceno agriculture successful.
Rectifying land distribution patterns and the nature of labor relations as the
Morales administration is attempting to do is not conducive to Cruceno suc
cess; it is "politics." The following quotation from one of the CAO's officers
exemplifies the structural dissonance that underpins the politics of making
labor relations visible:
Now they [the government] say it is about labor. Slavery and exploitation. In the
new law . . . labor irregularities can affect your property rights. You don't have
contracts, you didn't pay bonuses, you can't be godfather to your worker's
kids.... In many places, the landowner is the one that goes to the market, buys
things for the workers, pays in advance. Can't do that now. Can't give gifts. You
have to register them [workers] with the appropriate labor institutions.... If you
don't have them registered, with a registration card and all that, you are not fol
lowing the law; you are harming the collective. . . . And they [workers] have to
go register themselves, too. . . . Workers don't want to be registered. They don't
want to pay taxes. They want their money!... Before, they [INRA] checked how
many cows you have. Now, an entire page of the field evaluation form is about
your labor relations, how many workers you have.
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Valdivia / AGRARIAN CAPITALISM AND HEGEMONY 83
we chatted, he commented on his exchange with the CAO's officer: "You see
how they are? They have money to pay people to mobilize, to close roads, to
take over institutions. But they won't give you money. They will pay you to
mobilize because they need you, but when it is about our organization, they
don't have money." This example of failed class alliances could be read in two
ways: first, as a failure of the CAO to broker sector unity (the CAO's officer
was unable to persuade its members to negotiate with Patricio?an opportu
nity for maintaining hegemony was missed) and second, as evidence that,
given Patricio's diminishing political influence, supporting his request was
too risky for the CAO. For hegemony to be maintained, the right alliances?
with the right political and intellectual leaders?must be pursued.
CONCLUSIONS
This paper has called attention to the conditions that led to the existing
order of agrarian production in the Bolivian lowlands. Class struggles over
this order are expressed in the intimate spaces of social institutions, such as
patron-client relations, as well as in more formal spaces of interaction, such as
through agrarian law. I have focused on the responses of agrarian elites to
state-directed change in the Bolivian lowlands, including examples of the
positionings, arguments, and strategies pursued, to offer an interpretation of
the role of agrarian elites in the production of hegemony. From the cultivation
of capitalism as the desirable mechanism for creating wealth and the unques
tioned nature of agrarian classes to the encouragement of sector unity as the
moral compass of capitalist agriculture, agrarian elites and their representa
tives are seeking to maintain relationships that allow them to govern the agri
cultural sector in the lowlands.
Hegemony, though precarious, is established in several ways: first, through
constructions of a defense of Cruceno agriculture that focuses on the "techni
cal" arguments while obscuring the dispossession and exploitation associated
with capitalist success; second, through a focus on land, capital, and markets
as unquestioned "production realities" and on the way in which current
reforms put these factors "at risk"; and, finally, through promises of unity in
the agrarian sector, though this unity is often undermined by paternalistic
relations of dependence and failed social contracts, as the natural way to face
moments of crisis.
The CAO's arguments, which represent the position of the dominant
agrarian classes, are not all fictional accounts that hide true motives or con
scious lies but inseparable from the uneven social, political, and economic
processes that have nurtured capitalist agriculture in the lowlands. Often,
interviewees understood that change was impending, but the terms in which
change is introduced and the ways in which it seeks to unglue the world of
privilege, political power, and landed monopoly in the lowlands will be con
tested every step of the way as elites attempt to minimize losses.
As the examples here suggest, there are no guarantees for the dominant
agrarian classes. The political economy that shaped modernization and, later,
internationalization in the lowlands is part and parcel of the ways in which
the Cruceno model became the proper order of production in the lowlands.
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84 LATIN AMERICAN PERSPECTIVES
Views of the agrarian capitalist self as the subject of agrarian history con
struct a present of the lowlands based on private and foreign actors while at
the same time obscuring the pivotal role of the state in producing lowlands
hegemony. The policies advocated by the Morales administration destabilize
these subjectivities and the conditions that led to their condensation. As a
result, the agrarian elites seem to be in a precarious situation in terms of repro
ducing hegemony precisely because the state is not supporting their position as
it did during the heyday of production between the 1960s and the early 2000s.
Members of the CAO hope that the changes taking place are not structural
and are taking advantage of this opportunity of political upheaval to build a
regional identity that, most likely, will not lead to an alternative organization
of resource governance. Supporters of the MAS are also attempting to shift
agrarian hegemony in the lowlands by supporting the position of the Morales
administration in the region. Thus far, however, social improvement in the
lowlands remains to be seen.
NOTES
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Valdivia / AGRARIAN CAPITALISM AND HEGEMONY 85
Producers (SOCA), the Guabira Sugar Producers' Union (UCG), Guabira S.A., and Unagro S.A.
11. FENCA members disapprove of the CAO's lack of interest in the small producer. Many
members see it as overwhelmingly favoring more economically powerful partners.
12.1 use pseudonyms to identify interviewees who are not elected officials or public leaders.
13. For example, the current president of the Asociacion Nacional de Productores de
Oleaginosas y Trigo (ANAPO), which represents soy producers, is the first Andean migrant to
hold a leadership position in the organization.
14. While political divisions within classes warrant a fuller explanation, here I focus solely on
the role of internal class conflicts in the CAO's strategies for hegemony.
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