Dignity and Defiance is a powerful, eyewitness account of Bolivia's decade-long rebellion against globalization imposed from abroad. Based on extensive interviews, this story comes alive with first-person accounts of a massive Enron/Shell oil spill from an elderly woman whose livelihood it threatens, of the young people who stood down a former dictator to take back control of their water, and of Bolivia's dramatic and successful challenge to the policies of the World Bank and the International Monetary Fund. Featuring a substantial introduction, a conclusion, and introductions to each of the chapters, this well-crafted mix of storytelling and analysis is a rich portrait of people calling for global integration to be different than it has been: more fair and more just.
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Dignity and Defiance
Stories from Bolivia's Challenge to Globalization
By Jim Shultz, Melissa Crane Draper
UNIVERSITY OF CALIFORNIA PRESSCopyright © 2008 The Regents of the University of California
All rights reserved.
The Cochabamba Water Revolt and Its Aftermath
In the opening months of the year 2000, the people of Cochabamba, Bolivia, took to the streets by the thousands. They were protesting the takeover of their city water system by a subsidiary of the U.S. corporate giant Bechtel and demanding the repeal of a new national water law that threatened to hand Bechtel control over rural water systems. On three separate occasions the people of Cochabamba and their rural neighbors shut down the city with general strikes and road blockades. Bolivia's president, a former dictator, responded with armed troops and a suspension of constitutional rights. More than one hundred people were wounded. A seventeen-year-old boy, Victor Hugo Daza, was killed.
On April 10, 2000, Bechtel officials finally fled the city, the water system was returned to public control, and the water law was repealed. The global legend of the great Cochabamba Water Revolt was born—a powerful modern-day tale of a corporate Goliath slain by a humble David of the Andes. In the years since, the story of the water revolt has been featured in so many international articles, books, and films that reporting about those events has become a phenomenon in itself. At the time of the revolt, the Democracy Center, based in Cochabamba, was the only ongoing source of reporting to audiences abroad. The center's coverage, which shared honors for top story of the year from Project Censored, became the basis of much of the reporting since.
In this chapter, Jim Shultz looks at the water revolt through seven years of hindsight, in a way that goes far deeper than any previous accounts by the Democracy Center. What motivated the people of Cochabamba to rise up? How did they organize themselves to fight and win against such a powerful foe? Of equal importance, however, is what happened after the revolt. How did it affect the global debate on putting water into corporate hands? What role has it had in Bolivia's subsequent political changes? And perhaps most important of all, what did the water revolt mean for the demand that sent the people of Cochabamba into the streets to begin with—the desire for clean, affordable water?
THE SEEDS OF A REVOLT
A two-and-a-half-gallon bucket of water weighs about twenty-two pounds, slightly more than the weight of five bricks. In Bolivia, that is just enough water to cook a family meal and clean up from it.
On the outskirts of Cochabamba, where water is scarce and taps in the home are merely a dream, young children, burdened mothers, and bent-over grandmothers carry such buckets of water over long distances from rivers or public spigots. For thousands here, gathering water in this way is a basic feature of their lives, in the way people in other parts of the world gather water by turning on a faucet.
But the demand for clean water is about something more than just the desire to shed heavy loads; it is also a matter of life and death. In Bolivia, more than one in twenty children die before starting kindergarten, and disease caused by the lack of clean water is among the most common causes. It was this, the need for something essential to life, which was most truly the genesis of the now famous Cochabamba revolt.
Water Scarcity: Cochabamba's Perfect Storm
Water was an issue in Cochabamba long before any locals ever heard the words Bechtel or privatization. The city that sprawls across a large valley eight thousand feet high in the Andean foothills got its name from water: Kucha Pampa, from the indigenous language Quechua, meaning swampy land.
Cochabamba's roots can be traced to the mid-1500s, when it was the lush, green source of fruit and produce for the miners of Potosí, the silver-filled Bolivian mountain that bankrolled the Spanish empire for two centuries. In its early years, the small pueblo and the land around it were surrounded by small lakes and lagoons. By the mid-1900s that wealth of moisture was already becoming history—the result of a three-way collision of forces over which residents of the city had no control.
First, Cochabamba was growing—by a lot, and fast. In 1950, the city had a population of 75,000. By 1976 that number leaped to more than 200,000. In 2001 it topped half a million. The once mighty silver and tin mines of the Bolivian highlands were in economic collapse; the small rural villages that had been the nation's heart were also becoming economically unsustainable; and families were headed to the temperate climates of Cochabamba by truck and busload.
A sprawl of new neighborhoods, often settled by whole mining communities that moved to the city together, sprang up across the hillsides of the city's southern and northern outskirts. Land that was long home to red-berried molle trees, sheep, pigs, cows, and farm crops was now dotted with small adobe houses with weak tin roofs held down by heavy rocks. And while the newly transplanted residents of those houses could live without electricity, without telephones, and without gas pipes running into their homes, they could not live without water.
Second, Cochabamba was running out of water, just as demand for it was starting to spike. Deforestation of the surrounding hills and years of drought left the once lush valley so dry for most of the year that light brown dust, the color of overcreamed coffee, became one of its most notable features. It filled the air during the August winds, blocking the view of the sun and sticking between Cochabambino teeth. To get water, neighborhoods drilled deep wells, exhausting the fragile water table underneath the city. Those who couldn't dig wells bought water at exorbitant prices from large dilapidated water trucks that traveled the new neighborhoods. Those who couldn't afford the prices charged by the trucks resorted to heavy buckets and long walks.
Cochabamba faced one more challenge that completed its water crisis—chronic poverty. Bolivia is the most impoverished nation in South America. The nation was falling deeper and deeper into debt. To get the people of Cochabamba the water they needed, huge investments were required in infrastructure—dams and pipelines to bring more water into the valley from the wet mountains above it, and tanks and underground pipes that could deliver that water to people's homes, or at least nearby. Neither the residents of Cochabamba, nor their city government, nor their national government, had the resources needed to get water to the people.
The Birth of a Water Company
In the mid-1960s Cochabamba's leaders began looking for assistance from abroad. In 1967, the city secured a $14 million water development loan from the Washington-based Inter-American Development Bank (IDB). In exchange for that aid, the IDB also set conditions for how the city should go about the business of providing water for its people, the kind of strings-attached aid Bolivia would encounter with foreign assistance in greater and greater abundance down the road.
The first requirement was that Cochabamba needed to set up a new public water company, SEMAPA (Servicio Municipal de Agua Potable y Alcantarillado) to manage the development of expanded water service. Run by a board headed by the city mayor, the company started building tanks and laying pipes. For years afterward, SEMAPA would be beset with charges of corruption and mismanagement and used as a source of cash and favors for the politicians who helped run it. A former director of SEMAPA described the corruption problem this way:
Someone hoping to get a political job contributes funds to help a friend get elected mayor. His candidate wins and he is rewarded with a job at the water company, in charge of buying large water pumps. The guy goes out and prices pumps with companies who sell them. "The price is $10,000," the water company official is told. "No it's not," he replies. "It's $11,000. That's how much you will bill the water company. The extra $1,000 is a commission you pay to me directly."
Side deals, payrolls padded with friends and relatives, and other acts of general mismanagement and inefficiency would plague the water company off and on for decades.
Nevertheless, throughout the 1970s, 1980s, and 1990s, SEMAPA continued to expand city water service—but it was never able to keep up with the rapid influx of new families, new neighborhoods, and the relentlessly growing need for water. The water service expansion that SEMAPA was able to achieve was also focused heavily in the city's wealthier neighborhoods in the center and north. The much poorer neighborhoods of the south—populated by ex-miners and people flowing in from the countryside—were left out almost entirely. A 1997 investigation concluded that in the more prosperous northern neighborhoods of the city (home to about one quarter of its population) 90 percent of the families had water hookups and indoor plumbing. In the poorer barrios of the south, less than half the families had these things. Not only was Cochabamba failing to solve its water crisis; it was also creating an entrenched system of water haves and have-nots.
Faced with the public water company's failure to solve their growing water problems, the poor neighborhoods of the city's south began doing what Bolivians have done for centuries in indigenous communities and for decades in the mines—they organized to solve the problem themselves. From the 1990s onward, more than a hundred "independent water committees" were formed, through which residents joined together to dig wells, lay pipes up to water sources in the hills, and look for other practical ways they could get water and manage that water collectively. But as with SEMAPA, these local water committees could not keep up with the demand for water and could not provide people with a long-term solution to the ever-growing water crisis.
Dams, Tunnels, and Wells
It was becoming a simple fact: Cochabamba had no real chance of solving its water problem if it relied simply on runoff from the Andean foothills surrounding it and the other sources that nature alone had provided. The city's quickly growing population required new sources for water, and city leaders aimed to fill that need with a combination of big projects, including dams, tunnels, and large-scale wells.
From 1967 to 1999, with financial support from foreign lenders such as the IDB, the water company dug more than sixty large-scale wells, enough to provide more than half of all the water it was distributing to Cochabamba water users. Many of these wells were dug not in the city itself, but in the rural areas that ring the far edges of the Cochabamba valley, and with each new deep hole dug under their land, farmers were getting more and more angry. The families of the countryside knew that draining the water underneath them would eventually take its toll on their land and their livelihoods. Valley farmers first tried to stop the well digging by persuasion. When that failed they shifted to resistance, triggering a series of confrontations that frequently became violent. Ultimately the War of the Wells was resolved through a combination of payments to the farmers and water-sharing arrangements with the city. The truce between the city and the countryside, however, was fragile at best. Real solidarity between the two would come only later, catalyzed by an unexpected source: a corporation headquartered a hemisphere away.
In the early 1990s, Cochabamba began debating two rival proposals for constructing huge new dams that would capture water from rivers far beyond the city, to be transported by pipe to the parched neighborhoods of the city. It was a debate as much about politics as engineering analysis. The cheaper and simpler plan was to bring water to the city via a new pipeline from Lake Corani, thirty-one miles to the city's east. The rival plan, one shrouded in rumors of behind-closed-doors sweetheart deals, was a $300 million proposal to build a huge dam at Misicuni, the convergent point of two rivers on a high plain far beyond the city, and to construct a twelve-mile tunnel through a mountain to bring the water to Cochabamba. Backed by a coalition of city leaders and wealthy developers with an economic stake, Cochabamba opted for Misicuni. Construction began in 1998 and was expected to take more than a decade to complete.
Enter the World Bank and the Demand for Privatization
The IDB was not the only big institution in Washington lending Cochabamba's water company dollars for water development and getting more and more frustrated with SEMAPA's inefficiency and slow results. The World Bank, the giant global lender based in Washington, had spent much of the 1980s and 1990s lending poor countries money to build big, and hotly debated, infrastructure projects such as dams and highways. Along with those loans came an ever-lengthening list of conditions. One of the places that the World Bank lent funds for water expansion was Cochabamba.
Meanwhile, at the World Bank's U.S. headquarters, economists and analysts were developing a new strategy to solve the problem of access to water in poor nations. The plan was called privatization, and it meant encouraging governments in low-income countries to lease their public water systems over to private corporations, most of which were large global conglomerates with no previous relationships with or history in the countries where they would operate.
"Public sector utilities in developing countries have often not been efficient in providing access to reliable water and sanitation services," bank officials argued. "Evidence shows that the private sector, under contract with the public sector, has often yielded better results than public sector utilities alone."
John Briscoe, the World Bank's senior water official, put the case for privatization more bluntly in an interview with PBS: "If you are genuinely concerned with them [poor communities] getting water, what is the best route to do that? It's a practical question, not a moral question. And a declaration that water is owned by the public to be managed by the public for the good of everybody—we've had decades of that, and it hasn't worked."
World Bank officials, however, did far more than just argue the case for water privatization. In country after country, bank officials made the privatization of public water systems a requirement for getting water funds. In Bolivia, the bank made its demand for privatization quite clear.
In February 1996, Cochabamba's mayor announced to the press that the World Bank was making privatization of SEMAPA a condition of an urgent $14 million loan to expand water service. In June 1997, Bolivia's president returned from a meeting with bank officials in Washington and declared that $600 million in foreign debt relief, much of it from the bank, was also dependent on privatizing Cochabamba's water. Bank officials would later dispute these declarations that they had forced Bolivia's hand, and they argued that they had opposed the Bechtel deal because it included the Misicuni dam project. But in 2002, in an internal report, the bank's own auditors confirmed it was, in fact, bank coercion that set the Cochabamba privatization in motion. Privatization of the water company had been, according to the report, "a bank condition" for extending water loans to Bolivia.
Left with little choice, in 1999 the government of Bolivia put Cochabamba's public water system up for private bid. Only one company came forward, a mysterious new enterprise called Aguas del Tunari, named for the rugged peak overlooking Cochabamba and its thirsty valley.
Bechtel Comes to Bolivia
Bechtel Enterprises is one of the largest corporations in the world. With 2007 earnings of more than $27 billion, the engineering firm has been responsible for some of the biggest infrastructure projects of the last hundred years, including the Hoover Dam, Northern California's BART transit system, and the troubled Boston "Big Dig" project.
Bechtel is also well connected politically. Caspar Weinberger, who later served as President Reagan's defense secretary, had been the company's general counsel and director. George Shultz, who served as Reagan's secretary of state, is a member of Bechtel's board of directors. In 2004, Bechtel's political clout was made even clearer when it was one of two U.S. companies selected by the Bush administration, with no competitive bidding, to receive contracts for rebuilding in Iraq, a deal worth nearly $1 billion.
Excerpted from Dignity and Defiance by Jim Shultz, Melissa Crane Draper. Copyright © 2008 The Regents of the University of California. Excerpted by permission of UNIVERSITY OF CALIFORNIA PRESS.
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Table of Contents
Introduction Melissa Crane Draper and Jim Shultz, 1,
1. The Cochabamba Water Revolt and Its Aftermath Jim Shultz, 9,
2. A River Turns Black: Enron and Shell Spread Destruction across Bolivia's Highlands Christina Haglund, 45,
3. Oil and Gas: The Elusive Wealth beneath Their Feet Gretchen Gordon and Aaron Luoma, 77,
4. Lessons in Blood and Fire: The Deadly Consequences of IMF Economics Jim Shultz, 117,
5. Economic Strings: The Politics of Foreign Debt Nick Buxton, 145,
6. Coca: The Leaf at the Center of the War on Drugs Caroline S. Conzelman, Coletta A. Youngers, Jim Shultz, Caitlin Esch, Leny Olivera, Linda Farthing, 181,
7. Workers, Leaders, and Mothers: Bolivian Women in a Globalizing World Melissa Crane Draper, 213,
8. And Those Who Left: Portraits of a Bolivian Exodus Lily Whitesel, l 255,
Conclusion: What Bolivia Teaches Us Jim Shultz, 291,