Our Brand Is Crisis

Our Brand is Crisis is a 2005 documentary that outlines the campaign strategy of Gonzolo “Goni” Sanchez de Lozada after he hired an American campaign team to help him win the Bolivian election.  The GCS team included notable Americans such as former CNN personality James Carville.  The team worked hard to sell a particular brand to the Bolivian people.  Their plot was to convince Bolivians to accept this brand, and vote for Goni, without naming many solutions for the country’s problems.  Throughout the election, Goni trailed in the polls.  Only on Election Day did Goni sneak past his competitors, winning 22% of the vote.  This means that while he received the majority of the votes, almost 80% of the country wanted another president.

After Goni won and took control of the country, it became very well known throughout the country that he was not a popular president.  He raised taxes to help raise money for the country’s struggling economy.  Bolivians were supposed to pay upwards of $30 to the government.  In the United States, that isn’t much money.  I’d be willing to bet that even college students would be able to afford that tax, however, in a third world county like Bolivia, this demand was an outrage.  Riots erupted in the streets, and former presidential candidate Evo Morales seized this opportunity to speak out against the government, creating his own following.  This resulted in the infamous Gas Wars that left many Bolivians dead after riots erupted in the streets.

Goni was forced to resign his position and flee to the United States.  His vice president took over for a short while before Morales was elected as the new president of Bolivia.  Bolivia has had eight presidents since 1990.  This quick leadership change in Bolivia over the past twenty years shows that their government is in turmoil and needs help to become stable once again.

John Perkins writes in Confessions of an Economic Hit Man that international banks “saddled their country with huge amounts of debt, backed by the promise of oil revenues.”  South American countries took out huge loans to improve their infrastructure, and planned to pay these loans back by oil revenue.  In Ecuador, “they must devote nearly 50 percent of its national budget simply to paying off its debts-instead of to helping the millions of its citizens who are officially classified as dangerously impoverished.”  The same can be said of Bolivia.  Goni’s brand promised reforms that would slowly ease Bolivia out of debt and turn the economy around.  Once Goni could not achieve this, people started to riot and he was forced to tax Bolivians in hopes of raising money.  This proved fatal for his presidency.

The Washington Consensus was a plan for US banks and investors to change their economic policies in Latin America.  This plan led to many Latin American economies being totally destroyed.  In The Slow Death of The Washington Consensus on Latin America, James Cypher explains that the Washington Consensus claimed that the “rising incidences of poverty, falling or stagnating wages, deindustrialization, and rapid increases in income inequality were shrugged off as transition costs.”  Cypher explains that “Latin America has attracted “hot money” that has been parked in nations offering a higher yield on assets. To maintain these funds, Latin American nations have kept their rates of interest high, thereby starving national firms of financial support and undercutting the efficacy of the public sector.”  This means that in order for Latin American countries to pay off their expense for petroleum distribution, they were forced to raise interest rates in their countries, paralyzing their economy.

Our Brand Is Crisis shows that there is no quick fix for the economic troubles in Bolivia and Latin America.  Simply putting a qualified leader in power will not pull these countries out of debt.  Bolivia will continue to run through different presidents until they finally find one capable of saving their economy.