A Tale of Two Bolivias

Behind the Ongoing Gas Wars, a Geographic Rift Between Rich and Poor

By Teo Ballvé
2004 Narco News Authentic Journalism Scholar

August 27, 2004

BOLIVIA, AUGUST 2004: Women with colorful cloth bundles tied to their backs cross the mangled highway overpass, careful not to step on the bent stubs of torn handrails. “Here’s where men, women, children—entire families—pushed the train wagons onto the highway for the road blockade during the uprising,” explains Vidál Choque, pointing to an overpass in the largely Aymara city of El Alto just outside La Paz. As a young resident of El Alto, Choque describes that he felt “compelled to participate and fight” in what has been dubbed Bolivia’s “gas war.”

He is speaking of last October, when an indigenous-led revolt surged against a government plan to export the country’s vast gas reserves through Chile. It was one of the most significant insurrections in Bolivian history since Tupac Katari, an indigenous leader, similarly laid siege to La Paz in 1781. Once again indigenous movements descended en masse into La Paz, this time forcing the resignation of then-President Gonzalo Sánchez de Lozada.

Another movement, receiving much less attention, however, is also making waves in Bolivian politics. Its interests are diametrically opposed to those of the powerful indigenous-based social movements. Civic and business groups from the media luna region, which is the crescent or “half-moon” shaped region comprising the northern, southern and eastern lowlands of the country, are at the forefront of this drive to challenge the indigenous movements’ supremacy as the nation’s most active political force.

The long-simmering tension between the two regions ignited over the recent referendum on the fate of the nation’s gas reserves. While each referendum question received a “yes” vote, the ambiguous wording of the questions means congress must now interpret the concrete implications of the referendum by creating a new oil and natural gas law, known as the hydrocarbons law.

Current proposals on the new hydrocarbons law vary in their interpretation of what recovering the nation’s hydrocarbons actually means. Some merely propose a renegotiation of the 78 existing contracts, allowing the government to retain higher royalties and exact higher taxes. Other proposals advocate the retroactive annulment of contracts.

Indigenous groups from the altiplano (highlands) demand the unequivocal nationalization of the reserves, while media luna groups believe they stand to benefit from the continued exportation of gas by a handful of multinational corporations. The controversy over the country’s natural gas resources has radical groups from the resource-rich media luna calling for the creation of a nation independent from the impoverished western highlands.

These well-funded civic and business groups use a racist and regionally chauvinistic discourse, saying the future of the gas reserves should not be held hostage by what they see as extremist indigenous movements from a part of the country with which they have little in common. Some analysts now openly discuss the possibility of a two-state solution or, worse yet, a civil war.

Alvaro García Linera, once accused as a former member of the 1990s Tupac Katari Guerrilla Army (EGTK) and now a university professor of politics and sociology, believes President Carlos Mesa is trying to defuse the situation by building support for a more moderate position at the center of the two poles. “If he fails and doesn’t channel popular discontent by stabilizing the country, then the poles will amass power,” says García. “And this would open the possibility of a civil war to mediate the clash between the poles.”

The cleavage between the two regions runs deeper than the gas controversy. The cultural identity and ethnic makeup of the regions differ dramatically. The altiplano is largely indigenous — Aymara and Quechua — while the media luna has a much larger mestizo population. Economically, the altiplano is geared towards domestic markets, yet the resource-rich media luna is export-oriented. “They are two national projects,” says García, “and this is what’s defining Bolivia’s political trajectory at the moment.”

The eastern department of Santa Cruz, the epicenter of the media luna autonomy movement, is Bolivia’s richest. It accounts for 90 percent of the nation’s industry, 60 percent of the country’s oil wells and over 50 percent of the gross domestic product (GDP). Since the 1970s, the federal government has favored Santa Cruz in its development agenda, making it Bolivia’s economic powerhouse. In the eyes of many Santa Cruz residents, known as Cruceños, they are shouldering the economic burden of an overly dependent and unappreciative country.

Cruceño taxi driver Juan de Dios González told a correspondent for the Mexican daily El Universal: “The altiplano has nothing to do with us. Soon this will be its own country. We will become independent, that’s what people want here in Santa Cruz. We are sick and tired of financing an entire country. We don’t want to know what happens in the altiplano, because the country’s problems always, always originate there.”

The most public face of the autonomy movement is the 40,000 member-strong Movimiento Nación Camba de Liberación (Movement for the Liberation of the Camba Nation). The group’s name is derived from the proposed breakaway country that would potentially comprise the departments of Beni, Pando, Santa Cruz, Chuquisaca and Tarija—more than two-thirds of the national territory. According to the group’s Web site, this part of the country “constitutes ‘the other vision’ of Bolivia and this movement aspires to achieve the radical autonomy of this oppressed nation.”

It describes Bolivia as “a miserable and backwards country, where a culture of conflict prevails … and the bureaucratic center of La Paz decrees a system of state centralized colonialism that exploits its ‘internal colonies,’ appropriating our economic resources and imposing a culture of underdevelopment.”

The organization’s fiery rhetoric makes it difficult to distinguish some of its more moderate positions from those of its radical fringe. Some proponents simply seek greater regional autonomy, while others seek the unconditional independence of the so-called Nación Camba. Despite these varying degrees, both currents believe the federal government has no right to decide the future of the region’s natural resources.

Indeed, Nación Camba consistently expresses its contempt for the federal government in all its forms. Its critiques of federal institutions are heavily laced with the demonization of politically assertive indigenous groups and the altiplano more broadly. The movement, for example, wants to create its own police force and police academy independent of the existing national police system because they consider federal institutions overly beholden to altiplano indigenous groups.

“The national police is characterized by the preeminence of political loyalties,” concedes the movement’s Web site, “and a faithfulness to the Andean region along with an ethno-cultural affinity to the Aymara masses from which cadets are recruited, trained and converted to policemen. These are then deployed to areas that are ethnically and culturally different, making them, in effect, an army of occupation.”

This kind of language — calling outsiders “an army of occupation” — however seems overblown when considering that, according to Juan Forero in today’s New York Times, 1,350,000 of Santa Cruz’s 1,400,000 inhabitants arrived to the city themselves over the past forty years. And, among the current inhabitants, according to the 2004 United Nations Human Development report, 60 percent of Santa Cruz’s population is made up of the very same former highland residents so feared by the elites. Thus, the separatists who claim to speak for the region, in fact, make up a minority of the city’s own citizens.

Although the organization describes itself as nonviolent, the orientation of some of its subgroups leads many observers to doubt the group’s nonviolent underpinnings. Los Querembas, which is the Guaraní word for “warrior,” is the self-styled “vanguard” of Nación Camba.

They maintain that they “do not constitute an armed movement or paramilitary group. We exercise civic action in favor of our movement and work for accomplishing our goal of national self-determination.” The motto of the Querembas, however, is much more pointed: “The Camba fatherland or death!”.

Still, the most combative arm of the Nación Camba movement is its Youth Brigade. Among the Youth Brigade’s stated objectives are “defending the region’s natural resources” and “promoting regional autonomy.”

During the “gas war,” the Youth Brigade in Santa Cruz along with the officially unaffiliated, ultra-rightwing Unión Juvenil Crucinista — another militant separatist youth group — violently repelled an approaching march of mostly indigenous protestors. Amid a hail of flying rocks and shouts of “Colla (highlanders) pieces of shit,” the marchers were unable to enter the city.

The first president of the extremist Unión Juvenil Crucinista, founded in 1957, was Carlos Valverde Barbery. He is currently the primary ideologue of Nación Camba — a kind of unofficial godfather of the movement. Valverde first achieved national prominence in the 1970s when the brutal regime of Gen. Hugo Banzer rewarded him with the appointment of Health Minister for his role in leading a paramilitary group supporting the military coup. Valverde believes the creation of two independent republics is “the only solution for the country.” And adds, “Why should we keep unity, if [the two regions] are so totally different? We have absolutely nothing in common on so many levels.”

Nación Camba first began to organize in response to massive land invasions and occupations in Santa Cruz carried out by the Bolivian Landless Movement (Movimiento Sin Tierra — MST) in 2000. Of all Bolivia’s departments, Santa Cruz continues to have the most unequal distribution of land. According to the government’s Institute of Agrarian Reform (INRA), only 25 landowners hold around 22 million hectares in Santa Cruz — almost 60 percent of the department’s total territory, nearly the size of the U.S. state of Montana.

Inaction on promises of land distribution by INRA and the recent arrest of MST leader Gabriel Pinto has led the MST to step up their land occupations. Many MST members are recent migrants from the altiplano, which inflames the conflict with ethnic and regional connotations by pitting landless, migrant indigenous campesinos from the altiplano against lowland, mestizo landowners.

At a ranch owned by Rafael Paz Hurtado, MST leaders directed authorities to a weapons cache they alleged belonged to paramilitary “self-defense” units hired by landowners to protect their lands from encroachment. Paz told authorities he had the rifles, automatic weapons and grenades to protect his farming equipment and animals. A press release by the local bloc of the MST firmly denounced the arms deposit: “Our country cannot stand for the proliferation of paramilitary movements at the command of landowners due to the voracity of transnationals and local oligarchic interests.”

To counter the growing presence and strength of the MST, Nación Camba has its own program for providing landless campesinos with a small plot of land. It has even managed to build a small base of support among new arrivals from the altiplano by offering parcels to those that join the ranks of Nación Camba. It also seeks to sway public opinion throughout the media luna region to its favor by functioning somewhat like a think tank, publishing articles, editorials and position papers.

Because Nación Camba’s proposed separation from Bolivia is presented as a vehicle for greater economic independence and prosperity, the movement has found a willing partner in—and built a strong alliance with—the Santa Cruz Chamber of Commerce and Industry (CAINCO). CAINCO president Zvonko Matkovic, for example, declared, “What we should do is simply and smoothly separate ourselves [from Bolivia].” The alliance between these two groups represents the urban, mestizo elite at the helm of the autonomy movement.

When asked what he thinks should be done to the “radical” (indigenous) movements Matkovic responded: “A heavy hand, a heavy hand. In any other country, people that go against the economy of the country, of the state, are people that are arrested and tried. That is what this government does not have the will to do.”

CAINCO represents about 1,500 companies operating in the region, and according to its mission statement it “serves to protect and defend the interest of its member companies,” among them, oil and gas companies. In fact, many of the international conglomerates with existing gas contracts in the region—Repsol-YPF, Petrobras, Enron—are members of CAINCO’s board of directors.

CAINCO enjoys generous funding from local and international organizations. It has a long established relationship with the Inter-American Development Bank (IDB). The IDB’s Multilateral Investment Fund gave 1.3 million dollars to Bolivia’s Foundation for Business Development, of which CAINCO is one of four members.

The stated objective of the IDB loan is to “facilitate the entry into the formal economy of businesses located in Bolivia.” However, the category of “Awareness and Dissemination” in the loan accounts for an entire 21 percent of its total funds. The bulk of funds in this category finance a “communications campaign,” “printed materials,” “contracting the mass media” and “service promotion.”

Media has played a significant role in shaping public opinion on the gas issue, according to Bolivian political analyst Eduardo Gamarra in a risk assesment paper he wrote for the USAID agency: “An autonomous media-based opposition (oposición mediática) exerted an unusual degree of influence and was a significant source of conflict [in the gas dispute]. The media have indeed been extremely active and critical of government policy and also of … [indigenous] opposition groups.”

More striking, however, is that, according to documents released by the U.S. government under the Freedom of Information Act by Narco News journalism professor Jeremy Bigwood, CAINCO receives funds from the congressionally funded U.S.-based National Endowment for Democracy (NED).

The NED has a controversial history of supporting groups in foreign countries hostile to governments that Washington deems unseemly. Earlier this year in Haiti, the NED contributed to the destabilization of the government of a democratically elected leader. The NED also gave funding to Súmate, a group whose sole purpose was to organize a recall referendum against twice-elected President Hugo Chávez of Venezuela.

In this case, the NED’s activities are seemingly business-oriented. CAINCO’s first ever NED grant came just in time for the July 18 gas referendum. CAINCO received the grant, totaling 128,285 dollars, on May 1. The stated purpose of the grant is to research and advocate for the modification of the federal law on “Contracts of Goods, Labor, General Services and Consulting,” which sets rules on purchases, bids and contracts. Gas exploration and exportation contracts, for instance.

According to the NED, the law needs changing because “the decree puts more emphasis on the private sector than on the public sector to reduce corruption at the same time that it does not guarantee bidders’ rights,” says the grant. And, says the NED, fighting corruption will make Bolivia more attractive to international investment.

The NED grant, among other things, is therefore helping CAINCO pave the way for private companies to obtain favorable government contracts and invest in the exploration and exportation of the region’s natural gas. Despite the pending hydrocarbons law still to be decided in congress to determine how the reserves should be developed, Matkovic firmly supported recent moves by President Mesa to prematurely begin selling gas to Argentina. And he did not fail to mention that he was worried by “pressures imposed by radicalized social sectors, looking for another upheaval in the country”—a veiled reference to altiplano groups.

Clearly, the gas issue has become the most divisive issue Bolivia has faced in decades. But the fallout from the gas war along with other recent and similar upheavals—the April 2000 Cochabamba “water war” and the February 2003 tax riots—are only symptoms of a more profound process currently underway. These insurrections have forced a nationwide evaluation of the gamut of neoliberal policies—market liberalization, privatization and the general dissolution of the state—carried out in recent decades.

The majority of the population in the altiplano, the part of the country most devastated and marginalized by these policies, is wholly rejecting the neoliberal economic model. Groups like CAINCO and Nación Camba—along with its offshoots—have recently gained prominence because they are directly contesting this blatant rejection, in some cases violently, because it is an economic system that continues to serve them particularly well as the landed elite and captains of industry.

Since they comprise a minority elite, these groups have manipulated and exploited prevalent threads of racism and regional divisions that have long-plagued Bolivian society. Much like the conservative movement of the United States, these groups have decided to maintain their economic hegemony by waging their battles in terms of culture rather than economics, because the latter would alienate their less affluent supporters.

CAINCO and Nación Camba, however, are right on one point: Despite its economic power, Santa Cruz has never successfully asserted itself politically in the national sphere. In large part, this is because it lacks credible political leadership. The fact that civic and business groups are the main engines of the region’s political engagement is indicative of this shortfall, especially when compared to the widespread grassroots political organizing of the altiplano.

Alvaro García believes that a conciliatory outcome to the conflict will require the development of a broader and more representative political leadership in the media luna. “It will require a capacity to create points of agreement,” says García. “Bridges of communication must be nurtured between the forces of economic power in the east, on the one hand, and the sociopolitical and popular indigenous forces of the west on the other.”

The outcome of the hydrocarbons law and the Constituent Assembly, which will convene in 2005 to rewrite the Bolivian Constitution, will likely determine the direction of this ongoing conflict. As Bolivia looks toward the October anniversary of last year’s rebellion, the future remains uncertain. This uncertainty could prove as disastrous as the original export plan. If the population, and importantly, the social movements, feel betrayed and misled by the new hydrocarbons law, it just may spark a second gas war. As the youthful Vidál Choque said as he turned to head home that day in El Alto: “Whatever happens, I will keep fighting.”

Teo Ballvé, associate editor of the NACLA Report on the Americas www.nacla.org and 2004 Narco News Authentic Journalism Scholar, would like to thank The Fund for Authentic Journalism for its generous support while investigating this article.

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