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Honduras

An interview with Rasel Tomé, LIBRE party founder and congressional candidate

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TEGUCIGALPA — Rasel Tomé, a tall attorney with striking blue eyes, slick jet black hair and a mustache to match, and dressed in a pastel guayabera shirt, looks every part the leftist Latin American revolutionary that you might have thought belonged to a radical generation from half a century ago.honduras flag icon

Tomé, whose roots are in Olanchito on Honduras’s north coast and whose family worked in the ubiquitous banana companies that dominated the Honduran economy and captured its government for much of the early and mid-20th century, was a legal adviser to former president Manuel ‘Mel’ Zelaya, who was ousted by the military from the Honduran presidency in June 2009.  Ostensibly due to his push to amend the Honduran constitution to allow for presidential reelection, Zelaya spent much of his presidency edging further to the left, away from the United States and toward Venezuela and its ‘Bolivarian’ socialist allies within Latin America.

But Zelaya is back.  His wife, Xiomara Castro de Zelaya, is one of two frontrunners in this weekend’s general election, and she represents one side of a choice so polarizing that both sides speak about the take-no-prisoners campaign as if it’s a civil war.  Even if it’s a cold civil war, there’s no doubt that the 2009 coup still dominates the political debate here.

‘In Honduras, there’s a debate of two thoughts,’ said Tomé, a congressional candidate running on the Castro de Zelaya ticket, comparing the election to the choice that Abraham Lincoln faced during the US civil war. ‘The ones that believe that this model of inequity and inequality should keep going, with the privileges to the elites, holding onto the constitution that was created in 1981 and that has been violated and destroyed by the coup d’état.  And there are the ones that consider that to move society forward, we need a new social pact… we can abide by it generation by generation into the future, that it will be the starting point for our country.’

Tomé helped found the Movimeinto Resistencia Progresista (Progressive Resistance Movement) that opposed the 2009 coup, one of five popular movements that joined forces to form the Partido Libertad y Refundación (Party of Liberty and Refoundation) two years ago — popularly known as LIBRE, an acronym that plays on the Spanish word for ‘free.’  LIBRE, in many ways, is the first truly leftist party in Honduran political history with a chance of winning power in Honduras, and its candidate is Zelaya’s wife, Xiomara Castro de Zelaya.

Throughout much of the 20th century, including after the return of regular elections in 1981, Honduran politics has been mostly a contest between two competing elites — those in the conservative Partido Nacional (National Party) and those in the more centrist Partido Liberal (Liberal Party).  Manuel Zelaya, a wealthy rancher from eastern Honduras, was himself part of the Liberal Party elite when he was elected president in 2005.

Though I met several LIBRE activists over the course of a week in Tegucigalpa, none were quite as compelling as Tomé — in a country where politics has often been a cynical game of spoils between competing sets of elites (including, by the way, the Zelayas, whose family members are rumored to have profited handsomely by Zelaya’s first term in office), many Hondurans see both the Zelayas and their chief opponent, Juan Orlando Hernández, the candidate of the governing Partido Nacional (PN, National Party) as two sides of the same ineffective coin — and they have little hope for the other main candidate in the race, Mauricio Villeda of the Partido Liberal (PL, Liberal Party).  Tomé admitted as much.

‘Villeda is the son of an ex-president,’ Tomé said.  ‘[Outgoing president Porfirio] Lobo Sosa’s father was a congressman many times over.  Juan Orlando, his father was the governor of a sector of the country. Manuel Zelaya has been in the political running for the last 30 years.  So people who have a panoramic view see them as people who belong to the same category.’

Tomé added, however, that the Zelayas have now put themselves in the service of the people as a vector for change.

It was an impressively honest answer, but it also highlights the tension between the Zelayas and the activists who could power Xiomara into  the Honduran presidency on Sunday.  If she succeeds, she’ll have a dozen interest groups with high hopes of social and economic transformation, all of whom will want her to push for more change than any one president could possibly deliver at a time of joint security and economic crises — especially with the possibility that no party will win an absolute majority in the unicameral Congreso Nacional (National Congress).

When I met Tomé two weeks ago, he showed up with another associate, and they unfurled their campaign banner.

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Tomé held forth for nearly an hour on over a dozen issues relating to the Honduran campaign — in contrast to the controlled and stilted interviews that LIBRE’s presidential candidate has given to the media (often alongside her husband, which has done nothing to dispel notions that her candidacy represents a second term for Mel Zelaya), Tomé has a compelling style that makes you wonder if he might not be LIBRE’s presidential candidate in four years’ time.

Tomé spoke earnestly on several topics — economic opportunity, the role of the military, LIBRE’s position in favor of community-based policing, the Central America Free Trade Agreement, and US-Honduran relations.  When I spoke to Tomé on November 6, it was the morning after Bill de Blasio overwhelming won the New York City mayoral election, running on a platform that emphasized reversing income inequality perhaps more than any US politician in recent history.  Though inequality is a global trend, you might say Honduras is in the vanguard of that trend.  As of 2009, the World Bank recorded a Gini coefficient of 57 in Honduras, the highest in Latin America and one of the highest in the world, outpacing Brazil (55), one the poster child for income inequality, Mexico (47) and the United States (45, as of 2007).  That’s staggering for Honduras, where people once joked the country was so poor it didn’t even have a proper oligarchy.  Continue reading An interview with Rasel Tomé, LIBRE party founder and congressional candidate →

Austria

Meet Austrian chancellor Werner Faymann, Europe’s Superman of Keynesian economics

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Austrians go to the polls on September 29, and just as with Germany’s election last weekend, voters seem inclined to reward a government that has largely kept Austria’s economy strong through a time of recession and unemployment throughout much of the rest of Europe.austria flag

But German chancellor Angela Merkel has steered a largely moderate, pragmatic course over the past eight years in Germany, and it’s arguable that Germany’s economic success owes much to its position as Europe’s largest economy and its role as a leading global high-tech manufacturer than to any Merkel-era economic policies — if anything, Merkel’s center-left predecessor Gerhard Schröder pushed through the policies (including the Hartz IV labor and welfare reforms) that steeled Germany for the economic storm of the late 2000s and early 2010s.

In Austria, however, it’s been an even more sanguine story.

The country has a 4.8% unemployment rate, according to Eurostat, the lowest among all 27 countries in the European Union.  Its GDP dropped just 3.8% in 2008 (a narrower drop than in Germany), and it returned to growth thereafter — even in 2012, it managed to record GDP growth of 0.8% while most of the eurozone was mired in recession.

So what has Austrian chancellor Werner Faymann and his government done over the past five years in order to steer Austria out of the straits of the eurozone morass?  As it turns out, a lot.

While several European countries have served as battlegrounds for harsh transatlantic battles among economists over economic policy (the usual suspects, but also places like Iceland, Latvia and Estonia), you would think that neo-Keynesian economists would be shouting from the rooftops about Austria’s economic stewardship.  Don’t confuse Austria’s economic policy today with Austrian economics, as such, which is something very much the opposite.

Since his election in September 2008, Faymann has led a grand coalition between his own center-left Sozialdemokratische Partei Österreichs (SPÖ, Social Democratic Party of Austria) and the center-right Österreichische Volkspartei (ÖVP, Austrian People’s Party), and it’s about as anti-austerity a government as Europe has seen.

Given the strength of the Austrian labor movement, Austria immediately pursued the kind of work-sharing policies that Germany also adopted in the aftermath of the crisis when aggregate demand tumbled — the idea that shorter working hours for everyone would be a way to disperse the slack in the economy, thereby avoiding the wave of layoffs that we saw in the United States.

But Faymann also pushed through job training legislation that massively empowered Austria’s Arbeitsmarktservice (AMS, Austrian Employment Service), including strong benefits for the unemployed and the guarantee of a paid training internship for young Austrians in the marketplace.  Austria’s labor market has performed exactly the opposite of that in the United States — unemployment rose in Austria because more workers were seeking jobs, while the US unemployment rate has dropped partly because so many American workers have given up on finding employment.

Faymann also allowed Austria’s public debt to rise from around 60% in 2008 to 75% today in order to finance the jobs legislation and other stimulative measures to shore up Austria’s economy.  His government also took the lead in convincing the European Union and the International Monetary Fund to provide up to €125 billion to stabilize banks in the Central European and South Eastern European (CESEE) region, a strategy that worked to reassure global investors.  A financial panic in CESEE region countries, such as Hungary, would have led to massive losses for Austrian banks as well.  The idea is that a credible commitment from government at the outset of a financial crisis will stave off a larger financial panic.  Contrast the far less proactive European response to the wider sovereign debt crisis — it was only in July 2012, the eurozone crisis’s third year, that European Central Bank president Mario Draghi said he would do ‘whatever it takes’ to save the euro.

Faymann is campaigning on a platform of instituting a wealth tax on millionaires and institutionalizing a levy on the assets of large banks, both of which Faymann hopes will keep income inequality relatively low in a society that already has one of the world’s lowest Gini coefficients.

With a record like that, why isn’t Paul Krugman cheerleading for Faymann from the op-ed pages of The New York Times?  Here’s a European leader who has pursued as close to a Krugmanite economic policy as anyone.

For one, you could easily argue that Austria’s just been lucky.   Continue reading Meet Austrian chancellor Werner Faymann, Europe’s Superman of Keynesian economics →