How to Make a Change in Latin America? A few tentative remarks.

Václav Klaus.
Categoría: English.
It is enormous pleasure and honour for me to be with all of you here this evening. Many thanks for
bringing me to Guatemala and for giving me the extraordinary opportunity to address this very
important gathering and such a distinguished international audience.

Let me start with mentioning that this is already my second visit to Guatemala. My first visit here was
very brief, only one day and night. It was 25 years ago and I was invited to receive an honorary
doctorate from the University of Francisco Marroquín. This was in October 1993, only four years
after the fall of communism in my country. The title of my speech at the University was “The
Interplay of Political and Economic Reform Measures in the Transformation of Postcommunist
Countries”[1]. Thank you for motivating me to reread my 25-year-old speech. I was pleased to find
out that it has still a relevance and that it would not be necessary to re-write it.

In my speech, I allowed myself to say – slightly immodestly – that “the Czech Republic has already
crossed the Rubicon dividing the old and the new systems.” I added, with unhidden pride and
satisfaction, that “we may become proof that the transformation from communism to a free society
can be realized” (p. 7). I can say now, after a quarter of the century, that this statement has proved
to be true. The only problem is that – by entering the European Union, by “catching the European
disease” – we are in many respects on the way back. We will need another radical transformation.
Together with us the whole of Europe.

We understood at the very beginning of our “Velvet revolution” that the positive vision, which we
were offering our compatriots, must be clear, simple, and straightforward. It was much easier to do
it in Central Europe in the moment of the fall of Soviet communism than it is now in Latin America.
Communism was a well-defined evil. Our positive program was free society, parliamentary
democracy, free markets, in other words, capitalism.[2]

We rejected the ambitions of social engineers of all ideological colours that it is possible (and
desirable) to mastermind, dictate, or command the transformation process. The transformation
proceeded in an already democratic political setting. I still believe in my old, proposition that any
large-scale societal transformation is necessarily a mixture of constructivism and spontaneity. For the
Hayekians in this room, a mixture of “human design” and “human action”.

A. My three important experiences

When I got your invitation several months ago, I asked myself why it was me who had been chosen
to address your Forum and to give a closing speech at this evening. I am not an expert on Latin
America. I have shortly and officially visited six Latin American countries – Guatemala, Mexico,
Brazil, Argentina, Chile and Peru. No vacations, no sight-seeing. I learned a lot from my talks with
many Latin American politicians as well as academicians and political activists but I'm well aware of
the fact that I should speak here in a low voice, or, even better, that I should listen rather than talk.
Nevertheless, I am expected to say something here now. I dare speak here tonight because there do
exist in Latin America undeniable similarities with our experience and that there are in our hands
important, generally valid pieces of knowledge, concepts, rules, and theories which we have to make
use of.

There are, perhaps, three main reasons that could justify my speaking in front of you this evening:

- my decades lasting communist era experience;

- my experience with getting rid of the communist heritage;

- my recent EU experience.

The second era was a happy part of my life, which is something I cannot say about the first and the
third period. Even these years were not just a waste of time. It was always a useful and productive
learning process for me.

I do believe that our communist experience has a certain relevance for Latin America today even
though I know that you have never had communism of our type (with the exception of Cuba). I was
even surprised when you suggested the title of my today´s speech – the move from socialism to
capitalism. Do you really call your today´s system “socialism”?

The current Latin American political, economic and social system seems to me so complex and
multidimensional, that it can´t be as easily defined and described as our former communism. This
contributes to the difficulty of finding ways how to get rid of it, how to motivate people to be
convinced about the necessity to reject it. I have learned a lot from the excellent paper by Alberto
Mansueti from Centro de Liberalismo Clásico which was prepared for my much needed “education”
before coming here.[3]

The frustration with communism made me a true liberal. After the fall of communism, when we
became free to travel all over the world, we could see what a big disadvantage it actually was, not to
experience the same learning process as we were forced to go through. My almost half a century
spent in the Czechoslovak communist regime remains to be the dominant experience of my life. It
gave me sharp and merciless eyes and an extraordinary sensitivity in noticing any unfreedom, any
injustice, any kind of attempts to mastermind the society from above (by those who pretend to know
better than the rest of us what is good for us).

My second important experience was the era of transition, my personal opportunity – a few days
after the fall of communism – to start organizing a fundamental systemic change (and to be – in the
eyes of my fellow citizens – responsible for it). I understood that the main precondition for success
was the following triad:

1. You must know and be able to formulate in an understandable way where to go. The vision of
society you want to build must be clear, not fuzzy, explicit, not implicit, hard, not soft,
uncompromising, not pleasing everyone;
2. You must know how to get there. You must be able to formulate simply and understandably the
procedure, the road, the sequence of measures which must be inevitably taken. One important part
of it is the ability (and the courage) to tell the people of the country the truth about the inevitable
costs of the transformation process. We know from Milton Friedman that there are no free lunches.
Similarly there are no free reforms (or transformations);

3. You must be able to convince the people about all of that. You must explain to everyone that the
transformation of the whole society is a homework, a domestic task, not an import from abroad. You
must aim at satisfying the people in your own country, not the bureaucrats of the IMF and the World
Bank, nor investment bankers, professional advisors and consultants. They are maximizing their own
income, not the wealth of your nation. I must admit that they don´t like me much in the Washington,
D. C. headquarters of these organizations.[4]

My third, not less important experience is my today´s life in Europe, I mean my life in the European
Union. I have in mind my life in the post-democratic, highly centralized and overregulated, inefficient
and stagnating, more and more politically correct European Union. I am afraid people in the rest of
the world do not see and understand the true substance of this entity.

Most of them see only what the EU propaganda wants them to see. The Latin-Americans seemingly
believe that the EU is

- a peace-guaranteeing community of nations;

- a democratically run grouping of countries, where a demos feels like the demos;

- a coherent entity based on mutually shared values and behavioural patterns;

- an entity which centralizes only a small part of decision-making;

- a conglomerate of countries where all are equal (in the Orwellian sense);

- a family-like institution where the weaker members are significantly helped by the stronger ones;

- an institution where the opposition to official views is welcome, allowed and made possible.

Nothing can be farther from the truth than this propagandistic scheme. The current European Union
is

- an entity without demos, which means without democracy;

- an entity with only a weak common identity. As regards our identity, we are primarily Czechs,
Italians, or Hungarians. And we are proud of it. Europe has never been a melting pot;
- an entity which misuses the term subsidiarity for disguising the actual state of affairs and the ever-
growing centralization of the decision-making;

- an entity with one dominant country, Germany;

- an entity without authentic, genuine solidarity;

- an entity constrained and weakened by its non-functioning monetary union and by its irresponsible
Schengen arrangements.[5]

One of my colleagues who spent ten years in the European Parliament, when reading the first version
of the manuscript of this speech of mine, suggested to mention to you one of his experiences there:
the visit of Hugo Chávez. My colleague remembers how shocked he was seeing that the European
Parliament stood up and enthusiastically applauded Hugo Chávez when he suggested the
nationalization of the British Petroleum. You should know that the EU parlamentarians would never
applaud any Latin-American anti-Chávez. It is well-known, that they were “famously” not able to
accept (or to swallow) my speech there in 2009 when I spoke there in the capacity as the President
of one of the EU member states.[6] This says a lot about the current EU.

B. A Few Remarks on Latin America

I'd like to congratulate you on the organization of this gathering. One cannot achieve anything alone
and isolated. It is important to meet, to exchange views and experiences, to see that we are not just
a tiny group of people, almost an endangered species, very often ridiculed at home as messengers of
rather irrelevant ideas, not to speak about our political incorrectness.

It is necessary to build institutions, especially political parties. I was very much impressed by Alberto
Mansueti´s sharp analysis of the Latin American political cycle, which he calls “the vicious cycle of
politics”. Nevertheless, there is no freedom and liberty without political parties. I spent the whole
1990s as Prime Minister fighting President Václav Havel´s adoration of “nonpolitical politics” and
his contempt for political parties. The Western “progresivists” and “liberals in the American sense”
loved him specifically because of that.

We who are here tonight know that liberty, freedom, la libertad, is the most important goal and
ambition, that it is the precondition for everything else.

How to bring freedom to Latin America? I know that there are huge differences among Latin
American countries and that any fast and primitive generalization is dangerous. What are the main
prerequisites of the Latin American liberal project? It has to be based on freedom, on
democratization, on putting an end to civil wars, guerillas and terrorist “armies”, as well as to police
brutality. It should bring the end of autocratic regimes and start building the notion of citizenship
because that is the precondition for getting rid of sharply divided societies (politically, economically,
social, culturally), of the “two floors society” (in the terminology of Alberto Mansueti) and for ending
poverty, crime, injustice and social segregation.
Is the liberation from the post-colonial rezidua and from the old version of American imperialism
the current task as it used to be in the past? I am not sure. Today´s tenets like cultural Marxism,
political correctness, humanrightism, environmentalism are universal. They come from the West to
the Rest. This is, however, a different import than in the past. These “isms” become fundamental
obstacle to any move forward.

Let me make a terminological digression. In our part of the world, in the moment of the fall of
communism, we wanted to radically liberalize, deregulate, decentralize the whole society but we
didn´t want to use the term liberalism as the main slogan of our effort (because of the dubiosity of
its American version). “Liberalism of the American style” was for us not about freedom and radical
liberalization. It reminded us a soft version of socialism.

We didn´t want to accept – with all our admiration of Margaret Thatcher – the term conservatism
either. I hesitated how to name the political party I founded in 1991 and gained a victory with in the
first post-communist elections. It was finally called the Civic Democratic Party. We wanted to stress
citizenship, democracy and a political party.

It was logical to speak about liberalization after forty years of communism but it was impossible to
fight for conservatism because it was not meaningful to conserve communism. You must have very
similar problems now.

I am afraid that the current version of liberalism has transformed liberalism into something not very
liberal. With its defense of multiculturalism and humanrightism aims at the destruction of the
Western Civilization. It became cosmopolitan (and cultural)[7], whereas the original liberalism
concentrated on the fight between the state and the individual inside a country (and used to have a
very strong economic dimension). This is a radical shift. Some liberals even come close to the
dangerous ideology of globalism.

This liberalism – together with the ideology of the New Left and Neomarxism – fights for all kinds
of rights, mostly or exclusively for human rights, not for civic rights. In this respect liberalism comes
close to the leftist revolutionary ideologies you know so well from your own Latin-American
experience. Looking at it from Europe, we see a very special role played here by the catholic church
which is very different in Latin America than in Europe. The new Pope is closer to the ideas of the
new liberalism, the New Left and Cultural Marxism than to the ideas of the old Catholicism.

C. Is Populism the Main Danger?

The modern European and American liberalism considers these days – to my great surprise –
populism its main enemy. If I understand it correctly, populism, especially here in Latin America,
used to be the dominant doctrine of non-democratic, autocratic and quasi-socialist rulers (of course,
they didn´t use this label themselves). Today´s populism – in the speeches of some liberals, even
classical liberals – is a term used as a derisive and downgrading label for frustrated people in the post-
democratic Europe (and America) who are blocked from participating in a normal democratic
discourse, who are unable to publish their views in dominant media, who have justified feelings that
they can´t normally politically compete with the arrogant European and American political elites.
They are excluded from it by the politically correct exponents of the progressivist Brave New World.
Not to see it is a tragic misunderstanding.

I agree with Frank Furedi[8] that many liberals (and non-liberals as well) “apply the populist label to
movements and groups whose values contradict their own” (preface) and that “in our time, populism
is a term that anti-populist use to describe people they do not like” (p. 7). I share his view that “the
anti-populist reaction to populist movements represents a far greater menace to democratic politics”
than populism itself.

We experience a growing polarization in our societies, one of its aspects is “polarization between the
governing elite and a substantial portion of the governed”.[9] Populism is an answer to it.

The modern, or pseudo-modern liberalism misinterprets the West. I touched upon it when talking
about the EU. It seems to me that the Latin American liberals are idealizing the West. We – in the
era of communism – idealized the West as well, but at that time the West was still the West. It is not
now. We could – in our revolutionary moments – refer to the West, which is to my great regret not
possible to do now.

We live in a post-West world. I would be happy – when I am here – to be able to refer to Europe as
a symbol of the West, but I know that it wouldn´t be correct. Europe is almost lost already, there is
no authentic liberal movement there now. Europe had until recently an advantage, that it – in spite
of all its radical revolutions (the French Revolution, the Russian Revolution[10]) – can be
characterized by the many times interrupted, but still visible evolutionary line which is something I
don´t see in Latin America now. Its domestic tradition and culture have been violently suppressed
and foreign immigrants from all corners of the world came here with very diverse cultures and
aspirations. To find a new, truly Latin American evolutionary line is a heroic task.

We have to make liberalism in Latin America a revolutionary ideology. In Eastern and Central
Europe, it was possible to get rid of communism quite rapidly. The past was well defined, the future
– free society, parliamentary democracy, liberalization, deregulation and privatization – as well. The
refusal of the past by the common people was overwhelming, the outlines of the future were
understandable to them. It is not so simple here.

I already said, that it was much easier to make a fundamental systemic change in Prague then, than it
is in Guatemala City now. The non-monolithic Latin American world, the relative freedom in many
areas, the absence of a general feeling that the past is a total failure, are obstacles to a fundamental
change. No one believed in communism in our part of the world in the 1980s. This doctrine was
totally discredited. I am afraid it is not so simple in Latin America now because there is no coherent,
simply labeled and simply defined evil which must be brought to an end.

I hope I am wrong. I hope you know how to go ahead.

Václav Klaus, Closing speech at the Third Foro Liberal de América Latina, Hotel Real
Intercontinental, Guatemala City, Guatemala, March 17, 2018.
[1] Klaus, V., Renaissance: The Rebirth of Liberty in the Heart of Europe, chapter I, CATO Institute,
Washington, D.C., 1997.

[2] I understood that the New Liberals in Guatemala speak about a “devolution”, not about a
revolution. That may be a good term for this country because there has been a market economy and
a private property system here which just needs to be liberalized and deregulated. It was not the case
in our country after decades of Communism.

[3] Mansueti, A., Latin America: Our Creole Apartheid, unpublished manuscript, February, 2018.

[4] Klaus, V., Future of International Development Institutions – Can Their Failures Be Even
Bigger?, Rhodes Forum 2015, Kallithea, Rhodes, October 11, 2015. You can find the speech here:
www.klaus.cz/clanky/3815.

[5] More about it in my book “European Integration without Illusions”, which has also a Spanish
version “La Integración Europea Sin Ilusiones”, published in Spain, Editorial Club Universitario, San
Vicente, 2012.

[6] Speech of the President of the Czech Republic Václav Klaus in the European Parliament, Brussels,
February 19, 2009. You can find the speech here: www.klaus.cz/clanky/310.

[7] See the views of the President of the Mont Pelerin Society, Boettke, P. J., Rebuilding the Liberal
Project, Policy, The Centre for Independent Studies, Sydney, Vol. 33, Nov. 4, 2017.

[8] Furedi, F., Populism and the European Culture Wars, Routledge, London, 2018.

[9] Topel, R., Populism, Policy and Welfare, Alamos, 2018. He explains the growth of polarization
by the fact “gains are widely distributed in the long run, whereas losses are highly concentrated”.

[10] See my Soviet Communism Is Over, What About Freedom?, Speech at The Victims of
Communism Centennial Commemoration, Library of Congress, Washington, D.C., November 9,
2017. You can find the speech here: www.klaus.cz/clanky/4200.