Gas wealth fuels populist experiment in Bolivia

For centuries, Bolivian laborers toiled to unearth silver, gold, and tin, only to see most of the wealth benefit a small number of elites and foreigners.

On Sunday, this poor landlocked Andean nation will try something novel: Voters will decide whether to nationalize the country's 55 trillion cubic feet of natural gas, the third-largest reserve in the region. It's the first time Bolivians will have been consulted on how to exploit the nation's buried assets.

The bold democratic experiment marks a populist - and economic - shift in a country that has seen its share of aristocracy. The results will be closely watched by energy-hungry neighbors Brazil, Argentina, and Chile - and the US.

Historically, average Bolivians have played the role of bystander, as small groups of military and political leaders toppled governments, only to be toppled themselves. The referendum, part of a major push by interim President Carlos Mesa to redraw the political and social landscape here, could be the last best hope for peace and stability in a country that some say is on the verge of civil war.

"In the past we had violent confrontation, which resulted in bloodshed, and now we are going to resolve differences by voting," said Mr. Mesa last week.

That violent confrontation came to a head last October. Dozens of people were killed in street protests after President Gonzalo Sanchez de Lozada announced plans to allow foreign companies to export gas to Mexico and California. Mr. Lozada stepped down and fled to the US. The referendum, which could see the state retake full control of the energy sector, was designed to appease protesters and radical social groups who feared the poor would be denied benefits from the sale of gas the way they had been from sales of silver and tin.

Some estimates say that the gas could cover Bolivia's energy needs for the next millennium.

Sunday's vote is just the beginning of a broader plan by Mesa for a constitutional assembly next year that will draw up a new social and political pact.

Since independence from Spain in 1825, the country has seen more than 200 coups and countercoups, and despite vast mineral wealth it remains the poorest country in South America. Bolivia's institutions are also in decay. Its finances depend on foreign aid and the federal government has little control over wide swaths of the country.

"State authority does not exist at the moment. The government cannot do anything," says Marco Aimaretti of the Center for Judicial Studies and Social Investigations in Santa Cruz.

The weakness of the state means that next year's assembly will be dominated by several antagonistic blocs whose power has grown over recent years as the state's has declined. The fault lines include those between probusiness and socialist groups, and between traditional political parties and the new powerful indigenous-peoples movements.

Some indigenous groups are demanding total autonomy for their communities in the western Altiplano highlands, while the country's fastest-growing party, the leftist Movement Toward Socialism (MAS), will seek to use its growing strength to push its own brand of indigenous revivalism, socialism, and support for coca farmers at the assembly.

The fear, both in and outside Bolivia, is that the country will fracture. Foreign Minister José Pampuro calls it as the "Lebanonization" of Bolivia, and the latest report on Bolivia by the United Nations Human Development Program expressed concern about possible future conflict.

While militant indigenous groups have grabbed most of the headlines in recent years, one of the most potentially explosive sources of conflict is found in the state of Santa Cruz, the most dynamic part of the country's economy.

Many here view the capital La Paz as a bureaucratic parasite that wastes their taxes on badly administered public services in the Altiplano. In June, 150,000 people marched, demanding that next year's Assembly give Santa Cruz autonomy.

"For us, autonomy is synonymous with development," says Nino Gandarilla, leader of the Pro-Santa Cruz Committee, which called the demonstration. "Centralism does not let us work. Centralism impedes the development of the people."

But perhaps more dangerous is a cultural and racial dynamic in Santa Cruz's call for autonomy. Economic growth here has attracted and been partly fueled by migration from the Altiplano highlands. Support for separatists has grown as such radical indigenous-dominated parties as MAS organize among the migrants.

Groups like the Camba Nation Movement are demanding autonomy in part as a protection for what they say is the region's separate identity. Camba Nation argues that a distinct "camba" culture exists, the result of a distinct history that can be traced back from independence, through Spanish rule, to preconquest times, and this gives them the right to self-determination. The movement says it has more than 5,000 militants ready to defend the region's identity.

Both the separatists and the radical indigenous groups will lay out their competing visions for the area in next year's assembly. But many people here worry that a confrontation there might escalate into one on the streets.

The hope is that President Mesa's high-risk strategy of calling the assembly pays off, and that these differences can be contained within a constitutional agreement. All sides agree that the status quo is finished. But commonplace protests, roadblocks, and sporadic violence mean something is needed quickly to fill the vacuum.

Otherwise, Mr. Aimaretti says, the risk of conflict grows. "If something is not done soon," he says, "the polarization, which people are beginning to experience, will become increasingly clear and dangerous, and we will see more violence."