Vox Populi

The Poll Every year, the reputable Chilean polling firm ‘Latinobarómetro’ publishes an extensive survey of opinion that covers the whole of the Latin America region. This year, over 20,000 people from 18 countries in the South and Central America region were surveyed by outsourced reputable local polling companies such as Gallup and MORI.

When this year’s edition was published in mid November, your author expected the results to be picked up by the English speaking media. After all, to hear the voice of the people commenting about their lot is not something to be taken lightly. Strange then to have found an almost total English speaking blackout about the results of this important snapshot of LatAm views and opinions.

Or maybe it wasn’t so strange after all. Let us look at some of the poll questions and results for some of the countries involved.

It should be stressed at this point that the survey is very complete, and runs to 112 pages. We have tried to select representative questions and answers, but also strongly urge you to read the survey in full, available free of charge from the Latinóbarometro website.

We would also like to sincerely apologise to some smaller central and South American states, but due to the need for brevity this article will limit itself to eight large economy countries, namely (and in alphabetical order) Argentina, Brazil, Chile, Colombia, Mexico, Peru, Uruguay and Venezuela.

The questions We have selected questions that concentrate on economic issues, but to be fair to the survey itself issues such as politics, education and justice are also covered. The ten selected questions were posed in the following way to those polled. We have added our own titles for easy reference later.

1) Current Economic Situation How would you rate in general the current economic situation of your country? Would you say it is very good, good, regular, bad or very bad? (Tabulated only “very good” or “good”.)

2) Future Economic Situation In the next twelve months, do you believe that the economic situation and that of your family will be much better, a little better, about the same, a little worse or much worse that it is today? (Tabulated only “much better” and “a little better”.)

3) Favouring Market Economy Do you strongly agree, agree, disagree or strongly disagree with the sentence that I am going to read to you? “The (free) market economy is the best for the country.” (Tabulated only “strongly agree” and “agree”.)

4) Favouring Private Enterprise Do you strongly agree, agree, disagree or strongly disagree with the sentence that I am going to read to you? “Private companies are indispensable for the development of the country?” (Tabulated only “strongly agree” and “agree”.)

5) Fairness of Income Distribution In your opinion, how fair is the distribution of income in your country? (Tabulated only “very fair” and “fair”.)

6) Satisfaction with Democracy In general, would you say you are very satisfied, fairly satisfied, not very satisfied or not at all satisfied with the workings of democracy in your country? (Tabulated “very satisfied” and “fairly satisfied”.)

7) Satisfaction with Leaders Do you approve or disapprove of the government led by your president? (Tabulated only “approve”.)

8) Equality in Justice There are different opinions about justice in your country. There are people who opine that all citizens in your country have equal access to justice; other people opine that not all citizens in your country have equal access to justice. Which of the two opinions is closest to your way of thinking? (Tabulated only “equal opportunities”.)

9) Exposure to Corruption Have you or any family member been exposed to any act of corruption in the last twelve months? (Tabulated only “yes”.)

10) Satisfaction with Education Standards Would you say you find yourself very satisfied, fairly satisfied, not very satisfied or not at all satisfied about the (standards of) education to which you have access? (Tabulated only “very satisfied” and “fairly satisfied”.)

The answers So to the responses. We have packaged the answers by country, and give a small commentary on each. Please note that although we are featuring only eight countries here, the rankings given show the position compared to all 18 countries in the survey. General comments and conclusions at the end.

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Argentina’s scorecard is mediocre at best. It demonstrates acceptable levels of satisfaction with its leadership and standards of education, but scores low in all the main economic areas. Interestingly, the country scores very low in its preference for a free market economy and private enterprises. Note that “exposure to corruption” is the only section where a high score is bad, so not even the 3rd place ranking there saves it from being an also-ran.

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Brazil takes the honour of being “o maior país do mundo” in corruption (well, in this case LatAm and not the world, but you get the picture). It wins the “accolade” by a long way, too, as 66% surveyed said they or a family member had been exposed to some sort of corruption in the last year. Second place in the survey got 33%. It also has issues with judicial and income distribution equality.

On a more positive note Brazil scores well in the economy categories, as one might expect during the impressive boom period in Latin America’s biggest economy. This must be tempered, however, with a low 13% approval in how that newly found income is being distributed. image006.jpg

Although Chileans seem to recognize they are enjoying a good economic moment, the drop in rankings for future expectations shows doubts for its sustainability. The country’s reputation for income inequality, however, is once again reflected in the opinions of its own people with a mere 10% surveyed happy about the way income is distributed in what is perceived to be a relatively wealthy LatAm society. Chile does score well in the corruption stakes, which is a big plus in this region.

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It is clear that Colombia is betting on a market economy and happy to do so. It is also very happy with its leadership under Alvaro Uribe, these results backing up the consistently high popularity polls the president enjoys. Other statistics do not shine as much, however, with no better than middling percentage scores for its economic present and future. The low level of satisfaction shown for its democracy is juxtaposition to the leadership popularity.

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LatAm’s second largest economy does not shine in the eyes of its own people, with low scores for its present and future economic situation. Frankly for one so large the results are shockingly poor, but faith in free market economics has not been dampened so far. Its leadership scores highly enough, but satisfaction with democracy in general and corruption are other black spots on its scorecard. Would they by chance be related?

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Ugly. Peru seems to have an awful reputation amongst its own people, and the Garcia administration should look upon these numbers with considerable alarm. It comes in the bottom three for all LatAm nations in eight out of the ten categories, with the only bright spot, it seems, being the tepid hope it places in a free market economy to cure its woes. These results may surprise a lot of people; unfortunately they do not surprise us.

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A strong showing. The smallest nation by population on our reduced list, but included due to its economic and political clout. Uruguayans seem to be happy with their present and future economic lot (at least by ranking, if not by percentages), and shine as the happiest people with their own democratic system. Education also scores highly, and satisfaction with its own leaders ranks an acceptable 61%. Overall a marked difference from the state of play just across the Rio de la Plata in Argentina.

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Shockingly good. Venezuela wins the race by a mile, with top three positions in seven of the ten categories. Happiest of all LatAm about its present and future economic situation, the way the money is being distributed inside the country, and about its justice system, these results fly in the face of what we are repeatedly told about Venezuela.

General comments When we saw the days tick into weeks with virtually nothing written in English about this important survey, we wondered why that should be. But on revisiting the survey we began to suspect that the opinion Venezuelans had about their own country was so positive compared to other LatAm states that dwelling on the report and debating it might open a can of worms amongst those who would have us believe otherwise about the Venezuela of today.

As part of the research for this note, we searched the word “Latinobarometro” in the news category of Google, expecting the welter of stories that had passed us by. There were only 35 responses. But amongst those responses, something strange was noted. Apart from some minor passing comments from very minor websites and a report by The Economist dated 18th November, only one fact was being used by mainstream reporters. Here are three examples: “…A recent 18-country poll by the Chile-based Latinobarometro polling organization identified Chavez as one of the least-popular leaders in Latin America. Only Castro was less popular…

…The defeat could dissuade Chávez’s leftist allies in Latin America, particularly in Ecuador and Bolivia, from attempting similar constitutional overhauls. A study this fall by Latinobarometro, a Chilean pollster, showed that Chávez’s influence around the region has waned and he is now no more popular in the region than President Bush…

…A recent study by pollster Latinobarometro — as well as an outburst this month by Spain’s normally mild-mannered King Juan Carlos, who told Chávez to “shut up” — suggest his influence in the region could be waning…

English-speaking reporters had obviously read the report, then. But somehow they managed to cherry-pick the fact that Chávez was unpopular. One should also note that although Chávez scored 61% approval in the report amongst Venezuelans, reporters unerringly went for the statistic that showed Chávez at 4.5 approval (maximum 10, minimum 0) in the opinion of all Latin Americans. Do these same journalists report on other countries’ opinions George W Bush? Or perhaps the latest US popularity figures from Iraq?

There was one variation, however. The Miami Herald quoted the Venezuelan ambassador to the USA, Bernardo Alvarez, talking about the poll results.

…Alvarez cited a recent poll by Chile-based Latinobarómetro, in which Venezuelans ranked second in Latin America in terms of satisfaction with their democracy.

”The economy is still growing, for four consecutive years, at a rate of 11.9 percent, and the social programs have obtained important advances, like the decrease of the poverty rate from 55 percent in 2003 to 30 percent in 2006,” Alvarez said.

Nevertheless, few analysts share the government’s optimism…

Well that may well be true. A few analysts may not share the government’s optimism about the future of Venezuela. It may also be true that a handful of analysts, economists, sociologists and politicians know an awful lot more about LatAm than the collective wisdom, knowledge and understanding of the 527 million people that this Latinóbarometro survey represents with a margin of error of plus or minus three percent. Then again, it may not. But all the same, the only way the English speaking media has found to use a comprehensive 112 page report that covers 18 different countries is the same small statistic that backs up their previously stated ideas about one man in one country.

Conclusion

The general comments above were confined to the standout case of Venezuela in the survey, but the issues are much wider than that single country. It appears that the outward perception many have of LatAm is not shared by its own population. The ‘economic powerhouse’ of Mexico is not so powerful for Mexicans themselves. According to its citizens, small and ignored Uruguay is enjoying a very sweet spot in its affairs at present. We are told Peru is in the 5th year of an economic expansion that has brought it to the brink of investment grade. For sure that is true, but somebody has forgotten to tell the Peruvians how lucky they are.

We are not trying to convince anyone on politics and we don’t care how you vote, quite frankly. But we do care about the people and the countries of Latin America, and care very deeply. There is far too much misrepresentation about people, places and countries of Latin America in the English speaking press, and to blindly believe anything you hear about any country in Latin America, not just Venezuela, could be detrimental to your financial health in the future. Is it wise for a company looking to invest in this region to listen to what other people want them to believe about a place, or would the smarter company consult the people themselves before making any decision?

The same question is equally valid for people wishing to invest in regional equities or bonds. There has been some work done by certain economists to develop a country risk ratings system where social issues are taken more into account. Up until now these initiatives have remained on the sidelines of the discipline, but perhaps it is time for those bright enough to take a fresh look at the subject. The EMBI is not giving us the full picture.

7 Responses to "Vox Populi"

  1. Anonymous   December 6, 2007 at 2:41 pm

    Das ist ihm! (assuming you know what it means since you speak the same ideological language that führer Chávez does). I’ll send you money for a one-way ticket to Caracas, so that you and Hugo can live together. He needs friends like you now. Must be cold and lonely in Miraflores, wouldn’t you agree?

  2. Anonymous   December 6, 2007 at 5:03 pm

    On the POLL and results on/about Venezuela: Obviously the recent election results (Dec 2nd) contradict what the poll suggests Venezuelans feel…. Corruption, crime -specially in the areas where the poor live- difficulty finding basic food stuffs, inflation, businesses reacting to uncertainty, the inexistance of the rule of law, amazing capital flight, brain drain, and a number of things economic that will -without a doubt- proove themselves within the next 18 to 24 months, and eventually reveal what the Chavez government is doing to Venezuelan democracy and economy. Not to defend the previous governments; their disdain for the social situation is partly unjustifiable. No matter arguing too much with those that are persuaded by the Chavez rethoric. The negative effects, once they become obvious to everyone, will be, for the first time in Venezuela’s recent history, very very slow and hard to fix. Petrodollars regardless. To those still willing to argue and find much good in the Chavista regime, it would do them good to visit Venezuela (as the other commentator has suggested) and do some good old fashion serious detailed research. Venezuela will proove to be one of those cases where regular economic figures did not even begin to reveal the cracks and coming economic problems. Finally, as to only a handfull of economists and analysts see things as negative… I would suggest the comentator checking the behaviour of any of the Venezuelan bonds…. And If still willing to argue positively about the future of Venezuela, one last suggestion: Put your money where your mind is: Mortgage your house, buy those Venezuelan bonds and wait a little. I will kindly mail you some food stamps as help during your years of recovery.

  3. Vitoria Saddi   December 6, 2007 at 6:25 pm

    Dear Anonymous (the first one):I ask you to keep the debate on a high level. Do not make rude jokes or blank observations, especially when you don’t have the guts to sign your own name. If you disagree with the author, try to argue with economic reasoning. We all know that economics is hard but I am sure you can make it.Best,Vitoria Saddi

  4. Paul Escobar   December 6, 2007 at 10:36 pm

    I would like to respond to the second “anonymous”.You claim that the recent referendum loss contradicts the polling presented above. This is not the case.The above poll is consistent with the most recent polling, done by pollsters hostile to the current Venezuelan government.In fact, the very polling firms who predicted the referendum loss…also emphasized that the current government remains very popular……………….So what happened?The logical conclusion is that the referendum failed, based on its own merits. As hard as it maybe to believe, Venezuelans can hold two seperate opinions at once. The Venezuelan public didn’t see the need for constitutional changes. But they still valued the governments pro-growth policies, and efforts at uplifting previously marginalized segments of the population……………..No one criticized George Bush (Jr), in the same way as they are criticizing Chavez. At the height of Bush’s popularity (yes, there was a time), many Americans adored him. They supported his overall focus, and his personality.However, that popularity did not allow Bush to execute his most cherished ideological reforms. Despite being a popular post-911 President, and controlling both the senate and congress…He could not over-turn abortion. He could not outlaw homosexuality. He could not even reform a social security………………..It’s a similar situation in Venezuela. Where the public may appreciate the overall policies. But disagree with some specifics.The polls demonstrate this, quite effectively.

  5. mark turner   December 6, 2007 at 11:55 pm

    As it happens Vitoria, i have no real problem with anon1 and his sort. The ad hominem method of attack tends to speak louder about the writer than the writee. On the other hand the acid humour of anonymous2 is perfectly acceptable as long as it serves a purpose. FWIW anon2, i do not recommend VZ bonds at the moment but if you read back in this blog you’ll see i made a long call on Ecuador bonds that came a few short weeks before S&P raised the sovereign rating by two notches. I certainly do put my money where my mouth is, as clients pay my salary.If you read the post again, you may note that Chavez was only mentioned when talking about western media attitudes towards Venezuela. The post itself (bar the general comments section) was about the economic (mainly) and social (partly) attitudes and reflections of all LatAm. To dwell on Venezuela for a second, I am of the opinion that the oil boom we have seen in the last 5 years (to draw an arbitrary line) would have benefitted Venezuela whatever colour of government were in power. Of course, the ways in which that benefit would have been felt may have been different in their aspect but all the same it would be very difficult to imagine a situation where a whole country did not benefit from the tripling in price of its overwhelmingly major export.My truck is not with pro-chavez or anti-chavez people. As mentioned, i really don’t mind at all which way you vote. My truck is with English speaking media outlets that, at best, are guilty of errors of omission. May i suggest that there are plenty of other places on the internet where i’m sure there is lively debate about the VZ referendum results. It would be nice to keep issues here away from political actualities. A debate about the public snapshot perception as recorded by latinobarómetro might be a less polemic or popular with potential posters, but it might make for something a little more productive at an economics website. If you wish to debate the VZ referendum with me then feel free to send me an e-mail.

  6. Rob Sandberg   December 9, 2007 at 10:12 pm

    Mark, what would the people of Latin America prefer instead of democracy and free markets – ISI and military rule (or dictatorship)? These surveys should raise concerns for all of us, but without knowing what the people of Latin America would prefer instead, it’s unclear that they are on the verge of changing economic and political systems… those in Latin American countries might be very willing to continue supporting democracy and free markets as long as there is no other viable alternative (I would suspect that those countries that suffered tremendously under ISI and military rule will have a higher degree of toleration for democracy and free markets even if they do not solve various problems quickly). Also, how much causal weight should we place on the individual attitudes, values, etc. of normal individuals within these countries when one is trying to empirically explain political and economic stability within states? It seems to me that the actions and ideas of powerful economic and political elites within states as well as international economic events are more important variables for explaining stability (or system change).

  7. Anonymous   December 11, 2007 at 5:36 pm

    anon1’s recent comment was deleted