F.H. Cardoso and E. Faletto
CAPITALIST DEVELOPMENT AND THE STATE: BASES AND ALTERNATIVES (1979)

(The subheadings were added by Dr. Róbinson Rojas Sandford. The text is
 part of the POST SCRIPTUM, in Cardoso and Faletto, "Dependency
 and Development in Latin America", University of California Press, 1979)

The more developed countries of Latin America are attempting to define
foreign policy objectives that take advantage of contradictions in the
international order and allow these countries some independent policy-
making. But these countries remain dependent and assure an internal
social order favorable to capitalist interests and consequently fail to
challenge one of the basic objectives of American foreign policy.
Multinational enterprises continue to receive support from the foreign
policies of their countries of origin, as well as from local states.

How can these contradictory forces act together? It is through
contradictions that the historical process unfolds. Dependent
development occurs through frictions, accords, and alliances between the
state and business enterprises. But this type of development also occurs
because both the state and business enterprises pursue policies that
form markets based on the concentration of incomes and on the social
exclusion of majorities. These processes demand a basic unity between
these two historical actors as they confront popular opposition, which
may be activated when nationalist or socialist movements question the
existing social order. So, the conflicts between the state and Big
Business are not as antagonistic as the contradictions between dominant
classes and people.

Within the last ten years, the strengthening of the state and the
penetration of multinational corporations occurred within the context of
a new set of class relations. On one hand, attempts were made to break
(sometimes radically) with the global situation of dependency, with the
aim of transforming society in the direction of socialism. On the other
hand, dominant classes were reordered, with emphasis placed on the
repressive role of the state and on the simultaneous transformation of
the state into a tool for the fortification of the capitalist economic
order.

The exhaustion of the prior populism and the aggravation of class
tensions gave rise to various political attempts to break with the
prevailing style of development. In one form or another, during the past
decade, the politics of Latin American popular forces were profoundly
marked by the presence of the Cuban revolution. The shadow of Guevara's
deeds and the quasi-substitution of the process of mass politics by the
military actions of guerrilla groups (though this was not implicit in
their theory) considerably polarized Latin American revolutionary
movements. These attempts failed nearly everywhere, the only exception
of consequence being the case of Argentina, where the two principal
guerrilla currents were not completely dissociated from the remaining
socio-political movements. Though not constituting a real political
power alternative, the guerrillas of Argentina exert a certain veto
capacity, conditioning other political movements and attempts at
reformulating class alliances.

Attempts at radical rupture with the capitalist-developmentalist path
were not limited to the politics of the guerrilla. The Chilean popular
unity of the Allende period, as one case, and the Peruvian military
reformism, as another, were reactions based on broader popular forces
to development that is tied to international capitalist-oligopolistic
expansion. In both cases the state was viewed not as a "bourgeois
institution" to be destroyed, but as the lever for a possible total
transformation of society, on condition that its control remain in the
hands of popular forces.

Both the battle between classes and the basic dependency relationship
find in the state a natural crossroads. The contradiction of a state
that constitutes a nation without being sovereign is the nucleus of the
subject matter of dependency.

Our rereading the history has proceeded throughout the book toward
specifying the fundamental historical actors: classes and groups defined
within specific forms of production. Now, after ten years of reasonable
rates of economic growth, the expansion of global commerce, the
industrialization of important segments of the periphery of the
capitalist world, and the strengthening of the state productive sector,
the problem unfolds in a more complex manner. STRICTU SENSU, the
capacity for action of various Latin American states has increased. In
this sense, one might consider that they are "less dependent". Our
concern is not, however, to measure degrees of dependency in these
terms, -which fail to ask, "less for whom? for which classes and
groups?" Which classes have become more sovereign? Which alliances and
class interests within each country and at the international level lead
the historical process of economic development?

If the state has expanded and fortified itself, it has done so as the
expression of a class situation which has incorporated both threats of
rupture with the predominant pattern of capitalist development, as we
have said, and policies of the dominant classes favorable to the rapid
growth of the corporate system, to alliances between the state and
business enterprises, and to the establishment of interconnections, at
the level of the state productive system, between "public" and
multinational enterprises. To accomplish this, the state has assumed an
increasingly repressive character, and dominant classes in a majority of
countries have proposed policies increasingly removed from popular
interest. They have rendered viable a "peripheral" capitalist
development, adopting a growth model based on replication -almost in
caricature of the consumption styles and industrialization patterns of
the central capitalist countries.

The tendencies indicated in chapter six developed with increasing
velocity, achieving successes for that style of development (the
"Brazilian miracle" and the type of growth that occurred in Mexico until
1970, are notable examples of the trend). Given conditions in Latin
America, this process, while producing economic growth, urbanization,
and wealth, has redefined without eliminating, or else in certain cases
has aggravated the existential, social, and economic problems of a
majority of the population. This majority has come to be looked upon as
a resource for the accumulation of capital more than as the effective
potential for the creation of a society modeled on its own interests.

Under these conditions, the state and the nation have become separated:
all that is authentically popular, even if lacking the character of
specific class demands, has come under suspicion, is considered
subversive, and encounters a repressive response. In this vein, even
problems which Western capitalist democracies confront and absorb, like
the discussion of income distribution, minority movements (blacks,
Indians, migrants, etc), feminist or youth demands (not to mention the
freedom of syndical and political organization), appear threatening to
the existing order. From the perspective of the dominant classes, the
nation has become increasingly confused with the state, and the latter
in turn has identified its interests with theirs, resulting in the
confusion of the public interest with the defense of the business
enterprise system.

Local dominant groups in Latin America responded to the external
influences on economic growth and to the need to guard against attempts
to transform the prevailing order, with an amalgam between a repressive
state (often under corporate military control) and an entrepreneurial
state. What lends dynamism to this form of state, and what characterizes
its movement, is NOT the bureaucratic aspect it may have assumed in some
countries (Peru, Mexico, Brazil, Chile, among the most characteristic
cases), but rather its ENTREPRENEURIAL aspect, which leads it to ally
itself, in production, with the multinational corporation. Somehow, the
state has become a strategic element, functioning as a hinge that
permits the opening of the portals through which capitalism passes into
industrializing peripheral economies.

A state which expanded the public sector AT THE SAME TIME that it
intensified relations between the latter and the multinational
corporations began to develop with the accords on the "Chileanization"
of copper proposed by the government of Frei. The proposal was uncommon
in the statist tradition of Latin America: the connection with foreign
enterprises would be made through their association, not with the local
bourgeoisie, but with public enterprises created by the state, which come
to function as CORPORATIONS.

The generalization of this model, in Brazil, in Mexico, in Peru, in
Venezuela, for example, transferred the conflicts AMONG ASSOCIATES to a
more directly political sphere. In addition, it married foreign
interests with the local bourgeoisie, and in certain countries, with the
interests of local states insofar as they were direct agents of
production, as occurred in Brazil, in Mexico, and to a lesser extent in
Venezuela. The consequences of this process are enormous and are far
from having been exhausted by historical practice or by analysis. The
character of this state-as-entrepreneur and of the state associated
economically with imperialist forces without being a politically
associated state has lent to the contemporary form of the state a
significance different from that which it had until mid-1950.

What is novel is the expansion of the state's direct productive
investment in capitalistically profitable sectors. While state
investments in these sectors originally came about with resources
obtained through taxes and duties, they subsequently reproduced and
expanded through the PROFITS generated by the state enterprises
(petrochemicals, mining, direct consumer goods, etc.). In countries like
Brazil, Chile, Colombia, Peru, Mexico, and Venezuela, the public sector
contributes more than 50 percent to the annual formation of capital,
with the remainder contributed by private national and foreign
enterprises. Of this total, in a majority of these countries, the STATE
ENTERPRISES (as an individual portion of public expenditure) constitute
more than half of the investment of the public sector. In Brazil, in
1975, this figure exceeded 30 percent of the total investment (public
and private). Also in Brazil, the only two local enterprises which, by
the scope of their action, could hope to qualify as multinationals
(aside from the Iraipu hydroelectric corporation) are state enterprises:
the Vale do Rio Doce and Petrobras. Counted among the largest
enterprises operating in Brazil, in terms of assets and the value of
production or trade (and leaving foreign enterprises aside), are not
the enterprises controlled by local private capital, but rather those
of the state. In 1975, fifty-six of the one hundred largest Brazilian
enterprises were state owned.(7)

THE BUREAUCRACIES AND TRANSNATIONALS

The role of bureaucracies and of technocrats is considerable in
practically all of the industrialized countries of Latin America. In a
penetrating essay on this subject, (8) Guillermo O'Donnell attempts to
show the nature of this form of regime and the conditions under which it
emerges. He points out that regimes of this type established themselves
in the region as the response of local dominant classes to the challenge
presented by the mobilization and popular pressure generated by the
collapse of previous political orders (either populist or traditionally
authoritarian). He adduces further that this collapse occurred when
economic difficulties that followed the import-substitution stage of
industrialization created an inflationary situation and led the economy
into an impasse. Its solution required, aside from stability to ensure
economic predictability, additional capital flows and greater
entrepreneurial centralization in order to proceed along an
oligopolistic route toward the continuation of the process of
accumulation and toward the development of productive forces. O'Donnell
concludes that, for all of these reasons, there exists a relationship of
"mutual indispensibility" between bureaucratic-authoritarian states and
international capital (which needs to penetrate local economies and
which possesses the technological and financial requisites to undertake
the "deepening of development").

The lack of local private investment potential, the political need to
prevent multinational corporations from single-handedly appropriating the
most strategic sectors of the economy and their most dynamic branches,
and even, at times, the nonexistence of international capital flows
to attend to the investment needs of peripheral countries during any
given period (since multinationals act on a global scale, aiming at
maximizing results and not toward the continuity of local development),
has led local states, despite the capitalist ideology they defend, to
expand their functions and thereby to create a national basis from which
to bargain with the multinationals. In this process, neither the
decisions of the state nor the pressure from multinationals exclude
local enterprises from the game. But in practice these local enterprises
continue to lag behind the principal agents of transformation: the
multinationals and the state. By the very force of expansion, new
investment prospects do at times open up for segments of the local
bourgeois sectors. Some of these return to the political-economic
offensive, often allying themselves with the multinational enterprises
in the "antistatist" struggle.

This summary of contemporary development lies within what we perceived
as possible ten years ago. The role of the state and how it supports
itself in industrialized-peripheral countries has become more clear,
however.

If it seems necessary for the state in a dependent-capitalist country
to become bureaucratic if expansion is to be viable, then the risk is
run of relying on economic reductionism, which cannot take account of
historical processes. (9) For example, it may be true that Argentina's
General Ongania had a corporativist political plan, which tended to
bureaucratize the state apparatus and implement repressive policies.
Nonetheless, the Cordobazo -a mass rebellion- together with the force
of the labor movement, Peronism, and the enunciations of guerrilleros
and revolutionaries, prevented Ongania's plan from working.

President Lanusse later proposed a pact with Peronism, which aimed at
preventing an alliance between revolutionary movements and the Peronist
masses, which would have been dangerous to the capitalist order. After
Peron's death, the inability of a government controlled by a mass
bureaucratic party to thwart the revolutionary challenge led to the coup
of General Videla.

Was this coup an implementation of a bureaucratic-authoritarian regime
based on the dynamism of public enterprise? Not necessarily. In the
Argentinian case, social classes and the private economy constitute a
force which until now has escaped the political-corporativist control of
the state (though the labor movement and labor unions contain
corporativist ties). Corporativist projects expire under syndical
pressure and under the economic pressures of export sectors when these
demand free market prices (one of General Videla's first acts was to
remove the commercialization of meat from state control). In the
Argentinian case, in moments of advancing revolutionary pressures, the
state has assumed a repressive-military form, without having produced
until now a stable bureaucratic-authoritarian regime.(10)

In Venezuela and Colombia, especially in the former, the state is
promoting ties between multinational enterprises and the public sector
to strengthen the public sector, but without a bureaucratic-
authoritarian regime. To be sure, it represses the challenge of
"outlaws", as does every dominant order. But it does not exclude party
politics, the representation of interests, and some public freedoms.

These are examples of a pact of domination favorable to big business in
a situation of class conflict in which a formally democratic regime
does not give way to the emergence of more repressive forms of political
organization.

The Argentinian example demonstrates the "open process" of history. A
simple "structural" analysis, demonstrating the contradictions between
social forces and the drawbacks of the process of accumulation with its
cycles and crises is insufficient to explain the concrete course of
political events. Nor does it suffice to point out the affinities and
battles among dominant classes and the plans for political
institutionalization which they support. It is even insufficient to view
the political behavior of ruling classes in terms of reaction to a
popular challenge.

Popular reaction, under the guerrilla form, as we saw in Argentina, was
capable of conditioning  and of vetoing but not of transforming the
political structure. There have been no viable alliances capable of
imposing a form of state which could recover not only the aspiration
to sovereignty but the primacy of the popular interest. The incapacity
for hegemony of popular groups adds to the repressive capacity of
dominant classes the fatal ingredient that leads to a policy of advance
and retreat within the iron circle of prevailing structures.

In Brazil and in Peru, the fortification of a formally
bureaucratic-authoritarian order can be seen more clearly. The state in
Brazil does not adopt, as an ideology, the authoritarianism which it
practices. Thus the regime is guided by a duality of principles: the
constitutional order that anticipates, for example, elections; and the
institutional acts that transform the military president into de facto
dictator, as long as the political order is perceived to be threatened,
according to criteria determined by the organs of military security.
Despite these instruments of discretion, the failure to explicitly
recognize the validity of an authoritarian order leads the regime into
the exercise of electoral practices which at times jeopardize
authoritarianism. The government dismantles the very "legal" order it
created, by impeding the rotation in power of the two parties, by
eliminating elected deputies, by going against the "democratic ideal".

In Peru, where the regime is clearly nonparticipatory, the qualifying
phrase "bureaucratic authoritarian" is more immediately applicable:
public enterprise and the state as a bureaucratic organization both
expand while remaining under the control of the military corporation.
Meanwhile, social and economic policy in Peru, while not revolutionary,
is not income-concentrating, in comparison with what occurs when the
multinationals and the private sector of the local economy direct the
process of accumulation. In addition, political control does not assume
traits that are abusive of human rights, as occurs in Chile and in
Brazil or Argentina.

The contradiction between the state as the agent of capitalist
enterprise, and the nation as something that is essentially popular,
follows a movement that is not only different but OPPOSITE, in the
recent history of Peru and Brazil. Though the Peruvian state may be
bureaucratic-authoritarian, its policies are oriented toward the
incorporation of the masses, or at least toward the partial
consideration of peasant and popular interests. These objectives may
have been frustrated and difficult to secure within a policy that
stifled the spontaneity of popular reaction, congealed political
parties, and harbored seeds of military-bureaucratism. However, its
ideology and what it has done to reorganize the socio-economic order
distinguish the Peruvian state from that of the
bureaucratic-authoritarian state of Brazil.

POLITICAL REGIMES AND THE STATE

Political regimes vary, as does the relation of
bureaucratic-authoritarianism to the social bases of the state (viewed
as a pact of domination). Nevertheless, the current form of dependency
and the crucial role performed in it by multinational enterprises and by
the state productive sector are no accident.

It is necessary to draw a distinction between the state, as a basic part
of domination (and not as the expression of a "social contract") which
unites dominant classes in the exercise of domination over the rest of
society, and the variable forms assumed by political REGIMES.

The state expresses a situation of domination, reflects the interests of
dominant classes, and expresses their capacity to impose themselves on
subordinate classes. At the same time this discriminatory relationship
(the domination of one part over the rest) must appear to the national
consciousness to be the expression of a general interest. Consequently,
the state constitutes a relationship of domination incorporating AN
IDEOLOGY that masks the partiality. This process is not a simple
distortion: it must also mirror, in some way, the generality it wishes
to represent. Hence, even the most openly classist and repressive states
use a language and propose policies (generally non-viable) that purport
to reflect the "general interest".

So, the state expresses the imposition of one class or alliance of
classes over others. But while it serves those interests on which it
bases itself, the state proposes measures that lend verisimilitude to
the "generality of interests" which it must assume to exist (people,
equality, nation). In addition to expressing a relationship like this
at this level, the state is also a bureaucratic-regulative organization
and, in the case of modern states, becomes even a productive economic
organization.

To summarize, any state, through bureaucratic and productive
organizations, expresses a relationship of class domination (and
consequently has social bases), assumes an ideology as if in the common
interest, develops and implements policies that respond to the
fundamental pact of domination, but also claims to attend to the
aspirations of dominated groups. Officials of the state (notably in the
judicial sector) have to adopt both an ideology of equality and
generality ("all citizens are equal before the law") and a practice in
which dominant interests impose themselves.

ASSOCIATED-DEPENDENT CAPITALISM

In the industrialized countries of Latin America which we are
considering, the state embodies an alliance between the interests of the
internationalized sector of the bourgeoisie and those of public and
entrepreneurial bureaucracies. The local bourgeoisie links itself to
these sectors.

In part, the state in dependent capitalism generates its own social
base, since its productive function is to assure capital accumulation,
and since in performing this function, it creates a sector of public
entrepreneurs. At times this stratum is called the "state bourgeoisie",
to emphasize that these social agents are not simple bureaucrats nor do
they simply implement the "public good". They function, sociologically,
as the "officeholders of capital". For they support the accumulation of
capital in the state enterprises. Both the accumulation of capital by
public enterprises and the placing of all of the national wealth
(mineral ore, impounded taxes, lands, roadways, etc.) at the disposal of
private capital are fundamental requirements for the advancement of
associated-dependent capitalism.

The state extends a bureaucracy and bases itself on a civil and military
technocracy. The latter carries out the interests that are expressed by
the state. Certainly, an inversion of this relationship can occur. The
actors may occupy prominent positions on the political scene. The
military bureaucracy may predominate in the control of the state. But in
the end, long-term policies must be compatible with the social bases of
the state.

In the realization of policies of accumulation and development, though
the bureaucratic framework may be in the hands of a
technocratic-bureaucracy or a corporative military (together or
separately), the nature of the dominant state relationship develops
through the strengthening of the alliance between the local
entrepreneurial sector, associated with the multinational foreign
enterprises, and the state productive sector.

The same fundamental alliance which constitutes a dependent industrial
capitalist state may organize itself institutionally within a context of
authoritarianism, restricted democracy, or totalitarianism. There is
little credibility in its structural compatibility with substantive
forms of mass-democracy, populism, or even traditional caudillo
(bossist) authoritarianism, since in these regimes the requisite
policies leading to the expansion of industrial dependent capitalism
become difficult to implement, because of the masses' interests in
economic redistribution and political participation.

Not that Venezuela, Colombia, and Argentina will NECESSARILY have to
adapt themselves to the Brazilian or Peruvian military-bureaucratic-
authoritarian model. These last two regimes are themselves quite
different, both in the nature of their policies and in the nature of
their respective social bases.

The bureaucratic-authoritarian FORM of a regime like that of Brazil is
not the ONLY one capable of adapting to the "present stage" of capital
accumulation. Economic reductionism in this case would fail to consider
the changes that might occur from government to government (with, we
repeat, the basic state pact maintained).

There are many factors that function as sources of dynamism in history:
(1) circumstantial factors such as explosions of collective protest (the
    1974 Brazilian elections provide an example different form the
    Cordobazo, because the correlation of forces differs in the two
    countries);
(2) struggles within dominant sectors;
(3) the emergence of objective economic challenges (recessions, soaring
    inflation, a "new stage" of import substitution in the capital goods
    sector, for example);
(4) the ability of the governing group to resolve problems and the
    opposition's ability to debate them, and so forth.

Not all changes are always possible, to be sure, nor do political forces
of taking advantage of opportunities for transformation always exist.
But even in bureaucratic-authoritarian regimes, and even with the
persistence of the alliance that underlies the state, there is room for
regime-types to vary historically. What is at issue is not just a "mere
change in form". The differences between a torturing autocratic regime
and a "restricted democracy" arise out of the very possibilities for
struggles among classes, and they in turn influence the historical
opportunities of the dependent capitalist-industrial state.

A basic problem exists, posed by the present moment and by Latin
American situations of dependency: the very penetration of
multinationals requires a state that is capable of furnishing the
multinationals with the resources for accumulation. But this process is
contradictory: for this to work, the state must fortify itself and
expand its functions at both the administrative and the economic levels,
in this way increasing its prospects for sovereignty. Faced with the
political challenges of dominated classes to radically reorder society,
this entrepreneurial-regulative state militarizes itself, becoming even
stronger and more autocratic. At this point the relative loosening of
ties between the state and its SOCIAL BASE may occur, which the
economically ruling classes may perceive as a risk of "Bonapartization"
of the state. The spectrum of this perceived risk ranges from the
emergency of a new Peron to a "mythical Peruvianism" that would lead the
armed forces to ally with the people. In the process of exercising
sovereignty and equipping the state with entrepreneurial skills, which
allow both international and local accumulation, the entrepreneurial-
repressive state DISSOCIATES itself from the nation. THIS is the
specific political contradiction in the current form of Latin American
dependent development.

There may have been a redefinition of the "forms of dependency", in
certain Latin American countries there may be "less dependency", and the
state in these countries may be capable of exercising a greater degree
of sovereignty. But for us, what is at issue is the nature of class
conflicts and alliances which the dependency situation encompasses.

As we stated previously, the political struggle revolving around the
state shows what is essential in this form of dependency: the style of
development of the possibility of alternatives depends upon the
resolution of this question of the state. In the Chilean Popular Unity,
in Peru, and in the Popular Assembly of the Torres period in Bolivia,
popular forces or forces with popular intentions momentarily assumed
control of the state. We find, in these cases, ambiguity about what
constitutes the "popular" and unanimity regarding NATIONAL demands.

The fundamental challenge of the present moment in Latin American social
development  consists in linking these two aspects of radical political
movements, the popular and the national, and in getting to the bottom
of the opposition between the popular and the proletarian.

What is specific to the Latin American situation of dependency is the
difficulty in conceiving of a political passage to socialism by a
strictly proletarian route, given the structural conditions of
industrial capitalism in the periphery. So, alliances between popular
movements, national-popular demands, and properly working-class
struggles are required to enforce new paths in society.

These questions, however, are not posed today as they were during the
populist period. The advance of mass industrial society, urbanization,
the revolution in communication, even the situations of dependent-
DEVELOPMENT themselves, pose the political question of popular
participation in such a way as to EXCLUDE MANIPULATIVE LINKS WITH
DOMINANT CLASSES THROUGH THE STATE as an option. Such links were the
basis of populism's policy. The internationalization of production and
of the market have advanced, and the state as the stimulus for an
enterprise economy. But, at the same time, for dominated classes, the
paternalism of the traditional Latin American state (in both the
oligarchical and populist versions) has been broken. Although
politically frustrated, the guerrilla movements did serve the function
of disrupting this paternalism and putting an end to manipulative types
of alliance which once tied the people to the state in the name of the
nation.

The practical issues that will permit development of an alternative
type of state involve, first, knowing which course "substantive
democratization" must take to affirm what is essential in the national
and the popular and free from the rancidity of bureaucratizacion and
authoritarianism, and second, knowing how to balance the need for
organization and the vitality of spontaneous mass behaviour. As in any
case of social transformation, such questions go beyond analysis and
anchor themselves in values: they are projected into the future to
assist in the practical escape from a situation that reinforces the
prevailing exploitative order. It is not within the boundaries of this
book to pursue these questions. It is barely within those boundaries to
point out, as we have, that social practice in Latin America has already
begun to deal with these questions (even if in experiences that failed).

Researchers have directed their attention to ideology and corporativist
forms in Latin America.(11) It appears to us that the fusion between
enterprise and the state, both of them based on bureaucracies, and the
role of the armies in Latin American regimes, underscore the
corporativist ties between the state and society.(12) During certain
periods of political life, the relationship between civil society and
the state seems to dispense with the mediation of parties: classes just
appropriate segments of the state apparatus to defend their interests.
Sometimes connections are formed through "bureaucratic rings", which are
organized around high officials (cabinet ministers, generals, etc.) and
which articulate the immediate interests of enterprises, government
bureaus, the press, sometimes unions, repressive groups, and so forth
around some specific policy or issue. In bureaucratic-authoritarian
politics these semiformal structures substitute for an organization that
is more stable and representative of class interests, namely parties.
Particularly when regimes are centralized and positions at the top are
decisive in the articulation of interests (Mexico, Chile, Brazil, Peru),
bureaucratic rings seem to constitute the form of political linkage that
establishes connections between civil society and the state. The linkage
is not very stable, since the key official can be dismissed and the ring
thereby broken.(13)

These formal aspects of the juncture between the state and civil society
should not obscure the characteristics of the state in contemporary
Latin America which we have already pointed out. The state is the
expression of the dynamism of business enterprises and of the classes
that control  them as they operate in a context in which bureaucracies
and the regulative and organizational capacities of the state are
expanding.

The basic ideology of the state is fundamentally "developmentalism". In
view of the explicit ends of economic growth and national grandeur, the
exploitation of workers, if not openly defended by the state, is
justified by the argument that the tightening of belts is necessary
"at the moment" so that "in the future" the results of this economy may
be redistributed. We do not endorse studies of Latin American
corporativism that see in it a "profound cultural trend", consonant with
that society's patrimonialist structures. These structures were real in
another and bygone situation, but in the current period of industrial-
financial capitalist development, an insistence on the "necessity" of
the corporative form in Latin American political relations seem to us
an anachronistic and conservative point of view. When corporativist
forms exist, and there are circumstances in which they do, they express
the pact of dominion among classes trying to implant capitalist
development, and the opposition which these attempts encounter in the
political movements of subordinate classes.

Instead of insisting on the immutability of the "cultural dimension" and
historical roots of corporativism, it seems to us that what is important
is an understanding of the essence of contradiction between interests of
people and current style of development, between the state and the
nation. In these relationships of opposition, if any cultural dimension
exists and carries significance, it is what Gramsci called a
relationship of hegemony: the capacity to rule. The effective battle is
not between corporativism and the democratic tradition. It is between
technocratic elitism and a vision of the formative process of a mass
industrial society which can offer what is popular as specifically
national and which succeeds in transforming the demand for a more
developed economy and for a democratic society into a state that
expresses the vitality of truly popular forces, capable of seeking
socialist forms for the social organization of the future.
____________________________
footnotes

(7) It should be made clear that despite the importance of the role of
    the state productive sector in the Brazilian economy, foreign
    enterprises control between 40 and 50 percent of the large groups,
    according to measures of fixed assets, liquid assets, employment,
    and invoicing.

(8) O'Donnell, Guillermo, "Reflexiones sobre las tendencias generales
    de cambio en el Estado burocratico autoritario" (Buenos Aires,
    CEDES, 1975).

(9) We are not referring here to O'Donnell analyses. There exists in
    these (especially in "Notas para uma explicacao historico-
    comparativa" (Notes for an historic-comparative analysis), mimeo) a
    vivid effort to demonstrate that the "mutual indispensibility"
    between oligopolistic accumulation and bureaucratic-authoritarian
    regimes passes through the sieve of class struggles and through the
    accidents of history.

(10) On the contradictions in the recent evolution of the economy and
     politics of Argentina, consult O'Donnell text, referred to above.
     The alliance between part of the local bourgeoisie and the popular-
     worker movement constitutes, for that author, a defensive alliance
     whose limits emerge clearly when the cyclical oscillations of the
     economy lead agro-exporting sectors to demand corrections in the
     economic policies proposed by this alliance.

(11) See Schmitter, Philip, "Still the Century of Corporativism?". in
     WORLD POLITICS, 25 (January 1973), and his important book "Interest
     Conflict and Political Change in Brazil" (Stanford: Stanford
     University Press, 1971); also Stepan, Alfred, "The State and
     Society: Peru in Comparative Perspective", forthcoming from
     Princeton University Press. See especially chapters 1 and 2.

(12) See Stepan, Alfred, op. cit., where corporativism is NOT
     inappropriately generalized to describe all authoritarian regimes.
     See also, in Schmitter's book, cited above, the specifications
     made in describing corporative relations between the state and
     civil society and among parts of the latter.

(13) See especially, Cardoso, F. H., "A questao do estado no Brasil",
     in AUTORITARISMO E DEMOCRATIZACAO (Rio de Janeiro, Paz e Terra,
     1975).
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