Neoliberalism In Latin America

Neoliberalism is a new form of liberalism that tends to favor free market societies. The idea of neoliberalism is to promote privatization and deregulation to help improve the economic and living standards of a nation. As a result of more educated individuals arising in countries, philosophical and scholarly individuals began to take power and introduce the idea of neoliberalism into their respective countries. Although it is a fairly new term, in the early 1960s it began to make it’s first appearances in Latin American countries. Mainly due to the economic instability in Latin American countries during the 1960s to the 1990s, began to adopt lassie faire economic policies to help promote business and supplement the countries societies quality
of life. In the early days of corporatism in Latin America, large corporations that operated in the countries were viewed as equals to the government in scale of power. U.S. corporations were the largest in Latin America, and held massive amounts of land and power, which allowed these U.S. companies to operate freely. The U.S. companies were essentially monopolies that kept the countries that they operated in hostage by not allowing any social or economic mobility for the citizens of their respective countries. Countries such as Guatemala, Bolivia, Chilie, Brazil, Mexico, and many more were subject to government and external economic control which inevitably kept the individuals and government themselves from freely trading with any and everybody.
These countries were limited to trading with corporations or countries approved by their government or corporate sponsors. Latin American countries began borrowing money from international institutions in large sums, and then began accumulating interest, and borrowing more money to pay off the interest of past loans. The borrowing would eventually lead up to a debt bubble that would soon pop and cause Latin America to want a neoliberal society, to avoid any economic crisis like the debt bubble. Neoliberalism basically helps strengthen privatized corporations and allows the government to support the privatized corporations by subsidies. In Latin America, the government subsidized oil, fruit, or any item that is used in bulk or exported. Soon neoliberalism would evolve into countries competing with one another for corporate investments by offering lower taxes, tariffs, and already set up infrastructure. Countries would begin to skim from their budget to be able to pay for subsidies, thus creating a social problem by not building the much-needed infrastructure for their country and people to
thrive. The neoliberalism reforms have been linked to an increase in inequality and poverty for countries in Latin America.