Turning to the subject of this Note (**), bureaucratic capitalism in Bolivia experienced, like many of its Latin American peers, the "commodity price boom" (2006-2014), giving a false image of the country's economic development. This was merely a mirage or a trinket sold by the mendacious "socialism" of the MAS (of "Evo") and his successor Arce. From 2014 to the present, its economy has exhibited negative figures. Two decades of MAS rule correspond to "two lost decades of development" (ECLAC) for Bolivia in the present century, as has happened with the rest of the economies of Latin American and Caribbean countries. The bureaucratic regime failed, as it was bound to fail, under the leadership of the old State that represents and defends the rotten and outdated society, the old order of oppression and exploitation.
The brilliant and surprising figures for the reduction of poverty and hunger presented by the reactionary regime led by the MAS, under Evo Morales and Arce, were the result of the implementation of the social assistance voucher system, which reaches approximately 3.5 million people. These vouchers, which reach only a fraction of the vast mass of the destitute, are the way in which part of the crumbs of the immense wealth that the great imperialist monopolies and their economic agents, the native big bourgeoisie, are siphoned off with the so-called "extractive industry." This is the economic background for social policies in Latin America, and particularly in Bolivia, from the last decade of the last century to the present. It is the recognition by imperialism and the reactionaries in these countries of the obsolescence of their system of exploitation; it is equivalent to the alms and aid to the poor created by the Church during the final crisis of feudalism in Europe.
Here, we emphasize that social policy, which includes "assistance vouchers," corresponds to the recommendations of the so-called "Washington Consensus" in its "second wave of structural reforms," as a complement to the "neoliberal structural reforms." This social policy is promoted by imperialism in our countries to appease the explosiveness of the masses, generate domestic demand, and further fuel parasitism in our economies with "the capitalization of social security contributions" and to attempt to legitimize the further exploitation of our countries. This social policy
Character of society: the relationship between economic development - production - employment - poverty
To address this issue, we must start from the character of society, consider the relationship between economic development or production - employment - poverty, and examine the Latin American economic process from the 1990s to the present based on the figures and facts provided by official reports.
Keep in mind that these official reports fail to address the roots of these problems: the social relations of production.
It is necessary to distinguish between:
- Proletarian pauperization. The reserve army of labor and capitalist overpopulation, on how it is engendered by mechanized industry, on its significance in the cyclical movement of industry, and on its main forms of pauperization; and
- "Non-proletarian pauperization." The great mass of the poor, the vast majority referred to in official statistics, comprised primarily of the immense mass of poor peasants, among whom are those who have migrated to the cities, who, as Lenin characterized them, "can be classified among the destitute."
"Destitute" is the name that corresponds to them and which "should be considered in official reports," since "this would define more accurately and realistically the attitude of today's society toward these strata of the population."
Lenin, in a Review, points out the inconsistency of comparing the situation of the proletariat in the West (the developed capitalist countries of Europe) and the Russian peasantry with land, since they are in a much worse situation than the rural proletariat in the West. Russian peasants can be classified among the destitute, he tells us.
Why the difference noted above?
Because Lenin addresses the process of slow development from feudalism to capitalism in Russia, a landed path in agriculture, which is the path followed by the development of bureaucratic capitalism in agriculture in Latin American countries. In this case, like Lenin, he says:
“Outdated institutions, by slowing the growth of capitalism in both agriculture and industry, restrict the demand for labor without in any way protecting the peasants against the most shameless and unlimited exploitation, or even against death by starvation.”
Lenin was in the midst of preparing his work The Development of Capitalism in Russia, and so he studied a series of materials. For his Review, he quoted another author on the concept of "non-proletarian pauperization," as we read in the quotation:
"Mr. Grozdev's book is useful because it gathers data on the process of "non-proletarian pauperization" and rightly characterizes this process as the lowest and worst form of peasant differentiation. Mr. Gvozdev, apparently, is well acquainted with Russian economic publications (...)"
(* Parvus. The World Market and the Agrarian Crisis. St. Petersburg. 1898, 8, note. Lenin, Collected Works, Vol. 4, "REVIEW, R. Grozdev. "The Kulak Usurers, Their Social and Economic Significance")
Chairman Mao, already under the conditions of imperialism regarding this process, established:
“To serve the needs of its aggression, imperialism created the comprador system and bureaucrat-capital in China. Imperialist aggression stimulated China’s social economy, brought about changes in it and created the opposites of imperialism — the national industry and national bourgeoisie of China, and especially the Chinese proletariat working in enterprises run directly by the imperialists, those run by bureaucrat-capital and those run by the national bourgeoisie. To serve the needs of its aggression, imperialism ruined the Chinese peasants by exploiting them through the exchange of unequal values and thereby created great masses of poor peasants, numbering hundreds of millions and comprising 70 per cent of China’s rural population.
(CAST AWAY ILLUSIONS, PREPARE FOR STRUGGLE* August 14, 1949)
Bureaucratic capitalism: “Low economic growth and productivity in the region”
The “economic development” of Latin America, referring only to the period from the 1990s to the present. It has been nothing more than "economic growth without development" based on primary exports for the needs of imperialism, that is, the development of bureaucratic capitalism based on the maintenance of its semi-colonial and semi-feudal condition, which can only generate more backwardness and misery, contrary to the ROL's claim that with "neoliberalism, these have become capitalists."
The reports of official agencies themselves highlight the limited growth of the fundamental and typical features of capitalist development, hindered by the semi-feudal and semi-colonial basis, confirming that bureaucratic capitalism, as late capitalism, is born sick like its parents, imperialism and semi-feudalism. In the process of development of bureaucratic capitalism of the last 70 years,
The ECLAC 2024 report states: "economic growth without development," "lost decades," "is going through a development crisis." This same crisis admits the failure of the bureaucratic path led by one faction or another of the big bourgeoisie, when he says:
“The history of reforms in Latin America and the Caribbean to transform various aspects of development patterns is long, from state-led strategies to strategies that rely on market power, deregulation, and economic openness. This state-market dichotomy does not offer adequate solutions (…).”
In response, it proposes to be more "pragmatic" by combining both factors, as if that hadn't already been done and failed as part of the same path.
Contrary to what the ROL maintains, the plans of imperialism implemented by its lackeys of the native big bourgeoisie do not lead to the capitalist development of our countries, but rather to further backwardness. Let's review the official data on this matter:
- Between 2015 and 2023, the economies of Latin America and the Caribbean grew at an average annual rate of 0.9% (weighted average), that is, less than half of the 2.3% observed in the so-called lost decade of the 1980s. This low growth has not been limited to the last decade, but is a long-term trend.
- The average growth in the region decreased from 5.5% in the almost 30 years from 1951 to 1979, to 2.7% in the following 30 years (1980 to 2023). 2009), and only 1.8% from 2010 to 2024.
- As a result, the region's average per capita gross domestic product (GDP) level in 2023 was the same as in 2013.
- Between 1950 and 1980, the economies of Latin America and the Caribbean doubled their labor productivity levels. Forty-three years after the so-called debt crisis, the region has not been able to return to its pre-crisis productivity levels.
- Between 1980 and 1990, the region's average labor productivity contracted by 16.5%.
- From 1990 to 2013, a period of ups and downs in productivity growth culminated in 2013 with the end of the commodity price supercycle.
- Despite 23 years of recovery, labor productivity in the region was slightly lower in 2013 than in 1980.
- From 2013 to the present, it has again followed a downward trend.
The notable slowdown in investment in Latin America and the Caribbean since the 1990s (with declines in certain years) has had an adverse impact on the region's capital stocks, productivity, and economic growth. In turn, the slower pace of economic activity has had a negative effect on investment dynamics, which has decelerated production.
- The annual rate of change in investment, measured through gross fixed capital formation, has significantly decelerated in Latin America and the Caribbean over the last 70 years.
- The 1960s and 1970s saw average annual expansion rates of 5.6% and 6.3%, respectively. In the 1980s, investment contracted at an average annual rate of 2.1%. In the 1990s and 2000s, it expanded by 3.6% and 3.4%, respectively, while in the 2010s it showed a meager average growth of 0.8%. Furthermore, the investment cycle has been shorter than the economic cycle, implying greater volatility.
- The recessionary phases of the investment cycle have been more frequent, longer-lasting, and more contractionary than those of GDP. Even worse, the accumulated loss of investment during the recessionary phase of the economic cycle was greater than the gains during boom periods.
- This low level of investment is one of the main causes of the region's weak economic growth and productivity.
- Associated with low growth is a low rate of job creation. The 2011-2019 period recorded the lowest average annual job creation rate in the last 70 years (1.5%).
- Job creation has been declining since the 1970s, when the regional average annual growth in the number of employed persons was 3.9%.
- Furthermore, almost half of jobs are generated in informal conditions and are characterized by low productivity.
From the report: Economic Commission for Latin America and the Caribbean (ECLAC), Latin America and the Caribbean Facing the Traps of Development: Essential Transformations and How to Manage Them (LC/SES.40/3-P/-), Santiago, 2024.
According to the International Labour Organization (ILO), Bolivia is the country with the highest level of informal employment in the world, accounting for 85% of its workforce; This places it far above the informality rate in Latin America and the Caribbean, which stands at 53.7%, according to the latest data for 2022. In Peru, it varies between 76% and 79%.
The relationship between production and employment, etc., is also reflected in the following quote from the prologue of the ECLAC report (2025):
“The low capacity for growth is evident, for example, in the average growth rate of Latin America and the Caribbean between 2014 and 2023, which was only 0.9% per year, lower than the 2.0% recorded during the famous lost decade of the 1980s. ECLAC has warned that the region has just completed a second lost decade, characterized not only by weak economic growth but also by a very low rate of job creation and a slowdown in the poverty reduction trend observed since the early 1990s. It has also warned of the importance of redoubling efforts on several fronts to prevent a third lost decade from occurring.”
The above is from the Report of the Economic Commission for Latin America and the Caribbean (2025). Latin America and the Caribbean 30 Years after the World Summit for Social Development: Towards a Global Compact for Inclusive Social Development (LC/CDS.6/3), document prepared for the Sixth Session of the Regional Conference (September 2-4, Brasilia) on Social Development in Latin America and the Caribbean, organized by ECLAC, the Ministry of Development and Social Assistance, Family and the Fight against Hunger of Brazil, and the United Nations Development Programme (UNDP).
SOCIAL POLICY:
THE “RECOMMENDATIONS” OF THE “WASHINGTON CONSENSUS” AND ASSISTANCE BONDS
To document what we have been saying on the topic of this subheading, we transcribe the following from the aforementioned Report:
“The 1990s were marked by the recommendations of the Washington Consensus, which, in the case of social policy, proposed the idea of rationalizing the use of scarce resources through the use of targeting models for the poorest, using instruments such as Chile's CAS card, Colombia's System for the Identification of Potential Beneficiaries of Social Programs (SISBEN), Costa Rica's Target Population Identification System (SIPO), and the Dominican Republic's Single Beneficiary System (SIUBEN), among others. “The concern for efficiency in management, associated with the requirements of fiscal discipline (…) . Added to this was the incorporation of a "market logic for social services with the promotion of demand-based subsidies," which sought to encourage competition between public and private providers. This also included the distribution of resources through bidding and competitions to finance public and private administration programs and projects (see the above in the Report of the Economic Commission for Latin America and the Caribbean (2025), Chapter I, B).
Continuing, he says:
“In this context, the development of safety nets and social investment funds (SIFs) expanded, which marked the social management of those years (...) The SIFs played an important role in this regard and subsequently became the basis for the entities that exercised social authority, particularly with regard to non-contributory social protection. In most countries, this gave rise to the current Ministries of Social Development.
(...) Added to this was the outsourcing of services, which boosted the participation of private entities and non-governmental organizations in resource management and the implementation of social service offerings.
In the area of contributory social protection, this is clearly reflected in the emergence of individual capitalization schemes for pension funds and private health insurance.
Since the 1990s, and given the experience gained from SIFs and conditional cash transfer programs, the region has undergone a process of growing institutionalization of policies to combat poverty and access to services for the exercise of social rights (…) 23 of the 26 countries for which information is available have specialized ministries for development and social inclusion policies established by law (…).”
An article published in Bolivia, which we transcribe below, confirms everything stated above. We quote:
1. They call the indigent “the most vulnerable sectors.”
“Social bonds, particularly the Juancito Pinto Bond, the Juana Azurduy Bond, the Dignity Income, and the bond for people with severe disabilities, are designed to provide targeted assistance to some of the most vulnerable sectors. Their reach is considerable: approximately 3.5 million people benefit directly, which in Bolivia means an extensive impact on the economically weakest population.”
2. Demand Subsidy:
“One of the most notable points that emerges from the analysis of spending on these vouchers is the multiplier effect they generate on the national economy, given that 95% of these resources are allocated to immediate consumption, mainly for food, clothing, transportation, and basic services.”
3. To control the explosiveness of the masses, to “legitimize” the old State and the direct exploitation of imperialism and bureaucratic capitalism:
“The validity and continuity of these programs are also vital from a social and political perspective. By strengthening the link between the State and historically marginalized sectors, social vouchers act as an instrument of institutional legitimation and social cohesion, avoiding tensions and conflicts arising from extreme inequalities. Their contribution to building a minimum base of socioeconomic security is also key to governability and political stability in a context where economic insecurity can be a factor of destabilization.” (Social Bonds in Bolivia: A Strategic Investment for Inclusion, Development, and Stability, eldeber.com.bo, 08/11/2025
The World Bank and the IDB are responsible for monitoring the implementation of all the lackey governments in Latin America. This program began with the Bolsa Escola program in Brazil and the Education, Health, and Food Program (Progresa) in Mexico in the early 1990s. It was later imposed across the board as a result of the so-called World Summit on Social Development, held in Copenhagen in 1995, a bond program promoted and monitored by the World Bank.
The current situation in Bolivia demonstrates the failure of the reactionary government to fulfill its reactionary objectives, including its social policy.
A summary showing the failure of social policy driven by imperialism:
“The crisis resulting from the COVID-19 pandemic caused a significant deterioration in these indicators: poverty increased by almost 3 percentage points (representing a 12-year setback compared to the incidence level observed in 2008) and extreme poverty rose by almost 2 percentage points (equivalent to the levels recorded in the 1990s). Beginning in 2021, a gradual recovery process began, and it is estimated that by 2024, the lowest incidence of poverty in the region would have been reached (26.8% or 170 million people) and extreme poverty levels similar to those of the years prior to the pandemic would have been reached (10.4% or 66 million people). Despite this recovery, the levels of poverty and extreme poverty observed in most countries in the region are far from meeting the commitments established in the MDGs and SDGs.” (ECLAC, 2025)
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Appendices:
A. A summary of one of the imperialist institutions themselves, which illustrates what we are saying about the obsolescence of bureaucratic capitalism, which is unable to feed its own slaves and has to resort to "poverty bonds":
"It is interesting to remember that in Medieval Europe, Christian institutions created almsgiving, and in some cases solidarity with the poor, based on the figure of Christ. The poor person who came to a house or palace to ask for alms, according to evangelical tradition, could be Christ transfigured. The Catholic Church considered one of its greatest responsibilities in society to protect the poor, and to achieve this, it created a vast network of hospitals for pilgrims, hospices for abandoned children, and homes for the needy. Almsgiving
was the first form of social contribution. It was the poverty tax. The vast and solid network of institutions constituted a network of social protection that channeled significant resources.” (UNITED NATIONS ECONOMIC COMMISSION FOR LATIN AMERICA AND THE CARIBBEAN SOCIAL POLICIES IN LATIN AMERICA
GERMAN W. RAMA Seminar “Development Theory at the Dawn of the 21st Century” Santiago, Chile, August 28-29, 2002)
B. “ Social Bonds in Bolivia: A Strategic Investment for Inclusion, Development, and Stability
Carlos A. Ibanez
Publication Date: 11/08/2025 – 04:00
The social assistance bond system implemented by the Bolivian government is a fundamental tool for alleviating poverty and reducing inequalities in one of the most socially vulnerable countries in Latin America.
These programs, far from being simple economic assistance, represent a strategic investment in social cohesion, human development, and the country's economic stability. The diversity of benefits provided, ranging from educational incentives to support for pregnant women, the elderly, and people with disabilities, reflects the intention to cover multisectoral needs, thus supporting fundamental rights such as access to education, healthcare, and social inclusion.
The social assistance bond system in Bolivia reaches approximately 3.5 million people, distributed among the main programs in force. Beneficiaries are grouped into four broad categories related to the most relevant bonuses: students, pregnant women and young children, older adults, and people with severe or very severe disabilities.
The approximate data for 2024-2025 are as follows:
• Juancito Pinto Bonus: Benefits approximately 2.3 million primary and secondary school students in public and contracted educational institutions. The annual amount per person is Bs 200, which implies an estimated annual expenditure of Bs 460 million.
• Juana Azurduy Bonus: Aimed at approximately 300,000 pregnant and postpartum women and children under 2 years of age. The average actual amount received is Bs 1,200 per beneficiary, with an estimated annual expenditure of Bs 360 million.
• Renta Dignidad: Benefits approximately 1.1 million people over 60 years of age, with a monthly payment ranging from Bs 350 for non-retirees to Bs 300 for retirees. The annual expenditure reaches Bs 4.44 billion, making it the largest direct social expenditure by the Bolivian state.
• Bonus for people with severe or very severe disabilities: Covers approximately 70,000 certified individuals, with a monthly amount of Bs 250 and an estimated annual expenditure of Bs 210 million.
In total, the estimated annual expenditure for these bonuses amounts to approximately Bs 5.47 billion.
Social benefits, particularly the Juancito Pinto Benefit, the Juana Azurduy Benefit, the Dignity Income Benefit, and the benefit for people with severe disabilities, are designed to provide targeted assistance to some of the most vulnerable sectors of the population. Their reach is considerable: approximately 3.5 million people benefit directly, which in Bolivia represents a significant impact on the economically disadvantaged population. The amounts, although modest in absolute terms, have a significant impact on recipient households, allowing them to cover basic expenses such as food, medicine, transportation, and school supplies—items that often make the difference between staying in school or dropping out, or even between life and death in the case of maternal and child care.
One of the most notable points that emerges from the analysis of spending on these benefits is the multiplier effect they generate on the national economy, given that 95% of these resources are allocated to immediate consumption, primarily for food, clothing, transportation, and basic services. With an estimated marginal propensity to consume (MPC) of 0.95, the simple Keynesian multiplier would theoretically be very high (20), but in reality, considering leakages due to imports, taxes, and savings, the realistic multiplier is between 1.5 and 2.5. This active consumption not only benefits the households holding the bonds, but also boosts local production, favors commercial activity, and contributes to job creation. In fact, even considering realistic assumptions and adjusting for economic leakages, the indirect impact of this social spending is estimated to be equivalent to a 3.2% increase in Bolivian GDP.
The validity and continuity of these programs are also vital from a social and political perspective. By strengthening the link between the State and historically marginalized sectors, social bonds act as an instrument of institutional legitimation and social cohesion, avoiding tensions and conflicts arising from extreme inequalities. Their contribution to building a minimum foundation of socioeconomic security is also key to governability and political stability in a context where economic insecurity can be a destabilizing factor.
Furthermore, from a fiscal perspective, the investment allocated to these vouchers is relatively low, representing less than 2% of GDP. However, their distributive importance is very high, surpassing other types of less targeted and more regressive subsidies, such as those for fuel, in terms of efficiency. This indicates that, even in scenarios of budgetary constraints, the financing of these programs is sustainable and a priority due to their high social and economic profitability.
The benefits of the system are not limited exclusively to the direct recipients but contribute to social mobility and the reduction of long-term structural gaps. For example, the Juancito Pinto Bonus has been shown to significantly reduce school dropout rates, encouraging retention in the education system and, consequently, improving the future employment and economic prospects of new generations. The Juana Azurduy Bonus directly impacts maternal and child health indicators, reducing mortality and promoting more equitable access to basic services. Meanwhile, the Renta Dignidad program provides a support network for older adults, improving their financial autonomy and dignity.
Maintaining and strengthening these programs is, therefore, an ethical decision with profound economic and social implications. They represent a public policy consistent with the sustainable development goals, aligning with international commitments to eradicate poverty, eliminate hunger, and guarantee quality health and education for all. Beyond being an expense, social bonds act as engines of inclusion, development, and stability, transforming precarious domestic realities and contributing to the construction of a more just and equitable country.
In short, social bonds in Bolivia are much more than economic aid: they are an investment in dignity, equity, and the future. To ignore them would be to ignore the indispensable role they play in building a more resilient social fabric, generating opportunities, and consolidating a dynamic and sustained economy based on collective well-being. Therefore, any effort to maintain and improve these programs should be considered a national priority that transcends political circumstances and is consolidated as a permanent, inclusive, and effective public policy." eldeber.com.bo
