741292

book-review2017
LAPXXX10.1177/0094582X17741292Latin American PerspectivesGustafson / Book Review

Book Review
Extractivism
A Review Essay
by
Bret Gustafson

Daniel Lederman and William F. Malone (eds.) Natural Resources: Neither Curse Nor
Destiny. Washington, DC: World Bank, 2007.
Håvard Haarstad (ed.) New Political Spaces in Latin American Resource Governance. New
York: Palgrave, 2012.
Fabiana Li Unearthing Conflict: Corporate Mining, Activism, and Expertise in Peru. Durham,
NC: Duke University Press, 2015.
Jody Pavilack Mining for the Nation: The Politics of Chile’s Coal Communities from the
Popular Front to the Cold War. University Park: Pennsylvania State University Press,
2011.

Mineral, oil, and gas prices turned upward in 2003, beginning the latest boom in
Latin American extractive industries. The boom was intense, with high mineral-
dependence in Peru, Chile, and Bolivia and high gas- and oil-dependence in Ecuador
and Bolivia. By 2014 its speculative origins and the resulting easing of demand in
consuming countries had caused something of a retreat (Zibechi, 2016). Even so, there
is no foreseeable end to the predominance of extractivism in shaping Latin American
political economy and society.
The convergence with the extractive boom of a resurgent left spurred a boom in
academic production. We now know that despite the leanings of leftist governments,
extractive industries exert their own force, somewhat contained by the repositioning of
the state and the use of rents for social welfare. Progressive regimes did more to reduce
poverty. However, because of the material form of extractive industries and their imbri-
cation in transnational legal and economic webs, dependence inevitably produces con-
flicts between state sovereignty, popular demands, and extractive capital. Left or right,
governments defend the idea that one or another resource is the key to progress. There
has been little transformation of the industries in the form of worker ownership, the
promotion of small-scale operations, radical oversight, or detachment from global
finance capital. The politics of redistribution has been demand-oriented rather than
structural, and therefore even in progressive regimes redistribution has fomented a
politics of consumption rather than economic diversification (Zibechi, 2016). An over-
view of recent research sheds light on export dependence and possibilities for envision-
ing postextractivist political economies.
It may seem strange to review a ten-year-old World Bank tract, but the Bank contin-
ues to be a major player, offering loans to expand these industries and shaping policy
debates through claims to expertise.1 Once deployed, as in Lederman and Malone’s

Bret Gustafson is a professor of anthropology at Washington University in St. Louis.

LATIN AMERICAN PERSPECTIVES, Issue 222, Vol. 45 No. 5, September 2018, 222–228
DOI: 10.1177/0094582X17741292
© 2017 Latin American Perspectives

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Natural Resources: Neither Curse Nor Destiny, Bank ideas become part of the justificatory
political technology of the extractive apparatus and operate as political constraints on
alternative thinking.
Some background is necessary. Historically, Bank pronouncements unfailingly pro-
moted free-market export-oriented growth and thus enabled destructive industrial
practice.2 Yet during the 2000s one of the Bank’s own publications conceded that extrac-
tive-industry dependence contributed to slower growth of the gross domestic product
(World Bank, 2003: 2). An external review showed that Bank investments did little to
impact poverty and exacerbated environmental destruction (Salim, 2003, cited in
Redman et al., 2015). A group of (non-Bank) economists developed a critique by revisit-
ing the “resource curse” (Humphreys, Sachs, and Stiglitz, 2007; Sachs and Warner,
2001). The resource-curse argument is that dependence on one or two export commod-
ities undermines manufacturing, distorts exchange rates, corrupts political institutions,
and generates slow or negative growth. These free-market revisionists argued for a
stronger state role (even to the point of ownership), for rents to go to productive and
social needs rather than international financiers, and for public participation in con-
tracts and oversight. Read generously, these revisionists were rethinking the orthodox
model. Natural Resources: Neither Curse Nor Destiny was orthodoxy’s attempt to rebut
the revisionists and restore faith in free-market extractivism as compatible with “good
governance” and “growth.” The rebuttal is unconvincing.
Through 300 pages or so the contributors try to show that resource export-dependency
might produce growth. The work is an exercise in methodological gymnastics with a lot
of caveats. The editors’ conclusion (10) is revealing:

In sum, this book provides ample . . . evidence to suggest that natural resources
are neither curse nor destiny for developing countries. Nor are they a short-cut
to equitable and sustainable long-term development. Natural resources are
assets for development that require intelligent public policies that complement
natural riches with human ingenuity. It is only through these complex interac-
tions that resource-led growth can take off.

The mathematical excursion that follows is largely smoke and mirrors. Chapter 2
argues that if natural resource concentration lowers productivity in other sectors and
thus hurts total exports, the problem is not natural resources but export concentration
(31). But this is the entire point. Chapter 3 acknowledges that, since governments take
on bad debt in times of plenty and default when the boom recedes, the resource curse
involves currency and debt crises. The authors argue that if we discount bad debt, a.k.a.
“debt overhang,” then we can see signs of growth. Yet the debt cycle is part of the sys-
temic link between finance capital and resource extraction. This approach deflects
blame from international creditors (like the World Bank) and asserts that the problem
is bad government. Chapter 4 suggests that we look at the long term, when some coun-
tries with natural resources get richer. For example, Scandinavia has had high levels of
education (human capital, in Bank terms) and (albeit slower) growth. We are asked to
discount a long history of imperialist capitalism, neoliberal cuts to public education and
other services, and the role of external political and economic actors. If Latin American
states would only invest in “human capital” along with natural resources, we are told,
there would be no curse. And so it goes, with a series of “yes, but” and “if only they
would” stories deployed to justify neoliberal extractivism.
The book then engages Raúl Prebisch (1950), an early critic of commodity depen-
dency and declining terms of trade who argued that specialization had a crippling
effect on development. But the rebuttal to Prebisch (Chapter 5) is weak. It concludes
that commodity prices are historically flat and that price shifts are random and thus
irrelevant for policy formulation. This is a curious conclusion, since relative flatness of
224   LATIN AMERICAN PERSPECTIVES

commodity prices against increasing costs for manufactured imports reaffirms Prebisch.
A final chapter argues that countries might reduce dependence with trade liberaliza-
tion, capital and skill accumulation, and cheaper transportation—in other words, more
neoliberalism. Alongside this sleight-of-hand it is argued that diversification to indus-
trial agriculture—a process with its own curse effects—is an improvement.
As methodological fetish, the book carries out its primary political task while reaf-
firming antiquated ideas. Neoliberal economists deride those who invoke “depen-
dency” today, but this book invokes without irony the 1950s-era idea of “take-off” (10).
The volume paternalistically chides imprudent leaders in the South while ignoring the
financial agencies, industries, and capitalists of the North. Sachs and company differ
only in their tepid embrace of the state. Ever constrained by market thinking, which
presumes the normatively reasonable centrality of global capital, even the revisionists
leave one concluding that capitalist economists will never be capable of envisioning
transformations to address our current crises of climate, nature, and inequality.
New Political Spaces in Latin American Resource Governance takes on extractivism by
critiquing the resource-curse idea for its narrow focus on macroeconomic variables.
Instead, it borrows from Nancy Fraser’s Scales of Justice (2008) to consider natural-
resource contention as struggle for social justice (recognition, redistribution, represen-
tation). The volume explores new political spaces where struggles over justice unfold.
Chapter 2 considers similarities between what its authors call “neoliberal’ (Peru and
Colombia) and “alt-neoliberal” (Bolivia and Ecuador) regimes. Bebbington and
Bebbington argue counterintuitively that Colombia has made somewhat more legal
advances than countries deemed progressive (34), that such legal and institutional
change is needed in all phases of the extractive cycle, and that we also need shifts in
capital markets to create new sources of employment. Social movements are said to be
key actors, although the specifics are not detailed. In Chapter 3, McNeish questions the
essentialization of indigenous peoples as ecologically noble savages, reminding us that
indigenous organizations are complex and often contradictory political actors—at
times for extractivism, at times against it. If justice is the question, McNeish argues, then
indigenous sovereignty should be the primary issue. Hall examines Reduce Emissions
from Deforestation and Degradation, an ambiguous set of proposals that is often held
up as a way for polluters to pay and protectors to earn from conservation, and con-
cludes that its projects are a “mixed blessing” with limited impact (76). The underesti-
mation of social complexity, the top-down approach, and a failure to transform the root
causes of poverty all call these proposals into question. Haarstad and Campero return
to Bolivia and Peru to argue that change is constrained by “interstate extractive rela-
tions” at the transnational level (85). This includes infrastructural “integration” such as
the Initiative for the Integration of the Regional Infrastructure of South America, part
of the neoliberal apogee, and the Alianza Bolivariana para los Pueblos de Nuestra
América, the countermovement tied to the pink tide. In this connection the authors
show how arbitration agreements subvert sovereignty. The free-trade approach under-
mines grassroots and state sovereignty, while the counterapproach extracts “surplus”
sovereignty yet cannot bridge the chasm between extractivism and grassroots demands.
The pushback against investment treaties and arbitration has not transferred “surplus”
sovereignty downward. Even so, cases like Bolivia offer political potential that is absent
in more neoliberal settings.
Barton, Román, and Fløysand describe conflicts between gold mining, forestry,
aquaculture, and hydroelectric projects and local views of justice in Chile. Despite the
emergence of new forms of democratic struggle, Chile continues to commodify territo-
ries to create “extractive spaces” (124). Nongovernmental organizations and communi-
ties struggle for sustainable visions, but authoritarian neoliberalism carries the day: a
centralized pro-growth, pro-export, pro-market state dominated by trickle-down
 Gustafson / BOOK REVIEW   225

economics—in other words, injustice in the name of capital accumulation. In Chapter 7

Anthias examines gas development and the dilemmas for indigenous peoples in south-
eastern Bolivia. Territorial rights are subordinated to the priorities of natural gas extrac-
tion. Against this reality, the Guarani create new political strategies and visions, at times
mobilizing transnational support to bring the “state to account” (150). Chapters on oil
enclaves in Ecuador (Guzmán-Gallegos) and Peru (Okamoto and Leifsen) show how
oil companies—whether in mundane operations or in times of catastrophe—detach
themselves from material commitments to local communities. Instead, enclaves operate
through tactical engagement, taking advantage of their knowledge of the community’s
social complexity to disrupt some territorialities while recrafting others. Using the con-
cept of “unruly engagement,” these analysts suggest that conflicts be read through
three lenses—the politics of representation and the control of knowledge, the imple-
mentation of participatory forms, and the possibility of confrontation to challenge
“invited spaces” (194). Certomá and Greyl explore Ecuador’s flirtation with a “keep it
in the ground” policy for Yasuni. At the end of the day, the plan’s reliance on interna-
tional financing has reinforced the dilemmas of natural-resource-based “develop-
ment”: imbrication with global financial interests or, in this case, whims. Finally, Nem
Singh compares Chile and Brazil to consider hybridities between systems deemed
neoliberal or post-neoliberal. In Chile, the state copper industry and free-market ortho-
doxies coexisted through the “socialist” era of Bachelet. In Brazil, the rise of the
Workers’ Party created new relationships with private capital rather than supplanting
it with the state. In both cases, labor unions played a key role as the “fulcrum of
resource conflict[s].” Nem Singh concludes (pre-Temer) that Brazil’s economic prag-
matism might lead toward a deepening of social justice. The volume ends where it
began, highlighting what neoliberalism has failed to erase: the idea that “natural
resources belong to society” (248). Even so, the pursuit of justice continues to confront
structures and interests (such as those put forth in the World Bank volume) working in
direct opposition to this ideal.
Li’s Unearthing Conflict is a rich account of Peru’s mining boom. In the genre of “cor-
porations vs. communities,” it focuses on the Conga project. Multiple conflicts unfold.
Li’s tripartite approach, focusing on the materiality of mining, environmental impacts
and the deployment of expert knowledge, and emergent forms of contentious political
mobilization, echoes chapters of the Haarstad volume but expands our understanding
by merging political ecology with the anthropological approach to “things” such as
mines, springs, toxic waste, and mountains. This introduces ontological politics—strug-
gles over what counts as reality.
Li explores social and environmental disruptions in the “immense concessionary
area” (78) of Conga. The first revolve around irrigation water, a sacred infrastructure in
the Andes. Since the mine took control of water, the company offered compensation, a
new canal, and treated water, arguing that this would be equivalent to what was lost.
Yet water quantity and quality were objects of concern. Li calls this the “politics and
logic of equivalence.” The company’s logic of compensation opposed the community’s
experience of water as it related to agrarian existence and livelihood. A second conflict
arose around accountability and environmental impacts. Li suggests that procedures
like environmental impact assessments are a trap. Once people are lured into participat-
ing, they engage in strategies for securing social permission for projects already
approved by state. Some approaches to extractivism suggest that these assessments just
need to be done better. What Li implies is that the most effective strategy of resistance
might be to boycott the process. It forces people to engage in the “technical language of
environmental management” (225), which treats issues like water and livelihood as
manageable phenomena. To implement an environmental impact assessment is not to
consider whether the project goes forward but how to compensate for damages. This
226   LATIN AMERICAN PERSPECTIVES

returns people to the “logic of equivalences” through which social and natural violence
is assigned a monetary value. The technical approach discounts other languages of
struggle as irrational.
Li’s work will be invaluable for scholars of extractivism. The focus on things, now
trending in anthropology, offers an anchor. Writers such as Barry (2013) have suggested
that the study of politics often loses sight of things, although thing studies often lose
sight of politics. Li combines the two by drawing attention to the politics of things in
struggles over mining. What we are left wanting to know more about is the political
struggles beyond the things. Since a politics of possibility requires attention to onto-
logical politics as well as the correlation of forces that transcend the constraints of the
projects themselves, future work must link the managerial spaces of the project to
broader political horizons and processes. What Li’s work does best is reveal the limits
of activism focused on transparency, accountability, and social responsibility.
Historical perspective is useful for new political thought, especially given the near
invisibility of labor in recent critical work on extractivism. Pavilack’s Mining for the
Nation offers a case study of labor in the extractive industry and its potential role in
national progressive politics. Though counterintuitive given the progressive resistance
to coal in the United States, the history of coal labor in Chile was one of radical socialist
and communist struggle. This history was truncated with Pinochet and brought to an
end with the closure of most coal mines in the late 1990s. Pavilack’s account echoes
Timothy Mitchell’s Carbon Democracy (2011) and brings to mind the history of Bolivian
tin miners narrated by June Nash (1979): Mitchell’s view that political processes that
emerge from fossil fuel extraction have much to do with the politics of place, labor, and
the materiality of the industry (i.e., labor-intensive mines vs. oil extraction enclaves)
and Nash’s that local histories of ideological struggle and the making of resistant com-
munities are central to the national politics of extractivism. The intimate portrait that
Pavilack offers is one of heroic struggle, reminding us of the need to think critically
about labor if we are to transcend extractivism as we know it.
Pavilack retells the history of mining from the Popular Front period of the 1930s and
1940s through the cold war. The book reveals internal struggles over democracy and
citizenship, the role of alliance-building between miners and rural laborers, the lines of
conflict and accord between various strains of socialist and popular democratic politics
at the national level, and the betrayals of national leaders such as President Gabriel
González Videla (1946–1952). González Videla led the center-left project known as the
Popular Front but turned state violence against labor during a fit of anticommunist
paranoia (338). In this and other episodes, Pavilack details moments large and small
through a wonderful combining of texts, interviews, newspaper accounts, official doc-
uments, and even the poetry of the day. The material, such as Neruda’s critique of
González Videla as a “wretched clown, miserable mixture of monkey and rat, whose
tail is combed with a gold pomade on Wall Street.” (332), resonates today.
The work argues for the centrality of often violent class struggle in the making of the
Chilean state. Against popular democracy, Chile’s coalition politics, often manipulated
between elite interests, was a politics of intermittent violence against and opening to
the struggles of labor. Rule was sustained by the reactionary violence of elites, whose
dependence on foreign capital was countered by the workers’ deep embrace of popular
nationalism and democratic aspirations. This came amid progressive-era efforts by the
United States to promote worker welfare while countering communist ideas. In this
context, Pinochet was merely an extension of a long history of elite betrayal of the
nation. In contrast, labor was an anchor for popular nationalism. A detail that emerges
is that Pinochet was a young officer at Pisagua, an internment camp for labor leaders
established in the 1940s. Pinochet recalled cultivating his anticommunism through this
experience of institutionalized criminalization of labor (346). In short, coal miners had
 Gustafson / BOOK REVIEW   227

much to do with the violent struggle over Chilean politics that culminated in the
Allende government and the Pinochet coup. In a monumental way, Pavilack recreates
this in Mining for the Nation.
The book also documents forgotten voices and anonymous martyrs of the workers’
struggle. For example, the communist leader Luis Emilio Recabarren of the 1920s offered
a Mitchell-like critique of the bourgeoisie-dominated coal industry, arguing that a “legal-
istic modern industrial relations system” would ultimately hinder real popular emanci-
pation (54). Santos Medel, born in 1905, watched his father receive 50 lashes for
organizing a communal workers’ organization and went on to resist industry control of
local town councils and expand the power of communist labor in the 1930s. Carlos Silva
Torres was killed by the army during the Lota massacre of 1942, when he stepped out of
the union office carrying the Chilean flag (150). Coal miners worked deep underground
or, more accurately, under the Pacific Ocean. Daily life was marked by poor sanitation
and crowded housing in a harsh, cold, wet climate. As in many mining enclaves, women
struggled to maintain households amid dependency on company stores, problems with
alcohol and domestic violence, and bleak possibilities for children. As the elite reaction
deepened, women’s local voting rights were abridged because of their power to shape
the crucial spaces of local struggle (311). Even Pinochet, stationed at the prison for labor
leaders at Pisagua, recalled that the most militant were the women. Yet figures like
Eusebia Torres Cerna, a communist councilwoman from the mining center at Coronel,
rose to become national political actors, pushing for improved conditions (270).
Whether and how very different modes of labor organization tied to the extractive
industries of today offer progressive purchase remains an open question. Yet Pavilack’s
book brings us full circle from the myopic doxa of World Bank economists to the vio-
lence inflicted in the name of resource extraction. If commodity dependence deepens,
and despite political proclamations about worlds otherwise, extractive industries will
continue to exert an outsized influence on the meaning and practice of politics. As
scholars and sometime political actors, we must maintain a multiscalar approach
informed by political and economic critique, a concern for human livelihoods, onto-
logical politics and their imbrication in natural worlds, and the politics of labor. These
works suggest that future research articulate these scales of understanding as part of a
wider critical project aimed at imagining alternatives or at least carving out what
Haarstad and others call “new political spaces.” It is in these complex, interconnected
political spaces—perhaps against extractivism altogether, perhaps with some accep-
tance of extractivism and the aspirations of labor—that new forms of struggle and
visions of broader transformation might be made and remade and take hold.

Notes

1. For example, the extractive industries and transparency initiative, the Bank’s acknowledg-
ment of nationally owned oil companies, the revision of indigenous rights and the environment,
and efforts aimed at easing conflict through “training” of leaders and alliance-building with con-
servative environmental organizations. See http://www.worldbank.org/en/topic/extractive
industries.
2. For a good example of “destructive impacts” amid claims of progressive expertise, see
Hindery (2013).

References

Barry, Andrew
2013 Material Politics: Disputes along the Pipeline. New York: Wiley-Blackwell.
228   LATIN AMERICAN PERSPECTIVES

Fraser, Nancy
2008 Scales of Justice: Reimagining Political Space in a Globalizing World. New York: Columbia
University Press.
Hindery, Derrick
2013 From Enron to Evo: Pipeline Politics, Global Environmentalism, and Indigenous Rights in
Bolivia. Tucson: University of Arizona Press.
Humphreys, Macartan, Jeffrey D. Sachs, and Joseph E. Stiglitz (eds.)
2007 Escaping the Resource Curse. New York: Columbia University Press.
Mitchell, Timothy
2011 Carbon Democracy: Political Power in the Age of Oil. London: Verso.
Nash, June
1979 We Eat the Mines, and the Mines Eat Us: Dependency and Exploitation in Bolivian Tin Mines.
New York: Columbia University Press.
Prebisch, Raúl
1950 “The economic development of Latin America and its principal problems.” United
Nations Department of Economic Affairs/Economic Commission for Latin America. http://
archivo.cepal.org/pdfs/cdPrebisch/002.pdf.
Redman, Janet, Alexis Durand, Maria Camila Bustos, Jeff Baum, and Timmons Roberts
2015 Walking the Talk? World Bank Energy-related Policies and Financing 2000–2004 to 2010–2014.
Providence, RI: Institute for Policy Studies/Brown University Climate and Development Lab.
Sachs, Jeffrey D. and Andrew Warner
2001 “The curse of natural resources.” European Economic Review 45: 827–838.
World Bank
2003 Extractive Industries and Sustainable Development. Washington, DC: World Bank.
Zibechi, Raul
2016 “Progressive fatigue?” NACLA Report on the Americas 48 (1): 22–27.