On the eve of the May 4 autonomy referendum in the lowland department of Santa Cruz, Bolivia is increasingly polarized—with the central government of President Evo Morales refusing to accept the legitimacy of the Santa Cruz vote, and the Santa Cruz leadership refusing to accept the pending constitutional reform which would establish a process for achieving local autonomy. Bolivia's ambassador in ally Venezuela, Jorge Alvarado, called on the OAS to stand firm before "the separatist pretensions of the Departament of Santa Cruz." The opposition prefect (governor) of Santa Cruz, Rubén Costa, assured there would be no violence, announcing to the crowd at the closing rally of the autonomy campaign: "We don't want dynamite, nor clubs, nor rancor. The democratic vote is our only weapon." However, a photo of the rally in Ecuador's El Diario, showed one attendee holding a giant slingshot in the firing position. A popular banner slogan at the rally was "We have no fear!" (¡No tenemos miedo!). (El Diario, Puerto Viejo, Ecuador, May 3)

In addition to not recognizing the legitimacy of the referendum, national authorities also protest that Santa Cruz departmental authorities have contracted out the ballot count to a private firm. José Luis Exeni, president of the National Electoral Court, stated that the move is in further violation of Bolivian law. (Granma, Cuba, May 1)

Land, gas rent, ethnicity
The vote could be just a first step towards remaking Bolivia's political order. Over the next two months, three other lowland departments are slated to hold similar referenda: Beni and Pando to the north, and Tarija to the south. Tarija is the source of some 80% of Bolivia's natural gas production—accounting for most of Bolivia's exports and the bulk of its fiscal revenues. If the "statute of autonomy" is approved, the new regional "government" in Santa Cruz is to claim control over administration of both land and subsoil resources—including a greater share of the tax income that flows from the department to the national treasury.

These four contiguous lowland departments—known as the Media Luna (half moon) are the areas which voted "yes" in a July 2006 referendum—held simultaneously with the elections to the constituent assembly to draft the new constitution—that mandated the assembly to grant autonomies to those departments that wanted them. The country's other five departments—La Paz, Oruro, Potosí, Chuquisaca and Cochabamba—followed the government line and voted "no."

The constitutional proposal of Morales' ruling Movement to Socialism (MAS) involved a complex system of autonomies granted not just to the departments, but to regions, municipalities and ethnic communities within them—balancing the power granted to departmental capitals (and their elites) by devolution to lower levels of government and indigenous communities.

The election of departmental prefects in Bolivia in 2005—the first time that these positions were filled by popular vote rather than appointment—was the first move towards decentralizing the Bolivian system. Rubén Costas and Branko Marinkovic of the Comité Pro Santa Cruz—representing business interests in the region—have been pushing to extend the process ever since. The rural wing of this alliance is the Camara Agropecuaria del Oriente (CAO), one of the key institutions that make up the Comité Pro Santa Cruz.

John Crabtree on OpenDemocracy.net notes the three issues of land, gas rents and ethnicity that are driving the autonomy movement:

* Land The problem of land distribution in eastern Bolivia has become more acute. The lowland departments were never affected by the 1953 agrarian reform that redistributed land in the highlands and Andean valleys. A series of governments encouraged large-scale landowning as a way of developing agro-industrial production and thereby reducing Bolivia's dependence on minerals, particularly tin. They also sought to relieve the pressure on land in the highlands by promoting migration to the lowlands.

In recent years, particularly with the expansion of extensive soya production, growing pressures over landownership have built up in Santa Cruz. Small-scale peasants and indigenous groupings have found their properties under pressure from large landowners. In addition, landless peasants have also followed the lead of Brazil's Movimiento sin Terra (landless movement/MST) in squatting on unused private estates.

The MAS government has sought to ease these pressures by introducing upper limits on private landholding and threatening to redistribute land not being used productively. Its plans have met with strong resistance from landowners' organisations

* Gas rents The distribution of rents derived from the oil and gas industry has become much more salient since Evo Morales "nationalised" the hydrocarbons industry in 2006. This measure, which involved the compulsory renegotiation of existing contracts with foreign hydrocarbons companies, greatly increased the amount of money at the disposal of the government. In 2006 and 2007, Bolivia's central government could declare a fiscal surplus for the first time in living memory.

The four departments of the media luna argue that they should receive the bulk of the revenues that they contribute to the economy. Santa Cruz, for example, has long benefited from a fixed percentage royalty payment on oil and gas produced in the department, which it has used to fund local infrastructure. The implementation of the "statutes of autonomy" would entail a change in such processes and a substantial reduction in transfers to the central government.

The government contends that taxes on hydrocarbons production and exports form income that belongs by right to the whole nation, not just the locality where it is produced. It wants to use these funds to finance much-needed social programmes, in particular the expansion of an existing universal system of old-age pensions. A particular source of contention to the departments of the media luna was the government's plans to fund the so-called Renta Dignidad by switching money away from the departmental prefects, and thus cutting their budgets.

* Ethnicity The relations between Santa Cruz (with its large "white" immigrant community) and La Paz (with its majority indigenous population) have long been soured by ethnic or quasi-ethnic tension. In 2005, the election of Morales - Bolivia's first-ever wholly indigenous president, and on an agenda of redressing the ethnic balance and ending the marginalisation that the country's indigenous population had long suffered - was unwelcome news to the prosperous elites of eastern Bolivia. Their fears were extended by the election of a constituent assembly with a speaker and a large proportion of delegates of indigenous origin; and by the government's pro-indigenous policy orientation in a number of areas.

The issue of ethnicity has strong resonance in Santa Cruz. Large numbers of people have settled in Santa Cruz since the late 1970s, many of them migrants from impoverished indigenous communities in the highland departments. They make up the bulk of the population in low-income districts in the city of Santa Cruz and in agricultural zones to the north officially set aside for the settlement of migrants. They were also among those who enthusiastically supported the MAS in the 2005 general elections, helping the MAS to win more votes than any other parties in Santa Cruz. The ethnic dimension of this political rivalry in Santa Cruz has been exacerbated by the activities of rightwing youth groups with anti-indigenous agendas.

The ethnic issue also involves indigenous peoples from within the eastern part of Bolivia. These have become vocal political actors since the 1980s in defence of their territory and cultural identity. They claim rights to land, natural resources and even the sub-soil, leading to conflicts of interest with those of large-scale farmers, mineral prospectors and those involved in logging. They support the government's proposals for greater autonomy in the management of their own affairs.

A group of "Friends of Bolivia"—made up of senior officials from Brazil, Argentina and Colombia—has attempted to boker dialogue between the autonomistas and the MAS government—so far without success. Brazil and Argentina are especially concerned about the potential for instability in Bolivia—being highly dependent on the continuity of Bolivian gas exports. The OAS has also sought to help mediate. Dante Caputo, a former Argentine foreign minister, visited Bolivia on April 28 for the third time in a month. OAS members have pledged their support to the democratically-elected government of Bolivia—and noted that the government's willingness to negotiate contrasts with the intransigence of Costa and the Comité Pro-Santa Cruz.

Costa and the Comité respond that they are prepared to negotiate with the government—but they have refused to postpone the referendum, insisting that negotiations can only take place afterwards. (OpenDemocracy, April 30)

An attempt by the Catholic Church to mediate was also rebuffed by the Media Luna opposition, which accuses the government of bad faith during talks last year. This obduracy has revealed divisions among Morales' aides. Some favor arresting the Media Luna's regional leaders, or deploying the army to prevent the referendum. Instead, Morales has ordered the police not to patrol polling stations. The Santa Cruz authorities have signed up thousands of volunteers to do the job. "The government seems certain to claim that the vote cannot be trusted," writes The Economist. (The Economist, April 24)

Ranchers prepare armed resistance
The Media Luna's ranchers are increasingly talking about armed resistance to the agrarian reform—and at the forefront is a gringo from Montana with large holdings in Santa Cruz department, Ronald Larsen. "A small group of ranchers is preventing us from carrying out rightful land reform in the eastern region of Santa Cruz," says Bolivia's Vice Minister of Land, Alejandro Almaraz, who accuses Larsen of attacking his convoy this spring. "US-born Ronald Larsen is leading this violent resistance."

In March, when Almaraz and aides tried to pass through Larsen's property—they maintain it was the only way to reach to nearby indigenous Guarani residents to whom they were delivering land deeds—witnesses say the caravan was fired on by Larsen and his son Duston. The incident was followed by two weeks of rancher roadblocks and violent protests that left 40 indigenous people injured.

Larsen, who arrived in Bolivia in 1968, told a La Paz newspaper that Almaraz's vehicle had entered his property at around 3 AM. He said Almaraz "had not presented any identification. He was drunk and being abusive... I quieted him with a bullet to his tire. That's the story." (Time, May 2)

The poor in Santa Cruz—especially in rural areas—are mobilizing against the referendum. In the MAS stronghold of San Julián, 150 kilometers north of Santa Cruz city, Morales supporters have pledged to block roads to block a march by the pro-autonomy Unión Juvenil Cruceñista on the day of the vote. "They will be covered with blood if they come to San Julián," said protest leader Beatriz Medrano, who referred to Rubén Costas as a "damned oligarch." (EFE, May 3)

Speaking on a visit to New York April 28, Morales also asked for international support to end what he called "slavery" in Bolivia, following recent denunciations by sugar cane laborers on large estates in Santa Cruz that over 8,000 children work in the fields without pay.

Invoking the hand of outside powers behind the Santa Cruz movement, he said the referendum is "a bridge point for the Empire here in Bolivia disguised by the euphemism of autonomy." (VenezuelAnalysis, April 24)

Corporate power in the background?
Morales is moving ahead with his agenda to extend greater national control over the foreign companies that operate in the Media Luna. During May Day celebrations in La Paz, he announced that, as of this week, the state is to recover by decree the majority shares of three oil companies which took over public assets when the parastatal Yacimientos Petrolíferos Fiscales Bolivianos (YPFB) was privatized 10 years ago. The companies are Chaco (owned by British Petroleum), Transredes (owned by the British investment firm Ashmore) and Bolivian Hydrocarbons Logistic (owned by CLHD, with Peruvian and German capital). "From this moment the...re-founding of Yacimientos Petrolíferos Fiscales Bolivianos has been consolidated," Morales declared to a huge crowd in the capital's Plaza de Armas. Morales also announced the government take-over of the National Telecommunications Company (ENTEL). (Granma, May 1) Transredes was sold to Ashmore by Royal Dutch Shell last year. (Shell press release, May 30, 2007)

Potential for regional war?
An April 24, the commander of the Bolivian Naval Forces, Vice Admiral Jose Luis Cavas Villegas, voiced his readiness to resist secession, saying that "We are the people in arms, in order to defend the internal security of our population, the armed forces are with the people... [B]ehind the [national flag], we will defend unity all our lives”.

On April 21, speaking on the eve of an extraordinary summit of the Bolivarian Alternative of the Americas (ALBA) in Venezuela, that country's President Hugo Chávez warned, "Bolivia is on the verge of exploding." Chávez said the landlocked Andean country is "once again under fire—for daring to dream of retaking the path of dignity, liberty and real independence."

"The empire wants to put a brake on the integration of South America," Chávez proclaimed. "Today the cause of Bolivia is the cause of the dignified people of Latin America who fight for unity and liberty." He pledged: "We are and will continue to be with Bolivia and we extend our hand and our heart" to the Bolivian people.

During the summit, Chávez proposed the creation of a unified defense council of the ALBA countries, "because our enemy is the same, the empire." The declaration states that the nations in ALBA "reject the destabilization plans that aim to attack the peace and unity of Bolivia." It stated the ALBA nations would not recognize "any juridical figure that aims to break away from the Bolivian national state and violates the territorial integrity of Bolivia."

Added Evo Morales: "The imperialist project is to try and carve up Bolivia and with that carve up South America, because it has converted itself into the epicentre of the great changes that are advancing on the world scale." He added, on a note of hope and defiance: "I believe in the consciousness of the people and the wisdom of our social forces and of the indigenous movement, and above all of the patriots that are fighting for the dignity and sovereignty of our people." (Left-Green Weekly, April 25)

See our last post on Bolivia.