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The Political History of Fossil Fuels in Bolivia

2024, The Struggle for Natural Resources: Findings from Bolivian History

Abstract

Oil and gas embody the contradictions at the heart of modern Bolivian history. The opposition between Bolivians and foreigners is the most obvious. The struggle over hydrocarbons cannot be understood in strictly dichotomous terms, however. How “the nation” is defined – namely, who within that nation makes the key decisions about production, consumption, and spending, who reaps the benefits, and who bears the costs – is a crucial question sometimes lost in the debate between nationalists and privatizers. Additional contradictions have become more visible in the early twenty-first century. Our age of escalating climate chaos lays bare the contradiction between fossil fuel-based economic growth and ecological sustainability. Political struggles of recent decades have highlighted still more contradictions. They have demonstrated how hydrocarbon economies help fuel regional, interethnic, and gender-based conflicts. At the same time, hydrocarbons have also helped to smooth over these contradictions. Nationalist mobilization around oil and gas has often served as the grease that reduces friction among classes, communities, and regions. For example, the revenues resulting from hydrocarbon nationalizations (1937, 1969, 2006) have funded social spending and public investments, yet they have blunted most Bolivians’ concerns about the ecological and social costs of extraction. Nationalizations have redistributed wealth from foreigners to Bolivians, but they have reduced the government’s incentive to target large landholders, industrialists, and other affluent Bolivians with progressive taxes or property redistribution. In such ways hydrocarbons have often defused social conflict, if temporarily and illusorily.