Post-neoliberalism and capital flow management in Latin America: assessing the role of social forces

This article discusses why Latin American post-neoliberal parties have varied in their strategies of capital flow management. In brief, I propose that two complementary channels favor the pursuit of heterodox strategies: high degree of pressure from popular sectors that push for an immediate macroeconomic reorientation, and strategic allies among economic elites that mitigate the credibility losses associated with this decision. The comparative case-study on Argentina under Kirchnerism (2003-2015) and Brazil under the Workers’ Party (2003-2016) provides support for this argument. In the former case, the ruling party had to address the demands from strong and autonomous unions and social movements, while counting on a strategic alliance with domestic manufacturing producers. In the latter, conversely, the governing party lacked strategic allies among economic elites and could overlook the agenda of weak and subordinate popular organisations. In other words, both popular and elite channels favored the adoption of a heterodox strategy of capital flow management by Kirchnerism, while neither of them did in the case of the Workers’ Party. In Argentina, the option for heterodoxy also contributed to the repoliticisation of capital flow management by returning the visibility of this policy issue and impelling policymakers to go beyond technocratic discourses.