You might not have heard much about it, but 2018 is a year in which left-wing election candidates are making the running in a number of countries, causing US capital to fear the impact on its profits.

Reading the business press reports on forthcoming elections in Mexico, Colombia and Brazil, it appears the only criterion for whether a candidate is good is if the markets say so.

While coups or assassination of candidates have been favoured by Latin American elites and the US in the past, judicial coups and fraud are other ways to ensure that the people can’t vote for change.

The threat from Mexico’s veteran left-wing leader Andres Manuel Lopez Obrador is real, say some reports in the business press, but perhaps not as bad as it might have been. Why? Because he has allegedly moderated his politics to be more market-friendly.

“The moderation in his speech and in his campaign makes the likelihood of him winning higher and the likelihood that he will turn out to be very bad and very left-wing lower,” says Pablo Riveroll of Chile’s Bci Asset Management.

Lopez Obrador was denied a victory in 2006 due to well-documented vote fraud and the 2012 victory of incumbent President Enrique Peno Neto was also marred by vote-buying allegations.

This time the shadow of Donald Trump to the north, his racist attacks on Mexicans and his demands for renegotiating the iniquitous Nafta free trade deal have favoured the left-wing candidate, who leads in the polls.

Likewise the left-wing front-runner in Colombia, which goes to the polls on May 27, is limited, say the asset guys, because he has distanced himself from his radical past.

In fact, Gustavo Petro ran a popular administration in Bogota until he was overthrown by Colombia’s top prosecutor who accused him of violating the laws of the free market by challenging the privateer rubbish collectors in the city.

The coup against him, backed by President Santos, led to mass protests in 2014, but he was eventually reinstated by the courts.

Petro belongs to a political movement that has never had state power, he has pointed out, in a country which has witnessed how, “when there are strong candidates [of the left], they’ve been murdered.” As if to prove his point, his motorcade recently came under fire in an apparent assassination attempt in Cucuta.

When he was an MP during the presidency of hard right Alvaro Uribe, he led a push to get justice for many victims of Colombian paramilitaries and had to sleep with an assault rifle due to death threats.

There are fears that the powers that be will try to keep his name off the ballot for the election. In a tweet on February 26, Petro denounced the possibility of “a massive fraud” on the March 11 consultation to elect the presidential candidate for the left-wing coalition that could leave him out of the race, reported Telesur.
The markets are nervous.

“The base case is still for Petro to lose, but the uncertainty around that prediction has increased substantially,” Scotiabank’s head of Latin American strategy Joe Kogan wrote last month.

“Recent history warns against underestimating political risks.”

Mario Castro, a Latin America foreign exchange and rates strategist at Nomura in New York, said Wall Street does not forgive or forget the past actions of those who threaten the interests of global capital, stressing: “They’ve never been given the benefit of the doubt.”

“Petro’s proposal for a constituent assembly to reform health, education, the justice system, the economy and politics would create tremendous uncertainty for business and it is hard to foresee what reforms would ultimately be enacted,” said Kogan.

Any trace of pinkish social democracy is dangerous and Petro has been labelled a Chavez-Castro bogeyman by the right, although he denies this, saying he is closer to Uruguay’s former president Pepe Mujica.

Mujica, who was president between 2010 and 2015, never significantly challenged capital during his time in office, while legalising marijuana and abortion.

Of course, reading this kind of report, it is often wise to remember that what is good for the markets and the super rich is usually not good for the working class and middle class majority.

As we have seen in Venezuela, where recently sacked US secretary of state Tillerson has threatened an oil blockade of the country if it does not cancel its scheduled presidential elections, democracy in Latin America is supposed to exclude any outcome unwelcome in Washington.

It’s worth repeating that Washington is ready to declare economic warfare on Venezuela, already suffering US sanctions and a severe economic crisis, if it goes ahead with an election that will be monitored by international observers, including those hostile to the government of Nicolas Maduro, and a raft of guarantees for a fair vote.

In Brazil, former president Lula de Silva could stand a good chance of coming back to the presidency in October, but he faces a 12-year prison sentence for alleged corruption, which supporters say is a trumped-up charge designed to prevent him from running.

“We were worried about Lula because he belongs to a political party that’s more left-leaning politically and economically and therefore is perceived as less market-friendly,” said Gregorio Velasco, BCI head of institutional fixed income funds.

The markets want to see cuts to pension provision and more austerity in Brazil, regardless of who wins, he added. “The most important thing that we’ll follow in terms of policy will be fiscal discipline and approving the pension reform that would put a cap on fiscal expenditures.”
 

Lula, who has 42 per cent in the latest poll, is defiant about the jail threat, stating: “I’m going to stay here. This is where I was born. This is where I belong. The only thing I’m afraid of is betraying my people.”
Lula’s Workers Party presidential predecessor Dilma Rousseff was overthrown in a judicial coup in 2016.

Latin America’s left-wing tide has suffered defeats and setbacks in recent years, but if any of these elections do not go the way the markets think they should, we can expect a raft of stories telling us how dangerous democracy has turned out to be in the continent, dressed up of course in the language of market totalitarianism.

It’s not just Russia’s Vladimir Putin that doesn’t want real competition in elections. It’s capitalism.

You can contact Joe Gill on Twitter via: @gill_joe.