Southern Exposure

Desde as Entranhas dos Labirintos Latinos.

Tuesday, October 05, 2010

The Wage Gap in Latin America

Latin American politics have moved left. Twelve of the regions countries have held presidential elections since November 2005. Six of the countries in Latin America have elected heads of state that are further to the left than the outgoing leaders. The latest elections in the region have confirmed such trend; the reelection of Lula Silva in Brazil, the ascent to power of Daniel Ortega in Nicaragua and the election of Rafael Correa in Ecuador (another headache for Washington as Ecuador is the second largest exporter of crude oil in the region and it hosts the only U.S military base in South America).

Two basic camps of leftists have emerged within the region. Those who run on authoritarian populist platforms such as Hugo Chavez and those who support representative democracy such as Lula da Silva of Brazil.

While the authoritarian populist platforms receive the most scrutiny for their social and economic policies, further analysis indicates countries closest to the left-centre of representative democracy suffer from the largest level of inequality. This inequality is most apparent in Colombia, Mexico, Chile and Brazil. While Colombia and Mexico enjoy right wing governments, Chile and Brazil have the regionsmost marked centre-left governments.

While there are many indicators of inequality, comparing the wage paid to elected representatives against the minimum wage earned by the average citizen; serves as an effective indicator. The wage gap between those "who legislate" and those "who elect" is a powerful one, as it demonstrates how a nation and its legislative institutions not only perceive, but act on their duty to fight against economic inequality.

The elected representatives in Felipe Calderons Mexico enjoy the largest wage gap - paying themselves 52 times (USD $6.773 a month) that of the minimum monthly wage! To put things in perspective the average United State senator receives a wage of USD $13,766 a month, based on figures provided by the United States Senate. This monthly wage is thirteen times that of the average minimum monthly wage of USD $990 in the United States.

The elected representatives of Chile receive a staggering monthly wage of USD $11.282, 44 times the average national minimum wage of USD $256 a month. Furthermore, the monthly wage of USD $11.282 paid to Chilean senators does not include extraordinary costs such as flights, accommodation or consulting. In the case of the average Chilean senator, their average net wage is doubled when accounting for all costs. While Chile leads the region in overall compensation for its elected representatives, Brazil is one of the world leaders. Senators in Brazil receive 15 salaries throughout the year, withe the average cost per senator amounting to almost USD $240.000 a year in tax payer money.

The wage rankings for elected representatives in Latin America reveals the wage gap of the five nations to be enormous. Chile leads the region with an average monthly wage of USD $11.282 for its elected representatives - 44 times minimum wage. In second place Colombia with USD $7.400 a month - 41 times the minimum wage. In third place is Mexico where elected representatives are paid a monthly wage of USD $6.773 - 52 times the minimum wage. Fourth is Brazil, paying its senators USD $5.961 a month - 34 times the minimum wage. Fifth in the rankings is Peru, paying its elected representatives USD $4.756 a month - 30 times the minimum wage.

During his presidential campaign, Rafael Correa, elected president of Ecuador, used a belt as a symbol of his campaign (a wordplay on his last name, which means belt). The belt was a symbol for the radical changes he would bring to the country including the "whipping of the old political guard". We suggest Rafael Correa sends his belt to all his fellow Latin American leaders, so they can bring an end to the unjustifiable high levels of compensation paid to elected representatives in the region.

Alain Portmann, Dark Matter Politics []