In This Review

Coping with Austerity: Poverty and Inequality in Latin America
Coping with Austerity: Poverty and Inequality in Latin America
Edited by Nora Lustig
Brookings, 1995, 460 pp.

Jointly sponsored by the Brookings Institution and the Inter-American Dialogue, this study tackles some basic concerns about the sustainability of Latin America’s current economic model of private development and public restraint. In his introductory statement, Inter-American Dialogue president Peter Hakim says bluntly that over the 1980s, ‘whatever progress has been made in Latin America . . . has been tarnished and jeopardized by the mass poverty and the profound inequalities of income and wealth that plague most nations of the region.’ These sober chapters, which contain thematic as well as country-specific studies of poverty programs, clearly substantiate his statement. The authors disagree over the compatibility of increased social spending and economic adjustment policies. Lustig points out that although poor social conditions have traditionally sparked unrest, they can also diminish growth, investment, and human capital formation. Replete with dense collections of new data, this book is written for specialists, but the overall message will come as no surprise to them. During the so-called lost decade of the 1980s, almost anything that could go wrong did. Regrettably, what is not provided are the time-series data to judge whether the neoliberal reform policies implemented in the course of the 1990s, and by implication the wave currently under way, are alleviating or aggravating these deep-seated economic disparities.