Costa Rica Could Be Losing Its Political Example

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Street Vendors in San José, Costa Rica. Inequality has increased rapidly in the country throughout the past decade. Wikimedia Commons.

      Famously lauded as an exception to trends of overall political instability in Central America, Costa Rica has presented an enduring model of socially democratic peace for the region. The country is the area’s longest-standing democracy since it famously decided to abolish its military under the 1949 Constitution to invest in social services such as universal education and healthcare. Since then, it has come to be seen as a landmark of environmental stewardship, a beacon of prosperity to neighboring immigrants, and – with its Pura Vida (pure life) mentality – one of the happiest countries on earth. It is because of this tradition of remarkable democracy, peace, and social wellbeing that many have referred to Costa Rica as politically exceptional, especially in comparison to its neighbors’ history of civil unrest.

       But the country’s recent history reveals quite the opposite. In recent years, Costa Rica has become just as prone to divisive political and economic trends as the rest of the world.

       For one, income inequality has increased drastically in the last decade, due in part to the country’s semi-recent free trade policies adopted during the 1990s. While the economy continues to grow with global markets, it is not benefiting all Ticos (Costa Ricans) equally, leaving behind coastal and rural populations outside of the urban Central Valley. Now, according to The National Institute of Statistics and the Census, 20% of Ticos live in poverty, due to cheap wages for low-skilled employees. This makes Costa Rica, a country that has consistently had the lowest level of inequality in Latin America, now equivalent to the OECD regional average.

       The security situation has also deteriorated. Formerly just a stop on a larger trafficking route, Costa Rica is now home to both organized crime and drug operations. The rise of drug trafficking, a byproduct of larger inequality, has also increased the rate of violence in the country. Formerly known as the safest, most peaceful country in Central America, Costa Rica now has a homicide rate of 12 per 100,000 people, surpassing that of neighboring Nicaragua. According to the director of San José’s municipal police, with 603 violent deaths last year and 146 to date in 2018, the past twelve months have been “the bloodiest in the nation’s history.” Unfortunately, these incidents have shown that the ‘Switzerland of Central America’ is equally susceptible to international crime and violence in the territory.

      Lastly, Costa Rica is witnessing an impending financial crisis that could considerably shrink its famous social programs. The fiscal deficit is predicted to exceed seven percent in 2018 and public debt currently stands at 49 percent of GDP. This due in part to the country’s large bureaucracy, where twenty percent of Ticos are employed with high salaries and guaranteed annual raises. Current President Luis Guillermo Solís claims he has cut all he can in light of partisan gridlock, instead prioritizing tax revenue in February with a fast-track reform law. Yet Ticos say this isn’t enough, calling the new law a temporary fix that raises taxes without first cutting public salaries. Experts predict that if the next administration cannot address the country’s finances in the next year, this former bastion of prosperity and social equality may have to roll back the services that made it so exceptional in the first place.

      Each of these three issues suggests that Costa Rica has become susceptible to globally disruptive trends; ones that stand to threaten the country’s history of a strong social democracy. But surprisingly, none of them were the focus of the past Presidential Election. The priority, instead, was same-sex marriage.

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