By John Lancaster
                  Washington Post Staff Writer
                  Sunday, January 30, 2000; Page A21

                  For much of Latin America, the story of the past decade has been the
                  story of democratization. But recent developments--this month's
                  semi-coup in Ecuador, the 1998 election of an authoritarian leader in
                  Venezuela, escalating guerrilla warfare in Colombia--are causing concern
                  in Washington that the momentum may be shifting.

                  Popular fury over Ecuador's disastrous economic policies culminated
                  earlier this month in the decidedly undemocratic ouster of the country's
                  elected president, Jamil Mahuad, who ceded power to his vice president
                  after Indian protesters backed by the military briefly occupied the
                  Congress building.

                  Mahuad's ouster highlights the depth of popular frustration in Latin
                  America toward elected governments under siege from corruption, income
                  inequality and narcotics trafficking. Failure to bring these problems under
                  control, U.S. officials fear, could discredit Washington's efforts to promote
                  democracy and free trade in a region that until recently had little experience
                  with either.

                  "It doesn't take a clairvoyant to predict that democracy will wane in the
                  face of economic privation," Peter F. Romero, acting assistant secretary of
                  state for Western Hemisphere affairs, told an audience in Miami last
                  month. "The region's outstanding record of democratization since the apex
                  of military rule some 20 years ago cannot be taken for granted."

                  Already there are signs of a backlash. Little more than a year ago, for
                  example, Venezuelans elected as president Hugo Chavez, a left-leaning
                  populist and former army colonel who was jailed for leading an
                  unsuccessful coup attempt in 1992. Chavez recently persuaded voters to
                  approve a new constitution that concentrates power in the executive and
                  increases state control of the economy.

                  In Paraguay, meanwhile, gunmen believed to be associated with a
                  renegade ex-general and onetime coup plotter last March assassinated the
                  country's vice president; a senior administration official recently said he
                  "would not be surprised" if Paraguay's fragile democracy succumbs to the
                  same kind of unrest that unseated Mahuad.

                  "What you have is growing popular discontent, massive social or popular
                  movements that just have become so dissatisfied that they threaten or
                  challenge the civilian authorities," said Eric Olson, of the nonprofit
                  Washington Office on Latin America. "The risk here is that by merely
                  reestablishing a constitutional order and not dealing with the underlying
                  problems that brought about this crisis, democracy is under threat in Latin
                  America."

                  Few predict a return to the military dictatorships of the 1970s and '80s.
                  And administration officials say they regard Ecuador as something of an
                  anomaly: In contrast to many of its neighbors, the country has failed to
                  embrace structural economic reforms, creating conditions so dire that
                  Mahuad recently proposed replacing Ecuador's inflation-ravaged currency
                  with the U.S. dollar.

                  "It was such a basket case," said a senior official who closely follows the
                  region. "What happened in Ecuador will not happen in Argentina, or
                  Colombia for that matter."

                  The official added, "There is a danger that if people don't see the fruits of
                  free trade and economic reform . . . the free trade economic model will be
                  discredited. But so far what's surprising is that people are maintaining the
                  program."

                  As evidence, the official pointed to Chile, where former dissident Ricardo
                  Lagos earlier this month was elected president on a center-left platform in
                  the midst of the country's worst recession since the return of democracy in
                  1990. "They didn't go for the Communist Party, nor did they go for the
                  reassuring right-wing populist," the official said. "Those who say are we
                  seeing a trend toward the populism of Chavez, toward authoritarianism--it
                  really hasn't been proven to be the case."

                  As administration officials are fond of pointing out, all 35 members of the
                  Organization of American States (OAS) except one--Cuba, whose
                  government has been excluded from OAS participation since 1962--are
                  now governed by elected leaders. "The ballot box, and not the bullet, is
                  now the accepted path to office," then-U.S. envoy Victor Marrero said in
                  a speech to the organization last year.

                  The U.S.-promoted doctrine of free trade and free markets has also
                  brought undeniable benefits. Chile, for example, was one of the first in its
                  neighborhood to restructure its economy, slashing tariffs and selling off
                  inefficient state industries. The result, at least until the latest recession, was
                  15 years of sustained economic growth and a sharp drop in poverty rates.
                  Hyperinflation has largely been purged from the region.

                  But the benefits of economic reform have been unevenly distributed at
                  best. As Romero noted in a speech last year, Latin America's population
                  "has the most unequal distribution of income in the world," with the top 10
                  percent receiving 40 percent of total income while the bottom 30 percent
                  gets 7.5 percent.

                  Democratic governments from Venezuela to Argentina to Paraguay,
                  meanwhile, have been tainted by their failure to build strong civic
                  institutions and vanquish rampant corruption, fueled in some cases by drug
                  trafficking. According to Larry Birns, of the Washington-based Council on
                  Hemispheric Affairs, most countries in the region are governed by "faux
                  democracies" where military officers continue to wield power behind the
                  scenes. "Even though the era of military rule is behind us, it doesn't mean
                  the era of military supremacy is," Birns said.

                  Administration officials take a somewhat rosier view, in part because of the
                  OAS, whose Latin American members have collectively pledged to
                  maintain a united front against authoritarian threats to democracy.

                  "In the same way that it would be impossible for the European community
                  to think of Spain under a military dictatorship," one official predicted, any
                  Latin American government that came to power illegally "would be
                  completely ostracized."

                  It was fear of ostracism that prompted Ecuador's armed forces chief, Gen.
                  Carlos Mendoza, to dissolve on Jan. 22 the junta that had toppled
                  Mahuad only three hours earlier and hand power to Vice President
                  Gustavo Noboa. "What we were trying to do was prevent the international
                  isolation of Ecuador," Mendoza said.

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