Latin Leaders Follow No Boss; The latest bout of concern about Latin America is largely an overreaction to high oil prices, which make everyone a little dizzy.

Byline: Alfonso Prat-Gay (Prat-Gay was governor of the Central Bank of Argentina from 2002 to 2004.)

Conventional wisdom has it that Latin American governments are leaning to the left, toward a new populism, to old-fashioned state interventionism. Yet, to the extent that these diverse nations are moving in tandem, it is mostly away from the United States rather than to the left. Whether an anti-American tilt is good or bad hardly matters, in my view. The important point is that Latin

leaders are increasingly guided by pragmatism rather than ideology, working to answer popular demands caused by the failures of the 1990s. That makes a happy ending--sustainable economic growth--more likely this decade than in the last, despite the growing tendency of a few Latin states to overmanage their economies.

The latest bout of concern about Latin America is largely an overreaction to high oil prices, which make everyone a little dizzy. The immediate triggers were the moves by Bolivia and Ecuador to grab the windfall profits of foreign and oil and gas companies. But oil is not an ordinary household good. It's a critical strategic resource, and history tells us that when such a resource becomes scarce, governments of all stripes move aggressively to control it. Consider: there was little international outcry about "state intervention" when Washington blocked a bid by a Chinese oil company to buy Unocal, or when the U.S. Congress was discussing a windfall tax on oil companies late last year. So no one should read recent moves in Bolivia and Ecuador as a sign of where policy in Latin America is headed, either.

Nor is the image of a "left-leaning" Latin America consistent with the increasingly pragmatic record. Now that democracies have prevailed across much of the region, economic policymakers are enjoying unheard-of degrees of freedom, which they are exercising wisely, for the most part. As revenues and foreign reserves rise, thanks to a China-driven commodity boom, policymakers are using this money to build up fiscal surpluses and cut debt. Argentina and Brazil have gone to the practical extreme, paying their obligations ahead of schedule to the IMF (hardly a left-wing bedfellow). As for "populism," Hugo ChAvez, its iconic figure, has yet to raise Venezuelan real wages, which are down 25 percent since he took office.

The new pragmatism is a dramatic break ...