The modest and contradictory improvement in the economic situation described above, coincided with the elections and the spread of democracy in practically the entire continent, except for Cuba. However, the crisis of authoritarian Latin American regimes also entailed a State crisis that the addition of representative democracies plus ultraliberal economic solutions has not completely resolved. Thus, many political violence indicators in the continent: coups, strikes, closure of parliaments, civil violence and delinquency, high level corruption and, more recently, a boundaries war, have either not completely disappeared or have sprung up once more. This has been the reason for several external observers to question again both the relationship between society and the State, and the issue of «governability» in Latin America (SOCIETY FOR INTERNATIONAL DEVELOPMENT, 1994, pp. 11-12).

After 1990, however, a new approach based on the following premises gained ground:

a) According to some studies, Latin America is the world's region with most unequal income distribution. The richest 20 per cent receive 20 times more than the poorest 20 per cent (in some countries the ratio is 40:1). In Asia, by contrast, the ratio is 10:1 (THE ASPEN INSTITUTE, 1994, p. 43).

b) Maintenance of the essential macroeconomic balance for growth is an essential but insufficient requirement for social development. On the contrary, in the mid-term, societies cannot aim to increases in welfare which do not correspond to increases in productivity.

c) The subregional integration process has accelerated (MERCOSUR in 1988, NAFTA in 1992), and the summit meetings of all Latin American presidents have been institutionalized. A return to the national policies of state interventionism, protectionism and import substitution carried out in the 60s and 70s, seems inconceivable.

d) The existence of conflicting interests is legitimate and should be recognized. The consensus to search for solutions that are acceptable to the majority should be a rule. Effective and stable democracies are required. Neither dictatorial totalitarism nor guerrilla insurgencies contribute to social development.

e) To continue the debate on the size of the State is not the point. The State has responsibilities which cannot be resigned, particularly in the promotion of economic and social equity. Poverty elimination as a condition for development is not only of interest to the poor but to society as a whole.

f) Redefining the role of the State should lead to concentration on key functions, ensuring they are carried out effectively. Particular attention should be given to the development of human resources through nutrition, education, and health. At the same time, it is necessary to overcome the conflict between State and market; the creation of easily accessible, transparent and competitive markets, may contribute to equity.

Most of the above elements are gathered in a document drafted between 1990 and 1992 by the ECLAC: «Productive Transformation with Equity» (CEPAL, 1990). It aims to face up the risks of bipolarization and social outburst through a combined action of public and private sectors based on a «two-thirds» strategy that would allow to harmonize certain strategies (focused and immediate) to fight extreme poverty and marginality with the attention (horizontal and permanent) to the needs of the lower and middle strata of society, thus joining together both segments in an economic and social positive dynamics.

From the point of view of developed European countries, the above issues may appear obvious. However, this is not so in Latin America where democracy has been (and still is) relatively fragile and where, exception made for a few countries, the Welfare State has never existed. Unless, as it happens in certain circles in the USA, the term «Welfare» is applied to any allocation of public funds for social purposes (regardless of the amount, type, time or place) and then condemned. It is not long that J.K. Galbraith described how such circles view those employed in the Foreign Service, Defence, the Judiciary, Public Order, elite Universities or in the management of farm subsidies and pensions as «respectable and honest civil servants». Yet, those employed in public teaching, health, labour or environmental law, urban rehabilitation and programmes to fight poverty are often condemned as «damned bureaucrats» (GALBRAITH, 1992).

The oligarchic State of corporate or restricted democracy has failed in Latin America. Same as its last resort solution, i.e. military dictatorship. In view of this, early proposals consisted in promoting a «Minimal State», which in the region tended to be «Very Minimal» (BUSTELO, 1992). But as it has been shown since the beginning of the decade, the challenge of modernity and the non-subordinated insertion of Latin America into the new international context continues to focus on overcoming the confrontation between public-private and constructing genuine welfare States under the Rule of Law. These would be more representative, more decentralized, more efficiently managed and more effective in fulfilling their social tasks (LÓPEZ-ACUÑA, 1991). The content of the programmes that gained the elections that have taken place since mid 1994 (Mexico, Costa Rica, Panama and Brazil) appear to be heading in that direction, although not without hesitations.

In this sense, it is significant that the recent Summit of the Americas issued a «Declaration of Principles» and an «Action Programme» (SUMMIT OF THE AMERICAS, 1994) based on four points: a) preservation and strengthening of democracy; b) promotion of economic integration and free trade (the most difficult part of the negotiations); c) eradication of poverty and discrimination; d) guarantee of the sustainability of development and protection of the environment.

Without prejudice to the unavoidable declaratory content of both documents, it is significant the relevance given to: a) education in the chapter on the fight against poverty and marginalisation (100 per cent primary and 75 per cent secondary education by the year 2010); b) strengthening of the role of women, and c) equal access to basic health benefits. I shall further address this last point later.