iagnoses and growth of output, real wages and employment are high, and the macroeconomic policies put in place are nothing short of successful. Controls assure that inflation is not a problem and shortages are alleviated by imports. During the second phase, the economy runs into bottlenecks partly as a result of a strong expansion in demand for domestic goods and because of a growing lack of foreign exchange. Thirdly, there are a pervasive shortage, extreme inflationary pressures and a significant foreign exchange gap which then leads to demonetization of the economy. It then becomes clear that the government is at a loss. Populism, therefore, in essence, is a political issue as it breeds in a crisis of political representation, populism has a political agenda and is implemented using economic methods.
             Knight, however, argues that populism can be seen as strictly a political issue, as it arises in predicaments of political representation and is profoundly anti-democratic. Populism, therefore, presents itself is different to the political establishment; the populist alternative devises other mechanisms for participation where the masses are at best direct recipients of paternalist benefits from the government, aimed at securing political loyalties, while channels for real participation are systematically closed. Historically in Latin America, populist movements organized their support around core constituents, determined by the specific social and economic sector where the leadership originated. Thus the military, labor unions or peasants were, in different country situations, then the mobilized or mobilizing forces of emerging anti-status movements. Populist leaders have always capitalized on the discontent and aspirations of the traditionally excluded. The oligarchy is the usual antagonist, and a strong divisive message of 'us' and 'them' permeates the entire rationale of the populist arising. Therefore, Latin American populism ac...