I don't think colonial plunder remotely explains Latin America. Also, why aren't plunderer Spain and Portugal super-wealthy? (Incidentally, the degree of "colonial plunder" in Latin America varies a great deal, from genocidal in Mexico, to practically none in Chile, Argentina, Uruguay, but economic performance of the entire region has been lackluster, with the exception of Argentina between the 1880s and the 1930s.)
You're not entirely wrong about the impact of plunder being many generations-long, because, for example, Paraguay's bad performance almost certainly goes back (at least in part) to the ruinous Triple Alliance War, way, way back in the 1870s (in that war Paraguay lost almost all its males aged 12-60). But it doesn't have to be like that, and it isn't always. If it had to be like that then Europe might never have risen again after WWI or WWII, yet there it is. South Korea wouldn't have risen after Japan's occupation of it. China wouldn't either after the Japanese war, or the Opium wars.
> > A lot of countries have managed to grow very fast from abject poverty to first-world status. Japan. South Korea.
> As I mentioned in my reply to your other comment, they are much smaller, and had plenty of help from the US. Do you have any other examples?
Sure. I mentioned Argentina in another post, which grew fabulously fast between the 1880s and the Great Depression. China, of course, I mentioned above. Since the Industrial Revolution I think we've had these amazing growth stories: UK, US, Germany, Argentina, Japan, Japan and Germany again, South Korea, China. I'm probably missing a few. Many others had less spectacular but steady growth rates (think Australia, Canada, France, ...).
As for China, it's certainly on the cusp of first-world status. They have... a lot of bad ideas weighing them down though. The SOEs, for example, and the state-owned banks and their terrible lending practices, financial repression, unbelievable malinvestment following the 2008 crisis, unresponsive government, corruption, pollution, and so on. These bad ideas could easily sink China just as a very different set of bad ideas sank Argentina.
My thesis here is that some ideas are bad, and some are _terrible_, and others are at least not bad enough to crush the human creative spirit. Peronism (Argentina) falls into the 'bad' category, while Maoism (China) falls into the 'terrible' category. Capitalism inarguably is at least neither bad nor terrible -- I would argue it's awesome, and that it's not even an idea, but rather what results when you have freedom (which _is_ an idea, and a very good one at that), but I'm willing to let you have the last word (for this post's threads anyways) to the contrary provided you're willing to tell me how it is worse than Peronism or Maoism, or even just comparable to either (please don't blame Belgium's genocides in Congo on capitalism; that's a very lame and boring argument).
To me all of this is blindingly obvious. Again, the Argentine example is instructive, as it is one of the fantastic growth stories, but one that ended poorly when bad ideas were applied. China is another great example, with the Great Leap Forward and the Cultural Revolution being calamitous, with the rape of Nanking and the Opium wars not all that far in the past, yet it rose up when Deng Xiaoping put an end to the Maoist nonsense and brought a good enough measure of individual freedom (at least to trade) back into the picture, and then China bloomed. The difference between Mao's and Xiaoping's China is so stark that it is impossible not to see it as the difference between awful ideas on one hand and at-least-OKish ideas on the other.
The Argentina/China examples cannot be explained otherwise than above, or at least I've not seen alternative explanations -- none! not even unbelievable ones, or at least I don't recall any. China is certainly a counter-example to the plunder-explains-it-all theory. Though I expect that you'll tell me that the plunder of China was minimal in proportion to its population (but recall that the famines of the Great Leap Forward were not minimal that way!). At the end of the day, good ideas can lift a nation from a poor history, or they can sink it from a great history -- this much should be clear, and if that's true, then plunder is no excuse, or not enough of an excuse anyways.
This debate about the impact of plunder reminds me too of the Franco-Prussian war of 1870. Prussia won that, and imposed what it thought would be crushing reparations on France, which it intended to use to improve the wealth of the German people. But it didn't work. France managed to borrow what it needed to pay those reparations, underwent very fast growth, and paid off its debt in just a few years, all the while Germany under-performed. One might call what Prussia did "plunder" (is it not?), yet it failed, just as the Versailles reparations in the other direction after WWI had the same exact effect, but reversed because the reparations direction reversed too. Plunder is not the explanation that you think it is -- it can be in specific cases, but may not even be a good rule of thumb.