Latin America

Two countries have stood out in their respective regions as economically progressive policy successes in the last ten years. In Europe, Spain along with Ireland have seen much of the positive development and economic growth when the rest of the EU has been wrestling with high unemployment rates and drastic changes in governments. In Latin America, Brazil under Lula and under the former Cardoso Administration have grown at a steady positive rate, breaking the traditional Latin American plague of economic collapses and large booms that seem to be commonplace in almost all South American economies to date. With success, the importance of Spain and Brazil have taken on a new form in their regions and abroad. Traditionally the place of the United States, these emerging regional powers now seem to be inheriting some of America’s traditional problems.

Brazil has always been a country of immigration. The population of Brazil, while taking in only some immigrants from Asia, Africa and Europe in the last few years, was one of the countries that absorbed much of the world’s immigration since the 1880s. This open policy remained, and while economic problems and changes from populist, to military, to democratic governments took shape since the 1930s, immigration remained strong as long as there were jobs to be done in one of the world’s largest countries. With traditional economic instability and some recent success, many Brazilians have chosen to go abroad to either find more work or utilize their assets to enjoy life abroad. In Spain, this emigration from Brazil has taken a foothold with both emigrants coming and living illegally for work or working in legal low paying jobs, as well as those upper middle class Brazilians coming to make a life and career in Spain as professionals and entrepreneurs.

While the general impression of Brazilians in Spain is a positive one, there have been some problems against immigrants at the main Spanish airports and in society as a whole. Many immigrants, including many Brazilians often enter Spain and stay illegally. This has been a problem one many fronts, as many Latin Americans, Africans and other Europeans do not go through the normal procedures to live and work in Spain but come as temporary workers or as refugees or simply pass through the border and disappear. With Spain having some economic expansion and the closing off of the US to many immigrants, the Spanish immigration system has become overwhelmed. Since 2006, the number of Brazilians coming into Spain has nearly “tripled or quadrupled”, while at the same time in Spain eight Brazilians a day are deported.

The solution to the Brazil-Spain situation needs to be addressed by both countries. Brazil needs to reform its immigration to fit with its position as an emerging power in the world. With 3-4 millions Brazilians living abroad, Lula will have the responsibility to create and international Brazil without losing all of the most talented to other countries and still maintain funds coming from those emigrants abroad. Spain will also have to accept Brazilians and the diversity of the Brazilian social strata now living throughout the Iberian Peninsula. It will take a long time to adapt the infrastructure to treat foreigners in a respectful fashion, but attempts need to begin immediately. Brazilians and others will be challenged living in Spain in becoming Spanish. While it might be easier from some, it is doubtful that those migrants to Spain who are not seen in a positive light will be so easily welcomed in the near future.

On March 20th Steve Paiken of TVO.org’s The Agenda had a discussion on Cuba After Fidel and a possible boycott of the Olympic Games. This international panel first discussed the ability and rationale of boycotting the Olympics due to accusation of Human Rights abuses against the Tibetan people and later on a full discussion on the future of Cuba from the perspective of locals, US Experts, Cubans expats and the international community on Cuba after Fidel’s control. The discussion can be seen here and the video on the TVO.org March 20th Video page.

The panel’s discussion hit some key issues important to foreign policy towards Cuba. A comparison of policies towards China when abuse of rights is accepted by the international community, as compared to the heavy sanctions on Cuba for less abusive acts was the glue between the discussions of the two issues. Much of the criticism comes from the openness of the US and other countries towards China when many of the policies towards Tibet run contradictory to policies which support an embargo of Cuba. While rights abuses by any country are unacceptable, it is those who are abused which suffer from inconsistent policies which allow trading partners to ignore political pressures while placing a small country into poverty for the same reasons. Ideally, abuses by Cuban and Chinese officials should not be accepted for the sake of trade, and policies should not starve citizens of any country in an attempt to protect them from the abuses of the own government. This was the case during the oil sanctions on Iraq after the Gulf War, which lead to the starvation of many innocent civilians at the behest of Saddam Hussein. Bad policy which leads to increased suffering of politically oppressed people should be clearly unacceptable in any rights based society.

I encourage our FPA readers to take the time to watch the TVO program. Please address these issues in our blog comments accordingly.

After much anger, resentment and accusations by Colombian officials and Hugo Chavez, a Cold Peace has been declared between officials from Colombia, Venezuela and Ecuador. After an attack on FARC rebels by Colombia that took place inside Ecuador’s border, a negative reaction by Ecuador’s President and the movement of troops and saber rattling by Chavez of Venezuela could have lead to an open war between the South American neighbors. Even the country of Nicaragua set to oppose Uribe and Colombia, but in the end disgruntled hand shakes and an official apology by Colombia towards Ecuador allowed everyone to maintain stability on the borders. The only real losses were to the FARC organization. In the recent bout of political maneuvering, the FARC for the first time lost one of its top leaders, Raul Reyes based on proper intelligence work and efforts by Colombia and Uribe. Two days later, another one of FARC’s top officials was assassinated by his own bodyguard. Motivations for this were partially due to a $2.6 million reward as well as fatigue and a loss of cohesion in much of the FARC organization. In the end, the FARC soldier defected with his commander’s hand and brought Colombia the knowledge that FARC might be losing its luster of having untouchable leadership and a stable command structure.

In an ISN article last week called Colombia: Unintended Consequences, journalist Sam Logan discusses the outcome of the latest Andean skirmish after the attack on the FARC camp by the Colombian Armed Forces. The view, as discussed by Logan is that there were no obvious winners or losers in the latest political drama, but that the end of the situation showed that the FARC may have lost its image of invincibility due to the death of one of its top seven leaders and tacticians. This rolling success was only complemented by the death of a second FARC mid-level leader, showing to everyone that FARC’s discipline and command and control of its 16,000 plus soldiers did not stop one of its other leaders from losing his hand and his life to his own bodyguard. Logan explains that not only luck aided Colombia in creating FARC’s problems, but new intelligence helped produce FARC’s recent troubles. Colombia has recently adjusted its intelligence gathering system to disseminate information in a more productive manner. This may have contributed a great deal in finding Reyes, as well as allowed Colombian forces to press the attack on the FARC.

The damage to FARC’s reputation will do nothing more than help Uribe gain more support in Colombia’s own “War on Terror”. Political support and nationalism will likely remain high for Uribe, who himself was attacked by the FARC before taking office. Chavez has also saved face among his people, but may not be willing to proclaim another conflict so easily as the FARC’s unintended losses and his own political career depend on the will of the Venezuelan people to support an attack on its neighbor. With half of the country supporting Chavez and the other half opposed, support for FARC kidnappings, attacks on Colombia and spilling blood for those causes may not put Venezuela’s self proclaimed Caesar in a position to hold power in the future.

The clear losers of the whole situation are those kidnapped victims held by the FARC to date. While Chavez did aid in getting some hostages released, the use of kidnapping against Colombians and others is an effective torture on society in Colombia. Many seek to blame aggressive policies in maintaining captives like Ingrid Betancourt in FARC hands and put pressure on Uribe to negotiate with the FARC to gain her release. It is unlikely this debate will end with a possible aggressive push against a weakened FARC in the near future.

I was happy to read a clever article called: Linking NAFTA and Immigration by Ted Lewis of the San Diego Tribune as he discusses the campaign issues and how they are being spun to effect the campaign and America’s neighbours in a negative fashion. Lewis suggests that reform in NAFTA and effects on the poorest in the three member states needs to be addressed in a logical fashion, and not via the lens of the complete benefit of free trade or lowbrow electioneering. Addressing poverty and its root causes of increased unemployment in Mexico needs to be addressed in any future NAFTA negotiation. Lewis states that much of the illegal immigration comes from a lack of economic progress in Mexico since the agreement began and has lead to massive amounts of immigration to the US. Lewis also mentions that the electioneering between Obama and Clinton creates arguments against free trade, and in my impression creates intentional dissent in the US against Canada and Mexico. While Obama was blamed for not being serious in changing NAFTA, Clinton has used this small scandal to re-ignite her campaign. Ironically, the alienation of friendly foreign governments was always something linked with Bush, but support for the next Clinton Presidency may rest on the backs of Canadians and Mexicans alike if it continues to hurt Obama.

With much of the support for the Clinton campaign coming from the blue collar democrats in the northern states and America’s traditional industrial heartland, it makes sense that Clinton would use Canada and Mexico to blame for poor US policy in the past, much of which came under her husband’s term in office. In reality, the Mexican economy has purged its traditional weaknesses since 1994 and has maintained a solidly valued Peso, growth in the long run and even produced a more equitable government with the PRI dominated Presidency toppling a few years after NAFTA came into effect. The reality is that Mexico is a developing nation in many ways and has problems which 10 years of trade policy could never resolve in its best performance. To end poverty and develop a country a generation is needed to end generations of poverty and inequality. Targeted anti-poverty policy is needed to help remove the 30% of Mexicans who live in poverty and have always lived in poverty. Economic progress in Mexico has created such negative results because the flow of money often reaches the poorest last. This is the trend in almost every country where poverty dominated the political agenda. No one has addressed this in the Obama camp, and with the Clinton campaign it seems that immigration and NAFTA come second to embarrassing Obama as much as possible.

While poverty and success in Mexico’s economy can always be debated, the main issue of concern is that anti-immigrant and anti-NAFTA effects of running a negative campaign. It seems apparent that even though NAFTA is a mixed blessing, the current concerns with China seems to be targeted towards America’s neighbours. While China has a right to progress economically and diversify its society as it wishes, Americans need to debate how they want to proceed with their neighbours and China in a logical, fair and respectful manner and choose where they wish to take America in the future. No country can live in a vacuum, but every country has the ability to take measured and fair responses to grow its own economy and produce trade and development to assist its own people, create a net benefit in jobs and reduce poverty.

In a response to one of the FPA’s blogs, a candidate for Congress in the US claimed the wholly negative effects of NAFTA and America as losing its sovereignty over NAFTA. I responded in kind in order to dispel myths which seek to create straw man arguments of America’s friends and neighbours. I encourage readers to read the responses to the blog and address their concerns in kind. All fair points of view are respected and I encourage open debate. The response is noted in the FPA’s Latin America Blog: Paranoia on the Frontier: NAFTA and the US Election

A tradition has formed in economic thought since the 1960s in comparing two regions with similar levels of poverty and inequality. Both regions have traditionally been open to economic measures to promote growth and achieve the level of development of North America and Europe. Asia and Latin America are both regions which have suffered historical economic problems and large structural reforms, and in the 1960s were considered at the beginning of new forms of development. While many Asian countries set off to promote trade and investment and increase Foreign Direct Investment in their economies, Latin America sought to follow the trend started by Raul Prebisch, by raising tariffs and trade barriers and producing their own products internally and keeping investment inside their own individual economies. The independence of Latin America from the industrialized world would take its form in Import Substitution Industrialisation policy for the region. The exception to the rule in Asia was China. A Communist system left China locked into trade with other Communist countries and limited trade with the West. Upon the onset of problems between China and the Soviet Union in the 1970s, some moves towards greater trade with the West came after Nixon’s trip to open relations with China. Since then the progressive growth and eventual acceptance of China into the WTO has made China the world’s next Superpower, or at least the country that manufactures everything for the world’s current Superpower.

With economic progress came inequality. In Latin America economic success could always be measures by the percentage of people that benefitted or were lifted out of poverty by a boom in any of the Latin American economies. Boom and Bust cycles dominated Latin America well into the 1990s and beyond into Argentina’s financial collapse in 2001. This debate dominated the World Bank, as neo-liberal ideas were debated comparing Latin America’s failures to East Asia’s successes in the report on The East Asian Economic Miracle, giving credit to reduced barriers and increased trade as the reason for East Asia’s success. Dissent came from the head of the World Bank itself when Joseph Stiglitz published Rethinking the East Asian Miracle after the financial turmoil of many of the Asian Tigers at the time and clear collapse of Argentina later on. Equality was still an issue as 30-40% of Latin Americans remained in poverty, East Asia reorganized and China slowly started to rise as an economic giant.

Lessons learned from the World Bank’s debates and the past economic crisis in Latin America and Asia showed that fast growth often promotes cultures of decadence for those who benefit from it and marginalize other parts of a society which do not have the means to raise themselves out of poverty. Systemic poverty among rapid growth was often the result, and became entrenched in the society in the long run.

In an article this week in FT.com, China is advised by the author to take lessons from Brazil in dealing with inequality while managing an economic boom. Not until the late 1990’s did progressive governments in Brazil seek to challenge the country’s historical inequality while absorbing slow positive growth and attacking poverty in a country of over 170 million people. Brazil’s past reflected much of that of Latin America’s with short periods of growth followed by economic collapse which left the impoverished in Brazil in constant chaos. While China does have a large amount of savings as opposed to those nations in East Asia and Latin America in the 60s, poverty still must be challenged in China as not to create an underclass in society. Economic booms have always been used to justify economic policies, but in almost every case the boom eventually turns to bust as economic cycles often do. Past policies to absorb the gains of booms are not put into addressing social problems that are often historical and require time and money to resolve past the boom cycle. While China is not Brazil, these two giants could learn a lot from each other. Both economies are considered to be economic miracles in their own right, but stability and long term growth are only truly successful if it benefits all citizens to a greater degree over a long period of time. While poverty is a constant reality in all countries, the plague of poverty inherited or created can be helped by proper economic and social policy during times of prosperity. With proper economic policy, the trend of inequality with growth do not have to be the result of economic progress.

Dorris Lin of our own FPA’s China Blog crosses the ocean with her piece on the new ties China wishes to form with Cuba as the island nation takes to change after the retirement of Fidel Castro. While China and Cuba have always had healthy trade ties ,with Castro gone and China being seen as the next Superpower by many in the US the new relationship Cuba will have with its neighbors will certainly be one of great interest for Washington. See the article here. Also please read FPA’s China Trade Blog as it is guarnteed it will make you smarter!

Messages of distrust between the Colombian Government and Hugo Chavez were considered no more than showboating after Hugo Chavez made headway in getting two Colombian citizens released, followed by open support for the rights of the kidnappers to be represented as a legitimate political party. Anger and frustration in Colombia which has been literally torn apart by the FARC and other rebel groups over the last 30 years put Chavez on the hit list of Colombians inside their own country and those in the Colombian Diaspora who often left their places of birth due to problems derived from the conflict in Colombia. Upon the death of Raul Reyes, one of the FARC leaders killed in a camp in Ecuador, a diplomatic scrum has begun between Ecuador, Colombia and Venezuela. Ecuador is accusing Colombia of intentional violations of their territory with the recent attack. Colombia did apologize, yet made clear their claim today of support by the Ecuadorian and Venezuelan Governments for the FARC and Colombia’s right to protect its own sovereign territory from terrorist attacks. The last piece of the drama comes with Hugo Chavez. By placing a number of heavily armed troops on its border to add flames to his theory that Colombia wishes to attack its neighbor and himself personally, an Andean War has perhaps taken its first steps. Currently, Ecuador and Colombia have removed their diplomats from each other’s embassies and have no diplomatic communication beyond Chavez’s saber rattling, or more specifically the sound of marching and the screeching of tanks surrounding the borders of Colombia on either end.

Conflict in South America has always been considered much as a Cold War between neighbors who never took actions beyond minor skirmishes. In the era of South American military governments in the 60s and 70s, many disputes over territory were the catalyst for countries like Argentina, Chile, Brazil and most everyone else purchasing some of the most advanced equipment, Exocet missiles and even in the case of Brazil, an old aircraft carrier to keep their neighbors at bay in the event of a hot conflict. Ironically, the heaviest conflict was in the early 80’s between the UK and Argentina when local unrest and economic tensions lead General Galtieri of Argentina’s military government to divert attention away from local issues by attacking a disputed territory known as the Maldives Islands/Falkland Islands. Galtieri’s strategy of conquest did nothing more than to end his own career and reduce the last of his support in Argentina to nil and deal one of the final blows to the era of South America’s military dictatorships.

In a classic sense the political fate of Chavez may come with his verbal, and now physical adoption of the dispute between Colombia and Ecuador. Along with verbal accusations of Colombia’s intention to murder him and his recent mobilsation of his armed forces, Venezuela has been investing in some very advanced and high tech weapons from the Russian army since the Presidency of Chavez began. In addition to Chavez’s rearming of Venezuela, his support has also started to wane with some Venezuelan groups as seen in his loss in a referendum to increase his powers under the Venezuelan constitution. Some may see Chavez as taking the strategy of General Galtieri in assuming a conflict, but the will of the Venezuelan people to give their children and blood on behalf of the FARC and Chavez is likely not as strong as Colombia’s wish to turn itself back into one of the most promising countries in the region, free of terror, economic strife and threats from their borders. Support from the US may balance out Colombia’s military capabilities as well, as its Air Force and Army are equipped for conflict with rebels and AK-47’s and not new Venezuelan Sukhoi fighters or armored tanks.

Another territory in the world this week that seems to have similar problems as Colombia are Israel and the Palestinian Territories. Like Colombia, conflicts from outside its border are influencing the lives of its people. As well, parts of the country considered to be under the right of control of the government and people are in constant civil distress. Another similarity is that no one knows how to solve the problems, but everyone can agree that aggressive influences from outside the border will do nothing more than keep Israel, the Palestinian people and Colombians in constant conflict at the behest of a Chavez or similar malcontent in their respective regions. Colombia has always had unfortunate experiences with rebels inside its territory, but hardly anyone can doubt the impatience the Colombian Government will have with a full attack from its neighbors who are seen as supporting rebels and making the Andean region into the next Middle East.