Bush's
visit to Latin America
underlines its fragility
By
Jonathan
Power
March 22, 2002
LONDON - George W.Bush, the world now realizes, was
born with a silver spoon in his mouth. World events,
everything from the political composition of the U.S.
Supreme Court, from terrorism to the American economy
seem to have a preordained way of working in his
electoral favour. Again it is happening with Latin
America.
By rights the chickens should be coming home to roost
as Bush girds up for his end of week visit to Mexico,
Peru and Central America but, in fact, Argentina apart,
the tides, both political and economic, appear to be
working in his favour. Just the other day the
International Monetary Fund issued a report saying that
Latin America was "set for recovery", likely to benefit
from lower financing costs, higher commodities and an
expected rebound in the U.S. economy, with a projected
growth by the end of the year of 4% (excluding
Argentina).
For the last five years the region has taken
something of a battering: commodity prices fell by a
quarter and access to external financing was sharply
restricted, portfolio flows dried up and capital inflows
slowed down. On the political front there has been severe
turbulence in many of the countries that most matter.
Argentina entered an almost insuperable crisis of both
economics and governance. Peru went through the
destabilising business of driving into exile Alberto
Fujimori who had turned an elected victory into a quasi
dictatorship. Venezuela voted into power Hugo Chavez who
immediately set about policies that have curtailed
democratic rights whilst frightening away investors. And
Colombia has appeared to enter a new phase of
self-destructiveness to add to a past that is the most
violent of any country on the southern continent.
But despite this, from Bush's perspective, it
must seem that on balance rather nice progress is being
made. Peru now has a democratically elected president and
one set on combating the country's endemic and corroding
corruption. In Colombia it looks increasingly likely that
a rightist candidate will win the forthcoming election
and gear up the army's war against the leftist guerrillas
and the drug traffickers in the all out way Washington
wants. Even in Venezuela it appear as if Chavez is no
longer quite so firmly in the saddle and this vigorous
critic of America may find he is out on his ear at the
next election. Moreover, despite recurrent crises, Latin
America's turn to democracy in the late 1970s has managed
for the most part to sustain itself. Before 1975 military
dictatorships ran every country apart from Mexico,
Venezuela and Colombia.
Today, when there has been no successful military coup
since the early 1980s, when the ex-president of Chile
Augusta Pinochet spends most of his time housebound and
disgraced, when Argentina and Uruguay have imprisoned
their old military dictators and Mexico has finally
overthrown the straitjacket of its corrupted one party
rule, the political atmosphere could not be more
different than twenty years ago. To add to the positive
list there are the accomplishments, limited and
insufficient but still very important, for following the
"Washington consensus" during the 1990s, the rulebook of
the then orthodoxy of the IMF, the World Bank and the
U.S. Treasury that argued that these economies would
never progress unless they liberalised and opened
themselves up to the forces of globalisation.
The inflation prevalent in the late 1980s and early
90s when prices were increasing at several thousand
percent a year has now been squashed, an outcome which
benefits poorer people more than any other group.
Privatisation has also got rid of some of the price
gouging of the old monopolies, bringing in better service
in areas such as power delivery and telecommunications.
Not least, some countries, Mexico and Chile in
particular, have at last made real progress in developing
an alert manufacturing export sector. Radical leftism
that at one time swept the continent with its struggle
for revolutionary change is contained. The nearest it
comes to being in power is in the persona of Venezuela's
Chavez. But he has sidelined the trade unions and been
cautious in economic management.
In Brazil, the Workers' Party candidate, Inacio Luiz
da Silva, is in with a chance at the forthcoming
presidential election, but the record of the party's
achievement in local government where it controls seven
of the largest cities has been imaginative but certainly
not destabilising. Yet, if surveying the scene Bush is
complacent he may well be president for long enough for
it to come back and haunt him. 200 million Latin
Americans have an income inadequate to meet basic human
needs and 70 million have insufficient food. Little
progress has been made since 1980. Latin America, always
the most unequal of the world's continents, is more
unequal today than it was fifteen years ago. And despite
the promises of the Washington consensus none of the
Latin American countries, with the exception of Chile and
Mexico, have found a way at attaining regular annual
growth rates of 5%, the minimum necessary to make a
significant dent in reducing unemployment and poverty.
(And even Chile does so no longer.)
The trouble with the Washington consensus is that it
didn't deliver liberalising in the three areas that
really matter- with immigration into the U.S., with trade
where the barriers against a range of exports from
poultry to grains to manufactures are formidable and, not
least, with drugs. Only the legalisation of drugs in the
U.S. would pull the carpet from under the criminal gangs
and guerrillas that are tearing at the political and
social fabric of Peru, Bolivia and Colombia. Until the
U.S. soberly confronts its hypocrisy on these three
counts the progress seemingly made in Latin America will
all too quickly disappear.
I can be reached by phone +44
7785 351172 and e-mail: JonatPower@aol.com
Copyright © 2002 By
JONATHAN POWER
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link to read about - and order - Jonathan Power's book
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