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Latin America in the
Post-Bush Era:
What Can We Expect in the
Next Phase of
U.S.-Latin American Relations?
By Mark Weisbrot
Co-Director of the
Center for Economic and Policy Research (CEPR)
Thursday, May 29, 2008
Causes of Latin America's Recent
Distancing from the United States
1.
Long Term Economic Failure Associated
with Washington-Backed Reforms
2.
Bush Administration's Attempt to
Isolate Venezuela – Isolated
Washington
3.
Latin America Policy Based on “War on
Drugs” and “War on Terror”
4.
“Free Trade” Agreements
Latin America's Unprecedented
Long-Term Growth Collapse
90.0
82.0
Total Growth (percent)
80.0
70.0
60.0
50.0
40.0
30.0
20.0
9.0
10.0
14.0
0.0
1960-1980
1980-2000
2000-2007
Western Hemisphere: Total growth in per capita real GDP (Purchasing Power Parity)
“Neoliberal” or
“Washington Consensus” Reforms

Reduced restrictions on international trade and financial flows

Tighter fiscal and monetary policies (higher real interest rates)

Privatization of state-owned enterprises

Labor market and public pension reforms

Abandonment of state-directed industrial policies or development
strategies

Increased accumulation of foreign reserve holdings
South Korean Growth vs. Brazil
1960-2007
25,000
constant international dollars
Brazil
20,000
Republic of
Korea
15,000
10,000
5,000
19
60
19
63
19
66
19
69
19
72
19
75
19
78
19
81
19
84
19
87
19
90
19
93
19
96
19
99
20
02
20
05
0
Brazil and Republic of Korea: Real GDP per capita (Purchasing Power Parity)
 In
the last decade, voters in Argentina,
Bolivia, Brazil, Ecuador, Nicaragua,
Uruguay, Venezuela all elected candidates
who ran against “Neo-liberalism”
 Washington doesn't recognize
failure,
pushes more “Free Trade” Agreements
with less and less success
Bush Administration
Supports Military Coup in Venezuela
and Subsequent Destabilization Efforts

State Department funds people and
organizations involved in coup

White House and State Department lie about
events in attempt to support coup

Bush Administration supports further efforts
against Chavez government (e.g. oil strike)
Result: Deep Rift Between Venezuela
and Washington; Relations with Rest of
Region also Cool

Brazil, Argentina, Ecuador, Bolivia and other
countries support Venezuela against Bush

Latest example: Colombia Incursion into
Ecuador, condemned by all except
Washington

Many other examples
Q: What Would a New Latin
America Policy Look Like?

Give up on NAFTA-type agreements

Acknowledge that there are different paths to growth
and development

Respect national sovereignty in Latin America

Normalize relations with Venezuela

Cease support and funding for opposition (white
separatist) movements in Bolivia, opposition in
Venezuela
(Continued, next slide)
Q: What Would a New Latin
America Policy Look Like?

Support negotiated solution to Colombian conflict

Abandon failed supply-side approach to “war on drugs”

Normalize relations with Cuba

Co-operate with efforts at regional economic integration
(as in Europe)