The Latin America of the 21st century is not so easily controlled by gunboat and dollar diplomacy. In spite of dire media reports about Venezuela, U.S. power is on the decline while cooperation between Latin American states is increasing.
By Anne Winkler-Morey WAMM Newsletter Spring II 2014
Venezuela moved to the front page as a theater of protest and violent state repression this spring. We saw pictures of young people, fists raised, facing Venezuela National Guards, cars burning, and reports of growing body counts. Actors at the Academy Awards sought points by lamenting state violence in Venezuela. U.S. Secretary of State Kerry called the Venezuelan forces “terrorists.” Venezuela accused the U.S. embassy of coordinating and supporting protests, and ousted three diplomats. The U.S. followed suit and began talking about economic sanctions. Today as I write, the death toll has reached 40. Venezuelan President Maduro has asked the Pope to mediate between his government and the opposition. The story is developing daily.
One aspect of this story that deserves more notice is the role of Latin American nations in the conflict signaling a profound change in the power of the United States in the region. Mural on the side of a building in Caracas commemorating Simón Bolívar, the father of Latin America’s struggle to free itself from colonial rule. Created by Guerrilla Communicacional.
Historians will note that from his first election in 1998, Hugo Chavez advocated regional sustainability, economic diversity, and solidarity in Latin America as a way to loosen the domination of the United States and other “First World” or Global North powers. He wasn’t the first leader to do so. Fidel Castro, in his role as a leader of the nonaligned movement during the Cold War, championed South-South inter-cooperation even while remaining economically dependent on the Soviet Union. In a similar vein, Jamaican leader Michael Manley pushed for Caribbean inter-cooperation, countering Reagan’s South-North oriented Caribbean Basin Initiative. These past efforts faltered due to the overwhelming economic power of the U.S. during those periods.
By the 21st century, however, U.S. power in Latin America was on the decline. A decade of wars in Iraq and Afghanistan and the rise of other global powers, most notably China and the EU, made it easier for Latin American states to diversify products and trading partners, as well as to pursue inter-Latin American trade and cooperation. The free trade agreements beginning with NAFTA can be seen as an effort by the United States to codify old relations and counter Latin American steps to break centuries of dependency.
The same year NAFTA became law (1994), Brazil and Argentina initiated a regional trade organization, MERCUSOR. It now incorporates most South American states. Venezuela became a full member in 2006, and due to Chavez’s leadership the trade group established the Bank of the South, a bold antidote to the IMF. Instead of increasing indebtedness and First World control of the Global South, this new bank supports redistribution and inter-American economic cooperation.
In addition, Chavez took unilateral action, using Venezuela’s seemingly inexhaustible oil resources to engage in its own inter-American oil diplomacy, providing grants, barters, and no-interest loans to Caribbean and Central American nations and NGOs, even providing grants to low-income communities in the United States. In Minnesota, the Red Lake and Fond du Lac reservations received winter fuel through Venezuelan-owned CITGO. The economic crisis in Venezuela and the protests.
Ironically and unfortunately, while championing economic diversity in the region, Venezuela remained dependent on one product and one partner. The decades-old dependence between the United States and Venezuela continued after 1999, creating a strange undercurrent to the open hostility between the two countries. For all the bellicose rhetoric (and political and military aggression on the part of the United States), neither nation has wanted to interrupt their oil trade. Within Venezuela these oil revenues are plowed into clinics, schools, food and housing subsidies as they never have beforeleading to steady decline in the poverty rate, but like all single-product economies, such dependence leaves one vulnerable to the vagaries of global capital.
The dramatic increase in oil exploration in the United States in the last few years – much of it using fracking technology – has decreased U.S. dependency on Venezuelan oil. It is one reason for the recent fall of oil prices, which led to Venezuela’s current economic downturn and threatened its ability to bring its redistributive policies to full fruition. Still, poverty levels have continued to fall: at 55 percent in 2004, they were down to 25 percent in 2012. (We don’t have any figures for the last 16 months. It is quite possible these figures will go in the wrong direction as rising prices cut into working-class budgets.)
The U.S. military places Central America, South America, and the Caribbean under its South Command.
Map: U.S. Army Combined Arms Center