TCS Daily


Latin American Circus in Vienna

By Martin Krause - May 18, 2006 12:00 AM

The announcement should read: "Come and see the most spectacular show ever... the world famous Latin American Circus arriving in Vienna!"

The opportunity was the Summit meeting in Austria of the presidents and prime ministers of Mercosur and the European Union countries. They were supposed to discuss how to move on free trade negotiations between the two trade blocs. (Such has been the European move to counterbalance the FTAA initiative promoted by the US in the region.)

But it turned out not even the photo opportunity went as planned and there was not much else to show for the meeting itself.

The reason for this has to do with the shameful mess Latin America is in now, particularly South America, thanks to the initiative of Venezuelan Hugo Chavez and his attempts to recruit new allies for his folkloric "revolution".

Chavez has been meddling in the internal and bilateral affairs of South American countries. His ambassador to Peru had to be recalled by request of the Peruvian government for his intervention in the Peruvian presidential electoral campaign in favor of Ollanta Humala, another former military officer with a violent past, turned into "redeemer of the indigenous traditions" of Latin America.

He was more successful with his support of the recently elected Bolivian president and former coca-leader Evo Morales, and has encouraged him to play hardball with the oil and gas companies by "nationalizing" Bolivian natural resources. But those companies are not the usual multinationals that prompt the cries of "Yankees go home" or other so-called representatives of American or European imperialism. He's picking on Brazil's state-owned Petrobras, the largest producer in his country.

Morales, echoing Chavez's lousy mouth, claimed the Brazilian company "violated the rule of law", profited from "illegal contracts", and even with "smuggling". The usually friendly relations between Bolivia and Brazil are now a matter of grave concern in the region. All the graver because Brazilian president Lula da Silva was not too far from a leftist ideology, himself -- at least during his years before he came to power.

Also present in Vienna was the intransigent position of Argentina towards Uruguay with regard to the construction of two paper mills on the Uruguayan side of the river the two countries share as a border. Argentine president Néstor Kirchner clearly avoided Uruguayan president Tabaré Vázquez, again, even though both supposedly come from the same left of center side of the political spectrum.

Chávez is also confronted with right-of-center Colombian president Álvaro Uribe and Vicente Fox of Mexico. He already managed to disturb and spoil the last FTAA "Summit of the Americas" in Mar del Plata, Argentina, in November 2005. Behind his posturing though, it comes out clearly his disdain and rejection of anything that gets closer to free trade, markets or "private sector".

But his political maneuvering may come back to haunt him. So far, what this radicalization is achieving is something unexpected a few years before: moderate Latin American center-left governments are becoming increasingly pro-market and pro-US. The socialist Chilean president Michelle Bachelet continues and deepens the reforms of past decades, they are now even considering the privatization of jails. The socialist Uruguayan president is asking for bilateral trade negotiations with the US.

Argentina's opposition to the paper mills has destroyed the Mercosur and has left the FTAA as the only viable alternative which some countries have started to follow on their own.

The shameful show is not only scaring European leaders, but Latin Americans as well.

Dr. Martin Krause is the Professor of Economics and Dean of ESEADE Business School in Buenos Aires, Argentina.

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6 Comments

Black and white
"So far, what this radicalization is achieving is something unexpected a few years before: moderate Latin American center-left governments are becoming increasingly pro-market and pro-US. The socialist Chilean president Michelle Bachelet continues and deepens the reforms of past decades, they are now even considering the privatization of jails. The socialist Uruguayan president is asking for bilateral trade negotiations with the US."

People only seem to be able to detect differences, not absolutes.
Moderate milquetoast policies become background noise until someone comes along and upsets the cart, either way.
Castro and Chavez are useful if only to remind us why communism is bad. It's too bad thier people have to suffer for it.

I agree with you
about the failure of statist economics as practised by Chavez and the like. But the author of this article seems unable to understand his own double standards when he says, "Chavez has been meddling in the internal and bilateral affairs of South American countries."

Is he pretending that the U.S., Britain, France, the former Soviet Union and a host of other countries intervening in the affairs of others are in some way different?

What to do?
What is the purpose of the "meddling"?
Mexico is 'meddling' in the USA immigration policy.
If the purpose of the meddling is to advance individual liberty, then by all means, meddle.
If it is to increase the power of the state or a dictator, then that is BAD meddling.
Is all killing murder?

Most meddling
occurs to advance the power of the state doing the meddling. Rarely is it to advance the welfare of the citizens in the target state. It may be mendacious, but Chavez can claim that his interest lies in the welfare of those poor citizens in countries hostile to his policies. It may be transparent, but not necessarily more absurd than some of the things the U.S., France, Britain, Russia have done over the years during the cold war.

Moral relativism
So a nation, whose citizens have established a government that demonstrably respects individual liberty, that meddles in nation which does not respect any individual's liberty, is no different than a totalitarian state that tries to subvert liberty in other states?

Of course there's a difference
but a nation that respects the liberty of its own citizens does not necessarily also respect the liberty of citizens of another country. Take France, for example. While France certainly respects the freedoms of its own citizenry, its interventions in its former colonial possessions in north Africa can hardly be considered to be in the best interests of the welfare of the locals.

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