Obama's South American Reality Check

Many people, including most of the
presidents and leaders of South America, were hoping that President
Obama would initiate a serious change in US-Latin American relations,
after the low point
reached during the Bush years. Change will certainly come - it is
happening every week - but there are few if any signs that the
initiative will come from the north.

The Obama administration announced yesterday that it would allow Cuban-Americans with relatives in Cuba to visit and send money, and that some communications links would be opened. This was widely expected, and as the Financial Times noted,
it was "the minimum necessary to make sure that Obama gets a good
response" at the Summit of the Americas, where 34 heads of state will
meet this weekend in Trinidad and Tobago.

To be sure, Obama will
do much better than his predecessor did at the last Summit four years
ago. At that meeting, in Mar del Plata, Argentina, President Bush was
so embarrassed
that he skipped town a day early. In addition to the huge protest
rallies that greeted him, the event was historic in that it marked a
clear end to Washington's 10-year dream of a "Free Trade Area of the
Americas."

But the so-called "free trade" agreements - including
the North American Free Trade Agreement, or Nafta, that has helped
deliver sluggish growth, increasing out-migration, and a massive
security crisis to Mexico
- are just one item of the menu of failed policies that Washington has
offered up to its southern neighbors. The collapse of economic growth
in Latin America under neoliberal policies has gone unnoticed in
Washington, but it's hard to miss in the countries that have suffered
through it.

From 1960-1980, income per person in the region grew
by 82%, as compared to just 9% for 1980-2000. Since 2000 it has grown
by about 17%, which - despite the last 5 years of much improved growth
- will make this the third consecutive decade of dismal economic
growth. Nothing comparable has happened to Latin America in more than a
century. To get an idea of what this means for the region, if Brazil
or Mexico had simply kept growing at their pre-1980 rate - which would
not have set any records for developing countries - they would have
European living standards today. This is basically what happened to
South Korea, which unlike Latin America, did not adopt Washington's
neoliberal policy recommendations.

The current recession, which was so clearly caused by policy failures in the United States,
has only reinforced the message that Washington is not the place to
turn to for economic advice or leadership. In the last decade, Latin
American voters who were fed up with neoliberalism have chosen
left-wing governments in what is now the majority of the region.

US
policy-makers seem clueless as to the historic, epoch-making nature of
the changes that have taken place in this hemisphere, their causes, and
their implications. They seem stuck in a time warp that precedes not
only the Bush years but often strays back to the cold war. Jeffrey
Davidow is President Obama's special ambassador for the summit and a
key Latin America advisor. Speaking
at an event in Washington last week, he tried unsuccessfully with cold
war rhetoric to convince his audience that maintaining this 47-year old
embargo - opposed throughout the region - is for the cause of
democracy. Never mind that everyone in the room knew that it is all
about the Cuban-Americans of South Florida, a state that has swung two
of the last three presidential elections. Perhaps equally out-of-place
was his praise of the Washington Post editorial board's position on
Cuba: "Maybe you think they are a bunch of ideologues as well," he
said, "but I think they say it much better than I do."

For those who don't read the Washington Post and remember it as a liberal newspaper from the Watergate years, its editorial board
has become fervently neo-conservative on foreign policy issues, having
led the charge for the Iraq war and shrilly denounced critics who
questioned the Bush administration's arguments for the invasion. If
Davidow does not have even a sense of his audience among the
centrist-liberal foreign policy establishment in Washington, how can we
expect him to deal with the new realities of an independent Latin
America?

Clearly President Obama could use some better advice on Latin America. It was a mistake to initiate verbal hostilities with Venezuela at the beginning of his presidency; a mistake to continue the Bush administration's policies toward Bolivia;
a mistake to think that he can ignore the call of President Lula da
Silva of Brazil and other presidents for an end to the embargo on Cuba.
Nothing would be easier than for this administration to break with the
past and establish normal relations with the entire hemisphere, which
was excited about his election and expected no less. But Obama's
advisors show little interest in doing this.

Of course, the Obama
administration's conservatism on foreign policy in general - including
Afghanistan, Pakistan, and the Middle East - reflects a political
calculation that his handling of domestic economic issues will make or
break his presidency, and that the safest route on foreign policy is
therefore to deviate only minimally from the status quo. But when the
status quo is so glaringly divorced from reality, change might be a
better option.