The Mex Files

I expect we’ll be hearing some more about the Bush famil y’s 98,000 acre spread in Paraguay in the coming months. Neil Bush (last month) and First Drunk Daughter Jenna (in October 2006) both made mysterious trips to the otherwise forgotten country in recent months.

Down With Tyranny has been one of the few widely read news blogs to follow the story, and actually went to Paraguay to investigate:

…I was hoping to track down the humongous Bush estate in the most remote part of Latin America’s least known country. I never did manage to get anywhere near the Bush estate– it was meant to be remote for a reason and the only way to get there is by private plane and then you need permission to land on their airstrip– but I did take note of a certain backwardness that might make it very alluring not just to Bush but to many of the potential war crimes defendants from his regime. They were actually selling Nazi memorabilia on the streets of Asuncion.

Well, Paraguay is in the news this morning– and not in a way likely to please the Bushes. The fascistic-oriented ruling party was deposed yesterday. Fernando Lugo, a former Roman Catholic Bishop– the “bishop of the poor”– and the leader of a left-of-center coalition of unions, Indians and poor farmers, beat Blanca Ovelar, who headed the very corrupt far right Colorado Party, widely considered to be in Bush’s pocket.

President-Elect Lugo, and his party, are promising to redistribute land in the last country in Latin America (like the United States, most agricultural land is held by corporate interests. Unlike the U.S., most Paraguayans are farmers). The Bush family lands are said to be investments in soya (Paraguay’s largest legal export) though there are rumors the Bush’s were interested in capturing water drilling rights in expectation that neo-liberal policies in the Southern Cone would lead to privatizing water distribution within those countries. However, Argentina, Brazil, Chile, Bolivia and Uruguay have all elected social democratic leaders who have rejected neo-liberalism, leaving Paraguay as the last hope for making a fortune from these privatized natural resources.

Then again, maybe some of the more sinister suggestions about the Bush compound are true, and water isn’t their main concern. Paraguay was, of course, best known as the refuge of Nazi war criminals and other nasty types. There are those who believe the Bushs are planning for their eventual exile somewhere beyond the jurisdiction of the United States and international courts. If even slightly true, the Bushs may have to start asking “Is it safe?” before they pack their bags.

Fernando Lugo’s election in Paraguay is also more proof, if any is needed, of my own hare-brained theory that the Bush family are working for Castro... think of it. Since Chinese Commie lovin’ George W. Bush was “elected” — with the help of Cubans in Florida (where his brother was conveniently Governor), Argentina, Bolivia, Brazil, Chile, Ecuador, Guatemala, ,Panama ,Nicaragua, Suriname, Venezuela and Uruguay, have all moved to the left. the fractured Mexican left united — and Bush’s handler, Fidel Castro, having achieved his goal of a leftist Latin America, could finally retire.

Following on the heels of the FARC-fetched explanations of why the Colombians launched a missile into Ecuador, the Colombian government’s only remaining overt rationale for U.S. military support seems to be evaporating. NarcoNews reports that:

… thousands of coca growers that had been occupying town centers in northern Colombia to protest the forced eradication of their crops have begun returning to their villages after three weeks of negotiations with local authorities. Their occupation of four large towns showed that Colombia’s much-demonized producers of the raw material for cocaine are willing to move to alternative, legal crops – if the government will treat them as partners rather than enemies.

Despite some whining from missionaries, about minor things like death squads, our national security depends on free trade with Colombia.

However, Haliburton and Blackwater can take heart (though it’ll mean more U.S. military casualties in Colombia)… now that the Israelis have been put out of the death squad training biz, there are other business opportunities. And, if all else fails, we’ll always have Venezuela:

Two Florida-based companies that have exported a total of at least 11 aircraft to Venezuelan buyers since 2003 are linked to four cocaine planes and what appears to be an elaborate covert intelligence operation…

Durn those Venezuelans.. they may screw the whole thing up:

The Venezuelan police have arrested a suspected drugs and weapons smuggler wanted in the United States. The US authorities have offered a five million dollar reward for the arrest of Hermágoras Gonzales Polanco, who has ties with the Colombian Guajira cartel.

He is suspected of smuggling large quantities of cocaine into the US and weapons, destined for paramilitary groups, from Europe into Colombia. Mr Gonzalez was arrested at the border with Colombia, together with 48 suspected paramilitaries.

While initial reports on the Colombian rocket attack on the FARC encampment in Ecuador mentioned a Mexican — Lucía Morett Àlvarez — among the survivors, it’s now reported that up to ten Mexicans were among the twenty casualties.

There are two conflicting stories about what the Mexicans were doing in Ecuador. One version has the students attending a Bolivarian Solidarity Conference in Quito or there was a FARC cell in Mexico City, at UNAM. Morett said she did not believe there was anything illegal in visiting FARC leaders in Ecuador — which would bolster Colombian claims that the Ecuadorians knew FARC had a base in their country. At the same time, the Colombian vice-president claims that Mexican and Chilean students were being trained and armed. And that there is a FARC “terrorist cell” operating in Mexico City (maybe this is what vice-presidents are supposed to do. I seem to recall that the U.S. vice-president also made claims of wider “terrorist” connections to justify the U.S. invasion of Iraq, after initial rationales were universally questioned). Count among those who are dubious the UNAM administration.

So far, Felipe Calderon has called the situation “deplorable” — but he seems to accept the Colombian story that the students (if they were students) were guerrillas.

Ecuador’s claim — that the Colombians (with U.S. support) attacked the camp because the Uribe administration was worried that Ecuadorian and Venezuelan negotiations to release foreign hostages held by FARC were about to bear fruit — is the most widely accepted. The Colombian government is widely seen as involved in human rights abuses and narcotics trafficking itself, ignoring right-wing death squads and narcotics dealing “terrorist” groups (and, in some cases, complicit in their activities), using the U.S. military equipment to fight leftists, and not narcotics traders.

So far, Mexico seems to be taking a “wait and see” attitude. I’ve seen nothing from the Mexican left condemning Colombia at this point, other than the expected anti-Colombian protests. Calderon and Uribe met briefly but there is no word on their discussions.

So far, Venezuela, Ecuador and Nicaragua have broken relations with Colombia, with Chile, Brazil and Argentina all supporting Ecuador. France and China also seem to be backing Ecuador, with only the United States in Colombia’s corner. Anything could tip Mexican neutrality –

I’m surprised no one has commented on this, but do you notice something about OUR friend Alvaro Uribe of Colombia (owner of the magic laptop) as compared to the “FARC-ed” leaders of Ecuador and Venezuela?

Hey… don’t call me nuts. The Free Republic is quoting a Colombian reporter as saying the two guys on the right (in the photo, not in their politics) are in cahoots with this dude:

That, of course, makes no sense. None of the U.S. Presidential candidates seem to know diddly-squat about Latin America.

Although this is a Mexico-focused website, it’s hard to ignore what has happened in Ecuador. The only Mexican connection, so far, has been that two survivors of the Colombian incursion are Mexican nationals (and are being tried in Ecuadorian courts). So far, Mexico has been able to maintain its strict neutrality when it comes to other nations’ internal affairs.  I think, however, Mexico (like Argentina and Brazil, which have already weighed in on the side of Ecuador) will be affected, though only obliquely.

While the whole thing may blow over — for the practical reason that no one wants a war, and it’s economically not feasible, there are some long term worries. It was Bill Clinton’s. administration that got the United States into the Colombian civil war, which was sold as an anti-cocaine trafficking police operation, we were warned we were involving ourselves in Colombia’s domestic politics. Given that funding for “Plan Merida” is still in the works, and the Mexicans, as well as some in the United States are concerned that the “real” use of military hardware will be to stifle internal dissent, this incident may have an echo in Mexican affairs over the next several months.

And, given that no country in Latin America is backing the Colombians (and, by extension, the United States), Mexican diplomacy may have a role to play here, if the Mexicans don’t (as I think they will) tilt towards the other Latin countries in this dispute. How the Calderon administration balances their role as a pro-U.S. state in this situation is going to be worth watching.

While the English-speaking press is beginning to realize the Colombia v. Ecuador… and Venezuela (and the rest of Latin America) is unlikely to erupt into a shooting war, they have still be slow in understanding that it is a serious issue, which will change the ways inter-American politics works.

Canada.com — and I give credit where credit is due — was the first English-speaking “main stream media” source to question the Colombian rationales for the attacks on FARC in Ecuador. Canada, like the United States and Colombia (and, if I’m not mistaken, Bahamas) label FARC a “terrorist organization”, but most American nations accept that they are a rebel organization seeking changes in their own country, not an international group. Even so, the Canadians have a hard time swallowing the “dirty bomb” story (a Colombian official claimed the laptop computer that somehow survived a rocket attack on a FARC encampment in Eucador — which killed 18 and wounded three — somehow spared a laptop computer that included, among other things, unencrypted correspondence regarding acquiring fissionable material… uh, right).

The Independent (U.K.), which some regard as a lefty rag, adds the obvious fact that FARC’s narcotics dealings are what earned them the cachet of “terrorist.” The Guardian does not overlook the fact that EVERY rebel group in Colombia (including the right-wing ones) — and for that matter members of the Uribe government — are involved in the same dirty business.

Another U.K. paper, The Guardian, with the veddy British gift for understatement, downplays the likelihood of a more than temporary crisis by noting:

Daily life largely continued as normal across Ecuador, Colombia and Venezuela. Caracas’s skittish middle class, which habitually stocks up on tinned food and toilet paper at the first sign of political turmoil, had yet to make a run on the supermarkets.

Venezuela, much to the delight of the right-wing, has a meat and milk shortage, importing commodities from Colombia. And Colombia’s army is about twice the size of the Venezuelan and Ecuadorian armies combined (plus is much better equipped and trained). The cartoon is from a Venezuelan newspaper (which also shows that the country does have a free press).

Both the Guardian and Independent articles are the best I’ve seen so far on the background of this situation. For the “whys and wherefores”, you need to go to more partisan publications. ZNet’s Justin Podur (reprinted in Venezuela Analysis) finds a logical reason for the Colombian actions in FARC’s negotiations with France and Venezuela for the attack.

Investor’s Daily oddly spins the whole mess into an argument for a free-trade pact between Colombia and the United States.

When Hugo Chavez says that Colombia is Latin America’s Israel, he is correct. They are the United States’ third largest recipient of military aid are using that aid to attack perceived enemies. And, apparently, with U.S. assistance, Colombia launched a missile attack on a foreign nation to wipe out what they consider a “terrorist”. A thought: a number of known terrorists live in Miami, and have attacked Cuba. Would the Cubans be justified in launching an air strike on Little Havana to wipe out Alpha-66 or Luis Posada Carrilles?

Can Mexico launch an airstrike on the El Paso Gun Show?

Fidel Castro (remember him?) says the “trumpets of war” have sounded in the Americas, as the result of the Colombian incursion into Ecuador.

As may not be clearly reported in the U.S. press, there has been a low-level civil war in Colombia since the 1950s. FARC, the largest of the guerrilla insurgent groups, is supposedly under the leadership of Secretary General Manuel Marulanda.

According to Colombian official sources, the “#2 man”, public spokesman “Raul Reyes” and several others was located just over the Ecuadorian border and killed in a raid – along with several others.

Ecuadorian President Rafael Correa immediately broke off diplomatic relations with the aggressor nation and Venezuela has called up its troops to the Venezuelan-Colombian border in anticipation of possible incursions into their country.

The U.S. media talks about “Hugo Chavez threatening Colombia”, but Venezuela is discussing protecting its own sovereignty… and as a functioning democracy, there is opposition to the military build-up.

Here’s where it gets interesting. The Colombians are claiming a laptop recovered from Reyes tells of FARC drug deals involving President Correa, Mexican narcos and possible military assistance to Hugo Chavez in case of an attack by the United States. The laptop also supposedly contains a message from Secretary General Maralanda. That latter fact in itself is suspicious. As far as I can tell, Maralanda hasn’t been seen since about 2002, and – if he’s even alive – he’d be in his late 80s. Correa, and the Ecuadorian government, labeled the supposed documents fakes. President Bachelet of Chile – who was not named in the documents – has also questioned the validity of the charges, and may break relations with Colombiaover their aggression against a fellow Andean Pact state.

And, to make things even more complicated, Reyes was acting as a go-between with the French and Venezuelan governments in their efforts to free Ingrid Betancourt, a dual French-Colombian national (and one time Colombian presidential candidate) taken hostage by FARC several years ago. One reason for the recent breakdown in Colombian-Venezuelan relations has been the Colombian governments’ interference in the Franco-Venezuelan-FARC negotiations.

The United States denies any involvement in the matter, though the Colombians admit receiving assistance from U.S. intelligence operatives. Even if the latter is still denied in Washington, there’s no getting over the fact that the U.S.had offered a Five Million Dollar reward for killing Reyes — which means they definitely interested in this outcome.

A couple of points worth pondering:Colombia’s rightist government is a U.S. client state, which puts that government at odds just about all the Americas, except for the United States and Mexico. Mexico does not face an organized leftist insurgency, but there are leftist movements within the country, similar to those that have come to power (democratically, one might add) throughout the region – most prominently in Venezuela (and very nearly did in Mexico, though the left probably was not “allowed” to win the 2006 elections).

That’s plausible, but not likely. Venezuela, with its oil wealth, has been able to invest in modernizing its air force and army. Colombia – with the infusion of United States aid supposedly meant to interdict the narcotics bought by U.S. consumers – has also been beefing up its security. Like all other Colombian paramilitary groups (and the government itself) – left and right – FARC was involved in the narcotics trade, and taking out a narcotics kingpin is a legitimate POLICE action.

However, the military assistance Colombia has been receiving since the Clinton Administration has never been really expected to be used for narcotics control. After “terrorism” became the cause de jour in 2002, FARC was re-christened as a “terrorist organization,” at least by the Colombians and the United States. But not by oil rich Venezuela, semi-oil rich Ecuador — nor, for that matter, by very many nations except those that almost automatically accept U.S. designations for this sort of thing… like Canada. Within Colombia itself, right-wing guerrilla groups were considered “paramilitaries,” not “insurgents” nor “terrorists” even though they also dealt in narcotics, hostage taking and murder. Of course, a number of the right-wing killers were tied to the Uribe government.

The whole purpose of “Plan Colombia” was always about propping up the friendly rightist government, and only incidentally about drug control. Which brings me back to Mexico…

“Plan Merida” channels “anti-drug” money from the U.S.government to the Mexican military for hardware and training resources (i.e., subsidizing U.S. based suppliers. The danger has always been – and continues to be – that governments will use the equipment to bolster their own interests, and not – as intended – to combat narcotics shipments to the United States.

What will be interesting to watch (and I admit these are just notes, not having a grasp of the whole situation, not really enough to go on yet) is how Mexico reacts. Besides having to deal with the fall-out of Mexican citizens (or at least one citizen) having been wounded in the Ecuadorian incursion  and the believability of the supposed laptop memos on Mexican involvement, the Calderon administration is Colombia’s only friend in Latin America. Given the Calderon Administration’s clear tilt towards the United States (and its eagerness to upgrade military equipment through “Plan Merida” funding) this will be a test of the Juarez Doctrine – staying the hell out of their neighbor’s business.

The White House will ask Congress next week for another $70 billion for the wars in Iraq and Afghanistan, an amount that would help cover operational costs only until early next year when the next administration takes over.

According to how estimates are done, somewhere between 21 and 51 percent of the United States Federal Budget ($2,387 billion)is for defense and military spending (the high estimate – $1,228 billion includes military pensions, veterans benefits and debt services for previous military expenditures).

The Mexican military budget (as a percentage of the National Budget) has been falling since World War II (even during the war, the budget was rduced — a rather neat trick I cover in my soon to be published book) and the Mexican military actually returns a small profit to the government (natural resource protection is a military mission, and planting fruit trees to protect watersheds  — and selling fruit — is a legitimate military activity; the soldiers’ and sailors’ bank is a mortgage lender; and Mexican military sales to foreign countries — mostly trucks and uniforms — bring in the dough).

Given the creeping militarization of police (and political repression) and raises for soldiers is up this year, the Mexican military budget is up… a whopping 0.44% of the Mexican Gross National Product is spent on defense… 34,861,500,900 pesos (3.2 billion dollars) is the estimate for FY2008 …mostly salaries for the 245,000 men and women (the highest percentage of women soldiers in Latin America)

Per capita, Mexico’s military is about the same size as Ecuadors, and in numbers is equal to Chile’s… both much smaller nations.  On the other hand, who has Mexico ever invaded.  Other than U.S. gun runners (and their customers, the U.S. financed drug dealers), Mexico doesn’t have any foreign enemies, and hasn’t pissed anyone off recently.  Like, say, Iraqis, Afghans, Pakistanis, Cubans, Venezualans ….

My best Thanksgiving dinner was at “el Rey de Pavo” on calle Simon Bolivar (or is it Motolinía?) — a little semi-hole in the wall joint serving nothing but turkey, 7 days a week — turkey tacos, turkey tortas, turkey soup, turkey mole… With limited seating, I had thanksgiving dinner with a bunch of jolly Quechans from Ecuador who’d come up to Mexico City to sell silk scarves on the streets.

OK, so we had to watch futbol, and not football. And the half-time show was a skinny old guy with a 12-string guitar. I had jamaica, which is the closest thing to cranberry you’re going to find in Mexico (it’s at least a pretty red color, and kind of tart)… but the basics were there. A peaceable dinner of corn and turkey with a bunch of Indians.

I don’t think the custom started with our Puritan Fathers, by the way… though the Plymouth Colonists and Squanto obviously got along a tad better than the folks at America’s first “inter-racial encounter” and dinner-party

Cortés had incredible luck off Cozumel. His ships were separated, and Pedro de Alvarado had arrived first. Alvarado, who turned out to be one of the greediest of the conquistadors, was stealing turkeys from the local villages when Cortés arrived. More importantly for Cortés, his crew had found two Spaniards. They were the last survivors of a shipwreck eight years earlier—the others had been sacrificed and eaten. Gonzalo Guerrero, a sailor, had married the local chief’s daughter. He had three children (these little Guerreros are probably the first modern Mexicans, mestizos - mixed bloods - part European and part indigenous), a responsible job as an advisor to his father-in-law and no intention of becoming a common sailor again.

The other Spaniard, Gerónimo de Aguilar, was a priest and carpenter. It was his carpentry skills that kept him alive; they made him a valuable slave. Father Aguilar was more than happy to be rescued. Slavery was bad and the human sacrifice worse,¹ but what terrified Father Aguilar were women. As a priest, he had taken a vow of celibacy and the indigenous people simply couldn’t comprehend a healthy young man refusing to take a wife. Eight years of temptation was enough. He considered his rescuers God-sent. He spoke fluent Mayan and was more talkative than Melchor.

Father Aguilar preached a sermon in Mayan, pouring out eight years of built-up frustration and anger. Though the people had treated their visitors kindly and fed them, the Spaniards insulted their hosts, destroyed the local temple and sailed north. Landing at the mouth of the Usumacinta river (near modern Frontera, Tabasco), they found much warier Mayans—they had evacuated their women and children and cautiously approached the Spaniards, sprinkling incense. The Spaniards thought it was a compliment, but the truth is that Europeans didn’t bathe, and the indigenous people were extremely cleanly. The Spaniards smelled terrible, but the Mayans were much too polite to say anything about it.²

These extremely polite people fed the Spaniards a turkey dinner and then nicely told them to go home, otherwise, regrettably, they would have to kill them. The smelly Spaniards asked to visit the Mayans’ houses. The Mayans, still polite, suggested the Spaniards had missed something in the translation. Cortés trotted out his lawyers, read the official document and turned his cannons against the Mayan stone clubs and obsidian swords. It was only a test to see if cannons, horses and war-dogs were effective weapons. The cannons scared people as much as killed them. Horses were unknown in the Americas, and the only dogs were small animals (ancestors of today’s Chihuahua) that were used both for food and for pets. Melchor, the grumpy old cross-eyed fisherman, took this as his cue to exit history.

1 When she learned of her son’s shipwreck and his probable fate, Aguilar’s mother became a vegetarian.

2Americans, north and south, generally bathe daily—one of the few indigenous customs adopted throughout the hemisphere. In Mexico City, the custom is so well ingrained that “bath houses” are just that—places to clean up when there’s no water at home. This confuses some gay visitors, for whom a “bath house” has a different purpose, though such institutions also exist.

You can understand then, why Thanksgiving never quite caught on in Mexico… though they have their own turkey customs…

Now that you’ve digested your meal… time to watch a little turkey-related sports action: El Globo de Manteca contra el Pipilo… may be best gobbler win!

mi pavo en accion

A tip of mi sombrero to Guanabee.com (and “viento” at tu.tv).

I’m not sure why, but the 40th anniversary of Che Guevara’s murder, assasination, execution… death… passed unnoticed here in Alpine, Texas.

It’s been rumored for years that a local worthy is retired CIA (probably true), and that he was involved in whatever it was exactly that went down in La Higuera, Bolivia 9 October 1967.  By legend, our small town civic leader chopped off Che’s hands and took them back in his flight bag to Washington.

Maybe, maybe not.  Che certainly is dead, however.  But, still relevant.  I realize it’s easy to romanticize the guy (and there aren’t a lot of handsome revolutionaries to make tee shirts out of.  Lenin and Mao never struck anyone as fashion icons) or to forget that he was — after all — a failure, but he still resonates today.

Che, like Simon Bolivar a hundred years earlier, and Hugo Chavez,  Evo Morales,  Rafael Correa — and to some extent, Mexico’s AMLO — all sought an intergrated Latin America. Whether it was done through military conquest (like Bolivar), revolution (like Che) or the ballot box and trade agreements (Chavez, Moreles, Correa, Lopez Obradór) the goal is the same:  uniting the varied peoples of the Americas in one big happy Raza.

It’s we English speakers who miss the boat here. In English, “race” is a word used to separate us into small, competitive groups.  In Spanish, “raza” is a uniting concept — a way of grouping peoples together.

It was a blunder, but the Italian sailor who brought us all together is also remembered this week.  Edmundo, at ¡Para justicia y libertad! says things much better than I can:

Today, youth across the nation are told by our government that Christopher Columbus merits honor and celebration because it marks the arrival of Columbus to the Americas. Most nations of the Americas observe this holiday on October 12, but in the United States the annual observance takes place on the second Monday in October. It was Franklin Roosevelt who first suggested in 1934 that all states adopt October 12 as Columbus Day, later in 1971, under Richard Nixon; the second Monday of October officially became established as a federal holiday to honor the explorer.

The October 12th celebration is commonly known in many countries in Latin America as Día de la Raza, a holiday that is comparatively recent. Before I go on, it is important to address the meaning of “la raza” because I can already hear the complaints how the name of the holiday is just more proof raza means “race.” The Spanish the word raza carries the meaning of an extended community bound by cultural ties in addition to those carrying similar physical traits. During that time, the word raza was used in a cultural sense to reference the contended affinity between Spanish-speaking peoples on both sides of the Atlantic Ocean. However, one must also be aware that during the early 20th century it was not surprising to find intellectuals employ racist theories because this was also the height of the eugenics movement.

The origin of Día de la Raza or Fiesta de la Raza goes back to the beginning of last century. In 1913, Faustino Rodriguez San Pedro, Chairman of Iberoamerican Union, proposed that 12th October be called Fiesta de la Raza and be celebrated throughout Spain and Latin America. Spain would later change the rename the holiday to Fiesta de la Hispanidad. In Costa Rica it is called Día de las Culturas and in the Bahamas it is called Discovery Day.

For better or worse, we’re all on the landmass.  We should be one people, but that may be asking a bit too much…

Happy… whatever… day:

From the International Herald Tribune:

Mexico and Argentina said Monday they are negotiating a free trade accord for vehicles and car parts that would make foreign car companies with factories in those countries more efficient.

“It’s an agreement we know will benefit both countries enormously,” President Felipe Calderon said in a news conference with Argentina’s leader, Nestor Kirchner. “We could have a huge potential for growth in this area.”

We don’t think about how important the Mexican auto industry is to the United States, but an agreement on auto parts isn’t likely to get people interested. When the Argentine President said that the proposed Great Wall of the Rio Grande is an affront to all Latin Americas the usual suspects commented (and, no I’m not going to bother linking all over the place to every anti-immigration “fuck you Argies” site). It’s a standard AP article on Latin America. Except for one overlooked phrase:

Kirchner also said he would personally help Mexico improve relations with leftist Venezuelan President Hugo Chavez and that Mexico has an open invitation to join the South American trade bloc Mercosur.

Some negative reference to Hugo Chavez is de rigur in AP-landia these days, but that’s not what I’m talking about. Mexico is being openly courted to get out of NAFTA and join Latin America. THAT IS IMPORTANT…

We don’t hear much in the U.S. about Mercosur (hell, we don’t hear much about Latin America in general), though it is likely to be extremely important to the futures of all the Americas. Mercosur is still feeling its way around (but then, the European Community took 50 years to develop, and Mercosur has only been around for the last ten), and – if we hear anything – it’s only that Venezuela hasn’t quite joined yet. Or, as the U.S. press puts it, Hugo Chavez hasn’t joined – much to our relief. WE (and Canada) were counting on a U.S. led “Free Trade Area of the Americas”, and blame Chavez for killing OUR plan – and instead opting for the existing (though far from united at this point) Mercosur.

The Mercosur countries (Argentina, Uruguay, Brazil, Paraguay) and the “associate states” (Bolivia, Ecuador, Colombia and Peru) and semi-member Venezuela (there’s a diplomatic spat holding up Venezuelan membership) have been paying down their debts to the big foreign lenders like the World Bank, the International Monetary Fund and the Interamerican Development Bank. Hugo Chavez has his own ideas about development, but is in agreement, and likely to work with, what Mercosur itself has been organizing – Banco del Sur, a self-financed development bank.

The Global Policy Forum describes the problem with just one of the existing development banks this way:

The World Bank, based in Washington, is a multilateral institution that lends money to governments and government agencies for development projects. For more than twenty years, the Bank has imposed stringent conditions, known as “Structural Adjustment Programs,” on recipient countries, forcing them to adopt reforms such as deregulation of capital markets, privatization of state companies, and downsizing of public programs for social welfare. Privatization of water supplies, fees for public schools and hospitals, and privatization of public pensions are among the most controversial Bank reforms. While the Bank insists that “fighting poverty” is its first priority, many critics believe instead that it is responsible for rising poverty. Many also criticize its cozy relationship with Wall Street and the United States Treasury Department. The stormy resignation of World Bank Vice President and Chief Economist Joseph Stiglitz in late 1999, and his subsequent public comments, suggest that the Bank is not as benign as it claims to be.

Yeah. There were riots in Argentina over privatizing water systems (and the country went through a couple of presidents in a couple of months), Bolivia nearly had a coup and Mexico is roiled over “suggestions” that various public utilities be privatized. Even the most conservative proposals for Banco del Sur will take into account peasant economies and state services. Right now, Banco del Sur is mostly Brazilian and Argentine money. Their economies are recovering from the tender mercies of IMF and World Bank concern (fun fact – every Latin American country with a president or treasury secretary with a graduate degree from the U.S. universities that turn out the bankers who run the development funds over the 40 years went broke, or had to restructure their currency).

And this is where Mexico comes in. Mexico has been losing ground economically since joining NAFTA. Mercosur requires single membership (in other words, countries like Bolivia would have to pull out of the Andean Pact to join, though the two trade groups may merge, or Mercosur may make special rules for Bolivia). NAFTA was originally pushed by PRI President Carlos Salinas de Goutari, though PRI has lost much of its original enthusiasm for the trading bloc since then. The PRD and the smaller left-wing parties never liked it, and have been pushing for more pan-Latin economic intergration. ONLY PAN, and only the wing of the party to which Calderón belongs, have been cheerleaders for the status quo development plans.

Although the announced agreements between Mexico and Argentina only cover auto parts, Mexico has expressed real interest in Banco del Sur. The country won’t be pulling out of NAFTA any time soon, but under pressure from the “left”, it has been considering renegotiation of the treaty, and it would not have to join Mercosur (where it is already an “observer”) to become a member of Banco del Sur. Once Venezuela works out it’s differences with Brazil, that’s going to change the whole pan-Latin development picture… and our economic ties to Mexico.

I’m not an economist, nor a banker. Nancy Davis, at Narco News isn’t either. She writes about the existing development project in Mexico (Plan Puebla-Panama). Even skipping over the Marxo-academic phrasing, it sounds as if the locals are getting screwed. They’d probably still get screwed by developments funded by Banco del Sur, though there’s a better chance of their being included in the plans.

The Canadian economics website, Angus Reed Report, blames Mercosur for killing the “Free Trade Area of the Americas” (which would benefit Canada), but notes that “free trade” conceptually is salable to the Latin American voter:

Investors’ Business Daily wonders whether “WE will clear Latin America for Takeoff” and misses the point that the Latin Americans may not give a shit what we think about it.

In January 2006, Laura Carlsen speculated in an article for the Center for International Policy on Mexican participation in Mercosur. At the time, she saw the Fox Aministration as likely to act as a “trojan horse” for their northern neighbors, but that appears to be changing now.

The Bank Information Center sees Banco del Sur as “direct challenge to the Northern based IFIs [International Financial Institutions] struggling to remain relevant to the region.”

I was able to get into subscription only “The Banker” for an in-house look at the effects of Banco del Sur on international lending. At the time the article was published (in May) Hugo Chavez was the big worry. The link may or may not get you in, so I’ll try posting my copy somewhere accessible.