which, according to Bush himself, puts it: "...after nine years of brave now stands at $12,000b. This plan is efforts to overcome the crisis, in 1989 in the spirit of Bush' previous most Latin American and Caribbean statement that "Latin American needs countries have reached the limit of business, not aid." ALFONSO MORO T HE PLAN has three main elements: the reduction or restructuring of the debt; the creation of a "Fund for the Americas" of $300m per annum, of which the US would provide $100m; and US government support in GATT negotiations over the reduction of import taxes on products from Latin America and the Caribbean 2. In return the region's governments would undertake to: draw up or reinforce plans for liberalizing their foreign trade and their rules concerning foreign investments; implement "debt for equity" and "debt for nature" swaps; give concrete undertakings for steps towards the creation of an integrated free trade zone on a continental scale; negotiate and agree to the preliminary accords of the IMF and World Bank on the various countries' adjustment programmes; and conduct debt negotiations with the US country by country.
All that for $100m! Latin America and the Caribbean seem to be going cheap these days. There has been a stampede of declarations and compromises from the Latin American governments to see who can make the most concessions in the shortest space of time.
Why now? The reasons are complex. The first reason is to do with the process of commercial and financial integration in Western Europe, leading up to 1992. This "Europe without frontiers" poses a serious challenge to North American imperialism, not only in relation to the US' loss of competitiveness, but also because European integration means the start of a new phase of inter-imperialist conflicts. Eastern Europe may offer a field for this struggle over the lion's their ability to make external adjustments with their existing productive structures."5 In other words, the dec- structures. In other words, the decade of austerity to which the peoples of these regions have been subjected according to IMF diktats, has not got the region out of its deep and prolonged crisis. The results of this decade have been not only the deterioration of all social indicators, but also the growing exasperation of the population with governmental promises, and a reappearance of large-scale social movements.
Commercial and political integration
Since the explosion of the debt crisis in 1982 the Latin American goverments have been proceeding towards increasing commercial and political integration with the US. The Bush plan merely formalizes the rules. As a result of the debt and a whole variety of neo-liberal economic measures, the countries of Latin America are undergoing significant limitations of their national sovereignty. This is occurring not only on the strictly economic level — with the generalized dollarization -but also, and most fundamentally, on the 1. International Herald Tribune, June 29, 1990. 2. General Agreement on Trade and Tariffs (GATT). At the round table in Uruguay it was clear that there was a conflict between the United States and the Euro pean Community (EC) on the former's plans for the "freeing" of agricultural prices. The US is hoping to profit from its advances in the field of bio-technology and get into the European market. 3. In 1988 the Federal Republic of Germany was the world's biggest exporter, followed by the USA and Japan. At the same time the joint exports of four EC countries — the FRG, the UK, Italy and France — made up 27% of world trade, compared to 11% for the United States. (see L'évolution du commerce international; Problèmes économiques, no. 3150, November 1989). 4. The chancellors of Mexico and Venezuela, during a meeting with their EC counterparts, accused the US of violating international law by invading Panama (El Pais, April 11, 1990). 5. CEPAL: Balance Preliminar de la Economía LatiRoman an en 1989. Comercio Exterior, México, 15 February 1990.
LATIN AMERICA political level, with the IMF playing a key role in the drawing up, application and supervision of austerity plans.
Latin American governments form a queue
With Mexico at their head, most of the governments have applied programmes liberalizing foreign trade, as Bush has wanted. On a visit to Washington, the Social Democrat president of Ecuador, Rodrigo Borja, fresh from his defeat in the legislative elections, was the first to announce that he had reached an agreement with Bush for his country to take part in the Initiative? Borja was followed by the presidents of Argentina and Brazil, Menem and Collor, who agreed to the creation of a joint commission to discuss with Washington the "establishment of a free trade zone." Bolivia and Colombia supported this idea, and after them the governments of Chile, Uruguay and all the Central American governments. Furthermore the Group of Seven richest countries have also implicitly given the scheme their blessing?
Until now, the reality behind the offers of the imperialists and the Latin American bourgeoisie to "come into the modern age" has been the modernization of poverty and a wave of privatizations in which the national wealth has been sold off to foreign capital. To give just some examples of recent privatizations: in Mexico, this year alone, the telephones and banks; the main airline in Venezuela; in Honduras the electricity and water companies; in Bolivia the Lloy Aero Boliviano airline, the railways and some mines; the Aerolineas Argentinas airline, the railways, roads and oil fields in Argentina; Brazil has announced for November - before the elections — the sale of steel and petrochemical enterprises and industrial equipment factories.
Bush and his acolytes talk about the new free trade zone coming into being in between two and four years. But time is not the key problem. Given their situation as dependent countries, there is no possibility that Latin America can create a real free trade zone with the US on a equal basis.
Tariff barriers will come down on the grounds that these have contributed to the decline in labour productivity and that there no longer remains any reason to maintain the differences between the imperialist and under-developed coun tries. There is a vision of a "dual world" in all countries - ultra developed zones, side by side with regions of extreme deprivation.
But in reality in Latin America the norms of work will be under the control of the multinationals, given the unequal starting point for this "equal exchange" is here that all the weaknesses in, and dan16 herses, in that all the region's economic, gers of, the plan are to be found. Weaksocial and political instability will be working against the plan, dangers, in that there is no effective and coordinated response from the Latin American peoples to this new offensive.
This means that the continent may have to absorb incalculable and irreversible costs. The CEPAL report that we quoted earlier indicates that the average Gross National Product per head in Latin America has fallen to the level of 1977-78, whilst average inflation has reached an unprecedented 1,000%. Three additional factors should be added: in the same year the region's external debt reached $416b, three of the main countries with the biggest debts, Brazil, Argentina and Venezuela, stopped paying their debt at the same time, and the region transferred $25b in services on the debt. This has to be added to the $200b paid in the course of the decade. The crumbs being offered by Bush will not get these countries out of their crisis.
Two reports from institutions that nobody could accuse of being left-wing reveal the effects of the adjustment measures carried out at the behest of the IMF and repeated by Bush. Surveying ten Latin American countries, CEPAL concluded that "whilst in 1970 some 112 million people in Latin America lived in poverty, the figure for 1989 was 183 million (44% of the population). Of these 88 million are destitute, 28 million more than in 1970"10 Destitute means, according to World Bank president Barber B. Conable, that these people "do not have $370 per year. "11 . That is, there are 88 million people who do not have $1 a day.
No reduction in poverty foreseen
Will "trade, not aid", alleviate this situation? Certainly not before the end of the century. "Although one can predict improvements in average per capita income in all regions, Latin America and Sub-Saharan Africa will probably not attain their full long-term growth potential in this time. The reduction in debt planned for by Brady will allow Latin America to achieve a growth rate per inhabitant of 2.3% (it was 3.4% between 1965 and 1980). If this projection is correct, the poor population in Latin America
. *12
However, although the debt reductions involved in the Initiative will probably not reduce poverty, they, plus the $100m tip, 13 are enough to buy Latin America.
What can stop the Bush plan? The "San Paolo declaration"13 issued by a meeting of Latin American leftwing parties in July, takes a clear position against this new United States offensive. The signatories of this text, along with a wide range of democratic forces in the region now face the task of taking practical measures to construct the means to resist.
Even in the context of the collapse of
International Viewpoint #191 • October 1, 1990 the "Socialist camp" and the electoral defeat of the Nicaraguan FSLN, those forces and organizations which continue to believe that the only real way out for the exploited peoples is an egalitarian and democratic system — real socialism -can take advantage of the increasing wave of mobilizations and actions throughout the continent, to put a stop to the imperialist pillage.
Such mobilizations have been developing in every country in Latin America, against the austerity plans and those who are implementing them.
New wave of workers' struggles
In Argentina almost 900,000 workers went on strike in July to reject the policies of the weak Menem government. Menem, who had an 80% popularity rating when he came to power, now has 41%. In Uruguay the Workers' Intersyndical (PITCNT) carried out its fourth general strike against the Lacalle government in June. Agricultural workers and healthworkers have been striking in Honduras, where the government used troops to put an end to the Tela Railroad strike. At the start of July a massive mobilization in defence of the conquests of the Sandinista revolution took place in Nicaragua. A third general strike against the Borja government is being prepared in Ecuador under the auspices of the United Workers Front. In Brazil, the number of workers on strike in June was up on the previous year, in its turn considered by the Ministry of Labour to have seen the largest number of strikes since 1964. Some 1.5 million people have taken part in strikes, without counting the Ford workers of San Bernardo del Campo.4 On August 1 a strike of the internal revenue oilfield workers (YPFB) in Bolivia was launched to protest against privatization. There have been strikes in Peru against Fujimori's austerity plan and so on.
On this evidence, the peoples of Latin America do not seem to have noticed the "end of history" and seem indisposed to sell their future to the United States for $100m. 6. The score a leveled in there 1990 My tien fory. 6. The secret talks between the US and Mexican govAmerican press. See Proceso numéro 700, Mexico, April 1990. 7. In the elections on June 17, 1990, Borja's ruling Democratic Left Party got less than half of its previous seats in the Chamber of Deputies, going from 30 to 14 deputies. See Informe Latinoamericano, London, July 19, 1990. 8. See Pensamiento Propio, nos. 27, 29, 31, Nicaragua, July 1990. 9. Le Monde, July 9, 1990. 10. CEPAL: "Magnitud de la Pobreza en América Latina en los ochenta", Chile, July 1990. 11. World Bank: "Poverty", Paris, June 1990. 12. Ibid. 13. See the article by Sergio Rodriguez in /V 190. 14. The Ford strike in Brazil ended on July 30 after 50 days. The strikers accepted a 50% pay rise and the reinstatement of 80 sacked workers.
NICARAGUA