part 10

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Posted by Sadie from D006033.N1.Vanderbilt.Edu ( on Wednesday, April 30, 2003 at 0:50AM :

In Reply to: part 9 posted by Sadie from D006033.N1.Vanderbilt.Edu ( on Wednesday, April 30, 2003 at 0:49AM :

The American presence in Bolivia is less brainlessly imperial than Ambassador Rocha made it seem. The embassy understands, for instance, that the relative success of the coca-eradication program has been a major blow to Bolivia’s economy. Jorge Quiroga, Goni’s predecessor as president, told me that the income from coca had accounted for more than 8 percent Bolivia’s gross domestic product and 18 percent of exports. “Imagine wiping that out,” he said. “All the unemployment and suffering, all the multiplier effects. In the U.S., it would be like wiping out the mining and agricultural sectors combined.” The embassy did not dispute these numbers or the analogy (and Quiroga is a SUPPORTER of eradication). Partly because the war on drugs causes hardship, the U.S. remains by far the largest source of bilateral aid to Bolivia, as well as the prime mover behind the World Bank’s local largesse.

The Bank also recognizes the impossible burden that international debt places on nearly all poor countries, and it has lobbied for partial debt relief for poor countries it considers fiscally responsible, including Bolivia. Despite its annexation to the Washington Consensus, the Bank is not a solid bastion of market fundamentalism, and its analysts have seen enough social and financial fallout from hasty privatizations to realize, belatedly, that in many sectors, such as utilities, a strong regulatory framework to protect public interest is essential to successful privatization. In most poor countries, the modern regulatory body is a novel concept. The Bank has therefore started sponsoring courses to train would-be regulators from countries undergoing structural adjustment. The courses are said to be first-rate, although problems can arise with the students sent to them by client governments. “They always send the minister’s nephew,” a regulation advocate in Bolivia told me. “Somebody who thinks of regulation the same way he thinks of a job in government, as a way to make money from bribes.”

“Structural adjustment,” incidentally, has precipitated so many riots in so many countries, caused so much suffering and received so much bad publicity, that it is currently being rebranded, by both the Bank and the I.M.F., as “development policy support lending,” which has a much less procrustean sound.

The U.S. Embassy is not, of course, a charitable organization. It exists to represent U.S. interests, which in Latin America has traditionally meant the interests of U.S. business. This is as true today as ever. Even at the World Bank, and at each of its regional development banks, the United States has, under order of Congress, an officer of the U.S. Commercial Service assigned to look out for U.S. business interests. And the economic big stick is at times crudely wielded. In late 2002, for instance, the Colombian defense ministry expressed interest in buying forty light attack planes from the leading Brazilian aircraft manufacturer. Colombia, which is racked by civil war, is a major recipient of U.S. military aid. General James T. Hill, head of the U.S. Southern Command, learning of the Colombians’ interest in purchasing Brazilian planes, fired off a letter to the Colombian government warning that future U.S. military aid could be jeopardized by the purchase. The Colombian air force should be buying American-made C-130s, the general wrote, mincing no words. When this letter unexpectedly became public, a Southern Command spokesman claimed it was merely a technical evaluation of Colombia’s military needs.

-- Sadie
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