The Brazil-US Ethanol Alliance Aims to End Mercosur and Chávez Dreams

    Venezuelan President Hugo Chavez

    Venezuelan President Hugo Chavez President George W. Bush has embarked on a five-nation tour of Latin America – the most ambitious of his presidency – in an attempt to reassert U.S. leadership in a region where open hostility to his government and its foreign and economic policies is the norm rather than the exception.

    The U.S. president hopes that espousing a new commitment to "social justice" will undermine Venezuela’s crusade for Latin American and Caribbean unity based on a rejection of U.S. dominance and the free trade model.

    Bush’s trip seeks to build a new coalition of the willing, in the face of a coalescing group of nations that has declared itself unwilling to continue to follow the economic and political dictums of Washington.

    In his speech last week, Bush described the countries on his itinerary – Brazil, Uruguay, Colombia, Guatemala, and Mexico – as countries that have made "the right choices," as opposed to the tacit accusation that many of the rest of them are making the wrong choices.

    The nations Bush is visiting are not well-positioned to receive a public figure so widely repudiated by their populations. Lula, engaged in a political balancing act between social programs for the poor and economic orthodoxy for the rich, risks taking a serious fall from being so closely related to U.S. interests.

    Colombia is embroiled in a human rights scandal that is exposing the government’s own connections to paramilitary operations that have been at least indirectly supported by U.S. aid to the country’s armed forces.

    Mexico’s President Calderón will get a photo op with the president, praise for his ongoing drug crackdowns, and a commitment to immigration policy reform. But the presidential summit will take place outside Mexico City, where grassroots mobilizations against electoral fraud and anti-Bush demonstrations are capable of drawing tens of thousands of people.

    So why risk a major tour now? Although they emphasize the social goals and deny that the tour is ideologically motivated, government officials have admitted that the president’s trip seeks to contain the growing influence of Hugo Chávez.

    The trip indicates rising U.S. concern about a consolidating left-center alliance in Latin America. The State Department has warned of a populist threat – including Venezuela, Bolivia, and Ecuador, with Argentina thrown in for good measure – and Secretary of State Condoleezza Rice says the U.S. government is committed to "ensuring that the peoples of the Americas are not abandoned to demagogues and authoritarians" – both frequent accusations against the Chávez government.

    But as Chávez forges relationships built on infrastructure construction, financing, oil, and preferential trade, Bush is offering little to back up his bid to be the champion of social justice in the region. The 2007 aid budget for Latin America is down from past years and conditionality is way up.

    Ironically, many of the specific measures to be highlighted during the tour look like a weak copy of the kind of measures Cuba and Venezuela have been carrying out for years, including offering medical services to the poor, but in this case through military teams and a floating clinic located on a U.S. Navy ship; scholarships to study in the United States; English lessons; and some housing construction.

    The rest include a round up of already existing programs and the extension of U.S.-based financial services in the region through loan and mortgage programs. These are not measures that are likely to win over the hearts and minds of Latin America’s poor.

    They key to the campaign, though, lies in the consolidation of the relationship with Brazil. Brazil is Latin America’s powerhouse, and considered one of the four emerging economies that will rise to be major players within the next decades.

    The ethanol alliance seeks to consolidate a new power line in Latin America that runs directly between the United States and Brazil, with the dynamic force being the transnational corporations with interests in both countries.

    If this alliance is consolidated it will erode the Bolivarian plan to integrate the continent with a model of state-regulated economies and Venezuelan oil. It would also undermine efforts to strengthen the Southern Common Market.

    In the deal, Brazil gains capital to develop ethanol-producing technologies within its own borders and export them to Central America and Caribbean nations. In addition to investment and credits, the São Paulo industrialists are assured policies to extend agribusiness into the Amazon and other regions now populated by small farmers.

    The United States gains greater independence from Middle East oil by importing more of the cheap Brazilian ethanol. It also begins to redraw the map of energy integration in Latin America based on Brazilian ethanol rather than Venezuelan oil and Bolivian gas, thus neutralizing the power of nations it considers uncooperative.

    Cargill, one of the largest owners and operators of ethanol production in Brazil, and other agribusiness corporations, expands in the south while continuing to protect its corn interests in the north by maintaining U.S. import tariffs on ethanol. As mono-cropping for biofuels takes over huge tracts of land, small food farmers who have always resisted international market control of land and resources will become a species in danger of extinction.

    None of these changes are really in the interests of Latin America’s poor or the U.S. public. Setting aside Chavez’s anti-American hype, Latin American countries helping each other out is not necessarily contrary to U.S. interests, if these are redefined in terms of stable, long-term relationships with its southern neighbors rather than by the destructive trade and security agendas that now dominate.

    The attempt to isolate nations that are seeking more equitable forms of development – including Bolivia, Argentina, and Ecuador – may help forge a coalition based on the interests of the powerful but will exacerbate Latin America’s problems and further distance the United States from its neighbors.

    Our foreign policy should place more value on principles – democracy, equitable development, well-being – rather than on ideological control, and it should be based on respect for the myriad forms of development being explored in the region. This is the foreign policy that the people throughout the Western Hemisphere deserve.

    Laura Carlsen is director of the IRC Americas Program in Mexico City, where she has worked as a writer and political analyst for the past two decades. The Americas Program is online at http://americas.irc-online.org.

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