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How bad did it get for Bush in Argentina?
Do you want to know how bad it went for Bush in Argentina?
The guy left Saturday before the summit was over. Said he didn't want to be late for a barbecue with Lula. The Barbecue is on Sunday. Despite all manner of threats and inducements, a solid bloc of five countries prevented the Mar del Plata summit from giving Bush even a token, verbal concession on the Free Trade Area of the Americas. And this bloc had tacit support and encouragement of some other governments that didn't want to step directly into Washington's line of fire.
The imperialists had been looking to get language saying that stalled talks on the hemispheric accord would restart in April, or some other point in the New Year. Instead of this, which would have been mostly a verbal concession, the final declaration contains a statement by Argentina, Brazil, Paraguay, Uruguay and Venezuela stating categorically: "The conditions do not exist to attain a hemispheric free trade accord that is balanced and fair with access to markets that is free of subsidies and distorting practices."
As is obvious from the statement, what most galls Latin American countries (and not just these five) is that "free trade" negotiations are always aimed at dismantling the protection of the national interests of Third World countries, but they don't deal with what are tremendously trade-distorting practices that only very rich countries can afford and that screw the Third World.
The most irritating item are the billion-dollar-a-day subsidies that the U.S., Europe and Japan give to their agricultural sectors. Third World countries can't afford similar subsidies and third world farmers can't compete in markets where Europe and the United States constantly dump huge surpluses at prices that do not have the remotest connection to the cost of production.
The United States has arrogantly refused to put its subsidies on the table in the FTAA talks saying they're negotiating on that with the Europeans in the framework of WTO talks. But another form this takes is all sorts of shenanigans and manipulation of the oil market and other commodity markets. The major imperialist countries maintain "strategic" crude oil reserves which are used as a club to prevent third world oil producers from obtaining top dollar for their products at moments of maximum demand or market disruption, guaranteeing instead that any extra income winds up as windfall profits of the imperialist oil companies.
That's what happened recently in the United States, when distilled petroleum product prices (gasoline, diesel, jet fuel, etc.) reached levels corresponding to $100 or more per barrel of crude oil, but crude prices stayed mostly at the mid-$60 dollar level, in other words, in a really FREE market, crude oil producers could have been getting up to half again as much for their oil, at least for a few weeks, and that money went to imperialist corporations instead. And this is an ongoing scam.
Some 95% of U.S. refinery capacity is now back or will be in a few days, but more than two thirds of Gulf of Mexico crude oil production remains shut down. Under these conditions, one would expect the domestic shortfall in crude production to have a cumulative effect in driving up crude oil prices. That's how free-market capitalism is supposed to "reward" those providing a scarce resource and create additional incentives for increased production.
But that isn't happening. By opening U.S. and European oil reserves, the price of crude oil didn't rise nearly as much as the price of distilled products, and the result was staggering jump in third-quarter profits for the oil majors, which control refining and distribution. These profits beat all previous records for quarterly operating results despite lower production and a spike of costs associated with the hurricanes. And mind you, those third quarter results are for a 3-month period that only included windfall profits from the Hurricanes in September.
What this means is that the opposition of these five countries is very solid because it is materially grounded. Brazil and Argentina have large agricultural industries and Venezuela has oil. And the economies of Uruguay and Paraguay are intertwined with those of their neighbors. But there were also political factors involved. With Bush's approval rating at Nixonian levels, growing indications of a recession in the U.S. next year, and the split in the U.S. Republican levels between the nativist/America first/religious fundamentalist sector on one side and more world-minded industrial, commercial and banking interests on the other, there really isn't any point to negotiating anything with Bush. He can't deliver, and whatever concessions Latin Americans give now would simply become the starting point for new imperialist demands when a new president takes office. On the Latin American side, Fox and Lula are both lame ducks, and Kirchner in Argentina was in a way quite eloquent at the summit in saying that his country was not willing to repeat the neoliberal free market experiment of the 90's which produced such an unmitigated catastrophe.
More to the point, the examples of his own deposed predecessors and overthrown ex-presidents in Bolivia and Ecuador show what happens to those rulers who would try. Chavez, of course, has absolutely no intention of letting his country get raped like Mexico was by the United States with NAFTA. Some U.S. media reported that there was a move afoot to go ahead with an FTAA of 29, i.e., minus those five countries.
That they took this White House-inspired spin spread by Mexico's Vicente Fox, who acted as chief ventriloquist's dummy for the Bush regime, only shows the abysmal cultural level (in the Spanish sense of the term, i.e., the abysmal lack of general knowledge about the world) prevalent among even the foreign desk staff and international correspondents of American corporate journalistic outlets. For the U.S., there is, quite simply, *no point* to an FTAA without Brazil, much less without Argentina, Venezuela and Brazil. Especially because the U.S. already has NAFTA with Mexico, CAFTA with Central America, a bilateral deal with Chile, and is working on another one with some of the Andean countries.
Although for the South Americans, what makes the most sense is a trade bloc of that region, i.e., uniting the Mercosur and the Andean Pact, which is already in the works. To understand this you need only look at rounded-off figures for population (for Latin America CEPAL 2005, in millions) and then GDP (CIA Factbook 1994 estimate, purchasing power parity in billions of USD) for several Latin American countries (I've included also Germany, France, Britain and Russia for comparison). [I prefer rounded off figures because both the population and economic numbers are really estimates and do not have the precision that using three or four significant figures implies.] Germany 82 $2,400 Britain 60 $1,800 France 60 $1,700 Brazil 188 $1,500 Russia 150 $1,400 Mexico 106 $1,000 Argentina 39 $ 500 Colombia 46 $ 280 Peru 28 $ 160 Chile 16 $ 170 Venezuela 27 $ 150 Ecuador 13 $ 50.
What needs to be added is that Brazil's economy is if anything stronger than the comparison with Mexico suggests. It has tremendous agriculture and a large industrial base, if somewhat deteriorated, and important modern industries such as aerospace and nuclear energy. And politically, I think it is clear that Lula (whatever his own subjective view of himself, or the view his followers have) represents a serious national bourgeois effort to widen the country's relative autonomy from imperialism.
Meanwhile, Mexico increasingly is taking on many of the characteristics of a gigantic Bantustan, a reserve pool of labor for the U.S. economy. Like in the case of Blacks in the old apartheid South Africa, Mexican immigrant workers (especially the undocumented, but not just that layer) are stripped of legal rights and social protections in order that they can be more easily super-exploited.
Remittances from these workers will reach $20 billion this year, making it the country's second largest source of foreign exchange, and are growing at a rate of 20% or more a year, which means within two or three years they will become the country's main source of foreign exchange, as is already the case with some Central American countries. The 20% growth figure (this year's projection, last year's actual was 24%) is suggestive of how rapidly the country is being transformed --from the U.S. point of view-- from a source of oil to a source of wage slaves.
Politically, what is particularly striking is Brazil joining in the (clearly) Venezuelan-inspired statement that an FTAA that would be in the interests of the countries of Latin America is not possible. This could represent something of a shift in Brazil's position compared to what it took in Miami almost two years ago, when, yes, it opposed Washington's overall scheme but instead of letting the project collapse, Brazil came up with a formula that would allow individual countries to opt in or out of various parts of the pact, clearly an absurdity from the point of view of a customs union, but politically it had the effect of keeping the FTAA project around and even facilitated or justified Washington's plan B of opening Latin American markets one or a few countries at a time.
However, comments by Brazil's foreign minister make clear that, for Brazil, unlike Venezuela, the statement that "conditions do not exist" for a fair FTAA carry an implicit but emphatic *right now.* Brazil's message is that only sweeping concessions in the Doha round of world trade talks by the imperialists on the issue of agricultural (and perhaps other subsidies -- remember, Brazil is in the airplane business and expanding into the rocket business) would make a "fair" FTAA possible. But even so, cohering these five countries around a no to the FTAA, is therefore an advance, although we should have no illusions that this means and end to Washington's attempts to further subjugate various Latin American countries through trade deals, both between the U.S. and one country or a handful of countries (the CAFTA model) as well as through the WTO.