THE BEST PRESIDENT LATIN AMERICA EVER HAD
Beatrice E. Rangel
George Herbert Walker Bush decided to take a dive into heaven while the Group of 20 was meeting in Argentina.
Paradoxically, as president, he advocated among his Latin American colleagues for the establishment of hemispheric caucus that would promote growth and act as crises muffler. The presence of the Group 20 in Latin America in a way was a tribute to the most strategic mind to live at the White House since president Jefferson.
As such, he launched a foreign policy that aimed at preserving stability despite the change wave propelled by economic activity that was about to enter the digital age.
In the Middle East he drew the line to Saddam Hussein while respecting the UN mandate and Iraq’s sovereignty.
He took advantage of Russia’s self-inflicted implosion to open arms to Eastern Europe and East Germany through foreign direct investments and acceptance to NATO.
In Latin America he was a development militant who understood that the only way to preserve freedom was through progress. And he dedicated a good part of his mandate to plant the pillars for future development in Latin America.
His Initiative for the Americas aimed at lifting the weight of debt from the Latin American economies through the Brady Plan. He then designed what should have been the engines of growth: free trade and foreign direct investments .
The Free Trade Alliance for the Americas (FTAA) was planned to promote specialization among the Latin economies while enhancing their income streams. As income streams grew foreign direct investment would make up for the lack of internal savings and trade and foreign direct investment pushed the rates of growth middle classes would expand thereby paving the way to self-sustainable growth.
The imitative of the Americas was half way implemented as the FTAA was the subject to a vitriolic fight led by Lula’s Brazil against free trade. While Brazil engaged in a never-ending negotiation for a free trade agreement with Europe and opened the doors of Mercosur to Venezuela, a country that had no significant exchanges with the trade alliance its diplomats depicted the FTAA as a tool for US dominance and the weapon of servitude designed by the United States to keep Latin America underdeveloped. Further, the Brazilian diplomacy committed to many initiatives that ran counter to its long-term interests such as accepting the Argentina’s Kirchner levy on exports without opening a procedure in Mercosur or suing Argentina at the WTO. Without free trade, the Latin American economies went back to their good all corporativist ways and rent extraction and as a result, except for Chile, they have made little or no progress in the first two decades of this century.
In fact, one could even argue that they are not doing well at all and that their performance is worse than that of the turn of the century.
To be sure, South America’s middle-income population from 16% in 2001 to 27% in 2011, and the segment that was poor dropped from 17% to 7%. In Central America and the Caribbean progress was significantly smaller from 2001 to 2011. The middle-income share of the population grew only from 19% to 21%, while proportion of poor declined by just 3%.
Today middle class creation has come to a virtual stall. Development experts estimate that would FTAA have passed middle class growth would have reached 25 percentage points in South America and 30%in Central America. This would have placed the region on a selfsustained growth track.
But Latin leaders preferred to follow the petro dollar track established by Hugo Chavez instead of the road to development created by GHW Bush. As Topo Gigio would put it” What a class act!!!
Published by LAHT.com on Monday, December 3th. 2018
*The opinions published herein are the sole responsibility of its author.*