From: Witness For Peace Date: 30 Mar 92 13:44 PST Subject: WFP Myth of the Month--April 92 Message-ID: <1563600143@igc.org> Lines: 338 Status: RO Witness for Peace 1492-1992 Expose the Myths: Calling for a Just World Order Myth of the Month--April 1992/Aid and Economic Assistance MYTH: The European colonists brought progress to the Americas and U.S. aid brings progress to Latin America RESPONSE: The European colonists brought with them new crops (e.g. sugar cane, coconut, banana), new technology (horses) and new ideas of how things should be done in the Americas. However, far from bringing progress, their arrival brought hunger, death and destruction. In much the same way, the U.S. has been "aiding" Latin America for years. In the last decade alone the U.S. has poured billions of dollars into Central America. However, the poor majorities of Central America are hungrier and generally worse off today than they were a decade ago. The United States appears to be destined by Providence to plague Latin America with misery in the name of liberty. --Simon Bolivar (mid-1800s) The Colonies and European "Progress" When the Spaniards "discovered" the Americas in 1492, they found highly developed peoples who had been living there for centuries. With 300,000 inhabitants, Tenochtitln, the capital of the Aztec empire (upon whose ruins Mexico City is located today) was twice the size of London, the largest European city of the time. To supply a city that size, the Aztecs had developed sophisticated agricultural production and distribution systems. The Mayas had a highly developed knowledge of mathematics and astronomy. They had developed the concept of zero, which the Europeans learned from the Arabs. They were agriculturally self-sufficient, working the land communally and producing enough to feed their entire population. The Incas in the central Andes were also a highly developed people. They were self-sufficient, producing many varieties of corn corresponding to different soil types. They developed terracing as a way to use scarce water to irrigate large extensions of land along steep slopes. Llamas were used for transportation, and the Incas traded as far south as Chile and as far north as Central America. The Spaniards introduced alien technologies into the "New World," technologies that had been developed on the European continent in a very different ecosystem and for the production of different crops. In many parts of the Americas the consequences of European technologies and crops were disastrous, not only for the land but also for the people. Newly introduced animals and plants displaced those that were more appropriate to the environment. Cities, productive infrastructure, food, clothing and social organization--more often than not ill-suited to the people and environment--were all unquestioningly transferred from Europe. The results for the Indians were disastrous. Hunger, until then only the product of natural disasters, became endemic to the colonial system. The imposition of European customs and slavery adversely affected social and family structures. Highly developed peoples were treated as "savages" and were marginalized for not complying with European standards. For the indigenous people "progress" meant destruction, hunger, an attack on their cultures and traditions, and loss of their lives and lands. U.S. Aid and Central America: "Progress" Brings Increased Poverty Between 1810 and 1824 the majority of Spain's colonies gained their independence. U.S. policy-makers considered these governments unstable and feared that if some powerful European nation (such as Britain) replaced Spain, U.S. territorial, political and economic expansion would be threatened. The Monroe Doctrine, formulated by President Monroe in 1823, forbade European nations from intervening in Latin American nations' internal affairs while it gave the U.S. the power to unilaterally intervene anywhere in Latin America in order to protect U.S. interests. In other words, it was acceptable only for the United States to intervene. In this way, during the first 100 years of their independence, Latin American nations fled Spain's control only to fall into the "sphere of influence" of the U.S. What little progress and development took place benefitted the wealthy elites and U.S. corporations (such as the United Fruit Company of Boston) but had a negative effect on the fate of the poor majorities. The Alliance for Progress and Beyond: AID and U.S. Foreign Policy The aftermath of World War II brought the consolidation of U.S. hegemony in the western hemisphere. U.S. investment in Latin America grew at breathtaking rates as the United States' relative self-sufficiency gave way to increasing reliance upon Latin American raw materials and labor. The Cuban revolution (1959) presented the first serious post-World War II challenge to U.S. hegemony in the Americas. The Alliance for Progress, launched in 1961, was President Kennedy's response. Kennedy defined the Alliance for Progress as a "partnership" between North and South that would set Latin America on the road to prosperity and social justice, thus preventing other Latin American countries from following Cuba's example. (Today Bush's Enterprise for the Americas Initiative/Free Trade Agreements are being framed with the same "partnership" rhetoric.) The Alliance for Progress differed from the Monroe Doctrine in one important way: the Alliance was preventive rather than reactive. The Alliance's main goals were to provide 1) economic aid to improve the living standards of Latin Americans; and 2) military aid to thwart any revolutionary movements. However, in Central America (as elsewhere) the established elites refused to implement even the mildest social or economic reforms promoted by the Alliance for Progress. Moreover, since Central American militaries traditionally saw it to their advantage to protect the interests of the oligarchies, the military aspects of the Alliance in effect strengthened the power of the Latin American elites and put the U.S. squarely on their side against popular and reform movements. The U.S. Agency for International Development (USAID or AID) was created as a result of the Alliance for Progress, ostensibly to channel economic aid from the U.S. government to Latin American countries. However, in Central America, AID did not provide funds for development projects geared toward improving the lot of the poor. Rather, AID became the channel for funds to shore up the wealthy landowning elites and their agro-export enterprises in the hope that the oligarchies' profits would eventually "trickle down." As assistance failed to "trickle down," AID became a primary source of funds for counter-insurgency projects attempting to maintain the economic and political power of the elites by disarticulating popular and guerrilla movements who challenge such power (as in the case of Guatemala and El Salvador in the 1980s). If there were ever any doubts about the function of USAID and the use of its funds, they were dispelled in the 1980s. According to Barry and Preusch (Central America Fact Book, 1986), the three primary uses of the funds funneled through USAID to Central America were: 1. "Stabilization": This actually means propping up governments that are friendly to the U.S. and that promote U.S. economic interests. For this purpose AID uses the Economic Support Funds (ESF). Economic Support Funds in Central America are cash transfers from the U.S. Treasury to a Central American government. According to an AID official, "the purpose of ESF is to support peaceful solutions to international problems which involve U.S. interests, national security, and the attainment of U.S. foreign policy objectives." Interestingly, according to a Pentagon official, the Pentagon also uses ESF to "address economic problems in a way that both complements and enhances the military assistance [the U.S.] provides." In this way, "stabilization" is closely tied to militarization. Militarization is only one of the ways that ESF funds are used. Another use for these funds is to "aggressively seek [economic] policy changes" in recipient countries. In the name of "stabilization" AID pressures Latin American governments, among other things, to: * Encourage and favor U.S. investment; * Increase credit and reduce taxes for export businesses; * Remove tariff protection for local industries; * Remove food subsidies and reduce government funded social services; * Improve opportunities for the private sector; * Revoke labor laws favoring collective bargaining and unions. Like the colonists 500 years ago, AID's "stabilization" produces greater misery for the poor and more profits for the wealthy. 2. Pacification: In the language of counter-insurgency, pacification means eliminating social support for guerrilla movements in order to bring an end to the war and, most importantly, to restore the old status quo. According to Lieutenant Caldon of the U.S. Southern Command, the elements of pacification are "humanitarian aid, development assistance and economic support" coupled with strong military support to the armies of Central America. In this way, using tactics that the Spaniards used 500 years ago to subdue the Indians, pacification introduces changes that will bring the civilian population under military control. In Central America AID pacification funds have been put toward: * Resettlement of entire towns and villages into areas more easily controlled by the military. Guatemala's military-controlled "model villages" and "development poles" are prime examples of this; * Rural development projects in military-controlled areas to facilitate control of the peasant populations; * Food-for-work projects to employ and keep track of resettled people; * Limited land reform to reduce rural tensions; * Support for elections that give regimes a democratic appearance. Like the conquistadors who fought the indigenous populations five centuries ago, AID has been a key player in the counter-insurgency projects of Central America, particularly in El Salvador and Guatemala. Rather than funding development and social justice projects, AID funds the projects--military and other--of the wealthy. 3. Private Sector Support: The purpose of providing assistance for the private sector is, in President Reagan's words, to let loose "the magic of the marketplace." However, the "magic" created only charms the business elites. Following this mandate, AID has provided funds to: * Create and strengthen private sector organizations; * Promote and expand export-agriculture and the maquiladora (assembly) sector; * Support the promotion of "free-trade zones;" * Provide insurance and funds for U.S. corporations to invest in Central America; * Facilitate U.S. trade with the region; * Provide funds for use by private businesses in the region; The benefits of private sector support accrue only to well-established business interests and U.S. associated or owned enterprises. Representative Byron Dorgan (D-ND) summarizes AID's role: "[in] order to stabilize [Central America] the U.S. has provided a tremendous amount of foreign aid--over $10 billion--in the last decade. However, only about $4 billion of that aid was focused on development programs..." According to Dorgan, in spite of such a massive inflow of funds "poverty remains the root of most of [Central America's] problems." It is not hard to imagine why poverty in Central America is worse today. Sustainable development, social justice and elimination of poverty are clearly not on the U.S. policy agenda_promoting U.S. business interests and supporting "friendly" pro-U.S. regimes are. Examples: AID in the 1990s: The Case of Nicaragua In a December 1990 congressional hearing on hunger Rep. Dorgan asked: "Is the Bush administration determined that we should now make the same kinds of investments in nutrition, health care as we used to make in military aid and contra support?" The answer would be "no." A close look at AID's work in Nicaragua since Chamorro came to power indicates the poor have once again been relegated to second place, while U.S. interests continue in the first. AID's re-introduction to Nicaragua after a 10 year hiatus is a repetition of old patterns. In May of 1990, a week after President Chamorro came to power, AID signed an agreement for food donation. However, the agreement was plagued with conditions. The profits from the sale of the donated food should be used by the government of Nicaragua to reduce and eliminate state control of agricultural production; state enterprises must be privatized; and the private sector must be aided and encouraged. AID's conditions produced such an uproar in Nicaragua that future agreements were kept secret as a result of pressures from the U.S. embassy--a bad sign of things to come. In November of 1990, funds for Nicaragua were held up for three weeks during the Concertacion (Social Pact) talks between the labor unions, the government and the private sector. It is widely suspected that the funds were contingent on the results of the talks. Other AID activities in Nicaragua include a "privatization plan" formulated by an AID-funded economic policy team charged with formulating the government's economic policy. In this way-- as in Costa Rica, El Salvador and Guatemala--AID will be formulating the country's economic policy based on the neoliberal and structural adjustment models (see Myth of the Month, May 1992). Through AID, U.S. intervention in Nicaragua continues apace, only this time under the guise of "economic reform." In spite of the end of the "Cold War," the U.S. is conducting policy as usual in Central America. Rather than using this historic moment to champion development for the poor, the U.S., through AID, continues to push an agenda which in the past has resulted in increased misery for Central America's poor majorities. A Positive Aid Package: What Would it look like? According to a June 1991 Central American Historical Institute memo, a positive U.S. AID program for Nicaragua would: * Continue at substantial levels until the Nicaraguan economy is well on the road to recovery; * Contain development aid for agriculture, especially for small and medium-sized farms (individual and cooperative); * Contain aid for small urban enterprises, a key component of Nicaragua's economy; * Distribute all credit and technical assistance without favoring particular political ideologies; * Provide additional aid to support land distribution, particularly to resettle the demobilized contras as well as the demobilized Sandinista Army soldiers; * Provide aid for health and education through government ministries and Non-Governmental Organizations (NGOs); * Provide aid for environmental programs; * Perhaps most importantly, recognize that economic reform must be worked out by national consensus, without conditions or pressures from AID or the U.S. government. Calling for a Just World Order: * Form a study/discussion group to learn more about U.S. economic aid as a form of intervention. For further readings see "Resources" below. * Become a Witness for Peace Media/Legislative Contact to receive regular updates on how to affect foreign aid legislation (use the sign-up sheet provided in the packet). * Write to your congresspersons and encourage them to support community-based development aimed at poverty alleviation. Use the example above as an alternative aid packet. * Write to your local media and tell them the ways U.S. assistance hinders rather than sponsors development. * Go on a Witness for Peace delegation to Guatemala or Nicaragua and experience first-hand the effects of U.S. economic assistance (see enclosed delegation schedule). * Find out what local groups are doing on this issue and join forces with them. Discussion Questions: 1. Why is it a myth that U.S. economic aid to Central America helps the poor? 2. What kind of aid package would help the poor majorities of Central America? Why? Resources: Aid as Obstacle, Frances Moore Lapp et al., Food First: 1981. The Central America Fact Book, Tom Barry and Deb Preusch, Grove Press: 1986. Feeding the Crisis: U.S. Food Aid and Farm Policy in Central America, Rachel Garst and Tom Barry, University of Nebraska Press: 1990. Roots of Rebellion: Land and Hunger in Central America, Tom Barry, South End Press: 1987. The Soft War: The Uses and Abuses of U.S. Economic Aid in Central America, Tom Barry and Deb Preusch, Grove Press: 1988. World Hunger: Twelve Myths, Frances Moore Lapp and Joseph Collins, Grove Press: 1986.