Clinton’s First Year: Trade Above All
No sooner had Colombia’s
president, C6sar Gaviria,
been propelled to the secre-
tary generalship of the Organiza-
tion of American States (OAS) by
what the Council on Hemispheric
Affairs has called “Washington’s
graceless back-room bullying and
salon cajolery,” than he announced
that hemispheric free trade would
become the organization’s primary
goal. “We want the different trade
agreements…to converge into one
single process,” he said. “We want
to create a single, larger free-trade
zone.” If there was some mystery
as to why Washington exerted such
inordinate pressure on regional
countries to support Gaviria-the
president of a country whose
human-rights credentials are deeply
suspect-over Costa Rican foreign
minister Bernd Niehaus, Gaviria’s
post-election remarks may hold the
key. The Clinton Administration
may be indecisive about all other
aspects of inter-American policy,
but when it comes to letting the
market-and those who have mar-
ket power-take control of hemi-
spheric economies, it has shown the
ability to be expeditious.
The Administration has three
stated goals for the Americas: free
trade, free elections, and the ame-
lioration of poverty. These can
probably be taken at face value, as
long as we remember that free trade
is primus inter pares; the other two
are only relevant as long as they
support the first. U.S. policy toward
Mexico, for example, where free
trade and free elections have not
yet shown themselves to be perfect-
ly compatible, clearly demonstrates
the primacy of trade. In the wake of
Mexico’s current political uncer-
tainty, Clinton has publicly sup-
ported President Carlos Salinas’
pronouncements that both political
stability and the implementation of
free-market economic policy must
precede the democratization of the
country.
The simultaneous-though
uneven-promotion of trade and
electoral democracy comes togeth-
er in a policy National Security
Advisor Anthony Lake has called
“enlargement.” Lake has called for
the replacement of the old policy of
the “containment” of Communism
with a policy of “enlargement…of
the world’s free community of mar-
ket democracies,” all of whom can
take advantage of that “immense
entrepreneurial opportunity” that’s
out there, almost within their grasp.
The idea is to make the Americas
into one vast land of opportunity
where, in the famous words of Al
Capone, “all you have to do is
reach out and take it.”
f course, some people are
more primed to reach out
than others. One of the lat-
est groups to take advantage of the
policy of enlargement is the inter-
national community of mining
companies which-following the
U.S.-encouraged enactment of free-
market legislation in a growing
number of the region’s countries–
has entered the Andes en masse,
looking for copper, silver and gold.
“Discarding decades of prickly
nationalism,” reports James Brooke
in the New York Times, “Argentina,
Bolivia, Chile and Peru have
rewritten their mining codes to
encourage foreign investment. The
new codes establish clear tax rules,
easy repatriation of profits, protec-
tion against nationalization and low
tariffs on machinery.” Apparently
the United States itself is less
accommodating to these transna-
tional companies-many of which
are U.S.-based. “North American
and Australian companies,” writes
Brooke, “complain of increasing
‘barbed wire’ at home: environ-
mental hearings and native-Indian
land ownership disputes that either
block new projects outright or
stretch out approval time for years
on end.”
Free trade, in other words, is a
way to allow U.S.-based transna-
tional companies to do business in
countries desperate for their invest-
ment dollars, before unions, envi-
ronmentalists, and land-rights
claimants catch up with them.
Environmental degradation, the
sell-off of the national wealth, and
the development of an economic
model driven by cheap-labor export
platforms for transnationals are all
at issue here in the “enlargement”
of U.S.-based capital.
U.S. support for these ventures
stems, of course, from an interest in
a certain kind of hemispheric pros-
perity. “Exports,” says Richard
Feinberg, director of Inter-Ameri-
can Affairs at the National Security
Council, “have become a major
engine of our economic growth, and Latin America is one of our
most dynamic markets. U.S.
exports to Latin America have
more than doubled in seven years
to nearly $80 billion in 1993.” The
World Bank has estimated that
about 40% of global trade is intra-
firm trade among the 350 largest
transnationals, so that the “hemi-
spheric prosperity” necessary to
sustain that trade need not be all
that deep. Moreover, the magnet
for investment is precisely the low
costs of production made possible
by the desperate straits most of the
population finds itself in. It should
come as no surprise, therefore, that
the promotion of free trade seems
often to work at cross-purposes
with the Administration’s other
professed goals for the Americas:
democracy and the alleviation of
poverty.
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