5 Latin America and Imperialism in the 21st Century

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DOI: 10.1163/156916306776150359

2006 32: 45Crit SociolMarco A. Gandsegui, JR

Latin America and Imperialism in the 21st Century

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Critical Sociology, Volume 32, Issue 1 also available online

2006 Koninklijke Brill NV, Leiden www.brill.nl

Latin America and Imperialismin the 21st Century

M A. G, J.(Centre for Latin American Studies Justo Arosemena

University of Panama)

A

Imperialism is a useful analytical tool that must be further

developed to comprehend the present day contradictions of a

multi-polar, capitalist system and its implications for Latin

American social struggles. A critical look at the contributions

of Wallerstein and Arrighi are taken as a point of departure

for suggesting how imperialism in the context of its sharpening

contradictions can help inform oppositional forces to think interms of social transformation. A critical look at provisions

within the general framework of regional and bilateral free

trade agreements reveals their tactical relationship to recent

attempts to maintain and further consolidate U.S. hegemony.

The total market utopia of imperialist projects such as the

FTAA can be usefully understood when conceptualised against

the backdrop of neoliberal and imperialist crisis.

K : Imperialism, Latin America, Free Trade, Social

Movement, Neoliberalism, Capitalist Crisis

After years of silence, the Latin American academy has returned to the

analysis of imperialism. Even now, imperialism as an explanatory category

in the field of the social sciences is more fashionable among liberals than

Marxists. The debate among liberals ranges from their extreme right fac-

tions over to the recycled former-Marxists among their ranks. For the

former, we find those who argue that imperialism is a moral burden

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46 Gandsegui Jr.

1 See Samuel P. Huntington (1999): In the multipolar world of the 21st century, the

major powers will inevitably compete, clash, and coalesce with each other in various

permutations and combinations. Such a world, however, will lack the tension and conflict

between the superpower and the major regional powers that are the defining characteristic

of a uni-multipolar world. For that reason, the United States could find life as a major

power in a multipolar world less demanding, less contentious, and more rewarding thanit was as the worlds only superpower. On the other hand, Edward Said (1979), in his

work Orientalism, offers an excellent synthesis of the imperialist ideology that saturated

the decadent period in Great Britain at the end of the 19th Century and at the beginning

of the Twentieth Century. In a talk given in Dublin in 1988 entitled Yeats and

Decolonisation, he argued that . . . and it must also be noted that this Eurocentric

culture relentlessly codified and observed everything about the non-European or presumably

peripheral world, in so thorough and detailed a manner as to leave no item untouched,

no culture unstudied, no people and land unclaimed. All of the subjugated peoples had

it in common that they were considered to be naturally subservient to a superior,

advanced, developed, and morally mature Europe, whose role in the non-European world

was to rule, instruct, legislate, develop, and at the proper times, to discipline, war against,

and occasionally exterminate non-Europeans.2 In 1848, K. Marx and F. Engels were referring in The Communist Manifesto to the

incessant expansion of capitalism that sought new territories and markets on a global scale.3 See Enoch Adames (2002).

that Western civilisation must assume.1 In the case of the latter, impe-

rialism emerges as a mighty bastion that helps order a higher civilisation

in the finest spirit of Kautskys ultra-imperialism (Hart and Negri 2000).

Among Marxists, there are those who look for the conceptual rootsof imperialism by returning to the original formulation of Karl Marx

who defined it as a ubiquitous characteristic of capitalist development.2

According to John Bellamy Foster (2002), imperialism is as proper to

capitalism as the search for profits and it is a necessary product of cap-

italism as a globalising force. Notable authors such as Arrighi (2001) and

Wallerstein (2003)3 provide us with conceptual criticisms of imperialism,

not so much for its intrinsic value, but in the mechanical way it has

been transplanted from knowledge generated by its application during

different stages of the development of capitalism. In the ensuing debate,

the discussion centres upon the polarity of the capitalist system (or cap-

italist world system). A multi-polar world becomes substituted by the bi-

polar world, and finally, for some, it emerges as a uni-polar world. In

this debate, the Leninist notion of the weak links of the system is essen-

tially abandoned.

In this brief essay, I wish to emphasise that we live in a multi-polar,

capitalist system. The conceptual utility of this notion consists precisely

in allowing us to reveal and exploit the multiple contradictions thatcapitalisms own development generates. In discussing the theoretical

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Latin America and Imperialism in the 21st Century 47

4 For Gramsci, hegemony is the organisation of consent through persuasion and coercion.

scenarios that Wallerstein and Arrighi offer us, we can build offof their

insights concerning the future development of capitalism in an effort to

better prepare us for action. The discussion then turns to the significance

that initiatives such as the FTAA and the various bilateral free tradeagreements have for Latin America. These imperialist initiatives seek to

create a total market utopia that can provide tonic for the hegemonic

development of capitalism during the first part of the new century.

Defining Imperialism

Imperialism is the struggle between capitalist nation-states for rule over

the expanding capitalist world system. Those who manage to exerciserule by establishing its hegemony must maintain it on the basis of force.4

But this gives rise to important questions. Does imperialism disappear

when the struggles cease between capitalist states? Can imperialism dis-

appear if a state transforms itself into an all-powerful one that subordinates

all other states to its rule?

In order to become consolidated, capital requires political will, something

that rests upon a national project. The nation is the political expression

of capital. The expansion of capital as expressed in the political will of

a nation enters into contradiction with other nations and their respective

political wills. The nature of this competition constitutes the essential

object of study for the theory for imperialism.

The first to use the term imperialism in Latin America were Leninists.

Latin American communists affiliated with the Third International identified

imperialism as the principal obstacle for the consolidation of the Russian

Revolution and the new Soviet state. According to this notion, the working

class and its allies had as their central task the struggle against imperialism.

The defeat of imperialism would result in the triumph of socialism inthe USSR and in time for all countries of the world, including the entire

region of Latin America.

Imperialism was consequently analysed from a negative perspective.

In other words, imperialism constituted a force that blocked the develop-

ment of the productive forces of the less developed, semi-colonial and

colonial countries. In this period, the alternatives were, on the one hand,

to consolidate the Soviet state in order to have a solid base for con-

fronting imperialism. On the other hand, there was a need to extend

the revolutionary movement to a world scale based upon a combinedstrategy rooted in the unequal development of capitalism.



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48 Gandsegui Jr.

5 This special issue of the CEPAL Reviewwhich contains Valpy FitzGerald (1998) went

under the title of ECLAC: Fifty Years of Reflections on Latin America and the

Caribbean.6 See the works of Theotonio dos Santos and the anthology produced by Ronald

Chilcote.7 For more discussion on this, recommended are various articles by Rui Mauro Marini

and Ricaurte Soler that appear in the Panamanian journal Tareas.

The debate was interrupted with the onset of the Second World War.

To the extent that the system was incapable of resolving its own con-

tradictions, it had been obliged to expend its efforts in inter-imperialist

wars. Among the political consequences in the aftermath of the devastatingconflagration was the expansion of the socialist bloc with the states of

central Europe and Asia, especially China. Leninist theory appeared to

be proving itself in action, with the weakest links breaking off from the

capitalist system. Later, the first socialist revolution broke out in Cuba,

a country which soon aligned itself with the Soviet bloc. Imperialism

became increasingly identified as merely a strategy for slowing the advance

of socialism that was continually marching forward towards new triumphs.

In the Cold War context, the debate developed in terms of the alter-

natives available in the face of imperialism. Enormous efforts were made

in Latin America to establish a theory of socialist revolution that, by

definition, was anti-imperialist and distinct to the region. The supra-

national Latin American project, originally conceived of in the Southern

Cone, appropriated the imagination of both liberal reformists and Marxists

alike (FitzGerald 1998).5 On the one hand, the necessity to drive for-

ward a national project of capitalist development in order to create the

conditions for socialist revolution was discussed. Many communist par-

ties and other groups committed themselves to this project. On the otherhand, the Cuban Revolution suggested the viable possibility of a national

development project without capitalism. Revolutionary movements of the

period relied upon a variant of dependency theory in order to explain

the role of imperialism.6

The Latin American revolution did not go unanswered. The United

States and its local allies mounted a counter-revolutionary offensive that

lasted at least a quarter century (19641989). This offensive went about

overthrowing some of the most mature revolutionary movements in the

region as well as some of the most original ones. By the end of the1980s, the revolutionary movements formerly considered the most viable

in Latin America had disappeared. Perhaps even more importantly, inde-

pendent national projects no longer had momentum and Latin-

Americanism as a movement was bankrupt.7 In their place, a top-down



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project became installed throughout the region that promoted social de-

mobilisation, combining a democratic electoral discourse with a neoliberal

political economy that applied adjustments which rapidly impoverished

the working and middle sectors of the region. Without any national proj-ect or dream for regional unity, imperialism also disappeared from the

regional discourse of opposition. The collapse of the USSR and their

European allies along with the radical reforms that took place in China

all contributed to the defeat suffered by socialism on a global scale.

The Cuban revolution, the Bolivarian movement and the various social

movements around which workers, peasants and other oppressed sectors

coalesce remain the exception. In spite of the noted absence of imperi-

alism in current regional discourse, it continues to exist as a robust, mate-

rial fact. If indeed imperialism exists as we argue here, it is because

capitalism continues to expand, creating the same contradictions between

core countries as it does at the periphery.

While the Latin American Revolution suffered a setback in the final

years of the Twentieth Century, we must remain aware that imperialism

also suffered profound transformations and this should be the object of

more serious analysis. The decades of populism (19501980) followed by

the neoliberal reaction towards the end of the Twentieth Century have

transformed all contending social actors in a qualitative manner. Therecan be little doubt that revolutionary forces in the region are now re-

grouping for new battles. For this reason, better theoretical instruments

are required that can serve as a guide for their struggles.

Wallersteins Scenario

According to Immanuel Wallerstein (2003), U.S. hegemony experienced

significant transformations in the latter half of the Twentieth Century.Wallerstein understands hegemony, first, in the way that the United States

had controlled the world market. Secondly, U.S. hegemony was displayed

by its indisputable military power. Third, its culture became the point

of reference to which countries around the world aspired to. But he pro-

ceeds to argue that the United States has now lost its hegemony, pri-

marily because it has lost its legitimacy. This loss of legitimacy of its

power, he argues, has resulted from fierce pressures from four distinct

sources: Europe, the Far East, world-wide social movements, and its own

contradictions that emanate from capitalist development (Wallerstein2003).

In the next decade, he asserts, Europe will make some important deci-

sions with respect to its project as a political entity. How exactly will



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50 Gandsegui Jr.

Europe proceed to recover its past global position of power? According

to Wallerstein, it will be difficult but Europe will in the end manage to

reconstruct itself, creating an army in the process. This will be met with

great concern from the United States, mostly because sooner or later,the European army will connect up with the Russian army. With respect

to the East, Wallerstein observes a tendency towards a strategic warming

of relations, with distinct political and economic characteristics, between

China, Japan and a unified Korea. This is because if the East is going

to play an independent global role, according to his logic, it will have

no choice but to move in that direction.

Beyond Europe and the Far East, Wallerstein identifies the challenge

which the World Social Forum represents for the United States. According

to Wallerstein:

[You] should watch the World Social Forum. I think that is where the action

is. It is the most important social movement now on the face of the earth

and the only one that has a chance of playing a really significant role. It

has blossomed very fast and it has a wealth of internal contradictions that

we should not underestimate. (2003: 7)

Wallerstein emphasises that the movement surrounding the World Forum

does not have a hierarchical centre, but is instead made up of a large

variety of currents which at the same time are representative.

But Wallerstein does not forget about the conflicts between capitalists

themselves, something that is one of the most important contradictions

in the development of capitalism. As he puts it: The basic political con-

tradiction of capitalism throughout its history has been that all capitalists

have a common political interest insofar as theres a world class struggle

going on. At the same time, all capitalists are rivals of all other capitalists.

Now that is a fundamental contradiction of the system and its going to

be very explosive (2003: 8). According to this reasoning, the capitalistworld system is confronting three challenges that are become increasingly

difficult to resolve. They are challenges which precisely arise as a con-

sequence of the success of the capitalist world system. On the one hand,

there is de-ruralisation, by which is meant that the demand for wage

labourers has become a global phenomenon and that accessibility to

cheap sources of this very special commodity is becoming increasingly

difficult to acquire. This results in an increase in the cost of the labour

force that in turn impacts negatively upon the profits of capitalist investors.

A second challenge facing the capitalist world system is the growingcosts of natural resources. The increase in these costs are due, in large

part, to the fact that the same capitalist world system is incapable of

conserving natural resources and tends to destroy them in a systematic



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8 See Gandsegui (2002).

fashion. The result of this increase in the costs of externalities translates

into a reduction of the profits on investments.

The third challenge consists of the so-called democratisation which

must be understood both from a mobilising as well as institutional pointof view. The mobilisation of peoples revolves around the discourse of

democracy and demands for equality and more and better social services,

as well as more and better opportunities. This mobilisation forces political

administrations, or states, to look for the resources necessary to satisfy

these demands. These resources can be acquired through the taxes that

national states manage to collect. In the final analysis, the constant

increase in taxes negatively affects the profits of investors.8

Richard B. Du Boff (2003) presents a synthesis of the evolution that

U.S. imperial power experienced during the last half of the Twentieth

Century. He points out how the United States lost ground in the field

of industrial production, international finances, and foreign investments.

This can be summarised by the following observations:

In 1950, the U.S. economy generated half of the worlds gross product.

At the onset of the Twenty-First Century, it accounted for only 21%

of total world production. In 1950, 60% of manufactured goods world-

wide were created in the United States. In 1999, it represented only

25%. In 2001, U.S. exports of commercial services represented 24%of the world total. In this same year, the exports of the European

Union reached 23% of the world total.

Non-U.S. companies dominated the industrial sector in 2002. In that

year, nine out of 10 of the worlds largest electronics and electrical

equipment industries were non U.S.-based. This was also true for eight

out of the 10 largest automobile producers, seven out of the top 10

oil refinery companies, six out of 10 biggest telecommunications firms,

five out of 10 pharmaceutical giants, four out of the six largest chemicalmanufacturers, and four of the seven biggest airlines.

Of the 25 largest banks in the world, 19 were non-U.S. based (although

the two largest, Citicorp and Bank of America are based in the United

States).

Among the largest 100 corporations of the world in 2000, 23 were

U.S. based. Four countries of the European Union had 40 of the

largest corporations and Japan had 16. In the decade of the 1990s,

the world sales of the 100 largest transnationals based in the United

States declined from 30% to 25%. In contrast, the share of transnationalsbased in the European Union grew from 41% to 46%.



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52 Gandsegui Jr.

9 This discussion of the thought of Arrighi is based mostly on a revised version of a

paper presented at the conference: The Triad as Rivals? U.S., Europe, and Japan,

Georgetown University, Washington, DC, April 2526, 2003. It later appeared in Faruk

Tabak (2004).

In 2001, 21% of direct investments in the world were of North American

origin, compared with 47% in 1960. Between 1996 and 2001, 17%

of new foreign investments were from the United States, while those

of Great Britain, France and Belgium together accounted for 37% ofglobal foreign investments.

During the period 19982000, a total of 25 large mergers took place

in the United States, five of which were acquisitions of foreign multi-

nationals (three British and two German). Among the 20 largest inter-

national mergers carried out during the 19872001 period, only two

were led by North American based transnationals (General Electric

and Citigroup), making up only 5% of the value of all mergers carried

out during that period (Du Boff2003).

Arrighis Scenarios

According to Giovanni Arrighi (1994),9 the accumulation crisis (or crisis

of overproduction) of U.S. capitalism can ultimately result in three alter-

native scenarios:

First, the old centres may succeed in halting the course of capitalist history.

The course of capitalist history over the lastfive hundred years has consisted

of a succession of financial expansions during which there occurred a change

of guard at the commanding heights of the capitalist world-economy. This

outcome is also present as a tendency in the current financial expansion. But

this tendency is countered by the very extent of the state and war-making

capabilities of the old guard, which may well be in a position to appropriate

through force, cunning, or persuasion the surplus capital that accumulates in

the new centres and thereby terminate capitalist history through the formation

of a truly global world-empire. (Arrighi 1994: 355)

The result of this scenario is domination without hegemony. In contrast,the second alternative would come about if:

. . . the old guard may fail to stop the course of capitalist history and East

Asian capital may come to occupy a commanding position in systemic processes

of capital accumulation. Capitalist history would then continue but under

conditions that depart radically from what they have been since the formation

of the modern interstate system. (Arrighi 1994: 355)



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This outcome would signify domination and a new hegemony. The third

alternative would involve a continuous growth in violence that results

with the destruction of the world order:

. . . to paraphrase Schumpeter . . . it may well burn up in the horrors (or

glories) of the escalating violence that has accompanied the liquidation of the

Cold War world order. In this case, capitalist history would also come to an

end but by reverting permanently to the systemic chaos from which it began

six hundred years ago and which has been reproduced on an ever increasing

scale with each transition. Whether this would mean the end just of capitalist

history or of all human history, it is impossible to tell. (Arrighi 1994: 3556)

According to Arrighi, the confrontation (or bifurcation) that results from

the tendency towards the formation of a world-empire centred in theWest and of a world-market anchored in the East has serious social con-

sequences. The possibilities that one or the other tendency may prevail

depends upon the capacity that each has for resolving systemic problems

left behind by the United States. He considers that the principal chal-

lenge confronting the world-system is how to resolve the seemingly

unbridgeable gulf between the life-chances of a small minority of world

population (between 10 and 20 percent) and the remaining vast majority

(Arrighi and Silver 1999: 289). He maintains, however, that the con-

tinuing rapid economic expansion of China can ultimately be recognisedas the major force which could bridge that seemingly unbridgeable gulf

(Arrighi 2004).

Arrighi asserts that there exist two grand obstacles to a non-catastrophic

transition towards a more egalitarian world order. The most immediate

obstacle consists of U.S. resistance towards making adjustments and

accommodating to the new circumstances. Arrighi reminds us that in the

case of the British and Dutch world-system transitions, it was both the

appearance of new and aggressive (bellicose) powers as well as the lackof flexibility in accommodation that broke up their hegemony.

For Arrighi, there is no new power in the immediate present that can

put the U.S.-centred world-system in check. Indeed, the United States

enjoys better conditions than Great Britain did a century ago for con-

verting its declining hegemony into an open domination. This will depend

on the capacity that Washington demonstrates for adjusting and accom-

modating to the increasing economic power of Far East Asia. This would

involve following the line of a non-catastrophic transition towards a new

world order. Arrighi assures that if the system breaks down in the nearfuture, it will occur on account of U.S. resistance to carrying out the

necessary adjustments and its failure to look for the best ways to re-

accommodate to the new reality (Arrighi and Silver 1999: 289).



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54 Gandsegui Jr.

The second big obstacle to resolving the confrontation (or bifurcation)

refers to the questionable capacity of East Asia to create its own new

path of development. Arrighi argues that this could provide the world

with a radically different model from that which is presently constitutedand which has exhausted its possibilities. He argues that this is a task

that the dominant groups of East Asia have scarcely begun to contemplate

(Arrighi 2004)

For Arrighi, there are three important conclusions that can be useful

in our comprehension of the present conjuncture as well as the coming

period. In the first place, the belle poqueof the United States appears to

have reached its end and we are in the throws of the terminal crisis of

its hegemony. While the United States continues being the most powerful

country, its present relationship to the rest of the world can best be

described by the phrase mentioned earlier: domination without hegemony.

Second, the terminal crisis of U.S. hegemony is being provoked not

by the emergence of other aggressive powers but rather by its resistance

to adjusting to the changes and accommodating to the new world that

is coming into existence. The description that the United States employed

concerning Iraq prior to the invasion, i.e., as a new world power, was

never seriously accepted. Arrighi shows us that the strategy of national

security adopted by the Bush Administration in 2002, essential in orderto resist any adjustment or accommodation to the new realities, goes far

beyond even the vision that he himself had developed in his earlier works.

Arrighi suggests that the terminal crisis of U.S. hegemony is a case of

attempted suicide on the part of a superpower that outdoes any previously

known example in history.

Third, Arrighi alludes to the possibility of a state of systemic chaos.

He does not, however, commit himself to show whether this consists of

a permanent state or some sort of transition. Another possibility is that

the transition that is being observed becomes carried out rapidly andcleanly. Arrighi suggests that the force that could halt the tendency

towards systemic chaos would rest in the consolidation of the economic

rebirth of the Far East, with China at the helm. This tendency, according

to Arrighi, is reinforced and not weakened by U.S. resistance to adjustment

and accommodation.

According to William Greider (2003), the United States and the global

system will confront, in the near future, many obstacles and surprises.

Some years ago, Japan as the most vulnerable U.S. partner proposed

that it wanted to negotiate a ceiling with respect to this trade deficit

with the United States. It was a treaty for administering trade that was

rejected by the United States. Greider cites one of his well-placed sources



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who explains that one of the strategies of Japan is to help avoid that

the United States commits any major blunder during the next 15 years.

By that time, they would be more self-sufficient and better able to con-

tinue advancing on their own path to development without the UnitedStates (Greider 2003).

The resistance to adjustments and accommodation on the part of the

United States as described by Arrighi can contribute to an understanding

of the doctrine of preventive attacks that has been developed by the

Bush Administration. According to Harries (2004), the tone and impulse

of Washingtons present doctrine is one that rejects the traditional notion

of hegemony based on prudent and restricted use of force and the search

for consensus-building, something more typical of the decade of the 1940s.

According to Harries, the United States previously forced itself to create

an institutional network allowing it to develop initiatives based in coop-

eration, always with the notion of being the first among partners. This

vision contrasts vividly with the doctrine now enunciated by the Secretary

of Defence Donald Rumsfeld who argues that the worst thing you can

do is allow a coalition to determine what your mission is (Harries 2004).

The Bush Doctrine should be taken very seriously, warns Harries, and

its rhetoric should not be ignored. This has been put to the test in Iraq.

The use of U.S. military force in a preventive action is a very clearindication that the U.S. is willing to act without consensus and in a uni-

lateral form. The overthrow of a regime considered to be tyrannical and

the attempt to replace it with a representative liberal democratic gov-

ernment has implications that transcend the Middle East. If the invasion

of Iraq culminates in a success for the United States, the errors and

losses will be considered the necessary price that must be paid in order

to give girth to a new and revolutionary strategic doctrine. If on the

other hand, it fails and proves incapable of generating a new political

order, it will have to completely reconsider its global strategy. In thiscase, the limits of U.S. hegemonic capabilities will become evident for

all to see and the inclination to resist it will become stronger (Harries

2004).

The FTAA and Bilateral/Sub-Regional Free

Trade Agreements

The period of U.S. military aggression that accompanied the populistdevelopment model in Latin America from 19641989 eventually shifted

in large measure to the economic sphere, albeit with several well-known



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56 Gandsegui Jr.

exceptions. The FTAA project and the various Free Trade Agreements

being imposed upon region represent the new economic instruments of

domination and hegemony. According to Joseph Stiglitz:

The Bush administration has been bragging that it exemplifies the way its

economic policies can build new ties and new friendships around the world.

This is especially important in the Middle East, where, in other respects,

Americas foreign policy seems to have left something to be desired . . . [This

kind of cooperation] . . . is meant to demonstrate our broadmindedness, our

willingness to offer a carrot (rather than the proverbial stick) to those who

behave reasonably. (Stiglitz 2004)

While in other parts of the world, the United States has had to wave

its big stick, as Stiglitz says, it has been relatively successful in culti-vating collaboration for its policy of neoliberal economic adjustment in

Latin America. In reality, the new hemispheric policy goes well beyond

the economic realm and invades the remaining spheres of public, pri-

vate and everyday life. The new policy has been referred to as a total

market utopia (or authoritarian utopia). According to Edgardo Lander

(2004), the tendency today is to globally impose, both ideologically as

well as in tactical terms, a potent utopia about the construction of the

future that constitutes the total market utopia. This is not some abstract

vision that springs from the imagination, but rather the design of a globalorder that comes along with the most powerful communications, political

and frequently military mechanisms.

Lander (2004) further argues that the total market utopia projects the

ideological vision that the criteria of resource allocation and decision-

making rooted in the market leads to maximum human welfare. For that

reason, it is desirable and possible to reorganise all human activities in

accordance with the logic of the market. Polanyi would call this the mar-

ket society, a construct signifying that the operation of society becomesviewed essentially as an appendix of the market. Instead of the econ-

omy being framed in social relations, social relations are framed in the

economic system (Polanyi 1997).

The organisation of privatisation, globalisation and economic deregu-

lation has been imposed during the last decade and a half through diverse

mechanisms, among the most important of which figure the World Trade

Organisation (WTO). Beginning in 1995, the United States considered

that the WTO negotiations were not likely to move forward as rapidly

as they would like. This marked the beginning of a renewed push fornegotiations towards the creation of regional free trade areas. The first

negotiations that were set in motion the same year were those involved

with the FTAA or the Free Trade Area of the Americas. Since then,



14/23


10 GRAIN is an international non-governmental organisation (NGO) which promotes

the sustainable management and use of agricultural biodiversity based on peoples con-

trol over genetic resources and local knowledge.

the United States has tried without much success to develop a similar

level of regional negotiations in Africa and Asia (GRAIN 2004).10

The U.S. initiative has not gone unperceived. Peoples all across the

world have suffered the effects of so-called free trade and gradually havebeen accumulating forces aimed at rejecting the ruling economic model

(GRAIN 2004). That discontent achieved a dramatic expression in Seattle

in 1999 when thousands of social activists from around the world engaged

in several days of protest in the presence of ministers from more than

80 countries of the WTO. They were meeting to advance their agenda

in favour of accelerating the existing processes of globalisation. Beginning

around that period, discontent began to become more generalised,

expressed more massively, and developed in multiple ways.

These protests have continued in recent years. In 2003, the ministerial

meeting in Cancun, Mexico resulted in major demonstrations, with a

strong presence on the part of peasant movements whose representatives

participated from various parts of the world. The protests managed to

make an impact on the negotiations sufficient to impede the achievement

of results that had been planned by various governments. Many of the

non-industrialised countries came to understand that if they continued

to hand over their economies so openly, it was likely to have important

political costs. Meanwhile, the United States and Europe failed underthe bright glare of protest to reconcile their insistence upon maintaining

their own domestic subsidies with their hypocritical demand for developing

countries to eliminate any remaining form of protection over their domestic

agricultural production. The result was that the Cancun meeting ended

ahead of schedule and without agreement.

A few weeks later, the ministers involved with negotiating the FTAA

met in Miami. The protests were repeated in spite of an unprecedented

police presence. Once again, the room for manoeuvre was small and the

margin of giveaway on the part of the Latin American governments wasagain being reduced by the social pressure provided by the protests. This

was especially the case for the Brazilian government that firmly defended

certain minimal conditions for industry and agriculture, something that

ultimately made an agreement at that summit impossible. Just like the

WTO meeting in Cancun, the FTAA meeting in Miami ended ahead

of schedule having failed to reach a consensus.



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58 Gandsegui Jr.

It became clear that social protest, if it is sufficiently massive and

focused, can detain even that which has been presented as inevitable

(GRAIN 2004). But no sooner was the WTO being detained in Cancun

and the FTAA collapsing in Miami, that we saw an epidemic of treatiestake shape in a bilateral or sub-regional form. The United States has

closed in on more than twenty different countries in order to formally

initiate bilateral free trade treaties. This has already yielded signed treaties

in some cases, with each intent at a new treaty presented as an indis-

pensable initiative for overcoming the unacceptable obstacles to increased

commerce under the exigencies of globalisation.

GRAIN (2004) argues that these bilateral or sub-regional free trade

agreements are simply an attempt to accelerate the pace of hemispheric

consolidation. The United States has been very explicit in this respect

and its strategy has been termed competitive liberalisation. This con-

sists of approaching and pressuring weaker or submissive countries to

sign on with them so that as the process advances, those countries that

continue displaying some interest in maintaining a measure of sover-

eignty must eventually cede on account of the threat of economic iso-

lation. For that reason, the agreements signed with Chile and Central

America, from the U.S. point of view, have little economic importance

in themselves, but instead represent momentum towards a much biggerprize. This accounts for the rush to sign with Panama, to include the

Dominican Republic into CAFTA, and to consolidate the Andean coun-

tries into similar agreements.

Due to the presence of so much negotiation in the region, it has

become difficult to follow the process step by step, even more so when

each case is essentially being negotiated in secret. Nevertheless, based on

the processes already finished and the texts that have been signed and

published, it is possible to see that what is occurring is an imposition of

pre-established frameworks. In fact, Washington has let it become wellknown that the model agreement they are interested in generalising to

other countries can be found in that which was signed with Chile. In

that sense, negotiations across the region have become centred only on

formal aspects with very few modifications, while the corresponding prop-

aganda is designed to have us believe in a set of myths concerning what

is supposedly in play during the negotiations process (GRAIN 2004).

Stiglitz (2004) tells us that the policy of President Bush is incompre-

hensible and hypocritical. While they speak of global campaigns against

AIDS and offer large sums of money to finance them, that which it gives

with one hand is being taken away by the other. But he suggests that

the greater part of U.S. citizens would, for example, be in favour of per-

mitting more open access to generic medications that are capable of sav-



16/23


ing lives. The losses of the pharmaceutical companies would be relatively

small and certainly will be compensated for by the enormous fiscal benefits

that the U.S. government receives.

Regardless of the fact that the free trade agreements are promoted bygovernments under the label of free trade, these treaties incorporate

aspects that go well beyond issues dealing with the exportation and impor-

tation of goods (Moreno 2004). Indeed, they extend out into areas as

diverse as investments, the rights of intellectual property, government

purchases, services, policies for competition, telecommunications and the

financial sector, among others. In this way, they define the framework

that determines the orientation of public policies of the smaller economies

subscribed to the treaty.

Through all of these extra-commercial provisions, the free trade

agreements invade the sovereign jurisdiction of states such as their national

economic policies and strategic control over the provision of services.

These agreements moreover compromise their ability to fulfil and to

ensure the social, economic and cultural rights of the population. The

norms established in those portions of the agreements concerning gov-

ernment purchases, commerce in services, intellectual property rights and

investments serve to promote the processes of privatisation of public serv-

ices by way of concessions.The region is up against an instrument with a broad reach, with far-

reaching implications among its range of mechanisms. There is a whole

set of prohibitions on government policies that all add up to increasing

the power of foreign companies in the area of investments, non-

discriminatory treatment, intellectual property rights, liberalisation of

services and open access to public licences. The free trade agreements

guarantee the legalisation of privileges and convert them into rights

for the transnationals. With their ratification on the part of the legisla-

tive branches of each country, the treaties become converted intolaws of the land that display higher jurisdiction than any secondary law

passed domestically, something that is manifestly not true in the United

States.

The structured contents contained in the free trade agreements con-

form to a transversal logic that privileges profits over human rights and

ecological sustainability. It is overwhelming and disproportionate to note

how these treaties contain such an extensive list of rights ceded to for-

eign companies, in sharp contrast with the omission of mechanisms that

can guarantee compliance with the social and economic rights of the

respective populations and the conservation of ecosystems.

The United States especially seeks to establish advantages in four basic

areas:



17/23

60 Gandsegui Jr.

Government contracts

Pharmaceutical markets

Agricultural markets

Intellectual property (GRAIN 2004).

The clauses relevant to intellectual property assigns legal guarantees to

the United States for:

a. Appropriation and monopolisation of living beings and their parts,

without exceptions (thereby including plants, animals, human genes

and tissues). This will make it a crime to freely reproduce plants

and animals, or freely exchange seeds.

b. Appropriation and control of the circulation and use of information,

including traditional and scientific information.

c. Monopolisation over the manufacture and sale of medicines, including

the power to block others from producing inexpensive medicines,

even those used to prevent or cure illnesses of great social importance

such as malaria, tuberculosis or AIDS.

d. Appropriation of artistic and cultural creations, including all kinds

of music, literature, dance and design, granting permissions for their

use only in exchange for payment.

e. Restriction of creative activity in information management and tech-nology when that endangers certain monopolies.

f. Appropriation and restriction of the freedom to use prayers, icons,

symbols and rituals.

g. Restrictions on photocopying texts, including their use for study.

h. Punishing with fines and imprisonment those who do not respect

(or are accused of not respecting) the previously described regulations.

i. Applying such controls and punishments without the need for proof

of guilt, rather, the accused must demonstrate their innocence.

j. Persecuting those that might intend not to respect some of theseregulations.

k. Ensuring there are no exceptions for professors, students, researchers,

schools, universities, public libraries or national archives (GRAIN

2004: 7-8).

The clause concerning agricultural goods also has the same logic for the

United States. According to WTO data, the European Union and the

United States accounts for 51.8% of the worlds agricultural exports, of

which 81.4% corresponds to just 15 countries (Len 2003). The mostimportant countries in Latin America for receiving these exports are:

Brazil with 3.4%, Argentina with 2.2%, Mexico with 1.7% and Chile

with 1.3%; while at the same time, the agricultural imports of the



18/23


European Union and the United States make up 51.2% of the total,

and in Latin America, the most representative of exports to that market

is Mexico with 2.2% (Leon 2003). At the world level, the relative weight

in this category for other mostly agrarian countries is almost imperceptible.Moreover, tropical countries in the Equatorial region where the greatest

number of farmers are to be found are catalogued as markets where

transnational products can increasingly deepen their incursion (Len 2003).

According to a news release from the Bloomberg Agency, the agrarian

income of the United States reached a record US$ 65 billion in 2003,

fully a third more than in the preceding year, thanks to greater exports

and almost US$ 20 billion in government subsidies (La Prensa 2003).

According to the former U.S. Secretary of Agriculture Ann Veneman in

a speech to the Farm Journal Forum in Washington:

The sales of grains, meat and other agricultural products to foreign buyers

totalled [in 2003] to US$ 56.2 billion, more than 5% above the previous

year. It has been calculated that exports will increase to US$ 59.5 billion in

2004, close to the record US$ 60 billion in 1996. Part of this is due to bet-

ter prospects for exports in the coming year. The demand for agricultural

products are being stimulated by the lower value of the dollar, low inflation,

low rates of interest, and the tax reductions put into place by President Bush.

(La Prensa 2003)

Soy futures increased at the end of 2003 by 36% relative to the previous

year, in part due to strong exports, especially to China. The demand by

foreign buyers for soy, corn, wheat, and cotton in 2003 will widely surpass

the previous year according to a U.S. Department of Agriculture Report.

Orders for the purchase of corn, the principal crop of the United States,

rose 26% in the commercial year that began September 1, 2003. The

same report showed that requests for soy increased 20% and for wheat,

28% while cotton was up by 38% relative to their previous commercialyears (La Prensa 2003).

Du Boff (2003) shows that the United States has also developed an

aggressive agricultural policy on the home front. Only two months after

increasing steel tariffs in 2002, President Bush approved a subsidy law

for the agricultural sector that increased subsidies to farmers by 80%

over previously existing levels of assistance, costing US$ 190 billion to

be distributed over ten years (Du Boff2003).

The U.S. strategy in Latin America has not been entirely homogenous.

Washington understands well the varying levels of economic and politicaldevelopment in each county and sub-region. A strategy for political nego-

tiation has been developed for each and every one of these areas. This

heterogeneous analysis is being carried out despite the praises being sung



19/23

62 Gandsegui Jr.

11 According to Fenton (2004), the Coup in Haiti was planned and facilitated over a

four and a half year period by the U.S. government.12 In Rosario (2004), ex-President Carazo states that Costa Rica accepted a negoti-

ation without the participation of distinct sectors and with considerable hurry on the

part of public officials.13 Cali Manifesto of the Andean Labour Consultative Council (Manifiesto de Cali del

Consejo Consultivo Laboral Andino) on April 3, 2004. In one part of the declaration,

it states: The free trade agreements are part of the tactics employed by the U.S. gov-

ernment and the transnational corporations in the development of their strategic plan

to co-opt the countries of Latin America so as to strengthen their own negotiating bloc,

with the objective of confronting negotiations in a global framework with the European

Union, China, India, Japan and MERCOSUR. The FTAA is part of this strategic plan

designed for their own benefit, which also includes Plan Colombia, Plan Puebla Panama,

and the Andean Initiative. Signers of the Manifesto included:

by the State Department to the effect that Latin America now has a

nearly homogenous profile of democratically elected regimes.

In the first instance, the United States identifies countries where the

economic adjustment process has advanced in the most satisfactory man-ner. In this area we find Chile and Mexico. In the case of Chile, the

Pinochet Dictatorship (19731991) tendered the productive sectors and

repressed the popular sectors with relative success (Lara Corts 2004).

The governments under the ruling Concertacin coalition (19912004) have

continued the policies of adjustments and signed a Free Trade Agreement

with the United States. In the case of Mexico, both the Salinas and

Zedillo governments (19882000) established the bases for deepening

structural adjustments and implementing the NAFTA agreement signed

in 1994.

In the second instance, the United States has created a list of countries

with serious problems of economic development and political stability.

At the same time, they are countries that are highly dependent upon

the United States. On the one hand, their structural adjustment programmes

failed and on the other hand, their transition to electoral democracy has

encountered serious problems. This list is made up of the five Central

American countries, four of the Andean countries (Gallardo 2004), Panama

and the Dominican Republic. The lack of viability on the part of Haitihas made it the exception. The United States, with the complicity of

various countries in the region, has had to occupy that Caribbean country

militarily (Fenton 2004).11 Costa Rica is also an exception to the extent

that its electoral regime has enjoyed considerable stability (Rosario 2004).12

In the case of the Andean countries (including Venezuela), the workers

movements have jointly declared themselves in opposition to the free

trade agreements through the Andean Labour Consultative Council.13 In



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BOLIVIA: Central Obrera Boliviana COB; COLOMBIA: Confederacin de

Trabajadores de Colombia CTC, Central Unitaria de Trabajadores CUT,

Confederacin General de Trabajadores Democrticos CGTD; ECUADOR:

Confederacin Ecuatoriana de Organizaciones Sindicales Libres CEOSL, Confederacinde Trabajadores de Ecuador CTE, Confederacin Ecuatoriana de Organizaciones

Clasistas Unitarias de Trabajadores CEDOCUT; PERU: Confederacin General de

Trabajadores del Per CGTP, Central Autnoma de Trabajadores del Per CATP,

Central Unitaria de Trabajadores del Per CUT, Confederacin de Trabajadores del

Per CTP; VENEZUELA: Central Unitaria de Trabajadores de Venezuela CUTV,

Unin Nacional de Trabajadores UNT, Confederacin General de Trabajadores

CGT, Confederacin de Sindicatos Autnomos de Venezuela CODESA, Confederacin

de Trabajadores de Venezuela CTV.14 According to Javier Diez Canseco (2004), member of the Peruvian Congress, the

free trade agreement is not only a trade agreement, but it also treats crucial issues related

to sovereignty and national defence, autonomy in the design and application of state

policies, the legislative powers of the Congress, the jurisdiction over our laws and courts,

and the rights and duties of all Peruvians.15 As affirmed by Fidel Castro in his speech on July 26, 2004 in response to the

attacks being levelled at Cuba by the Bush Administration.

Peru, there is resistance being expressed within the national Congress to

the approval of a free trade agreement with the United States (Diez

Canseco 2004).14

In the third category are four countries affiliated with MERCOSURalong with associate member Venezuela. In practice, it was Brazil whose

demands for a competitive and equitable commercial trade agreement

led to the U.S. failure to reach a consensus for the FTAA in their 2003

meeting in Miami. It was Argentinas support for Brazils position that

led Washington to fire up its motors and launch an offensive seeking

bilateral free trade agreements all across the region.

In the fourth category is Cuba who remained uninvited by the United

States to the FTAA negotiations and marginalised from any possibility

of signing a free trade agreement as long as its socialist government is

in power. On the contrary, the Bush government continues a policy of

military threats against this Caribbean island, something that has been

in effect for more than forty years.15

Conclusion

It seems reasonable to expect that the crisis of U.S. hegemony can impact

upon Latin America, especially over the medium term. The challenges

to U.S. domination developing in the Middle East and on the part of

the European Union can be felt on a global scale and in various forms

across the Latin American region. Thefigures presented earlier by Du Boff



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64 Gandsegui Jr.

16 As Theotonio dos Santos (2003) put it, this is perhaps the most brutal effect of

this cultural and ideological situation. Nothing can be hoped for from a humanity that

does not believe in its own power of transformation.

(2003) are very clear in this regard. Japan has strong investments in the

region, especially in Brazil. China has recently entered into the region

and one of its companies administers the ports of the Panama Canal.

In this context, what remains to be consolidated is the regions own polit-ical project, be it Latin Americanist, Bolivarian or one in the spirit of

Martis Our America, that can enable a transformation adequate to

the task of confronting the realities of the 21st Century.16

The architects of such a process and of all great social transformations

are the people, organised and consciously involved in defining the emerging

lines of battle. In this essay, I have insisted that they require theoretical

tools in order to guide their social movements and to comprehend the

historical implications of their actions. We must continue to develop these

tools so as to ensure that the people of Latin America can take control

over their destiny.

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5 Latin America and Imperialism in the 21st Century

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