Latin America Topic Lecture

Resolved: The United States federal government should substantially increase its economic engagement toward Cuba,

Mexico or Venezuela.

I. INTRODUCTION

• Why did we choose this topic?

• When was the last time we debated Latin America?

• What are the core questions of the resolution?

Core Questions

1. Should the US engage more in these countries, or leave them alone?2. Is Latin America important ? [economically or politically]3. Is enough enough for Cuba?4. Is there anything else we could do for Mexico?5. Chavez is gone, what now?

II. Economic Engagement

What is it?

Deliberately expanding economic ties – the goal of changing behavior and improve relationsKahler & Kastner 04 Graduate School of International Relations and Pacific Studies University of California, San Diego & Department of Government and Politics University of Maryland [Kahler, Miles and Scott Kastner. Strategic Uses of Economic Interdependence: Engagement Policies in South Korea, Singapore, and Taiwan. <www.bsos.umd.edu/gvpt/kastner/KahlerKastner.doc>]

Economic engagement—a policy of deliberately expanding economic ties with an adversary in order to change the behavior of the target state and effect an improvement in bilateral political relations—is the subject of growing, but still limited, interest in the international relations literature. The bulk of the work on economic statecraft continues to focus on coercive policies such as economic sanctions. The emphasis on negative forms of economic statecraft is not without justification: the use of economic sanctions is widespread and well-documented, and several quantitative studies have shown that adversarial relations between countries tend to correspond to reduced, rather than enhanced, levels of trade (Gowa 1994; Pollins 1989). At the same time, however, relatively little is known about how widespread strategies of economic engagement actually are: scholars disagree on this point, in part because

no database cataloging instances of positive economic statecraft exists (Mastanduno 2003). Furthermore, beginning with the classic work of Hirschman (1945), most studies in this regard have focused on policies adopted by great powers. But engagement policies adopted by South Korea and the other two states examined in this study, Singapore and Taiwan, demonstrate that engagement is not a strategy limited to the domain of great power politics; instead, it may be more widespread than previously recognized.

Engagement is explicitly a POSITIVE inducement. Distinguishes from being broad and confusingHAASS & O’SULLIVAN 00 a. VP & Director of Foreign Policy Studies at Brookings, b. Fellow in the Foreign Policy Studies Program at Brookings [Richard N. Haass and Meghan L. O’Sullivan, Terms of Engagement: Alternatives to Punitive Policies 113, Survival, vol. 42, no. 2, Summer 2000, pp. 113–35] The United States and its principal allies in both Europe and Asia have long differed over the best strategies for dealing with recalcitrant regimes. European countries and Japan, to differing degrees, have argued that the preservation of commercial and diplomatic contacts is critical in maintaining leverage over countries with which they have foreign-policy and national-security disputes. In contrast, until very recently, the US has tenaciously clung to the position that policies of economic and political isolation are both morally and practically the right course to follow when dealing with so-called ‘rogue’ states. Although there has been occasional convergence, the friction that these two perspectives have caused has been far more notable than any points of accord. This dissonance is one of several important factors that have spurred the current debate in the United States, and to a lesser extent among America’s allies, over the relative merits of containment strategies versus engagement policies. Because of the prominence of punitive policies – such as sanctions and military force – in the foreign-policy repertoire of the US, this debate draws upon many of the lessons extracted from past cases in which policies of punishment were employed. However, strategies of engagement have thus far been subject to much less stringent evaluation, highlighting the need to identify the most favourable circumstances and strategies for employing incentives or rewards to shape the conduct of problem regimes.1The term ‘engagement’ was popularised in the early 1980s amid controversy about the Reagan administration’s policy of ‘constructive engagement’ towards South Africa. However, the term itself remains a source of confusion. Except in the few instances where the US has sought to isolate a regime or country, America arguably ‘engages’ states and actors all the time simply by interacting with them. To be a meaningful subject of analysis, the term ‘engagement’ must refer to something more specific than a policy of ‘non-isolation’. As used in this article, ‘engagement’ refers to a foreign-policy strategy which depends to a significant degree on positive incentives to achieve its objectives. Certainly, it does not preclude the simultaneous use of other foreign-policy instruments such as sanctions or military force: in practice, there is often considerable overlap of strategies, particularly when the termination or lifting of sanctions is used as a positive inducement. Yet the distinguishing feature of American engagement strategies is their reliance on the extension or provision of incentives to shape the behaviour of countries with which the US has important disagreements.

Economic engagement includes credits, investments, access to tech, loans, or aid. It includes removing embargoes or tariffs. Distinct from Political, Military, and Civil-Society engagementHAASS & O’SULLIVAN 00 a. VP & Director of Foreign Policy Studies at Brookings, b. Fellow in the Foreign Policy Studies Program at Brookings [Richard N. Haass and Meghan L. O’Sullivan, Terms of Engagement: Alternatives to Punitive Policies 113, Survival, vol. 42, no. 2, Summer 2000, pp. 113–35]

Architects of engagement strategies can choose from a wide variety of incentives. Economic engagement might offer tangible incentives such as export credits, investment insurance or promotion, access to technology, loans or economic aid.3 Other equally useful economic incentives involve the removal of penalties such as trade embargoes, investment bans or high tariffs, which have impeded economic relations between the United States and the target country. Facilitated entry into the global economic arena and the institutions that govern it rank among the most potent incentives in today’s global market. Similarly, political engagement can involve the lure of diplomatic recognition, access to regional or international institutions, the scheduling of summits between leaders – or the termination of these benefits. Military engagement could involve the extension of international military-educational training in order both to strengthen respect for civilian authority and human rights among a country’s armed forces and, more feasibly, to establish relationships between Americans and young foreign military officers. While these areas of engagement are likely to involve working with state institutions, cultural or civil-society engagement entails building people-to-people contacts. Funding non-governmental organisations, facilitating the flow of remittances and promoting the exchange of students, tourists and other non-governmental people between countries are just some of the possible incentives used in this form of engagement.

Export Credits• In other words, loans, insurance, and other support for exporters to

a country

http://www.oecd.org/tad/xcred/about.htmGovernments provide officially supported export credits through Export Credit Agencies (ECAs) in support of national exporters competing for overseas sales. Such support can take the form either of “official financing support”, such as direct credits to foreign buyers, refinancing or interest-rate support, or of “pure cover support”, such as export credits insurance or guarantee cover for credits provided by private financial institutions. ECAs can be government institutions or private companies operating on behalf of governments.

Investment InsurancePrograms for providing financial cover to companies deciding to invest in a foreign country

Catalog of Foreign Domestic Assistance [https://www.cfda.gov/?s=program&mode=form&tab=step1&id=7619dff6f3c7c709f7e378fe5dd97fbf]

To insure investments of eligible U.S. investors in developing countries and emerging markets, against the political risks of inconvertibility, expropriation, and political violence. Special programs include insuring (l)contractors and exporters against arbitrary drawings of letters of credit posted as bid, performance or advance payment guaranties, (2)petroleum exploration, development and production (3)leasing operations, and (4) debt financials, including securities.

Economic Aid

• This includes just about anything – giving another country aid with their economy.

• Here is a good chart - http://www.vaughns-1-pagers.com/politics/us-foreign-aid.htm

• Can basically do just about anything, making the topic “resolved: interact with the economy of one of these countries.”

• We give a ton right now to lots of countries. Not many Latin ones though.

Examples of things the US is doing via Economic EngagementOCC 09 Office of the Coordinator for Counterterrorism [Country Reports on Terrorism 2008, http://www.globalsecurity.org/security/library/report/2009/c-rprt-terrorism_2008-05-7.htm]

The U.S. strategy of Total Economic Engagement pursues economic reform, rule of law, and global economic integration, in countries with predominantly Muslim populations. Total Economic Engagement includes:• Regular bilateral discussions on these topics with host government officials, with both U.S.

Embassy officials and officials from a wide range of U.S. agencies participating;• Formal structured dialogues, high-level Economic Dialogues, and Trade and Investment

Framework Agreement (TIFA) Councils;• U.S. bilateral and multilateral assistance programs for economic reform, trade capacity-

building, and rule of law managed chiefly through USAID, the Millennium Challenge Corporation (MCC), and the State Department's Middle East Partnership Initiative (MEPI). Programs are often complemented with technical assistance provided by specialized U.S. agencies and offices;

• Coordinated multilateral policies and assistance strategies to advance reform goals by working with such international organizations as the International Monetary Fund, the World Bank, the World Trade Organization, and OECD (MENA-OECD Investment), and other multilateral donors; and

• Working with NGOs, such as Transparency International, and U.S. and foreign business associations, such as American Chambers of Commerce and Business Councils, to advance reform issues of mutual concern.

Removal of Penalites

• Domestic Penalties for not “buying america”• The Cuban Embargo• Tariffs for products and other acts of

protectionism.

Other Categories

• Investment Promotion: A company/NGO/law that promotes investment.

• Access to Technology: Selling an item [medical equipment], allowing the sell of an item [cuba telecomm], or focusing on developing a sector.

• Economic Loans: Here’s some cash, pay us back later, with interest.

• Facilitated Entry into an International Financial Organization: WTO, etc.

III. Advantages to Engaging

US Legitimacy/Image

• “Soft Power”• Losing the Hemisphere to others• Anti-Americanism wins elections• Doesn’t care about its neighbors• North/South Gap• Helps us do other things we want• ‘merica

Soft Power defined and made relevant to Latin AmericaPerez 10 J.D. Yale Law School. Working with Koh former Dean of Yale Law and Legal Advisor to the State Department [David A. Perez, America's Cuba Policy: The Way Forward: A Policy Recommendation for the U.S. State Department, Spring, 2010, Harvard Latino Law Review, 13 Harv. Latino L. Rev. 187]

Traditionally the U.S. has projected its influence by using varying combinations of hard and soft power. It has been a long time since the United States last sponsored or supported military action in Latin America, and although highly context-dependent, it is very likely that Latin American citizens and their governments would view any overt display of American hard power in the region negatively. n3 One can only imagine the fodder an American military excursion into Latin America would provide for a leader like Hugo Chavez of Venezuela, or Evo Morales of Bolivia. Soft power, on the other hand, can win over people and governments without resorting to coercion, but is limited by other factors.The key to soft power is not simply a strong military, though having one helps, but rather an enduring sense of legitimacy that can then be projected across the globe to advance particular policies. The key to this legitimacy is a good image and a reputation as a responsible actor on the global and regional stage. A good reputation and image can go a long way toward generating goodwill, which ultimately will help the U.S. when it tries to sell unpopular ideas and reforms in the region. n4In order to effectively employ soft power in Latin America, the U.S. must repair its image by going on a diplomatic offensive and reminding, not just Latin America's leaders, but also the Latin American people, of the important relationship between the U.S. and Latin America. Many of the problems facing Latin America today cannot be addressed in the absence of U.S. leadership and cooperation. Working with other nations to address these challenges is the best way to shore up legitimacy, earn respect, and repair America's image. Although this proposal focuses heavily on Cuba, every country in Latin America is a potential friend. Washington will have to not only strengthen its existing relationships in the region, but also win over new allies, who look to us for "ideas and solutions, not lectures." n5

US-Latin American Relations

• Related to image• Unchallenged by our neighbors – Brooks and

Wohlforth 2002 (Stephen G., Assistant Professor, William C., Associate Professor in the

Department of Government at Dartmouth College July/August, Foreign Affairs l/n)

• Environment• Economic Security• Energy Access• Proliferation

Economic Growth

• Need Trading Partners• Import Growth• Export Growth• Agriculture• Manufacturing• Energy Security• Immigration

Trade

• NAFTA• Bilateral Free Trade Agreements• FTAA• Protectionism• WTO

ChinaUS-Latin America relations are key to stop Chinese expansion in the region Lovelace 07 Ph.D., Director of the Strategic Studies Institute [Douglas, FOREWORD: CHINA’S EXPANSION INTO AND U.S. WITHDRAWAL FROM ARGENTINA’S TELECOMMUNICATIONS AND SPACE INDUSTRIES AND THE IMPLICATIONS FOR U.S. NATIONAL SECURITY,” Strategic Studies Institute, September, http://strategicstudiesinstitute.army.mil/pubs/download.cfm?q=806]

The U.S. Government is waking up to China's growing presence in Latin America. For the last several years as U.S. policymakers' attention and resources, largely diverted from Latin America, have been focused on the Middle East,

China has pursued a policy of economic engagment with the region. Sino-Latin American trade has sky-rocketed,

and Chinese investment in the region is picking up. In this monograph, Ms. Janie Hulse, a Latin American specialist based in Buenos Aires, Argentina, argues that increased Chinese investment in regional telecommunications and space industries has

implications for U.S. national security. She believes that globalization, advances in information technology and China's growing capacity and interest in information warfare make the United States particularly vulnerable. Ms. Hulse details China's expansion into the U.S. withdrawal from these intelligence-related industries in Argentina and

highlights associated risks for the United States. The author calls for the U.S. government to react to this current trend by increasing its engagement in regional strategic industries and bettering relations with its southern neighbors.

US-Chinese Relations

• Messing with our neighborhood• Staging Grounds• Economic Competition• Energy Security Issues• Neo-Con Fears

Democracy• Credible Message• Beacons of Democracy• Economic Engagement is pro DemocracyAmash 12 International Relations at UC San Diego [Brandon Amash, Evaluating the Cuban Embargo, Prospect: Journal of International Affairs at UCSD, http://prospectjournal.org/2012/07/23/evaluating-the-cuban-embargo/]Lifting economic sanctions will improve economic growth in Cuba, which correlates to democratization. Empirical evidence shows that a strong economy is correlated to democracy. According to the Modernization Theory of democratization, this correlation is a causal link: economic growth directly leads to democratization. Lifting the current economic sanctions on Cuba and working together to improve economic situations in the state will allow their economy to grow, increasing the likelihood of democracy in the state, and thus promoting greater freedom of expression, opinion and dissent.

Energy & Environment

• Ultra-Diverse• Oil• NAFTA manufacturing concerns

Indigenous Populations

• Section of the topic paper dedicated to minority population groups in these countries.

• Each of them has diverse histories and groups that are currently struggling for, or previously struggled for, independence.

IV. Disadvantages to Engaging

Appeasement

“a diplomatic policy of making political or material concessions”*Signal to other powers*Pretty silly for Mexico*Pretty silly in general

Capitalism/Growth Bad

• Engagement suggests we have something to teach them about the economy.

• Fundamental question of the resolution.• Hands off / top-down / bottom-up• Environment• Poverty / Inequality

Relations/Legitimacy Bad

• Soft Power is only good if the person who has it isn’t evil.

• Negative things we would get Latin America to do

• Chinese Influence/Growth good• Hegemony is bad

Budget

• Does Economic Engagement cost money?• If yes, then spending money is bad.• If no, then who cares, and why spend any?

Politics

• The only disad• Why fix their problems• Buy America• Cuban Nationals• Immigration/Remittances fears• Venezuela is friends with Iran

V. Philosophical Questions

• Capitalism/Neoliberalism - “a term of condemnation employed by critics of liberalizing economic tendencies” Profit & Greed

• Western Model Bad – Development, Human Rights, Trojan-Horse for our values.

• Foreign Policy flaws – Security, Indict of Foreign Policy Assumptions.

VI. Cuba

Current Demographics

• Officially The “Republic of Cuba”• 2010 census says 11m people.• 2.2m in Havana, no more than 500k in any

other single city.• Low population growth rate – 1.43 per

woman.

Political History 1.0

• Populated by Native American groups: Taíno & the Ciboney.• Columbus landed there in 1492. 1511 became a Spanish

protectorate. [1511-1898].• Remained Spanish far later La Siempre Fidelísima Isla ("The

Always Most Faithful Island“ – concern for slave revolts, fear of U.S., pirates. Cuban-Chinese slaves.

• 1868 - Carlos Manuel de Céspedes. Freed his slaves to fight for a revolt. Freed all slaves who would join the fight.

• 1878 – ended the battle, Spain agreed to increased autonomy.• Spanish-American war – Treaty of Paris [1898]. Gave up

Guam, Puerto Rico, the Phillipines, and Cuba.

Political History 1.1• May 20, 1902 – Cuban independence from U.S. control.• Platt Amendment• Fulgencio Batista was democratically elected President in the elections

of 1940• Batista outlawed the Cuban Communist Party in 1952.• 1956 – group left Mexico planning to establish military rebellion. Batista

claimed to have killed the leaders.• Castro was alive and covered by the NYT.• 1959 – Castro has claimed Havana. US sends support for the “free of

communism” government.• 1960 – communist rule. • 1961 – Soviet Union, Emigration, Bay of Pigs.• 1962 - Embargo

Political History 1.2

• Still the embargo, no really.• Helms-Burton - The Cuban Liberty and Democratic

Solidarity (Libertad) Act of 1996.• Everyone hates it. Everyone.• Trade Sanctions Reform and Export Enhancement

Act of 2000 (TRSA) – agriculture• 2009 – Travel & Remittances for family members• Jan. 16, 2013 Obama waived the right to suit

businesses.

Cuba’s Economy

• Centrally planned• 2000 – 23% private employed. • 1981 – 8% private employed.• Difficult to know for sure• No use of the ‘dollar’• Netherlands is their top trading partner

U.S. Cuban Relations

• What relations?• The Embargo started on 2/7/1962.• Obama has a list of requirements: transaction

fees, telecommunication, political prisoners, improved human rights record.

Cuba & Debate

• Great Aff Evidence• Tons of recent literature – the political winds

are shifting• PICS• Everyone talks about Cuba• Recently found some oil• Smaller affs

VII. Mexico

Current Demographic Facts

• Technically, “The United Mexican States” made of 31 states and a federal district.

• 113 million people makes it the 11th most populous in the world. Largest Spanish speaking in the world. What’s the only Latin American country with more people?

• Highly touristed – 10th most visited in the world. 22.5 million visitors annually.

Political History 1.0

• Human remains 23,000 years ago. • Cultivation of Maize.• Earliest complex civilizations: Olmec, Mayan, Zapotec.• 1519 Spanish began a conquest over the Aztecs, whose

leader was Moctezuma II. • Smallpox killed more than 3m, many Spanish were

immune. Made the Christianity popular.• 1821 – Independence from Spain• 1824 – calls for independence. Including Texas. • 1846 – Mexican-American war.

Political History 1.1

• 1848 - Treaty of Guadalupe Hidalgo. Peace treaty to end the war. $15m to Mexico. Got Rio Grande border for Texas, California, New Mexico, Arizona, Nevada, Utah, and parts of Wyoming & Colorado. Bought some more for 10m.

• Given an option to stay in the U.S. as full citizens. 90% stayed.• 1910 – Mexican Revolution. Election fraud concerns. • 1940-1980 – major economic growth, oil prices, U.S.

economic ties. But, large inequalities.• 1/1/94 – NAFTA. Zapatista Rebellion. • 1994 Economy collapses. Huge US financial stimulus package.

Rebounded by 1999.

Political History 1.2

• 1917 constitution – representative democracy.• Congress, Executive, Judicial branches.• National Action Party: a right-wing conservative

party founded in 1939• Institutional Revolutionary Party: a center-left

party and member of Socialist International• Party of the Democratic Revolution: a left-wing

party,[86] founded in 1989 as the successor of the coalition of socialists and liberal parties

Mexico’s Economy• 14th largest GDP in the world. • Economists, like Goldman Sachs, predict it will become the 5th

largest by 2050. [http://thecatalist.org/2010/03/mexico-2050-the-world%C2%B4s-fifth-largest-economy/]

• Population Growth, Improving Infrastructure, developing economics.

• 46% are living in poverty - • infant mortality in Mexico is three times higher than the average

among OECD nations• U.S. & Canada are 50% of its imports and exports.• Remittances from the U.S. are .2% of its entire GDP.• Largest auto producer in North America – Ford, Chrysler, and GM

NAFTA

• North American Free Trade Agreement. • January 1, 1994 between U.S., Canada, and

Mexico. • Eliminated Article 27 of the Mexican

Constitution – protection of Indigenous Indians. • Started the Zapatista rebellions. Still ongoing.• Agricultural dumping.• Industry Migration.

U.S. Mexican Relations

• Foreign relations directed by the President of Mexico. • Friendly with the U.S. with the exception of the support

for the Cuban government.• 1 million U.S. citizens reside in Mexico.• Provided Relief Aid multiple times: Katrina & 9/11• Rejected the War on Terror. • We trade – A LOT. We’re #1 for them, #3 for us.• Wal-Mart is the largest private employer in Mexico.• War on Drugs• Immigration

Mexico & Debate

• We’re doing a lot of economic engagement now

• Advantages won’t be as good as Cuba, but the disads won’t be as good either

• Immigration• War on Drugs• International Organizations

VIII. Venezuela

Current Demographic Facts

• Officially called the Bolivarian Republic of Venezuela.• Population is roughly 29 million people.• “Extremely High Biodiversity” including the Amazon

River Forest Basin.• Highly Urbanized. Most live in the cities in the North.• Capital is Caracas.• Divided into 23 states, the capital, and federal districts.• Speaks Spanish but recognizes over 30 indigenous

languages.

Political History

• Colonized by Spain in 1522, secured full independence in 1830. [Spanish diseases killed off a huge percentage of indigenous people]

• Impeached President Carlos Andres Perez for embezzlement of public funds in 1993.

• 1998 Election of military official Hugo Chavez.• Started the Bolivarian Revolution, rewriting the

constitution. Died on March 5th. • March 8, 2013 elected Nicolas Maduro. First since

Chavez and the revolution.

Venezuela’s Economy

• Per capita GDP for 2009 was US$13,000, ranking 85th in the world.

• Currency is the bolívar.• Leading exporter of oil. Citgo is owned and

fueled by Venezuela.• Largest known reserves of oil. 297 billion. Up

from 99 billion in 2007.

U.S. Venezuelan Relations

• 2002 the US recognized Pedro Carmona in a coup attempt – allegedly. Chavez told people he had proof of a US planned invasion.

• Sept. 2008 officially broke off relations with the U.S, re-established in June 2009.

• In Russia, during a political speech Chavez said, “"the greatest terrorist in world history.”

• Despite political tensions, trade & economic interactions remain high. 40.4b in 2005.

• It is an interesting and unsettled time in the history of Venezuela.

Venezuela & Debate

• Not as much literature• Ever changing post Chavez• But, Oil. Sweet sweet oil.• Like finding cards?