Growing differences over trade and foreign policy threaten to upset the delicate balance in U.S.-Brazil relations. To head off trouble, Washington should lower its expectations, remembering that it has a greater stake in Lula's domestic success than in Brazil's active cooperation on any particular issue.
Peter Hakim is President of the Inter-American Dialogue.
COURTING BRAZIL
Although most Latin American leaders complain that the United States has lost interest in the region since the September 11, 2001, terrorist attacks, Washington has courted the president of Brazil for the past year. Within weeks of his election to the presidency in October 2002, Luiz Inácio Lula da Silva, known as Lula, was invited to meet President George W. Bush at the White House. He returned last June for a summit meeting with Bush and ten key cabinet members. At the time, he was the only head of state publicly opposed to the war in Iraq to be welcomed at 1600 Pennsylvania Avenue.
The Bush administration has no more important task in the hemisphere than to cultivate a constructive working relationship with Brazil. As Latin America's largest and most influential country, Brazil will determine, to a large extent, whether the United States is able to advance its foreign policy agenda in Latin America, and on some issues it will affect U.S. success outside the region. Although Brazil may not be powerful enough to shape policy in Latin America as much as it might like, it often has enough muscle to substantially help -- or obstruct -- U.S. plans for the region. The main test of the relationship will not be whether Brazil and the United States can find areas of cooperation, but whether they are able to accommodate their divergent interests and goals, tolerate different practical perspectives and, in the end, avoid conflict.
Although security has taken over as the United States' first priority, the Bush administration's agenda for inter-American relations has not changed much in the past two years -- and is not very different from those of Bill Clinton or George H.W. Bush. The United States remains focused on making Latin America a more compatible and productive partner by strengthening democratic politics and market economics in the region; forging hemisphere-wide free trade and investment arrangements; and encouraging cooperative action to address common problems such as terrorism, drug trafficking, and threats to constitutional rule.
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As in other Latin American countries that have returned to democracy this decade after bitter experiences under military regimes, Brazil's "New Republic" came to power with wide public support. The 1985 transfer of power from the military to the politicians went smoothly. The political and labor climate was relatively calm. The productive base of the economy was solid and business sectors wanted to give democracy a chance. Brazil had a foreign debt of over $100 billion, but huge trade surpluses made foreign creditors willing to refinance the debt. Under these circumstances the transition did not have to go badly. But it has.
The Bush administration's recent protectionist measures have attracted intense international criticism. U.S. backtracking on free trade could give other countries an excuse to do likewise. But critics should note that those measures also made it easier for Bush to win "fast-track" negotiating authority from Congress, providing the political base necessary for further liberalization.
U.S. tariff policy has evolved into something astonishingly tough on the poor, both at home and abroad. This scandalous situation would not be hard to fix.
