Latin America was very much on the agenda during the first months of the Carter Administration. During that period, visits to, analyses of and speeches about Latin America emerged from the new Administration at a rate not seen since the early days of the Kennedy presidency.1 Addressing the Organization of American States less than three months after taking office, the President spoke boldly of a "new approach" based on "a high regard for the individuality and the sovereignty of each Latin American and Caribbean nation, . . . our respect for human rights, . . . [and] our desire to press forward on the great issues which affect the relations between the developed and the developing nations."

Bold words - and now that almost two years have passed, what does the record say? To what extent have the energy and excitement of the first months been translated into policies and practices that really constitute a "new approach" to U.S.-Latin American relations? And perhaps most important, what are the new issues, problems and contradictions that have been illuminated by the Administration's attempts to translate the rhetoric of its commitment to human rights and democratic practice into a hemispheric foreign policy that is truly different from the conservatism and anti-communism of the immediate and not-so-immediate past?


If, in the early months of 1977, the Administration had been asked what its major specific policy initiatives toward Latin America had been to date, surely the response would have placed at the head of the list the decision to accelerate the negotiation of the Panama Canal treaties and the decision to explore more correct, if not actually warmer, relations with Cuba. By August, after months of intense negotiations, new treaties were in fact ready. On September 7, Presidents Carter and Torrijos met at the Organization of American States and with much pomp and circumstance signed the documents in the presence of 17 Western Hemisphere heads of state and the representatives of nine others. Meanwhile, negotiations were also underway with the Cubans, a process which culminated in the opening of U.S. and Cuban Interests Sections in Havana and Washington on September 1, 1977.

Although a revised set of arrangements for the Panama Canal was essential in order to avoid a future crisis in the hemisphere, in a very real sense the final acceptance of the treaties was not primarily an inter-American or even a bilateral affair. Rather, it was essentially a domestic event - one might even say a domestic occasion. Even before Presidents Carter and Torrijos signed the two treaties, a massive and well-organized campaign against their ratification by the U.S. Senate had begun. The ratification process triggered deeply held feelings of chauvinism, pride, and prejudice, illuminating aspects of U.S. political culture which neither in the past nor in the present have yielded easily to what some like to call "rational debate." Particularly after January 1978, the full scope of this struggle came into view. At one point in his February 1 address to the nation on the treaties, Carter felt compelled to ask, almost in desperation: "Another question is why should we give away the Panama Canal Zone? As many people say, we bought it, we paid for it, it's ours. I must repeat a very important point: We do not own the Panama Canal Zone. We have never had sovereignty over it. We have only had the right to use it." After his presentation, phone calls to the White House still ran four to one against ratification.

During these months, hundreds if not thousands of consultants, lobbyists, "truth" squads (for and against), and fact-finding missions crossed and recrossed both Washington and the country - and occasionally even the hemisphere - arguing and arm-twisting for and against the treaties. Meanwhile, legal opinions, presidential statements, amendments, and both written and verbal "understandings" were all impinging on a Senate debate characterized in an election year by even more than the usual amounts of posturing and logrolling.

Somehow the treaties survived, and in March the first and less sensitive document - concerning the neutrality and operation of the Canal - was approved in the Senate. On April 18 the Senate ratified the by then much battered and amended second treaty by a scant one-vote margin. Two months later, on a steamy day in mid-June, Presidents Carter and Torrijos met in Panama City to deliver the instruments of ratification. But the tenor of the congressional debate had deeply affected the reception of the treaties on the Isthmus. A day earlier, the Panamanian government had closed down Panama University and instituted massive security procedures to forestall protests from Panamanians who were angry and humiliated, not only by certain aspects of the treaties themselves but also by a ratification process in which Panama and Panamanians had daily been subjected to insult, abuse and charges running from gross incompetence to communism.

Whereas the initiatives on Panama survived the U.S. political process, those on Cuba did not. Faced early in 1978 with a Soviet and Cuban buildup in Ethiopia, and later with the clear involvement of Cubans fighting against Somali troops in the southern Ethiopian province of Ogaden, the Administration responded to Havana with harsh words and thinly veiled threats.2 On March 17, President Carter said pointedly that Soviet military intervention "in local conflicts" along with "mercenaries from other Communist countries" is an "ominous development." Subsequently Frank Carlucci, the Deputy Director of the CIA, told a Senate subcommittee that the Soviet Union and Cuba were waging "the most determined campaign to expand foreign influence in Africa since it was carved up by the European powers in the late 19th century." But the Administration could find no appropriate policy initiatives to match its angry words.

In this context of substantial frustration at Cuban and Soviet activities in Africa, and criticism at home and abroad for not "doing something" about it, the Administration reacted sharply in mid-May when approximately 4,000 Angola-based rebels invaded Shaba Province in southern Zaïre. Within hours, elements of the 82nd Airborne Division had been placed on alert, the first such mobilization since Carter's inauguration. Accusations that the Cubans were deeply involved in the invasion followed shortly. In his news conference of May 25, President Carter said that Cuba must share both the burden and the responsibility for the attack. Three days later National Security Adviser Zbigniew Brzezinski was warning, "I do not believe that this kind of Soviet and Cuban involvement ought to be cost free." In June, the Senate voted 53 to 29 to approve a nonbinding sense-of-the-Senate resolution calling on the President to terminate the Interests Section agreement until Cuba withdrew militarily from Africa.

Then came the Cuban reaction. Vice President Carlos Rafael Rodríguez, speaking in the United Nations, called Carter's charges of Cuban involvement "absolutely false." During June, Fidel Castro repeatedly denied Cuban involvement, explaining Cuban policies and activities in the area in great detail to journalists and U.S. officials and other visitors. It was, for many, an absurd and even depressing spectacle: the Carter Administration first accusing the Cubans of complicity in the invasion, and then of not being resolute enough in preventing it. In the end, it was Secretary of State Cyrus Vance who became the spokesman for a more moderate and conciliatory policy, but not before the Congress was both confused and inflamed by the conflicting reports. When the dust had settled at the beginning of July, senior U.S. officials were ready to admit in private that the Administration had "never had the evidence" of the Cuban involvement.

That a year which began in this fashion saw no further U.S. initiatives toward improved relations with Cuba is not surprising. But the final word had not yet been heard from the Cubans. In November, in a startling reversal of previous policies, the Cuban government announced that it was considering the release of all political prisoners and the implementation of plans that would enable tens of thousands of Cubans living abroad to return for family visits and reunions. Using the mechanism of a dialogue in Havana with representatives of the Cuban community in exile, President Castro announced at a second meeting in December that as many as 12,000 former prisoners would be allowed to leave the country if they so desired. Making pointed reference to U.S. human rights rhetoric, Castro said that it was now up to the United States to demonstrate that it cared as much about the fate of these persons as it had been claiming all along. As the year ended, U.S. officials were still seeking appropriate responses to the Cuban initiatives. At the same time, they were attempting somewhat weakly to explain why Cubans now seeking entry to the United States were being screened so slowly and carefully by authorities who only a few years earlier had welcomed exiled Cubans to the United States by the hundreds of thousands.

While Panama and Cuba had been on the Administration's agenda from the outset of the presidential campaign, the same cannot be said of Latin America's two largest nations, Brazil and Mexico. The President had, it is true, criticized the 1976 memorandum of understanding that had suggested a special U.S.-Brazil relationship; and Mexico's President José López Portillo had been the first foreign head of state to visit the White House after Carter's inauguration. But it could hardly be said that the new Administration had specific Mexican or Brazilian policies in mind beyond a rather diffuse commitment to "pay attention" to the bilateral relationships.3

In 1977, in fact, serious problems arose in U.S.-Brazilian relations as the Administration pursued policies - in the areas of nuclear nonproliferation, human rights, trade and tariffs - that on numerous occasions offended Brazilian sensibilities and interests. But the major fumble of the year took place much nearer home. In October 1977, after signing a letter of intent with potential U.S. purchasers, the Mexican government began to construct a gas pipeline from its southeastern fields to the Texas border. Shortly thereafter it became clear that Mexico's price - which gas transmission companies in the United States were quite willing to pay - was thought by the Administration to be too high given the ongoing domestic energy debate and other factors. In December the potential gas deal was turned down in particularly loutish fashion by U.S. officials, angering and embarrassing their Mexican counterparts in the process.

By the middle of 1978 it was obvious to many members of the foreign policy community in the United States, including some members of the Administration, that U.S.-Mexican relations merited much closer attention. In part, the sharply escalating estimates of Mexican petroleum reserves were responsible for the new-found interest. Of perhaps equal importance, however, was a growing preoccupation with the increasing numbers of undocumented Mexican workers crossing the border. Earlier, a hastily assembled package of legislation intended to reduce and control the inflow of migrants had been presented by the Administration. Despite strong backing from certain sectors of organized labor, however, it was soon evident that the package stood very little chance of congressional approval. A powerful coalition of Chicanos and Hispanics, civil rights activists, and businesses that employ low-cost Mexican labor was arrayed against it. Furthermore, the Mexican government, needing the safety valve represented by the export of the un- and underemployed, let it be known that it would not look kindly on a more closely guarded border.

With so much oil, so many people, so many problems, and a 2,000-mile frontier with the United States, Mexico was a natural candidate for high-level bureaucratic attention in Washington. In fact, in October when it became known that the U.S. government was preparing a Presidential Review Memorandum (PRM 41) on U.S.-Mexican relations, the big unanswered question was why this initiative had taken so long. But no amount of memorandum writing can change the fact that an easy consensus will not be forthcoming on such contentious issues as undocumented workers, trade and tariff policies, energy relations, and, not least of all, the U.S. role in alternative development scenarios for a Mexico that will double in population in the next 20 years, that is currently unable to employ one-third of its labor force, and that has one of the most unequal distributions of income in the world.

Brazil, unlike Mexico, was not seen as a prime candidate for high-level U.S. attention in 1978 despite Carter's whirlwind April stopover on his way to Africa. With relations on a more even keel than they had been a year earlier, there was a lessened sense of urgency in Washington toward the nation with the largest gross domestic product in the developing world. It was the Brazilians themselves who generated the big story of the year - the seeming anomaly in November of a hard-fought election in the context of what is still a military dictatorship. Almost 46 million people went to the polls, handing the government party a resounding defeat in the more modern and urban sections of the nation. Although the electoral system was openly rigged to generate governmental majorities at the national level, the message was clear: a repudiation of much of what the military has stood for and a mandate to continue and even accelerate the political opening of the recent past.

Both the Brazilian elections of November and the Venezuelan presidential elections of December seemed a hopeful and democratic note on which to end the year. Additionally - particularly in the Brazilian case - they seemed to vindicate the Carter Administration's human rights initiatives in the hemisphere. Although few U.S. officials would have been foolish enough to claim that the Administration was instrumental in creating the still-fragile political opening in Brazil, human rights advocates took comfort from the fact that Carter and his advisers were much more supportive of such tendencies than previous administrations. But elections are not the core of human rights concerns, nor is Brazil necessarily either the benchmark or the bellwether of Latin America.


The blue-ribbon private Commission on U.S.-Latin American Relations, chaired by Sol Linowitz and thus known popularly as the Linowitz Commission, issued its second and final report on December 20, 1976, exactly one month before Carter took office. The timing was not casual, nor were its opening words in the section on human rights: "Latin America is suffering from a plague of repression." The Commission did not exaggerate. At no time in the recent history of the hemisphere had the incidence of military rule been so high, the gross violations of political and individual rights so widespread, and the use of officially sponsored assassination, torture and brutality so systematic.

From the outset, the Administration's policy initiatives in the human rights area were deeply conditioned by congressional actions already taken. Led by House and Senate Democrats reacting against the aid, comfort and support given to some of the most repressive governments in the world by all postwar administrations, the Congress in the mid-1970s mandated a series of mechanisms for the review and possible termination of both military and economic aid to governments engaging in gross and systematic violations of human rights. The key question was to what degree would the Carter Administration live up to the letter and spirit of this body of domestic legislation and the more diffuse but nonetheless significant obligations embodied in the relevant body of international law and practice?

Precisely because Latin America was, in global terms, not a high security area, and because gross violators such as Chile were a substantial embarrassment to U.S.-Latin American relations, the new Administration moved quickly to implement parts of the legislative mandate. On February 24, 1977, Secretary of State Vance announced to a Senate subcommittee that the Administration had decided to reduce or eliminate foreign aid to three countries - Argentina, Uruguay and Ethiopia - because of human rights violations. The amounts involved were not large, but symbolically the initiative was important, for it marked the end of an executive branch undercutting of legislative intent, as well as a partial declaration of independence by the Carter Administration from past U.S. policies. The Brazilian government, already forewarned that the cuts were coming, announced in March of that year that it would not accept $50 million in U.S. military sales credits. The official reason was that the U.S. government had prepared a human rights report which was "a violation of the principle of noninterference." Argentina, El Salvador, and Guatemala soon followed suit in rejecting military aid.

What was clear by 1978, however, was that there were sharp limits to what could be accomplished by various mixes of carrots and sticks applied to the more repressive governments in the hemisphere. Argentina is a case in point. There was little question that the Argentine military junta qualified as a gross violator of human rights under existing legislation. In 1978, for example, Amnesty International estimated that in addition to those known to have been imprisoned, tortured, or killed, more than 15,000 Argentines had simply "disappeared." Given this record, Congress halted all military assistance and commercial military sales to Argentina as of September 30, 1978. Earlier in the year, the Administration had also voted against three loans sought by Argentina through the Inter-American Development Bank (IDB) and had abstained on several more in the IDB and the World Bank. Additionally, earlier in the summer, a $270 million Export-Import Bank credit for the purchase of turbine generators had been held up.

By this time, however, the business community in the United States was up in arms. "You have no idea of the pressure," said one State Department source. Evidently the pressure was effective, for by the end of the year the Administration had not only approved many of the previously prohibited commercial military sales, but the Export-Import Bank credits had been released after the Argentine government pointed out that it was ready and able to purchase the generators from non-U.S. suppliers backed by European or Japanese credits.4 Meanwhile, there was no palpable improvement in the human rights situation in Argentina, and the Administration was faced with the somewhat embarrassing situation of having run out of sticks while watching its carrots being eaten by the junta without any noticeable effects on its behavior.

The human rights activities of the Administration were not, however, limited to attempts to pressure some of the gross violators into more acceptable forms of political behavior. Perhaps equally central to the White House was an attempt to identify the United States with nominally democratic forms of governance in a hemisphere ruled overwhelmingly by the military. Thus the clear cooling of relationships with the Pinochet government in Chile was matched by a search for more conciliatory relations with the democratic, Left-nationalist governments of the Caribbean basin, in particular Jamaica. In this context it was not by accident that the second Latin American head of state invited to Washington was Carlos Andrés Pérez of Venezuela, a country that the previous Administration had viewed as too strongly supportive of Third World nationalism.

Subsequently, a crucial aspect of this attempt to identify the United States with formal democracy in the hemisphere was found in official support for elections. In this respect, 1978 was a vintage year. Major elections were held in nine Latin American countries outside the Caribbean. These ran from the total sham of General Alfredo Stroessner succeeding himself as President in Paraguay, to the controlled but nevertheless significant elections in Brazil, to the hotly contested presidential elections in Costa Rica and Venezuela.

It is in this context that the Dominican Republic election of May 1978 and subsequent U.S. actions take on special significance. While the ballots were still being counted, the Dominican military moved to halt the electoral process after it became clear that presidential candidate Antonio Guzmán would defeat the more conservative incumbent, Joaquín Balaguer. Immediate and sharp protests from the United States, coupled with a generalized protest from the more democratic governments of Latin America and Europe, helped preserve Guzmán's victory. There were evident historical ironies in these events: the man Guzmán had defeated was none other than the U.S.-blessed three-term ruler of the nation - its only elected President since U.S. armed forces invaded the Dominican Republic in 1965. And Secretary of State Vance, heading the U.S. delegation to Guzmán's inaugural, had 13 years earlier, as Deputy Secretary of Defense, visited Santo Domingo as a member of the U.S. team seeking an "acceptable" solution to civil war and the U.S. occupation.

In a way, this was the high point of the year for the Administration's human rights efforts in Latin America. Using relatively conventional and acceptable instruments of diplomacy, the United States intervened on the side of the angels. The issue was clear: a military subversion of the electoral process was taking place. The alternative outcome was fully acceptable to almost all sectors of U.S. opinion: Guzmán, although to the left of Balaguer, was at most a reformist candidate. The necessary policy leverage was at hand: the Dominican armed forces and the die-hard opponents of Guzmán were hardly in a position to stand up to a U.S. government which had, for years, been their trusted supporters.

If the Dominican Republic proved an easy case, Nicaragua proved to be quite the opposite. At three specific moments during 1977 and 1978, the Carter Administration was given opportunities to define its position with substantial clarity vis-à-vis the Somoza dynasty - and each time the response was less than vigorous. First, on taking office and articulating its human rights policy, the Administration could have defined Nicaragua as a top priority. The level of Somoza-led repression was quite high enough to qualify for attention, and the historic and shameful role of the United States in creating and sustaining the dynasty made Nicaragua a key test for an Administration claiming to be different from its predecessors. Instead of seizing this opportunity, however, the Administration took a cautious, bureaucratic, business-as-usual approach. Given the long-standing intimacy of official U.S. relations with Somoza, this was tantamount to continuing support for the dictatorship.

Then, in January 1978, after the assassination of Pedro Joaquín Chamorro, editor of La Prensa and the most widely known moderate anti-Somoza leader, the opposition coalesced into an extremely broad band of religious, civic, business, and traditional political organizations as well as the armed Sandinista National Liberation Front. But the United States again hung back, choosing to use mild and conventional diplomatic measures to urge Somoza to improve his human rights record. In fact, in July, responding to some cosmetic changes in Managua, President Carter sent a letter to Somoza congratulating him on the progress being made. Although the text of the letter has never been made public and the Administration claims that it was not a letter of support, a private letter from Carter to the Nicaraguan tyrant at that point was naturally interpreted as an attempt to prop up the dynasty.

In late August the Sandinistas struck against the dynasty in their most audacious and successful armed action to date: the taking of the National Palace. For the next weeks, the world witnessed what one observer called a national mutiny, clearly inspired but not always directly led by the Sandinistas. It was literally the revolt of the Nicaraguan people against the dynasty and the National Guard: citizens at the barricades, government armored cars, artillery, and airplanes loosed on the cities, troops dragging young people from their homes and shooting them in the streets, the Red Cross entering still smoking towns to burn the bodies lest disease spread.5 Yet even after it became clear that a Somoza bent on maintaining himself in power was quite capable of unspeakable crimes against his own people, Washington's response was still cautious and "evenhanded," accompanied by endless explanations to the effect that the United States did not wish to intervene.

How is this timid, too-little-too-late approach of the Carter Administration to Nicaragua to be explained? Bluntly, a continuation of cold war attitudes and policies is at the root of the explanation. Stated most simply, the fear is that should Somoza be overthrown, the National Guard restructured, and the Sandinistas incorporated fully into a post-Somoza government, the door may be open in Central America to Cuba and the Soviet Union. From outside the Administration, particularly in the pro-Somoza lobby led by Congressman Charles Wilson of Texas, a more primitive vision predominates. There, following Somoza's own line to the letter, the choice is baldly put: either Somoza or another Cuba.6

For the more perceptive members of the Administration, the resulting policy dilemma is cruel. In the context of a professed human rights commitment, continued support for Somoza is not possible. Yet neither is any solution that might smack of "losing Nicaragua to the communists." The chosen avenue out of this dilemma has been to push hard for a process of mediation between Somoza and the opposition, a process which began in October with the participation of the United States, the Dominican Republic and Guatemala. The expressed purpose of the mediation is to achieve "an enduring democratic solution," by which is meant some sort of electoral replacement of Somoza with minimal participation by the Sandinista movement. The preferred mechanism is a national plebiscite, currently scheduled for February 1979.

But in fact, if not in form, the mediation, as of the end of 1978, has already failed, for the opposition groups that have tentatively agreed to the plebiscite do not include either the Sandinistas or their civilian supporters; and it is difficult to imagine that any mechanism not supported by the most broadly based opposition force in Nicaragua has much chance of issuing in "an enduring democratic solution." In fact, as should have been clear from the outset, the minimal institutions of a democratic political order do not come easily into being in a country ruled for more than 40 years by one family, the sword, the dollar, and every imaginable form of graft and venality. What Nicaragua has also demonstrated is that when a popular struggle against despotism gets located within a cold war framework, the Administration's commitment to human rights will almost inevitably be subordinated to the maintenance of U.S. influence and control.


The dilemmas, successes and failures of the Administration in the human rights area are properly viewed as the complex result of multiple forces at work both in the United States and abroad. This is well understood with regard to the first two categories of human rights used by U.S. authorities in assessing the performance of other governments: the rights of the person, understood as freedom from torture, cruel, inhuman or degrading punishment, arbitrary arrest or imprisonment; and the rights to civil and political liberties, understood as freedom of thought, religion, assembly, speech, and the press. There is, however, a third category which has proved to be much less viable both as a criterion with which to assess the performance of other governments and as a guide to policy actions in the human rights field or in foreign relations more broadly conceived. This is the category of economic and social rights, understood as access to food, shelter, jobs, health care, and education.

Yet to understand U.S. policy toward Latin America, the limits thereof, and the full implications of the current wave of violations of the rights of the person and civil and political rights, this third category is essential. It is essential precisely because it is not a high priority concern of U.S. policy in Latin America - nor could it possibly be without a reordering of priorities so massive as to be unimaginable under current circumstances.

To illuminate this problem, we need to review rapidly the realities of Latin American economic and social structures. Despite very significant national differences, several generalizations can be made.7

- Aggregate economic growth in Latin America over the past decade has been above world averages. The per capita income in the region now exceeds $1,000. As an integral aspect of the kind of economic growth that has been taking place, Latin America has become predominantly urban, the work force increasingly proletarianized, and the more dynamic sectors of the economy linked more than ever before to international capital. Increasingly, growth is export-led, implying that questions of trade, tariffs and technology are critical to continued expansion.

- The actual situation with respect to income distribution and social equity is, in general, appalling. Fifty percent of the region's citizens have incomes of less than $200 per year; one-third receive less than $100. The top five percent of the population controls one-third of the total income. The emphasis on industrialization and export-led growth almost everywhere reinforces and accelerates the neglect of agriculture - at least agriculture in basic food-stuffs for domestic consumption. Large sectors of the countryside and those who live there are neglected. In the countryside - as well as in the fringe and slum areas of the cities - high infant mortality, high levels of illiteracy, and abominable housing are the norm. Although the statistics are in dispute, the situation of the poorest one-quarter or one-third of the population may actually be worsening - a situation exacerbated in certain countries by rapid population increase. Certainly the gaps between those who profit from growth and those who do not are widening. A short walk through the poor areas of almost any city in Latin America will reveal the human meaning of these statistics.

- Related but not identical to income distribution and social equity issues is the problem of unemployment. In some countries as many as one out of three persons in the working-age population is unable to find a job of any sort. Given the capital-intensive nature of much current development in Latin America, and the relatively high birth rates in at least some countries, unemployment rates are expected to rise even under conditions of "satisfactory" economic growth. Emigration, particularly from Mexico and the Caribbean, is rooted in this situation, although obviously it has multiple causes.

- The kind of development that has taken place is reflected in the structure of external indebtedness. Current estimates are that the countries of the region now owe approximately $80 billion in public and publicly guaranteed debt alone. Brazil and Mexico together account for well over half of this total, with significant amounts held by Argentina, Chile, Peru, Colombia and Venezuela. Increasingly, there has been a shift from public to private creditors. As a concomitant of this shift, more stringent terms are now the norm, with interest rates higher and maturities shorter than they were a few years ago. Needless to say, the less "confidence" the international banking community has in a borrower, the harder the terms. So massive is the overall indebtedness of the region that service payments on the debt are now running to about 40 percent of export receipts. In several countries - Peru and Jamaica being the most dramatic cases - the primary political-economic issue of the day is how to repay this still-accumulating foreign debt.

- The Latin American state is everywhere involved in economic development and management. It is usually the prime borrower abroad, often an important investor at home, frequently a chief partner of foreign capital, and always a source of regulations on everything from wages to import quotas. State capitalism has come to Latin America with a vengeance, and even the governments that claim to give the freest play to market forces are in fact constantly intervening to establish the rules under which "free markets" will be allowed to operate.

The above sketch of Latin American development aids in understanding the nature of contemporary authoritarianism. To follow only one thread of the argument: with indebtedness so high, with international confidence the key factor in securing new loans, with exports seen as a major engine of growth and the essential key to repaying debt, with unemployment at near record levels, and with inflation still a problem, the stage is clearly set for a government-led assault on workers and workers' organizations.

The linkages are complex, but very largely determine the public policies that will be followed. Creditors want to be paid in dollars or in other international currencies. The international financial institutions are critically concerned with the debtor country's balance of payments. A sharp increase in exports - acknowledged to be the best way to achieve a more favorable balance and repay the debt - is very difficult to achieve in the short run. Also difficult to accomplish is a dramatic increase in capital inflows - except by borrowing even more.

This leaves imports as a natural target for those who would save hard currency. But in order to cut imports - or at least that sector of imports that is least important to ruling elites, economic managers, and most national and international businessmen - mass consumption must be restricted. Since quotas and tariffs are seen as inappropriate policy instruments, to a large extent consumer demand must be managed through restrictions on the real purchasing power of wage earners - and increases in unemployment.

When coupled with cutbacks in government expenditures (typically in public works and welfare-enhancing subsidies), a huge proportion of the adjustment burden is thus transferred to the working class. In an inflationary economy, the proportional burden is even greater. Needless to say, where minimal possibilities of political expression exist, this kind of adjustment medicine does not go down easily. Repression of trade unions as effective organizations and workers as individuals is in this sense "necessary," both for those in charge of managing the economy and for their friends and allies abroad.

Many of these same persons may decry the extreme and brutal measures used in countries such as Brazil, Uruguay, Argentina, Bolivia and Chile to establish and maintain control over the labor movement and to hold wages well below the inflationary spiral. Some may even take comfort in the fact that, once the most extreme measures have been used, a partial relaxation of control seems possible at a later date. But minimal honesty requires that the repression in both its physical and financial dimensions be seen as an organic aspect of what is now the prevailing mode of economic development in Latin America. Social and economic human rights do not fare well in such an environment.

Optimists believe - and they may well be correct - that the current plague of military-led repression in Latin America has peaked. The Brazilian and Chilean governments, for example, are both less overtly repressive today than they were a few years ago, with a true political opening seemingly underway in the former if not the latter. Certainly the net gain in dignity and well-being is immense when torture and imprisonment stop or are significantly reduced. It is to the credit of the Carter Administration that it has supported this trend.

The policy dilemmas embodied in the question of economic and social rights and the developmental dynamics sketched above are, however, resolved only very partially by a movement toward formal democracy. The dominant realities of social and economic conditions in the hemisphere remain unchanged even if the military go back to the barracks and the torturers are punished or simply move on to more congenial environments elsewhere. If the history of modern Latin America teaches no other lesson, it should now be clear that the combination of formal democracy (rare enough in the hemisphere) and late-industrializing capitalist economies has not and probably cannot significantly reduce the appalling inequalities in economic and social conditions referred to above.

In U.S. policy circles, this key fact of hemispheric life is not understood. For most, a false but comforting historical analogy between Latin America and the United States and Western Europe is still pervasive: in advanced industrial states it is substantially true that government policies have in part cushioned and aided those citizens most hurt by the operation of social class and the economy. For example, in theory and often in practice, public education gives most children a chance to learn and advance; systems of taxation reduce income differences and allow governments to deliver benefits to those who cannot purchase them in the marketplace; minimum wage and working conditions, enforced by the state, protect labor from the most ruthless aspects of exploitation. More generally, in this kind of system, the primary function of capitalist economics is seen as the generation of capital and aggregate growth, while the political process is supposed to assure movement toward equity in distribution and opportunity.8

Whatever its flaws in practice, a substantial argument in favor of the partial functioning - and self-corrective dynamics - of this model can be made for the United States and Western Europe. In Latin America, on the other hand, even allowing for different levels of development, no such case can be made. On the contrary, what has evolved in Latin America (and by implication in some other areas of the Third World) is a political-economic model that has no historical precedent in the now more developed capitalist world. For lack of a more concise phrase, this model can be called illiberal state capitalism, a situation in which state intervention in the economy is substantial, but governmental policies tend to reinforce rather than soften or ameliorate income inequalities, class distinctions and regional disequilibria.9

Often this illiberal state expresses itself through a seeming inability to act. Thus, even as nominally democratic a government as the Venezuelan, which has the added advantage of substantial oil revenues, has not been able to make significant inroads on problems of unemployment and rural impoverishment. Nor can the Mexican state, much favored by decades of stability and high levels of technical capability, accomplish a meaningful fiscal reform in order to correct one of the most regressive tax systems in the hemisphere. At other times the illiberal content of official policies is much more direct. For example, the once Left-leaning Peruvian military has increasingly undertaken wage and price policies that shift the burden of adjustment and debt repayment disproportionately to the poor and now even to the middle class. And in more repressive settings no pretense is made of using state power to help those who are left behind in the struggle for betterment and, at times, survival. There, even the rhetoric of liberalism has disappeared.


Here, then, is the heart of the policy dilemma that faces the Carter Administration: even if the worst excesses of torture and the denial of civil and political liberties are reduced in the hemisphere, the majority of the region's citizens will continue to live lives of poverty and much reduced opportunities, while a minority will continue their progress toward Western standards and styles of life. Admittedly, it is not within the power of this or any other U.S. Administration to redress these inequalities or to eliminate poverty in the hemisphere. This continues to be the responsibility of Latin Americans themselves and continues to imply the need for profound structural changes in politics and economics.

But it is precisely at this point that the Administration can be held accountable for its behavior toward Latin America and can be judged severely. Without doubt the overall political record of the Carter Administration is better than its immediate predecessors: by speaking the language of human rights, the Administration has helped to create some space for political opposition in the hemisphere.10 By seeking a modus vivendi with the existing Left-nationalist, English-speaking Caribbean states - in part, of course, to prevent them from moving further to the Left and closer to Cuba - a willingness to bargain with the Left rather than simply oppose or subvert it has been displayed. By moving on the Panama Canal treaties when it was clear that domestically there was perhaps more to lose than to gain, the White House has validated its disposition to run some risks and adjust to changing international realities.

But none of the above really addresses the basic developmental and foreign policy dilemmas of this hemisphere - and by extension of the Third World and the United States more generally. One cannot, for example, honestly claim to be interested in supporting significant improvements in economic and social rights without at the same time being willing to accept and even support much more radical, nationalist, and potentially "anti-American" politics and economics than this or any other Administration has been willing to countenance. One cannot continue to subscribe to and even celebrate banker's rules in public and private international capital markets that operate to deepen indebtedness, repression and inequality while at the same time claiming that one has policies designed to address basic human needs and encourage democracy.

The choices implied are difficult and the costs are necessarily high. Neither the national security community in the United States nor many elements in the business community would look with favor on U.S. policies that were clearly tilted toward social and political forces on the Left of the hemisphere's political spectrum. Even policies implying substantially greater sympathy for groups identified more closely with popular aspirations - such as certain elements within the Roman Catholic Church - would not be easy to implement. But in the long run, if the commitment to social justice in the hemisphere is to be meaningful, nothing less will do.

When viewed from this perspective, the Carter Administration, although substantially more civilized than its predecessors, is hardly more innovative or insightful. It is an Administration that has failed, or is unwilling, to understand that the old forms of political and economic organization are unable to deliver minimally acceptable conditions of life to millions of persons south of the border. It is an Administration that still views popular movements and protests through the lens of the East-West conflict. It is an Administration that apparently refuses to face up to the fact that what is good for U.S. business and security interests, as conventionally conceived, may in fact be quite disastrous for human rights.

That such contradictions are not easily addressed, much less easily resolved, through existing policy instruments is obvious. So, too, is the fact that the contradictions are not exclusively regional nor are the issues raised amenable to regional solutions. But it should be remembered that it was the President himself who introduced the human rights theme into both his campaign and his Administration. This carries with it an obligation to seek policies and opportunities, scarce as they may be, through which to align oneself with those social forces and political movements that are not only against authoritarian rule, but clearly in favor of the economic and social rights of the majority. A human rights commitment in foreign policy can mean no less.


1 Throughout this article, the phrase "Latin America" should be understood to include Latin America and the Caribbean.

2 For background, see Jorge I. Domínguez, "Cuban Foreign Policy," Foreign Affairs, Fall 1978.

3 See Albert Fishlow, "Flying Down to Rio: Perspectives on U.S.-Brazil Relations," Foreign Affairs, Winter 1978/79; and Richard R. Fagen, "The Realities of U.S.-Mexican Relations," Foreign Affairs, July 1977.

4 As pointed out by Karen DeYoung and Charles A. Krause, the "halt" of commercial sales of military equipment was never more than partial because of very intensive lobbying by arms suppliers. See "Our Mixed Signals on Human Rights in Argentina," The Washington Post, October 28, 1978, p. C-1.

5 For ample documentation, see Inter-American Commission on Human Rights, Report on the Situation of Human Rights in Nicaragua, Organization of American States, Washington, D.C., November 1978. An Amnesty International press release dated November 20, 1978, reported that in October Nicaraguan refugees returning from Honduras were being detained and summarily executed by the Nicaraguan National Guard.

6 The "true" nature of the Sandinista movement and thus the real nature of the choices, although not entirely clear, is certainly not as portrayed by Wilson and other hard-liners. It is suggestive of the quite different perspectives on the Nicaraguan struggle held in Latin America that the Sandinistas are explicitly or implicitly supported by just about every civilian government in the hemisphere. For additional support of this interpretation see Richard R. Fagen, "The Meaning of Nicaragua: The Hard but Necessary Choices," Testimony before the Subcommittee on Western Hemisphere Affairs of the U.S. Senate Committee on Foreign Relations, October 4, 1978.

7 Several of these generalizations are less applicable to the smaller and less-developed nations of the region, although they suggest the direction in which these nations are most likely to head if they are "successful." Cuba, with its very different developmental situation, should be excluded from this characterization. In that sense Cuba is "outside" the region.

8 For a clear general statement of this position see Arthur M. Okun, Equity and Efficiency: The Big Tradeoff, Washington, D.C.: The Brookings Institution, 1975.

9 Elsewhere I have sketched the functioning and the "logic" of illiberal state capitalism in the Third World, including its relationship to capitalism in the more developed countries. See "Equity in the South in the Context of North-South Relations," Albert Fishlow, et. al., Rich and Poor Nations in the World Economy, New York: McGraw-Hill, 1978.

10 This contrast is most clearly embodied in policies toward Chile, where the Carter Administration has been actively hostile toward the Pinochet government. For background, see Richard R. Fagen, "The United States and Chile: Roots and Branches," Foreign Affairs, January 1975.

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  • Richard R. Fagen is Professor of Political Science at Stanford University and former President of the Latin American Studies Association. Valuable assistance in the preparation of this article was provided by Ms. Cynthia Arnson.
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