Ordinary Asian street with a set up for a puppet theater. Photo: File photo.
By Claudio Katz – Mar 23, 2023
The United States is losing economic primacy in Latin America in the face of the overwhelming presence of China, unable to find recipes to counterbalance this influence that threatens its traditional domination.
The domination of the United States over Latin America has no equivalent in other parts of the world. In no other area has it maintained such direct control with such sustained interventions. It has always considered the region as a simple extension of its own territory.
Because of this singular gravitation, the retreat of the first power south of the Rio Grande is illustrative of the crisis of American power. Washington is losing ground in its old fiefdom at a staggering rate.
The evidence of this decline in economic terms has been overwhelming after the failure of the FTAA. The failed commercial and financial integration of the entire region under its control affected a traditional market of US capitalism. That failed project was not replaced by any other plan of the same scope. Bilateral treaties failed to produce the expected results and the old desire for Pan-American supremacy was shelved.
This economic adversity extended to the geopolitical-military plane. The erosion of US leadership was not reversed in the last two decades with greater deployment of the Southern Command, the IV Fleet, the bases in Colombia or the presence of the DEA, the CIA, and the FBI. The White House could not repeat the occupations of Grenada (1983) or Panama (1989). It reinforced the blockade of Cuba and tried out plots against Venezuela, but was unable to rebuild the OAS or organize the continental counter-coup that the Lima Group was hoping for.
The same setback is corroborated at the ideological level. The “American dream” no longer dazzles as it used to. The exaltation of pure capitalism persists, as well as the adulation of business or the idealization of competition, but the US reference lost its traditional and exclusive centrality. The difficulties faced by the economy of the North discourage the apologies of the past. The increase in inequality also makes the identification of the US political system with the welfare of the majorities implausible.
The old image of the United States as the protector of the continent is also losing followers. Only for decreasing sectors of the regional elites does it continue to embody the common values of humanity. Washington’s international intervention is no longer seen as the only antidote to chaos. It is clear that the Marines intervene only to ensure the profits of a capitalist minority in the North. This general revision of the role of the United States has been precipitated by the impetuous arrival of a new external player.
Failures in the face of a surprising challenger
China’s explosive expansion in Latin America corroborates the deterioration of US domination. The Asian giant does not have the competitive profile of Europe or Japan, which on different occasions made unsuccessful incursions into the region controlled by Washington. During the second half of the 20th century, these interventions were always restricted to certain branches of the economy and never threatened the general primacy of the major power.
The arrival of China presents another dimension and introduces an unprecedented wedge in the entire Latin American region, which the dominators of the North contemptuously referred to as their “backyard.” The speed of this Asian penetration is unprecedented. It began in the commercial sphere through operations that escalated at an annual rate of 26%. The volume of this trade jumped from $18 billion (2002) to $450 billion (2021). China has now become the main partner of Argentina, Brazil, Chile, Peru, and Uruguay and the second largest partner of Mexico and Colombia (Quian; Vaca Narvaja, 2021).
Beijing’s initial interest was focused on the acquisition of raw materials. It wagered on ensuring its supply of raw materials in the region that harbors the largest reserves on the planet. It openly challenged the Yankee custodian of these riches. Latin America is home to 40% of the world’s biodiversity, 25% of the world’s forests and 28% of the world’s water sources. It also has 85 % of the known deposits of lithium, 43 % of copper, 40 % of nickel and 30 % of bauxite. China has taken note of this wealth to sustain its extraordinary growth.
This onslaught reproduces in Latin America the expansion of the Eastern giant in the rest of the world. But in this case, it directly undermines the preeminence of its main rival in a territory of long-standing US. primacy. Washington’s surprise has been overwhelming and the establishment has not been able to define a counter-attack in the face of such a challenge. It never imagined that the Asian advance could reach this dimension in its own domains.
China took advantage of the failure of the FTAA faced by Bush and Obama’s hesitation in dealing with free trade to introduce its agreements in the region. By this means, in just 20 years, it managed to occupy a place very close to the United States in the whole area.
Trump attempted a virulent protectionist reaction. He froze the multilateral path, adopted the agenda of the domestic Americanist sector and sought to recapture the old captive markets. But his mercantilist gamble did not work either. He did not reverse the US trade deficit with China, nor did he improve the US surplus with Latin American clients.
The tycoon only gained some breathing space with a renewal of the agreement with Mexico (TMEC), which left US firms satisfied and ensured the enormous profits of the factories. He also introduced barriers to German and Japanese companies trying to penetrate the Northern market. He also vetoed the attractive agreements that China has been offering Mexico for the past twenty years.
But these achievements failed to compensate for the loss of space to Beijing throughout the continent. The United States was unable to expand its T-MEC model to the rest of Central America and the Caribbean. Nor was it able to prevent governments closely aligned with the West from extending their agreements with China.
This economic failure had political correlates. Trump’s counter-offensive to align the region’s right-wing presidents with Washington failed to have a significant effect on business. In no case did it induce the region’s ruling classes to curtail their exchanges with Beijing.
The adversity facing the United States becomes apparent in a comparison of Trump’s administration with his predecessor Nixon. To confront the challenge created by the renewed competitiveness of the German and Japanese economies, in the 1970s, the Republican leader ordered the non-convertibility of the dollar and a sharp rise in tariffs. He made a pact with China to separate it from the USSR and compensated for the defeat of Vietnam with the success of his partner Pinochet in Chile and with the counter-offensive of his Israeli appendage in the Middle East.
In contrast, all of Trump’s geopolitical initiatives were inconsistent, timorous and reversed by his own management before achieving any results. He vacillated in the trade war with China, exhibited countless vacillations vis-à-vis Russia, combined diatribes with inaction vis-à-vis Korea and Iran, and failed to impose his militarization demands on Europe. This contrast vis-à-vis Nixon offers another indication of America’s current backsliding.
The Failed Counteroffensive
The United States no longer resorts to free trade offers to curb China’s expansion, since it is unable to compete with its rival in this field. Tariff-free trade has always been the banner of the most competitive economies. It became the great emblem of London in the 19th century, of Washington in the last century and of Beijing today.
The United States only adopted this principle when its economy began to buckle its competitors. At that point, the isolationist sectors lost out to their globalist peers, who imposed the liberalization agenda.
In Latin America, this course was anticipated by Pan-Americanism and subsequently extended with trade liberalization programs. At the end of World War II, the flag of free trade was associated with a US economy that tripled the GDP of the USSR, quintupled the productive volume of Great Britain and was home to half of the world’s industrial activity (Anderson, 2013: 97-102).
The decline of this productivity was first perceptible in the face of the rebuilt economies of Japan and Germany and has now been made transparent by the rise of China. The competitiveness of the Asian giant explains its fervent defense of trade deregulation at the Davos Summits. The formal fidelity to this ideal in the bulk of the West contrasts with the real promotion of this goal by the new epicenter in the East.
The failure of Trump’s protectionist response to this dilemma led Biden to try Keynesian instruments to even the race with China. He came to the White House with New Deal rhetoric and bold proposals for more government spending, to rebuild revenues and shore up infrastructure investment. He promised to reverse tax cuts and penalize tax havens to raise the resources needed to revive the US economy.
Biden did not take up Obama’s multilateralism, nor the free trade initiatives of his globalist predecessors. He only attempted some approximation to that course, in order to ignite the engines of the American resurgence. But that strategy did not get off the ground in the first biennium of his term.
His package to increase public spending obtained much less than expected in Congress, in the face of the Republicans’ rejection and the objections of his own bench. First the pharmaceutical lobby blocked any restrictions on the patent empire, then big business vetoed improvements in social benefits and tax increases. Then the bankers objected to expanded public spending, and finally the oil companies obstructed the take-off of a green economy.
All the initiatives for environmental financing, increased health care and progressive taxation have been transformed into disjointed conventional stimulus packages. The Keynesian revival also has to contend with the new inflation scenario that followed the pandemic and the renewed military spending introduced by the Ukrainian war (Tooze, 2022).
China-Latin America and Caribbean Ties To Enter New Era of Equality, Openness, Mutual Benefit
This brake obstructs the delayed relaunching of the transatlantic and transpacific trade projects, which the United States is keeping undefined. The blockage faced by these initiatives confirms the stalemate of the first power. The international primacy of the dollar, the advantages in high technology and the gravitation of the Pentagon do not provide sufficient support for disputes with China. For this reason, Biden is unable to reverse the continued advance of the Eastern dragon in Latin America.
The region’s ruling classes are redoubling their business dealings with China, in defiance of all Washington’s pressures to obstruct those ventures. Biden is repeating the failure of his predecessor, who was unable to break that partnership. Trump’s two dauphins in the region – Macri and Bolsonaro – only feigned initial steps to distance themselves from Beijing.
These attempts were abandoned when the exporters of both countries demanded to preserve their huge sales to China (Lo Brutto; Crivelli, 2019). The delay introduced by Macri in the infrastructure works financed by Beijing and Bolsonaro’s flirtation with Taiwan were neutralized by the demands of large local capital.
That continuity in the financial and commercial relationship with Beijing is the pragmatic response of the Latin American ruling classes, to the absence of compensatory offers from the United States (Fuenzalida, 2022). Trump simply got angry with Argentina, Jamaica, Panama and Colombia, after demanding ruptures without compensatory offers of any kind. Biden modified the rhetoric, but seeks to recreate the same US patronage with little complementary support.
His international tax project exemplifies this fragility of proposals for Latin American partners. The initiative penalizes tax evasion by means of a new tax rate on large companies based in tax havens. But since this tax would be levied taking into account the location of the headquarters (and not the production sites), the 100 billion dollars it would contribute to the treasury would be entirely pocketed by the economies of the center. Washington would obtain a new flow of funds, with resources largely generated in Latin American territories (Página 12, 2021). Biden maintains the old tradition of shearing that region, but without slowing down the expansion of a rival that negotiates with all the local capitalists of the “backyard”.
The Silk Road in the region
The battle for economic supremacy in Latin America is also being fought in the field of international megaprojects. China is embarking on forging a gigantic belt of infrastructures, ports and routes, already involving 145 countries that are home to 70% of the world’s population and 55% of the world’s gross domestic product. The Silk Road involves 8,000 billion dollars in loans and surpasses the reconstruction plans that followed World War II.
This colossal undertaking is progressing amidst the stormy tensions caused by war, inflation and the supply shortage that erupted after the pandemic.
China must also deal with the conflicts generated by the indebtedness of the countries participating in its project. It is already a major creditor of very fragile economies (Mongolia, Laos, Maldives, Montenegro, Djibouti, Tajikistan and Kyrgyzstan) and is refinancing commitments to countries heavily affected by these liabilities (Bangladesh, Tanzania and Nigeria).
The negotiation of each section of the Silk Road also provokes conflicts with participants who increase their participation without consulting regional partners. Italy’s negotiations behind Europe’s back exemplify these tensions. But in this wide variety of circumstances, China has founds itself faced with a bewildered US spectator.
This problematic scenario has spread to Latin America. In just four years, the Silk Road has added 20 countries in the region, beginning to achieve an impact comparable to that of the African continent in this project. Argentina was the most recent incorporation and, with this entry, added pressure for the entry of the three major absentees: Brazil, Mexico and Colombia.
The Southern Cone economy was tempted with greater credits to finance the acquisition of manufactured goods and services from China. Argentina receives less pressure from Washington against Beijing than Mexico or Colombia and has less industry to protect from the import avalanche than Brazil. But the offers being evaluated by Itamaraty are in line with the expansion of Brazil’s trade with China, which jumped from US$2 billion (2000) to US$100 billion (2020).
Mexico is still pending a response to the proposal to conclude a direct FTA with Beijing, which is vetoed by the clauses of the T-MEC signed with the United States. Many voices are pushing for the adoption of this conflictive step, in order to place the country in a status of real equidistance vis-à-vis the two powerful countries of the planet (Dussel Peters, 2022). But this bet introduces a card that for now no one wants to play.
China negotiates with all its interlocutors, without demanding the same commitments that the United States usually demands. It does not have a tradition of being a creditor that consummates the appropriation of territories, companies or resources of insolvent debtors.
The lawsuits for “non-compliance” with obligations processed in an arbitration body (ICSID) illustrate the magnitude of the penalties imposed by US (or European) companies on Latin American states. The number of such penalties jumped from 6 (1996) to 1,190 (2022) for compensations exceeding US$33 billion (Ferrari, 2022).
The passage of time will settle all the questions about China’s future behavior in similar situations. Some analysts estimate that the Eastern giant has already begun to prevent such scenarios (Ecuador Today, 2021), substituting State-to-State credits for private loans with asset guarantees (Marco del Pont, 2022). But the implementation of these safeguards has not yet been verified and China continues to exhibit a friendlier profile than its North American competitor. It is moving ahead with the Silk Road at a speed that is unsettling to the US principal.
The inconsistency of America Grows
Faced with China’s shocking onslaught, Trump sponsored a defensive wall beginning in 2019 with his America Grows project. He encouraged especially privileged Latin American deals with US. firms, in the most promising sectors of energy activity. He particularly promoted investments to expand Mexican gas connections to Central America and to increase the US involvement in the electricity grids of Colombia, Ecuador, Peru, and Chile. He placed special emphasis on Bolivia’s gas reserves and the Vaca Muerta (Argentina) and Pre-Salt (Brazil) fields.
To accelerate these initiatives, he placed his delegate in the presidency of the IDB (Mauricio Claver Carone) and forced the granting of a mega IMF loan to the insolvent Argentine State. He also promoted a drastic modification of the current government procurement systems and proposed to sign commitments in an expeditious manner, skipping negotiations and parliamentary controls. He resorted to the Trumpian format of forcing in record time agreements of dubious legality.
But with this improvised libretto, the tycoon was unable to introduce any alternative to the Silk Road. His initiatives were left floating in the lax universe of projects, while Latin American governments continued to conclude effective agreements with Chinese clients and suppliers. The aura surrounding the launching of America Grows was extinguished before it aroused any significant interest.
These uncertainties recreated the tensions within the United States between the protectionist and globalist factions. This conflict reinforced the obstruction to an initiative that lacked significant government financial support. América Crece was conceived as a plan to open up business to the private sector, defining the investments to be made.
This approach is at the antipodes of the direct state support favored by China. While America Grows is subject to the approval of each US company, the Silk Road advances with funds provided by Beijing. Without that direct wallet, Washington cannot compete with its Asian rival.
Biden inherited this obstruction without providing any solution. He took up the same America Grows scheme, with the more pompous name of the Alliance for the Economic Prosperity of the Americas (APEP). He placed greater emphasis on the complementary program of incentives for the return of US firms based in Asia (Back to the Americas). He also shored up IDB funds to offer matching credits to China and sought to reduce the enmity generated with the region by his predecessor, displacing Trumpist officials from that organization (Merino; Morgenfeld, 2021).
Negotiations with 11 Latin American countries to promote the new project are progressing very slowly and are not arousing the interest that the FTAA aroused in the past (Oppenheimer, 2023). The call to expand the partnership model with Mexico (T-MEC) in Central America has not solved any of the problems that paralyzed Trump’s initiative.
The huge fiscal deficit dragging down the US Treasury restricts the supply of money required to develop such proposals. This lack of funds limits the internal Keynesian relaunching envisioned by Biden and obstructs external competition with the Eastern giant. For this reason, the IDB is sailing in a state of uncertainty, while the China-CELAC Forum is increasing its bilateral agenda. The United States is also failing to forge the political articulations achieved in the past with the Washington Consensus.
The magnitude of the US setback is evident by a simple comparison with the initiatives adopted by the White House in the 1960s to neutralize the impact of the Cuban revolution. At that time it resorted to the Alliance for Progress with mountains of credits and investments in all countries, without facing economic rivalry from any other power in the region. At present, the United States does not have those resources and faces a Chinese competitor that penetrates its own ” backyard”. The Latin American bourgeoisies, which in those years were automatically aligned with their principal, are now distancing themselves and playing their own game.
A portrait of great disarray
The recent Summit of the Americas illustrates the retreat of the United States in the region. This event is the main instance of political articulation of the continent and each of the eight meetings held in the last three decades portrayed the state of those relations.
In the first three Summits (Miami-1994, Santiago de Chile-1998, Québec-2001), the recovery achieved by Washington was very visible, with the rise of neoliberalism and the collapse of the USSR. But this resurgence was abruptly reversed at the fourth event (Mar del Plata-2005) with the defeat of the FTAA. That turn coincided with the erosion of unipolarity and the debut of a sequence of US failures.
Obama managed a stalemate scenario in the three subsequent Summits (Port of Spain – 2009, Cartagena-2012, Panama-2015). He was unable to finalize the bilateral treaties to replace the FTAA and had to accept the presence of Cuba. He even deployed a conciliatory rhetoric of equivalence of all countries and distanced himself from Pan-Americanism.
Trump radically modified that script in order to restore the explicit domination of the empire. He combined displays of force with rudeness at meetings and absented himself from the Summit itself (Lima-2018), to avoid protests and rejection of his xenophobic provocations.
But that absence only covered up the failure of his conspiracies against Venezuela and the shipwreck of the ultra-right coalition he tried to build in the region.
In the recent meeting (Los Angeles-2022), Biden faced a greater number of adversities. He laid out an agenda with all the topics in vogue (clean energy, digital infrastructure, green economy, democratic governance), to cover up his purpose of retaking US primacy (Lucite, 2022). He attempted a show of force with the exclusion of Nicaragua, Cuba and Venezuela, to please the right-wingers in Florida and assumed the dual role of formal host and patron of the meeting. But with this repetition of a Trump-esque boorishness, he precipitated the protests that marred the event.
Mexico led the absentee governments that did not accept the exclusions and induced a hollowing out of the Summit itself. The meeting remained a botched show, questioned by almost all attendees (Casari, 2022). The exclusions based on human rights violations were particularly absurd, in the midst of US reconciliation with the criminal monarch of Saudi Arabia. Biden was snubbed even by several right-wing governments that opted to absent themselves (Morgenfeld, 2022).
That absence prevented progress in the planned pact to contain the flood of migrants in different territories of Central America. It also failed to achieve the desired endorsement for the sanctions against Russia and had to accept a principle of annulling exclusions in future meetings. The speakers who postulated this principle became the real protagonists of the Summit. Not even the White House’s allusions to an imminent world war did not align Latin American governments with their big brother (Rangel, 2022).
What happened portrayed the change in the prevailing balance of power in the region. The United States is trying to make a move, without reversing the adversities it is facing, and is beginning to compete with meetings promoted by its Chinese rival, which do not exclude any participant. Unlike Mar del Plata, the Los Angeles Summit was not wrecked by the emergence of a Latin American alignment, but by the US administration’s own impotence.
The underlying military resource
The United States is trying to counteract its economic shortcomings with greater geopolitical and military action. This card has been played by all the occupants of the White House, to contain the Chinese presence and to break the autonomy of the local capitalist classes.
Both purposes are shared by the leadership of the Republicans and Democrats, who favor a combination of aggression and negotiation policies, in order to recompose US power. The mixture of the stick with good manners persists as the main combo of all Washington administrations.
No Northern leader contemplates the hypothesis of a US withdrawal from Latin America. This inflexibility is an intrinsic ingredient of the first power, which cannot (and does not want to) agree with China on the transfer of dominions that it agreed with Great Britain in the first half of the 20th century.
The United States intends to preserve its primacy by making use of the monumental military structure maintained by the Pentagon in the region. The Southern Command, the IV Fleet and the bases in Colombia articulate a device of a scale very similar to that deployed by the Marines in the Persian Gulf or the Mediterranean.
Latin America is the historical basis of US interventionism. Between 1948 and 1990 the State Department was involved in the overthrow of 24 governments. In four cases, US troops acted, in three cases, CIA assassinations prevailed, and in 17 cases, there were coups directed from Washington. A large part of these assaults were perpetrated by the 70,000 military personnel trained by the Pentagon between 1961 and 1975 to carry out all kinds of massacres.
The “war on drugs” has been the most recent form of such escalations. It included an enduring DEA presence, especially in Mexico, Colombia, Peru and Bolivia. A dramatic number of Latin Americans have been killed, with no effect on reducing drug trafficking. This ineffectiveness was a consequence of the CIA’s own action, which tolerated the commercialization of narcotics to supplement its financing.
This circuit also facilitated multi-million profits to arms manufacturers and banks, which transform black money into current operations. For this laundering, the entities involved in the crime -such as Wells Fargo- were penalized with irrelevant fines (Miguel, 2022).
The State Department always disguises its aggressions with implausible pretexts. The Marines and the embassy have traditionally been portrayed as saviors of wildly changing enemies. First it was the communists, then the Taliban, then drug traffickers, and lately terrorists. Hollywood actively contributes to this masquerade by massifying stereotypes, which at every juncture are molded to the mystifications propitiated by Washington (Cook, 2022).
The United States currently has 12 military bases in Panama, 12 in Puerto Rico, nine in Colombia, eight in Peru, three in Honduras, and two in Paraguay. It also maintains facilities of the same type in Aruba, Costa Rica, El Salvador, and Cuba (Guantanamo). In the Falkland Islands, the British partner ensures a NATO network connected to the North Atlantic sites (Rodriguez Gelfenstein, 2023).
But Washington adopts its strategy to constraints it did not face in the past. It can no longer dispatch gendarmes, with the same brazenness that prevailed in the second half of the 20th century. It prioritizes its activity in the shadows, to overthrow troublesome rulers and install like-minded dictators.
It is enough to observe the recent confession of a high-ranking Trump official (Bolton), to note how persistent is the meticulous US preparation of coups d’état (El País, 2022). Washington’s men also sustain the ferocious repression unloaded by the usurper Boularte against the Peruvian people (Ruiz, 2023).
With the same crudeness and without any filter, the head of the Southern Command proclaimed the Pentagon’s right to manage Latin America’s natural resources as its own (Reyes, 2022). With this mandate, a corps of US engineers remodels the navigable circuit of the rivers that cross Paraguay. In its confrontation with Beijing, Washington avoids any easing of its military presence in the ” backyard”.
Sanctions against Russia to alienate China
The geopolitical subordination of Latin American foreign ministries is another instrument of the US counter-offensive against China. The State Department is trying to use the war in Ukraine to engage Latin American governments in campaigns condemning Putin. It demands penalization of the Russian incursion without any mention of NATO. This pressure is aimed at breaking the resistance of many leaders to a blind alignment with Washington.
The punishments demanded by the United States against Moscow are aimed at reducing the margin of autonomy in the region. With this type of subjugation, the White House buried all vestiges of Latin American independence during the 20th century.
The mass media are in command of this pressure to force the reprobation of Moscow demanded by Washington. They are strengthening the climate of Russophobia that has been installed in public opinion and are questioning the hesitations in issuing more virulent censures against Putin. This campaign aims at resurrecting the OAS and neutralizing CELAC.
US pressure has not produced any results on the leaders in confrontation with the White House (Venezuela, Bolivia, Cuba and Nicaragua), but has had an impact on administrations that periodically oscillate between distancing themselves from and submitting to Washington (Argentina, Chile). On various occasions, these governments have provided votes of censure against Russia demanded by the Northern principal.
The United States does not hide its irritation with Mexico for avoiding such pronouncements and the President of Ukraine himself has harshly criticized López Obrador. He questions his proposal for a cessation of hostilities and a five-year truce. The same tension has spread to Itamaraty since Lula’s inauguration.
The warmongering climate promoted by the United States has not gained many adherents in Latin America. The bulk of the region remains far from the warlike tension prevailing in Europe. For this reason, the Pentagon’s request to several governments to send Russian supplies to the Ukrainian army has been rejected outright (Kersffeld, 2023).
Washington has failed to recreate the traditional submission to its geopolitical maneuvers.
This limitation contrasts with the subordination it imposed on Europe. The difference is obviously due to the location of the conflict in the Old Continent. But this submission to Washington preceded the current war and was carefully programmed by NATO strategists. In its long and traumatic experience with the Yankee oppressor, Latin America has generated more antibodies than Europe to the provocations of the State Department (Beluche, 2023).
The White House makes no secret of the economic purposes of its onslaught. It is extorting all countries to cancel their scarce business with Russia. They demand that Ecuador cut its banana sales, that Paraguay reduce its meat exports, that Brazil restrict its soybean and coffee sales and that Mexico cancel its sale of cars, computers and beer. The pressure on Argentina is concentrated on the sensitive issue of nuclear energy (López Blanch, 2022).
But since Russia’s economic impact in Latin America is very small, the main US purpose points in another direction. It intends to use the Ukraine conflict to undermine the presence of Moscow’s Chinese ally. Biden is obsessed with this containment of Beijing. He knows that the countdown for the control of the region’s natural resources is accelerating and he is urged to restore US dominance.
The battle for minerals to be used in the energy transition is a priority in this struggle with China. Several Latin American countries possess the resources that the two powers are trying to monopolize (Feliu, 2022). Warmongering is the main card of the United States to win this dispute.
The persistent harassment of ALBA
The imperial counter-offensive includes new attacks against the bloc of Latin American governments most hostile to Washington (ALBA).
This escalation against Cuba, Venezuela, Nicaragua and Bolivia was made transparent in the exclusion of these countries from the Summit of the Americas. Biden tried to shelve Trump’s outbursts at the beginning of his administration, but later adopted aggressive positions that are in tune with his own trajectory. He supported Thatcher in the Falklands War, upheld the crimes of Plan Colombia and supported DEA operations in Central America.
The White House has resumed its heavy spending on diplomacy, foundation funding and embassy prominence to reshape alliances with the Latin American establishment. In addition, it is very sensitive to the ultra-right lobby in Miami that demands brutal interventionist actions.
This influence is verified, above all, in the continuity of aggressions against Cuba.
Biden did not repeal the classification of that country as a terrorist state and he attempted to expel the Havana delegation from the United Nations Human Rights Council.
The current president is no exception in the long list of Yankee presidents who have tried to destroy the Cuban revolution through the blockade and armed conspiracies. The first power never recovered from its greatest defeat in the region and has not resigned itself to coexist with a socialist process 90 miles away from Miami. That challenge had an enormous long-term effect, demonstrating the vulnerability of the United States in its own fiefdom. Cuba laid the foundations for a gradual autonomous shift in the entire region.
It is true that Washington managed to contain the shock wave of the revolution spreading to the rest of the continent during the general wave of the 1960s and 1970s. It also held back the Central American upsurge of the following decade. It resorted to the terror of dictatorships and a war of attrition that ended with the invasion of Panama.
As in other parts of the world, the United States compensated for its great defeat in Cuba with other achievements of counterrevolutionary containment. In the Far East, it lost China and Vietnam, but reconquered Indonesia, held off Korea and subdued Burma and the Philippines. A balance of the same type could be exposed for the Latin American case (Anderson, 2013).
But Cuba had a more far-reaching impact for imperial domination, because it was consolidated in the first power’s own environment. Like all his predecessors, Biden has not been able to deal with this adversity.
From the White House, he also tried to sustain the harassment of Venezuela with new provocations, such as the kidnapping of the diplomat Alex Saab and the continued confiscation of Venezuelan goods in different parts of the world.
These usurpations include tons of gold in the Bank of England and the properties of CITGO, which is the eighth largest refinery in the United States and the largest foreign asset of PDVSA. The Bolivarian government has managed to recover another immobilized company in Colombia (Petroquímica Monómeros) and is disputing the recovery of an airplane held in Argentina.
The imperial harassment of Venezuela has been the longest and most brutal in recent times. It included all kinds of plots and was motivated by the evident interest in recovering US management of the largest oil reserves of the continent (Petras, 2019).
Biden also maintained funding for the Nicaraguan opposition to displace Ortega and enacted a law enabling new sanctions. In addition, he gave the go-ahead to several conspiracies in Bolivia, but has taken note of the difficulties faced by the United States in the region.
US Southern Command: The Empire on the March in Latin America
Compromises and uncertainties
Trump’s rudeness and inconsistencies in Latin America have left a balance of failures for Washington that Biden has not reversed. To deal with this adversity, he combines continuity with tentative attempts at a different policy.
The deterioration of the OAS persists, the Lima Group is in tatters and no effective body is enforcing US demands. Biden is looking for a readjustment to achieve this adaptation, but he cannot find a guide for his actions.
He inaugurated his administration by firing the most reactionary people that Trump had installed in the State Department. He also distanced himself from old right-wing allies in El Salvador and Guatemala to clean up the image of his administration.
He has taken up again with great intensity the lists drawn up by the Department of Justice to demand the extradition of officials committed to corruption or drug trafficking. This list includes 62 individuals from Guatemala, Honduras and El Salvador, who held positions in governments aligned with Washington. Some former presidents (such as Orlando Hernández) and their relatives (or close associates) have been deported and imprisoned in the United States.
As already happened with Noriega, the current US ruler is disassociating himself from his disgraced servants.
With this type of extraterritorial prosecution, to assert his authority, he casts ballast on his own past and reaffirms the principle of imposing his laws in other territories. In this way it attempts to discipline all governments to its needs (Veiga, 2022). This policy has extended to South America, with the forced resignation of the vice-president of Paraguay at the simple demand of the US ambassador.Biden also has a more pragmatic side and has replaced acts of force with negotiations with his most contentious interlocutors.
He maintained a relationship with López Obrador that is very different from Trump’s arrogance and instead of building the wall, he agreed on ways to contain migrants in southern Mexico. These rules were specified in the meeting between presidents that followed the clash during the Summit of the Americas.
He is also currently negotiating a bolder agreement with Venezuela to acquire oil made more expensive by the war in Ukraine. The United States needs to import crude oil from closer locations to ensure its supply, sustain gas sales to Europe and maintain sanctions against Russia.
Several US companies have already agreed to restart drilling to increase the extraction capacity of Venezuelan wells. But this operation requires the lifting of sanctions and a recognition of the Bolivarian government, which Biden avoids due to the enormous political implications of such a step. This reconciliation would constitute a precedent for extending the same strategy to Iran and the White House is unable to determine how such a turn of events would affect the arm wrestling with China.
As in other hot topics, Biden is postponing decisions while continuing to adjust his foreign policy. The imperial counteroffensive is a reaction to rebuild forces, but long-term initiatives have not yet matured in the US command.
The impasses in the neighborhood
The vertiginous penetration achieved by China in Latin America corroborates the impotence of US warmongering to counteract US economic regression. In no other region of the world has Washington exercised such manifest preeminence. If its weapons, spies and ambassadors are unable to contain Beijing’s business machine in this area, it has little chance of succeeding in stopping it in other corners of the planet. That is why Latin America is a test of the future.
China’s arrival in the region erodes the direct control that the United States has long exercised in the continent in the absence of rivals. Unlike Asia, the White House has managed this command throughout the continent without the help of former powers (Japan) or major partners (Australia). Unlike the Middle East, it has no strategic appendages integrated into its own imperial structure (Israel). The regional gendarmes supervised by the Pentagon (Colombia), never had that degree of symbiosis with the Northern establishment. Unlike Eastern Europe, the United States did not resort to its NATO partners to settle strategic disputes with Russia either.
What always distinguished US domination of Latin America was its direct, explicit and overwhelming interference south of the Rio Grande. That is why the arrival of China is so significant.
The United States never shied away from deploying all kinds of actions to display domination and let the local ruling classes know who is in charge. It resorted to a varied menu of co-optations, blackmail or threats to make that leadership explicit. But this combination of warlike methods and rhetoric of coexistence no longer dissuades the Latin American bourgeoisies from doing business with Beijing.
This failure places the Yankee dominator in an unprecedented situation, devoid of scripts. It does not face a revolutionary challenge from below (as in the 60’s and 70’s), nor a geopolitical competition (equivalent to the cold war). Nor can it retreat like the decadent empires in the face of African decolonization. It has to deal with economic competition and resort to military pressures that fail to achieve their goal. The peculiarities of the Chinese rival—which we will analyze in the next article—explain this American quagmire.
Claudio Katz: Professor at the University of Buenos Aires and researcher at CONICET. He is a member of the Red de Economistas de Izquierda (Left Economists Network). His last book “La teoría de la dependencia, 50 años después” received the Libertador Award for Critical Thought. His web page is http://katz.lahaine.org
