Honduran Destablization, Inc.

Otto Reich and the International Republican Institute

by Nikolas Kozloff

http://counterpunch.org/, July 9, 2009

When it comes to U.S. machinations and interventionism in Latin America, I'm not naïve: over the past five years, I've written two books about the inner workings of American foreign policy south of the border, as well as dozens and dozens of articles posted on the Internet and on my blog. As a result, when the Obama Administration claimed that it knew that a political firestorm was brewing in Honduras but was surprised when a military coup actually took place this strains my credibility.

Nevertheless, in the absence of cold, hard facts, I reserve judgment on whether Obama has turned into an imperialist intent on waving the Big Stick in Central America. Furthermore, the fact that Hugo Chávez of Venezuela says North American imperialism was behind the coup in Tegucigalpa does not make it so. In typical fashion, Chávez has failed to produce any shred of evidence to support his provocative allegations.

International Republican Institute

There are, however, a number of intriguing leads that point to U.S. involvement --- not in a coup per se but in indirect destabilization. Eva Golinger, author of the Chávez Code, has just published an interesting piece on her blog about the ties between the International Republican Institute (IRI) and conservative groups in Honduran society. Golinger has followed up on my extensive writings documenting the activities of the IRI, a group chaired by Senator John McCain (R-AZ). Though McCain seldom talks about it, he has gotten much of his foreign policy experience working with the operation that is funded by the U.S. government and private money. The group, which receives tens of millions of taxpayer dollars each year, claims to promote democracy worldwide.

Golinger reveals that IRI has thrown hundreds of thousands of dollars to think tanks in Honduras that seek to influence political parties. What's more, she discloses that the U.S. Agency for International Development (USAID) has provided tens of millions of dollars towards "democracy promotion" in Honduras. I was particularly interested to learn that one recipient of the aid included the Honduran National Business Council, known by its Spanish acronym COHEP, a long time adversary of the Zelaya regime.

Otto Reich

Another interesting lead comes via Bill Weinberg, a thorough and dogged journalist, founder of the Web site World War 4 Report and the host of WBAI Radio's thoughtful program Moorish Orthodox Radio Crusade in New York. On Sunday, Weinberg posted an intriguing article on his Web site entitled "Otto Reich behind Honduras coup?" In the piece, Weinberg discloses that the Honduran Black Fraternal Organization, known by its Spanish acronym OFRANEH, has claimed that former U.S. diplomat Otto Reich and the Washington, D.C. based Arcadia Foundation were involved in the coup.

In my first book, I documented Otto Reich's Latin American exploits in some detail. A Cuban native, Reich left the island in 1960. In 1973, while studying at Georgetown, he met someone named Frank Calzon. According to Honduras' La Prensa, Calzon was an "expert in CIA disinformation" who recruited Reich. Later, when Reich served as U.S. Ambassador to Venezuela under Ronald Reagan, he established contact with Gustavo Cisneros, a media magnate, billionaire and prominent future figure in the Chávez opposition.

After his stint as ambassador, Reich went on to be a corporate lobbyist for Bacardi and Lockheed Martin, a company that sought to provide F-16 fighter planes to Chile. In 2002, he became assistant secretary of state for Western Hemisphere Affairs under Bush through a recess appointment. Although Reich has denied there was any U.S. role in the brief coup d'etat against Venezuelan President Hugo Chávez in April 2002, the veteran diplomat reportedly met regularly at the White House with alleged coup plotter Pedro Carmona. At the height of the coup in Venezuela, Reich called his old friend Cisneros twice. According to the media magnate, Reich called "as a friend" because Chávez partisans were protesting at Caracas media outlets.

Reich has also served on the board of visitors of WHINSEC, formerly known as the School of the Americas, a U.S. army institution that instructed the Latin American military in torture techniques. As a member of the board, Reich's job was to review and advise "on areas such as curriculum, academic instruction, and fiscal affairs of the institute." After leaving the Bush Administration in 2004, Reich went on to found Otto Reich Associates in Washington, D.C. On the group's Web site, you can see a photo of Reich and John McCain shaking hands. A caption from McCain reads, "Ambassador Reich has served America with distinction by representing our fundamental values of freedom and democracy around the world, and I am grateful for his support."

Reich's outfit provides services in "International Government Relations/Anti-Corruption," and "Business Intelligence/Policy Forecasting." Specifically, the group seeks to "design and implement political and business diplomacy strategies for U.S. and multinational companies to compete on an even playing field in countries with complex ethical and legal challenges," as well as "advise major and mid-size U.S. corporations on government relations to support trade and investment goals in South and Central American countries and the Caribbean," in addition to identifying and securing foreign investment and "privatization opportunities" in Latin America.

Otto Reich and The Searing Case of Hondutel

In campaign '08, Reich served as a foreign policy adviser to Republican John McCain. In an interview with Honduras' La Prensa, Reich blasted Honduran President Zelaya for cultivating ties with Hugo Chávez. Reich had particular scorn for the Bolivarian Alternative for the Americas, known by its Spanish acronym ALBA, an anti-free trade pact including Venezuela, Honduras, Cuba, and Bolivia. "Honduras," Reich remarked, "should be very careful because the petroleum and Chávez problem is very similar to those who sell drugs. At first they give out drugs so that victims become addicts and then they have to buy that drug at the price which the seller demands."

Reich went on to say that he was very "disappointed" in Zelaya because the Honduran President was "enormously corrupted from a financial and moral standpoint." In another interview with the Honduran media, Reich went further, remarking brazenly that "if president Zelaya wants to be an ally of our enemies, let him think about what might be the consequences of his actions and words."

When discussing Zelaya's corrupt transgressions, Reich is wont to cite the case of Honduras' state-owned telecommunications company Hondutel. In an explosive piece, the Miami newspaper El Nuevo Herald reported that a company called Latin Node bribed three Hondutel officials to get choice contracts and reduced rates. Zelaya, Reich remarked to El Nuevo Herald, "has permitted or encouraged these types of practices and we will see soon that he is also behind this."

Reich would not provide details but reminded readers that Zelaya's nephew, Marcelo Chimirri, was a high official at Hondutel and had been accused of a series of illicit practices relating to Hondutel contracts. "After an outcry in Honduras," writes Bill Weinberg of World War Four Report, "Reich said he was prepared to make a sworn statement on the affair before Honduran law enforcement -- but said he would not travel to Honduras to do so, because his personal security would be at risk there." Reich's pronouncements to the Miami paper infuriated Zelaya who went on national radio and TV to announce that he would sue Reich for defamation. "We will proceed with legal action for calumny against this man, Otto Reich, who has been waging a two year campaign against Honduras," the president announced.

Turning up the heat on Chimirri, the U.S. Embassy in Tegucigalpa denied the Hondutel official an entry visa into the United States, citing "serious cases of corruption." Zelaya may have taken the U.S. ban on his nephew to heart. Zelaya complained to Washington as recently as last December about the visa issue, urging U.S. officials to "revise the procedure by which visas are cancelled or denied to citizens of different parts of the world as a means of pressure against those people who hold different beliefs or ideologies which pose no threat to the U.S."

Bush-appointed U.S. Ambassador Charles Ford was also turning the screws on Zelaya. Speaking with the Honduran newspaper La Tribuna, Ford said that the U.S. government was investigating American telecom carriers for allegedly paying bribes to Honduran officials to engage in so-called "gray traffic" or illicit bypassing of legal telecommunications channels. The best way to combat gray traffic, Ford said, was through greater competition that in turn would drive down long distance calling rates.

Perhaps the U.S. government was using the corruption charges as ammunition against Hondutel, a state company that Reich probably would have preferred to see privatized. The Honduran elite had long wanted to break up the company. In the late 1990s, none other than Roberto Micheletti, the current coup president of Honduras, was Hondutel's CEO. At the time, Micheletti favored privatizing the firm. Micheletti later went on to become President of Honduras' National Congress. In that capacity, he was at odds with the Zelaya regime that opposed so-called "telecom reform" that could open the door to outright privatization.

The Mysterious Case of Arcadia and Robert-Carmona Borjas

Building up the case against Hondutel and Chimirri was none other than the Arcadia Foundation, a non-profit and anti-corruption watchdog that promotes "good governance and democratic institutions." For an organization that purportedly stands for transparency, the group doesn't provide much information about itself on its Web site. The two founders include Betty Bigombe, a Ugandan peace mediator and World Bank researcher, and Robert-Carmona Borjas, a Venezuelan expert in military affairs, national security, corruption, and governance. The Web site does not list any other staff members at its D.C. branch. Outside of the U.S., the organization has outlets in Spain, Mexico, Dominican Republic, Chile, Argentina, and Guatemala.

In his columns published in the conservative Venezuelan newspaper El Universal, Borjas has gone on the attack against Chávez. In recent months, he had expressed skepticism about Obama's foreign policy openness, particularly if it meant dealing with "totalitarian" figures such as the Venezuelan President. According to his bio, Borjas left Venezuela after the 2002 coup against Chávez and sought political asylum in the U.S.

Interested in knowing where Arcadia's funding comes from? You won't get any pointers from the Web site. Click on "In The Media" however and you get an endless list of Borjas' articles and links to news pieces related to Hondutel (and I mean endless: I saw about 70 articles before I got tired and stopped counting). There's no other published research on Arcadia's site, leading one to wonder whether the organization's sole purpose is to pursue the Hondutel case. There's no evidence that Borjas knows Reich, though given their common interest (or should I say obsession) in the Hondutel affair it seems at least possible that the two might have crossed paths.

In recent months, Borjas had driven his anti-Zelaya campaign into overdrive. As Weinberg has written, "The Honduran newspapers El Heraldo (Tegucigalpa) and La Prensa (San Pedro Sula) noted June 11 that Carmona-Borjas had brought legal charges against Zelaya and other figures in his administration for defying a court ruling that barred preparations for the constitutional referendum scheduled for the day Zelaya would be ousted. A YouTube video dated July 3 shows footage from Honduras' Channel 8 TV of Carmona-Borjas addressing an anti-Zelaya rally in Tegucigalpa's Plaza la Democracia to enthusiastic applause. In his comments, he accuses Zelaya of collaboration with narco-traffickers."

So, there you have it: the International Republican Institute, an enigmatic Washington, D.C.-based organization intent on driving back Hugo Chávez, an inflammatory former policymaker with business connections and a high profile effort to discredit Zelaya and the Honduran state telecommunications company. What does it all amount to? There's no smoking gun here proving U.S. involvement in the coup. Taken together however, these stories suggest destabilization efforts by certain elements in the United States --- not the Obama administration but the far right which was more allied to Bush and McCain. Perhaps if the mainstream media can drag itself away from the likes of Michael Jackson and Sarah Palin, we can get a more thorough picture of the political tensions between Washington and the Zelaya regime.

Nikolas Kozloff is the author of Revolution! South America and the Rise of the New Left (Palgrave-Macmillan, 2008)

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National Endowment for Democracy (NED), International Republican Institute (IRI), United States Agency for International Development (USAID)

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