Democracy by Applause
excerpted from the book
In the Name of Democracy
U.S. Policy Toward Latin America in the Reagan
Years
by Thomas Carothers
University of California Press, 1991
SOUTH AMERICA
p118
During the 1970s, most of South America was under military rule.
In many South American countries leftist guerrilla movements arising
in the late 1960s had been defeated through brutal force in the
early and mid-1970s, scarring societies with a legacy of deep
political divisions and harsh repression. In the first half of
the 1970s, U.S. relations with South America were generally positive,
resting on common anticommunist sympathies and a tradition of
close U.S. relations with the military elites of the region. During
the Carter years, however, relations with a number of South American
countries soured. Carter was unsympathetic to the South American
military governments and made human rights an important issue
in U.S. policy toward the entire region, most notably toward Brazil,
Argentina, and Chile. The South American military leaders, accustomed
to uncritical friendship from the United States, were greatly
annoyed by the criticisms of their domestic behavior emanating
from the State Department and White House. Trade issues also produced
conflicts.
p119
As political and economic relations deteriorated, military cooperation
diminished as well. Formal and informal military ties, including
training, assistance, and reciprocal visits, declined in the 1970s.
The United States fell from being the largest supplier of arms
to South America in 1974 to the fifth largest in 1980...
The incoming Reagan administration was determined to rebuild
relations with South America, particularly with Brazil, Argentina,
and Chile, three of the most important countries of the region
and three countries with which U.S. relations had distinctly worsened
in the Carter years. The impetus for rapprochement was rooted
in the administration's fervent anticommunist outlook, in particular
its acceptance of Jeane Kirkpatrick's arguments regarding the
necessity of supporting anticommunist, authoritarian governments
in developing countries as alternatives to leftist totalitarian
rule. For the early Reagan team, the military leaders of Argentina,
Brazil, Chile, Uruguay, and other South American countries were
prime examples of the sort of moderate authoritarians who merited
United States backing.
Underlying this view of a necessary choice between authoritarians
and totalitarians was the notion of a worldwide communist or totalitarian
threat. Kirkpatrick and the early Reagan team believed that the
entire Third World was a target of Soviet expansionism. Although
the Reagan administration saw Central America as the immediate
target of Soviet-Cuban expansionism, it also believed that South
America (and in fact the whole world) was in danger.
p120
The Reagan administration's rapprochement with the military governments
of South America got underway in early 1981 and quickly took shape
as a multifaceted effort involving the upgrading of diplomatic
contacts, the adoption of "quiet diplomacy" on human
rights, and an attempt to reinvigorate U.S.-South American military
assistance and cooperation.
p121
The Reagan administration's abandonment of Carter's high-profile
human rights policy and the adoption of a policy of quiet diplomacy
on human rights eased the path of rapprochement. President Reagan
and his foreign policy advisers strongly disliked Carter's human
rights policy; they were convinced that high-visibility human
rights criticism of friendly anticommunist governments was counterproductive
to U.S. security interests and of minimal utility in obtaining
improvements in human rights. The administration quickly substituted
what it called a policy of "quiet diplomacy" on human
rights. In principle this policy was to consist of low-key, behind-the-scenes
advocacy on human rights issues. In practice, at least in the
early 1980s, it meant that human rights issues were essentially
dropped from the agenda of U.S. relations with Brazil, Argentina,
Chile, and other countries led by right-wing military governments.
p135
The Reagan administration's later policy of support for democracy
in South America was notable more for what it lacked than what
it contained. The main challenge facing emerging democratic governments
of South America in the 1980s was improving their stagnant economies.
The recession that hit South America in the early 1980s proved
to be not only of unprecedented severity but also unexpected persistence.
Although the recession in the industrialized countries that had
begun in 1979 eventually lifted, almost all of the South American
countries remained plagued by low to nonexistent growth, high
inflation, rising unemployment, and a steady decapitalization
resulting from elevated levels of debt service payments and a
decline in foreign investment. The calamitous economic situation
created strong pressures on the newly democratic governments of
the region. Although these governments generally had much initial
domestic support, their ability to consolidate and keep that support
depended on their economic achievements. Just as economic problems
had been instrumental in the downfall of many of the military
governments of the region, so economic performance would be one
of the principal criteria by which the new governments were judged.
p138
The negative political effects of this economic stagnation | mounted
steadily. The problems of unemployment, inflation, and chronic
shortages of government funds eroded public confidence in the
new democratic governments of the region and sowed the seeds of
heightened civil tension and conflict. Many South Americans, particularly
the younger generation, many of whom had never lived under democratic
rule before, began to associate democracy with economic chaos
and decline...
As the political strains generated by the economic situation
in South America increased, South American leaders pressed the
Reagan administration to adopt a more forthcoming economic policy,
particularly with regard to the debt crisis. Their general argument
was that the Reagan administration was failing to recognize or
acknowledge the political effects of the economic crisis in South
America and they urged the administration to back up its stated
commitment to democracy in the region with real economic deeds...
The general message about the inevitable connection between
the economic problems and the future of democracy was usually
accompanied by specific urgings that the administration adopt
a debt policy aimed at debt reduction rather than just increased
lending and economic growth...
The Reagan administration resisted these pressures, however,
and stuck to its noninterventionist approach. It was only with
the departure of the Reagan administration and the arrival of
the Bush administration that a new policy appeared. In 1989 Bush's
Treasury Secretary, Nicholas Brady, launched a new debt policy,
known as the Brady Plan, which incorporated a debt reduction element.
p139
It is interesting to examine why the Reagan administration remained
steadfastly attached to its noninterventionist approach to the
economic crisis in South America in the face of the rather obvious
failure of the policy and the broad-based criticism it received.
The main reason the administration did not adopt a more responsive
policy was that most high-level administration officials (though
certainly not all the career staff within the Treasury Department
and State Department) were sincerely convinced that debt relief
would have harmful consequences for the debtor countries (by hurting
their long-term creditworthiness) and that the essentially free
market approach of renewed lending and structural reform would
eventually succeed. The policy also reflected the administration's
tendency to separate the economic and political aspects of the
situation in South America and not formulate economic policy on
the basis of political considerations. The question of economic
adjustment measures by South American governments, for example,
was seen by the administration as an almost purely economic issue.
For the South American leaders confronted with the task of trying
to cut budgets and reduce public sector employment, however, it
was almost a purely political issue. The U.S. officials behind
the debt policy often did not seem aware of the degree to which
austerity measures were politically difficult for the new democratic
governments of South America. Instead they shook their heads over
what seemed to them to be the stubborn ignorance of the South
American leaders and despaired of ever seeing the prescribed structural
reforms carried out.
More generally, the administration showed little appreciation
of the damaging effects of the endless economic crisis in South
America on the recently revived democratic political life of the
region. Among some officials there was a strong, somewhat self-righteous
sense that the debtor nations had made their bed (by borrowing
so heavily in the 1970s) and would just have to lie in it. Often
combined with that was the belief that some of the South American
nations (particularly in the Southern Cone) were not as bad as
they let on and that another few notches worth of belt-tightening
would not really hurt them.
When confronted with the charge that the administration's
debt policy was jeopardizing the democratic gains, U.S. officials
tended to respond by pointing out that no military coups had occurred.
This response reflected a short-term "quarterly report"
style of political analysis that unfortunately characterized the
administration's attitude about democracy in South America. As
long as the Reagan administration could make it to January 1989
with no coups or sharp political reversals occurring in South
America, it could claim that its prodemocracy policies were successful.
Missing from this outlook was any sophisticated consideration
of the longer-term political consequences of the decapitalization
of South America and the recognition that consolidating democracy
was not simply a matter of getting these first democratic governments
through to the next election but a generation-long effort of building
the necessary economic and political foundations for stable democratic
societies.
p141
The administration's unwillingness to let political considerations
intrude into its economic policy toward South America was also
the result of relative priorities. The administration's debt policy
was rooted both in the administration's policy convictions and
its strongly held desire to protect U.S. lender banks. The political
interest in question-the well-being of the nascent democratic
systems of South America-was simply not that important to the
administration. Despite its numerous statements of support for
the return of democracy to South America, the administration had
little real interest in South America's political situation. As
a general matter, the Reagan administration's only really strong
interest in Latin America was preventing the spread of leftism
in the region. That interest led to a high level of involvement
in Central America for the duration of the Reagan years, owing
to the presence of a leftist government in Nicaragua and of leftist
rebels in El Salvador. In South America it led to an initial attempt
to rebuild relations on the foundation of shared U.S.-South American
anticommunist concerns. After that effort failed ... the administration
had no real impetus for paying much attention to South America.
The administration did welcome the democratic trend in South
America but largely as a spectator applauding a distant occurrence.
The dominant characteristic of Reagan's South America policy was
the remarkably low level of attention to the region that it entailed.
Despite the fact that South America contains the bulk of Latin
America's territory, population, and wealth, the Reagan administration
essentially ignored it, devoting what interest it had in Latin
America to Central America, particularly Nicaragua. It is difficult
to quantify this lack of interest in South America. It is evident,
however, if one looks at any measure, such as the number of speeches
given about the region, the time and energy the policy-making
apparatus devoted to it, or the U.S. government funds committed
to it. President Reagan gave more speeches about Nicaragua in
one year (1986) than he gave about any or all of the South America
countries in his entire presidency. Possibly only Africa and a
few parts of Asia were of less interest to President Reagan and
his foreign policy advisers than was South America.
In sum, the administration's Latin American debt policy remained
an economic policy rooted in economic interests external to the
region; concern over South America's political fate was not sufficiently
great to constitute a major factor in the policy. To the extent
that the Reagan administration did draw a connection between its
economic policy toward South America and the political situation
there, it believed that its advocacy of free market policies would
actually strengthen the cause of democracy in South America. This
outlook was based on the notion of a natural link between free
market economics and democracy, or in the terms often used by
administration officials, between "economic freedom"
and political freedom. High-level administration officials, such
as Secretary of State Shultz and Deputy Secretary of State John
Whitehead, frequently lectured South American leaders on the value
of adopting free market policies, arguing that such policies would
not only lead to rapid development but would also contribute to
the strengthening of democracy. As Shultz put it on one occasion:
I believe freedom and economic development go hand in hand....
Our support for democracy complements our support for economic
development and free markets-and vice versa.
This credo regarding the natural complementarity of free market
economic policies and democratic development was adopted by AID,
which in the early 1980s had adopted an emphasis on private sector
development in U.S. economic assistance and in the mid-1980s sought
to connect this economic approach to the sweeping democratic trend
in the region. If the administration had simply been arguing that
democratic political systems are almost always associated with
capitalist economic systems broadly defined, there would be little
to question.' In fact, however, what administration officials
were telling Latin American governments was that a particular
type of capitalism, the Reagan administration's free market version,
is more compatible with democracy than any other kind of economic
system. This argument was more ideological and much less well-founded.
In Western Europe, many variations of capitalism, including social-democratic
ones, have combined quite well with democratic political systems.
Given that many Latin Americans look to Western Europe more than
to the United States for political and sociocultural models, the
Reagan administration's argument was not particularly persuasive.
Furthermore, administration officials were not merely asserting
that democracy and a certain type of capitalism usually occur
together, but that free market capitalism will tend to promote
democratic development. This argument entails a considerable empirical
leap of faith. The historical record is that democracies are almost
always capitalistic, not that capitalistic countries are almost
always democratic. There are no solid grounds for arguing that
countries with a weak or absent tradition of democracy will tend
to become democratic if they adopt free market policies. Free
market policies have proven to be fully compatible with highly
authoritarian governments in many developing countries, such as
in many Asian countries since World War II.
The administration's argument was weak not only in general
theoretical terms but also in relation to the specific historical
experience of Latin America. Free market economic policies in
Latin America have traditionally been associated with dictatorships,
not democracies. The private sectors of many Latin American countries
bear little resemblance to the mythical ideal of hard-working,
hardheaded entrepreneurs that Reagan administration officials
subscribed to. They are usually economic elites, often quite antidemocratic
in conviction and in practice, usually held together by class
affiliations and often enmeshed in deeply corrupted cooptive relations
with the state. In the past at least, free market policies in
Latin American countries have often meant allowing these dubious
private sectors a free rein to exploit their structural advantages
in order to enrich themselves further at the expense of a working
class that is confined to a subsistence level existence. Free
market policies have also meant reducing the already minimal protective
net for the working class, which, when combined with the additional
hardships and dislocations produced by free market policies, has
greatly aggravated existing sociopolitical tensions. In the past,
only dictatorships have been able to control those tensions-through
violent repression.
A recent major study of economic development strategies in
Latin America highlights this troubled relationship between free
market capitalism and democracy:
This more modern kind of repression [South American authoritarian
governments of the 1970s] has very special characteristics: it
combines free-market economics with destruction of democratic
institutions and systematic use of terror to paralyze opposition.
At the very least, the combination suggests that democracy and
capitalism do not easily go together in contemporary Latin America.
To put it more strongly, the fundamental issue may be that informed
majorities given the chance to express their preferences can usually
be expected to vote for promises to control markets, shut off
international competition and foreign investment, and use government
rather than private enterprise as the main force shaping economic
development.
In the late 1980s a trend arose in which Latin American majorities
did vote for political leaders promising free market policies,
a phenomenon that may be interpreted either as an evolution of
Latin American societies or simply the result of desperate populaces
frustrated with all other solutions to their economic plight.
In any case, in arguing for a simplistic equation of free market
policies and democracy in Latin America, the Reagan administration
displayed considerable ignorance of the troubled reality of that
issue in Latin American history.
p145
Despite its low level of interest in South America, the Reagan
administration did not shy from taking credit for the resurgence
of democracy there. In 1985, for example, Assistant Secretary
of State Abrams asserted that the Reagan administration's policy
was one of the principal causes of the redemocratization of South
America. This claim was repeated in later years as part of the
administration's general claim to having played a key role in
the resurgence of democracy throughout Latin America. Administration
officials did not explain exactly how U.S. policy toward South
America had fostered the democratic trend; their arguments about
a U.S. role seemed to rest on the vague notion that frequent expressions
of support by the administration for the democratic trend somehow
translated into a powerful assist.
In
the Name of Democracy
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