Long before the conflicts in El Salvador and Nicaragua erupted like a Central American volcano, Charles de Gaulle observed, “Central America is but an incident on the road to Mexico.” Our immediate neighbor to the south, with a population of 80 million, is one of the Third World’s largest countries. Because of its great human and natural resources, its potential is huge. Its problems are equally as great.
Over ten million American citizens are of Mexican descent, and probably as many Mexicans live here illegally. Our history also overlaps, sometimes in painful ways. Many Mexicans who know that history have not forgiven us. The Mexican–American War in the nineteenth century and the exploitation of Mexico’s resources by some American corporations in the early twentieth century were glaring examples of indefensible American imperialism. But it is time for responsible leaders in both countries to recognize that we cannot continue to visit the sins of Latin America’s past on its future.
Mexico and the United States have a stake in a cooperative, friendly relationship that would serve the interests of both countries. Above all, Americans must learn to treat Mexicans with the respect that they deserve. When I visited the University of Mexico in 1955, I asked its director, Nabor Carillo Flores, about his academic background. He said that he had a bachelor’s degree from the University of Mexico and that for his doctorate he had gone to a younger institution—Harvard! It was a quiet but effective reminder that the United States, in the Mexican’s eye, was the new kid on the block. We may not agree with Mexico’s neutralist foreign policy nor with its one-party politics, but we should respect its right to chart its own independent course, provided the course is not antagonistic to our interests.
The severe economic crisis in Mexico today obscures the fact that its growth rate of 6 percent a year from 1945 to 1970 was one of the best in the Third World. The oil that was discovered in the 1970s proved to be a blessing and a curse. Mexico’s leadership saw the oil boom as the opportunity to borrow and spend profligately; it missed the opportunity to wisely use oil profits to diversify and develop a private-sector economy. Instead, Mexico became overly dependent on oil. By borrowing against anticipated oil revenues, it increased its international debt from $4 billion to over a $100 billion in just over a decade. When the bottom fell out of oil prices, Mexico was left with one of the largest debts in the Third World and an economy paralyzed by bureaucracy. The government today controls over two thirds of the economy, and government spending is 53 percent of GNP with the usual fallouts of inflation, inefficiency, and corruption. Without further reductions in its harsh import controls and further stimulus for its private secter, Mexico will continue to founder.
Mexico’s next President, Carlos Salinas de Gortiari, could provide the kind of leadership Mexico needs in its hour of crisis. He is a topflight economist who thinks and acts pragmatically. If he is to lead the nation rather than merely preside over it and steal from it as have many of his predecessors, he must decide whether Mexico will have a state-dominated economy or a diversified free-enterprise economy.
A leader can be only as great as the problems he must overcome. Salinas de Gortiari could go down as Mexico’s greatest President if he breaks Mexico’s shackles to the past so that it can reach for the rewards the future holds in store.
After my trip to South America in 1958, I had a fascinating conversation with Luis Muñoz Marín, the gifted governor of Puerto Rico. He expressed his deep regret about the violent demonstrations during several of my stops. He said, “I am very proud of my Latin heritage. We Latins are devoted to our families. We have demonstrated great talents in music, literature, and the arts. We are deeply religious. But I must admit we have never been very good at government.” He went on to say that Latin American nations either had too much government or had too little—either dictatorship or chaos. He concluded, “Too often we simply have not been able to maintain that all-important balance between order and freedom.”
Although most of Latin America gained independence from Spain and Portugal 150 years ago, the spread of democratic government is a far more recent development. Just ten years ago, only a few had democratic governments: Colombia, Costa Rica, the Dominican Republic, Jamaica, Suriname, and Venezuela. Since then ten more—Argentina, Bolivia, Brazil, Ecuador, El Salvador, Grenada, Guatemala, Honduras, Peru, and Uruguay—have joined their ranks.
While this is reason for great hope, we cannot ignore the dark historical background against which these events are shedding welcome new light. With few exceptions Latin America has suffered four centuries of authoritarianism and chaos. In this century alone there have been over 190 coups and interventions in Latin America and the Caribbean. Over 140 million of the people live in poverty, barely able to feed and house themselves.
Latin America’s new democracies have found it difficult to produce greater prosperity or responsible economic policies. The region’s total external debt is $400 billion. Inflation in Brazil, Argentina, and Peru is over 100 percent. While many Latin Americans are disenchanted by some of their elected leaders, they do not yet reject their newfound democracy. But if moderate elected leaders do not produce a way out of poverty, voters may choose radical, antidemocratic leaders who promise to do so.
It is fashionable, particularly in intellectual circles, to blame Latin America’s poverty on the United States. Some claim that the United States keeps Latin America poor by importing cheap Latin American raw materials and exporting more expensive manufactured goods. These “dependency theorists” blame external factors for Latin America’s plight and overlook the internal historical and cultural roots of the problem. The Catholic liberation theologists append to this condescending theory a typically flawed Marxist class analysis of society. These mutually reinforcing myths could create a self-fulfilling prophecy. In suggesting that Latin Americans are too weak to control their own fate and too passive to solve their own problems they perpetuate the direction-lessness and stagnation in which the lethal bacillus of communism thrives.
Those who blame the United States for Latin America’s problems should consider what happens when a nation turns to communism instead. For years, Castro’s Cuba was hailed as a viable alternative development model for Latin America. That farce is now completely exposed. During most of Castro’s dictatorship, the Cuban GNP has actually declined. If the trend continues, the Cuban model of development will land Cuba among the poorest and most backward nations in Latin America by 1999.
Latin America’s poverty is not caused by dependency on the United States, and it will not be solved by communist revolution. It will have sustained economic growth that benefits all of society only by abandoning the legacy of government economic control. Statist economies and their ugly progeny—mismanagement, bureaucracy, and corruption—are stultifying the energies of the people. Nationalized industry, state subsidies, and price and import controls have created inflation, deficits, and uncompetitive, inefficient businesses that squander the region’s resources and its future.
There are signs that Latin America is finally responding to the intolerable conditions bred by economic authoritarianism. The cry for economic liberty and reform is loudest from Peru, an exceptionally poor nation trying to preserve its young democracy while grappling with a deadening government bureaucracy and fighting “The Shining Path,” the most brutal communist terrorists in the hemisphere. From the midst of this highly uncertain environment sounds the clarion voice of economist Hernando de Soto, whose book The Other Path is a pivotal study of the extraordinary entrepreneurial dynamism of Peru’s underground economy. It shows that government has been frustrating the energies of the people instead of liberating them, which it could do by protecting legal property rights and eliminating the tyranny of bureaucracy. De Soto reminds us of the link between political and economic freedom. One reinforces the other. Whenever possible we must support Latin American solutions to Latin American problems, which is why The Other Path should be required reading for all American policy-makers dealing with the region
and the Third World in general.
To prosper, Latin America needs more trade. The Soviets have recognized the potential for Latin American trade, and this has been a major topic of discussion in their recent diplomatic forays into the region. For political as well as diplomatic reasons Latin America would find it much more preferable to trade with us than with the Soviets. If we seize this opportunity by opening our markets to Latin goods while encouraging them to open theirs to ours, we stand a chance of seeing the Western Hemisphere develop into one of the most booming free-trade zones in history.
No American administration since the end of World War II, including my own, has had an adequate Latin American policy. The next President must end this pattern of neglect. In doing so he should avoid continuing to smother Latin America with slogans. Our “Alliance for Progress” and “Good Neighbor Policy” brought little progress and left too much of the neighborhood on the wrong side of the tracks. We can best aid Latin America by implementing and expanding to South America the Kissinger Commission’s recommendations for economic aid to Central America. Our goal should be to encourage the development of free-market economies.
The United States must continue to demonstrate that we want democracy and economic prosperity for all of Latin America. If it can harness the energies of its peoples and resources, the region will unquestionably be a free world economic giant in the next century.
The only constant in the Third World is change. We do not have to accept Engels’ philosophy to recognize the profound appeal of his words “It is necessary to change the world.” Change will and should come in the problem-plagued Third World. The only question is whether it will come by peaceful means or violence, whether it destroys or builds, whether it leaves dictatorship or freedom in its wake.
Two kinds of revolutionary change are threatening the Third World today. The first is communist revolution. Even though the twentieth century has left no doubt about the brutality and failure of communism, there are still those who carry on a romance with violent revolution. They encourage the destructive fires of communism by traveling to Nicaragua to pick coffee for the Sandinistas, supporting the terrorism of the communist-dominated African National Congress, and referring to the ruthless New People’s Army of the Philippines as “Nice People Around.” From their comfortable distances they rarely get their own fingers burned, or lose their homes, or see their families taken away in the middle of the night. Ignorant of history and self-deluding about current events, they are strangely silent when the charred remains of revolutions become apparent.
In the 1930s they were fans of Stalin, until he turned the Soviet Union into a slaughterhouse. In the 1950s and 1960s their hero was Mao, the “agrarian reformer” who unleashed an ideological firestorm in which tens of millions of Chinese perished. Before communism engulfed Indochina in 1975, they triumphantly celebrated the virtues of the Vietcong and the Khmer Rouge. When the new regimes in Vietnam and Cambodia laid waste to their people and countries, they were momentarily tongue-tied—until there were new communist revolutionaries to talk about in Nicaragua and El Salvador. Children should not play with fire, and these naive proponents of communist revolution are ideological children who are using the Third World as their playground.
The communist idea which had so much appeal in the Third World as little as fifteen years ago has been discredited by communism in action. It has failed to produce prosperity and peace in every Third World country where it is practiced. In Asia, the dead economies of the communist prison states stagnate next to the robust economies of the rimland states. In Latin America, where debt and growth are so completely intertwined, Cuba and Nicaragua have the highest per-capita debts and the lowest overall growth rates. In Africa, where plummeting living standards are the norm, the communist states of Mozambique and Ethiopia rank as the poorest and most destitute.
In the Moslem world from Morocco to Indonesia, Islamic fundamentalism has replaced communism as the principal instrument of violent change. As we discuss this recent phenomenon it is vitally important that we not allow the extremes of Moslem fundamentalism to blind us to the greatness of the Moslem heritage. The same religion that produced Qaddafi and Khomeini produced Avicenna and Averroës, two of the greatest philosophers in history. But the revolutionary vision offered by radicals on the fringes of the Moslem world is just as enticing as communism, and just as destructive. The communist revolution appeals to man’s material needs. The Moslem revolution appeals to his spiritual needs. Communist ideology promises rapid modernization. Islamic revolutionary ideology is a reaction against modernization. Communism promises to turn the clock of history forward. Moslem fundamentalism turns it back.
Islamic revolutionaries denounce the atheism of the communist East and the materialistic secularism of the capitalist West. The Iranian demonstrators who stampeded four hundred pilgrims to death in Mecca in August 1987 were chanting “Death to the Soviet Union” as well as “Death to America.” They threaten Western interests in the Persian Gulf and elsewhere and also the stability of the Soviet Union, whose population includes 55 million restive, spiritually oppressed Moslems.
Communist and Islamic revolutionaries are ideological enemies who share a common goal: the desire to attain power by whatever means necessary in order to establish dictatorial control based on their intolerant ideals. Neither revolution would bring a better life to people in the Third World. Instead they would make things worse. But one or the other will prevail unless the West develops a unified policy for addressing both the economic and the spiritual dimensions of the struggle now under way in the Third World.
The winds of change in the Third World are reaching tornado force. We cannot stop them, but we can help to change their direction. When people need and want change it is not enough to be against revolutionary change that would make things worse. The only answer to a bad idea is a better idea. Moslem fundamentalism is a faith. Communism is also a faith. As Whittaker Chambers observed in Witness thirty years ago, “The success of communism is never greater than the failure of all other faiths.”
In many parts of the Third World and particularly in the Moslem world, prosperity alone is not enough. Iran is an example. The myth of the Iranian Revolution is that it was caused by the Shah’s corruption, police repression, and the poverty of the masses. This is simply wrong. During the Shah’s reign Iran was better off than any other country in the region except Israel. Its people were by far the best educated. I recall the Shah telling me in 1979, when I saw him in Mexico shortly before he went to Egypt to die, that he had sent tens of thousands of students to colleges in the United States only to have them return and join the revolution against him. He liberated the women; many joined the revolution that put them back into the chador.
Khomeini’s revolution was ostensibly against repression. It was actually against modern, Western values. As far as repression is concerned, he set the cause of women back a thousand years. He hated communism as much as he hated capitalism, seeing them as two sides of the same materialistic coin. Young people supported his revolution not because they wanted more freedom and better jobs, housing, and clothing, but because they wanted something to believe in more than materialism. Since the revolution the Iranian people have received exactly the treatment Khomeini promised. Whether it is exactly what they thought they would get is unknown, since the Ayatollah holds no free elections. But there is no denying that he offered a true revolution of ideas and that they embraced it with passion and conviction.
Western economic ideals produce growth and prosperity. Western political ideals produce liberty. The Third World yearns for both, but because the West has been better at sending money than at promoting its values the communists and now the Moslem fundamentalists rush to fill the void. In the years between now and 1999 the United States must lead the way in a campaign to seize the moral high ground from those who promise prosperity and fulfillment in the developing world and deliver poverty for the body and chains for the soul.
If
the people of the Third World think we are interested only in winning the Cold War with the Soviet Union, we will lose the war for their hearts and minds. These people have tremendous problems. At least the communists talk about the problems. Too often we talk only about the communists.
We should launch a peaceful revolution for progress. To do so we need a coherent and consistent policy that addresses the security, economic, and political needs of the developing nations. We should understand that the Third World will not be a peaceful region of growth in the next century unless all three of these needs are met. Security without growth is an empty promise, growth without security is an imperiled promise, and growth and security without political development are an unfullfilled promise.
Security aid. While military aid to our friends and allies in the Third World is not the only answer to their problems, it is in some cases indispensable if they are to provide the security without which there can be no progress. Such aid should come with training assistance, not just in the use of these arms but in the proper conduct of the armed forces that receive them.
Economic aid. In 1986 we spent under $13 billion on foreign aid, approximately two tenths of one percent of our GNP. Considering that we spent over 6 percent of our GNP on national defense, we spent over thirty times as much money preparing for a war that we probably will never fight than for a war—the peaceful revolution for prosperity in the Third World—that we risk losing. Congress is now cutting the administration’s foreign-aid requests. This is tragically shortsighted. But we do need some major changes in our foreign-aid programs. Too much of our aid has been poorly distributed. Too much aid has fed Third World bureaucracies, maintained the status quo, fueled corruption, and supported repression. Too much aid was spent on north-to-south wealth distribution and too little on wealth creation.
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