- Created: 16 October 2015
Published on 29 September 2015 by Alexander Main & Dan Beeton for Jacobin Mag
Earlier this summer, the world watched Greece try to resist a disastrous neoliberal diktat and get a painful thrashing in the process.
When Greece’s left government decided to hold a national referendum on the troika-imposed austerity program, the European Central Bank retaliated by restricting liquidity for Greek banks. This triggered a prolonged bank closure and plunged Greece further into recession.
Though Greek voters ended up massively rejecting austerity, Germany and the European creditor cartel were able to subvert democracy and get exactly what they wanted: complete submission to their neoliberal agenda.
In the last decade and a half, a similar fight against neoliberalism has been waged across the breadth of an entire continent, and mostly outside of the public eye. Although Washington initially sought to quash all dissent, often employing even fiercer tactics than those used against Greece, Latin America’s resistance to the neoliberal agenda has in large part been successful. It’s an epic tale that’s gradually coming to light thanks to continued exploration of the massive trove of US diplomatic cables released by WikiLeaks.
Neoliberalism was firmly implanted in Latin America long before Germany and the eurozone authorities began force-feeding structural adjustment to Greece and other indebted, peripheral countries. Through coercion (e.g., conditions attached to IMF loans) and indoctrination (e.g., the US-backed training of the region’s “Chicago Boys”), the US succeeded in spreading the gospel of fiscal austerity, deregulation, “free trade,” privatization, and draconian public sector downsizing throughout Latin America by the mid-1980s.
The outcome was strikingly similar to what we’ve seen in Greece: stagnant growth (almost no per capita income growth for the twenty years from 1980-2000), rising poverty, declining living standards for millions, and plenty of new opportunities for international investors and corporations to make a quick buck.
Starting in the late ‘80s, the region began to convulse and rise up against neoliberal policies. At first, the rebellion was mostly spontaneous and unorganized — as was the case with Venezuela’sCaracazo uprising in early 1989.
But then, anti-neoliberal political candidates began to win elections and, to the shock of the US foreign policy establishment, an increasing number of them stuck to their campaign promises and began implementing anti-poverty measures and heterodox policies that reasserted the state’s role in the economy.
From 1999 to 2008, left-leaning candidates won presidential elections in Venezuela, Brazil, Argentina, Uruguay, Bolivia, Honduras, Ecuador, Nicaragua, and Paraguay.
Much of the story of the US government’s efforts to contain and roll back the anti-neoliberal tide can be found in the tens of thousands ofWikiLeaked diplomatic cables from the region’s US diplomatic missions, dating from the early George W. Bush years to the beginning of President Obama’s administration.
The cables — which we analyze in the new book, The WikiLeaks Files: The World According to US Empire — reveal the day-to-day mechanics of Washington’s political intervention in Latin America (and make a farce of the State Department mantra that “the US doesn’t interfere in the internal politics of other countries”).
Material and strategic support is provided to right-wing opposition groups, some of which are violent and anti-democratic. The cables also paint a vivid picture of the Cold War ideological mindset of senior US emissaries and show them attempting to use coercive measures reminiscent of the recent chokehold applied to Greek democracy.
Unsurprisingly, the major media has largely missed or ignored this disturbing chronicle of imperial aggression, preferring to focus instead on US diplomats’ accounts of potentially embarrassing or illicit actions taken by foreign officials. The few pundits that have offered bigger picture analysis of the cables typically assert that there is no significant gap between US official rhetoric and the reality depicted in the cables.
In the words of one US international relations analyst, “one doesn’t get an image of the United States as this all-powerful puppet master trying to pull the strings of various governments around the world to serve its corporate interests.”
A close look at the cables, however, clearly belies this assertion.
“This is Not Blackmail”
In late 2005, Evo Morales won a landslide victory in the Bolivian presidential elections on a platform of constitutional reform, indigenous rights, and a promise to combat poverty and neoliberalism. On January 3, just two days after his inauguration, Morales received a visit from US Ambassador David L. Greenlee. The ambassador cut straight to the chase: US-vetted multilateral assistance to Bolivia would hinge on the good behavior of the Morales government. It could have been a scene from The Godfather:
[The ambassador] showed the crucial importance of US contributions to key international financial [sic] on which Bolivia depended for assistance, such as the International Development Bank (IDB), the World Bank and the International Monetary Fund. “When you think of the IDB, you should think of the US,” the Ambassador said. “This is not blackmail, it is simple reality.”
Nevertheless, Morales stuck to his agenda. Over the next few days he forged ahead with plans to re-regulate labor markets, re-nationalize the hydrocarbons industry and deepen cooperation with Washington’s arch-nemesis Hugo Chávez.
In response, Greenlee suggested a “menu of options” to try to force Morales to bend to the will of his government. These included: vetoing multi-million dollar multilateral loans, postponing scheduled multilateral debt relief, discouraging Millennium Challenge Corporation funding (which Bolivia has still never received, despite being one of the poorest countries in the hemisphere) and cutting off “material support” to Bolivian security forces.
Unfortunately for the State Department, it soon became clear that these sorts of threats would be duly ignored. Morales had already decided to drastically reduce Bolivia’s reliance on multilateral credit lines that required US Treasury vetting. Within weeks of his taking office, Morales announced that Bolivia would no longer be beholden to the IMF, and let the loan agreement with the Fund expire. Years later, Morales would advise Greece and other indebted European countries to follow Bolivia’s example and “economically free themselves from the International Monetary Fund’s dictate.”
Unable to force Morales to do its bidding, the State Department began focusing instead on strengthening the Bolivian opposition. The opposition-controlled Media Luna region began receiving increased US assistance. A cable from April 2007 discusses “USAID’s larger effort to strengthen regional governments as a counter-balance to the central government.”
A USAID report from 2007 stated that its Office of Transition Initiatives (OTI) “ha[d] approved 101 grants for $4,066,131 to help departmental governments operate more strategically.” Funds also went to local indigenous groups that were “opposed to Evo Morales’ vision for indigenous communities.”
A year later, the Media Luna departments would engage in open rebellion against the Morales government, first holding referenda on autonomy, despite these having been ruled illegal by the national judiciary; then supporting violent pro-autonomy protests that left at least twenty government supporters dead.
Many believed an attempted coup was unfolding. The situation only calmed under pressure from all the other presidents of South America, who issued a joint declaration of support for the country’s constitutional government.
But as South America rallied behind Evo, the United States was in regular communication with the leaders of the separatist opposition movement, even as they spoke openly of “blow[ing] up gas lines” and “violence as a probability to force the government to . . . take seriously any dialogue.”
Contrary to its official posture during the events of August and September 2008, the State Department took the possibility of a coup d’etat against, or the assassination of, Bolivian President Evo Morales seriously.
A cable reveals plans by the US embassy in La Paz to prepare for such an event: “[The Emergency Action Committee] will develop, with [the US Southern Command Situational Assessment Team], a plan for immediate response in the event of a sudden emergency, i.e. a coup attempt or President Morales’ death,” the cable read.
The events of 2008 were the greatest challenge yet to Morales’s presidency, and the closest he came to being toppled. The embassy’s preparations for Morales’s possible departure from the presidency reveal that the United States, at least, believed the threat to Morales to be very real. That it did not say so publicly only underscores which side Washington was taking during the conflict, and which outcome it probably preferred.
How It Works
Some of the methods of intervention deployed in Bolivia were mirrored in other countries with left governments or strong left-wing movements. For instance, after the return of the left-wing Sandinistas to power in Nicaragua in 2007, the US embassy in Managua went into high gear to bolster support for right-wing opposition party Nicaraguan Liberal Alliance (ALN).
In February 2007, the embassy met with the ALN planning coordinator and explained that the US did “not provide direct assistance to political parties,” but — in order to bypass this restriction — suggested that the ALN coordinate more closely with friendly NGOs that could receive US funding.
The ALN leader said she would “forward a comprehensive list of NGOs that indeed support ALN efforts” and the embassy arranged for her to “next meet with IRI [International Republican Institute] and NDI [National Democratic Institute for International Affairs] country directors.” The cable also noted that the embassy would “follow up on capacity building for [ALN] fundraisers.”
Cables like this one should be required reading for students of US diplomacy and those interested in understanding how the US “democracy promotion” system really works. Through USAID, the National Endowment for Democracy (NED), NDI, IRI and other para-governmental entities, the US government provides extensive assistance to political movements that support US economic and political objectives.
In March 2007, the US ambassador in Nicaragua asked the State Department to provide “approximately $65 million above our recent past base levels over the next four years — through the next Presidential elections” so as to fund the “the strengthening of political parties, “democratic” NGOs, and “small, flexible grants on short notice to groups engaging in critical efforts that defend Nicaragua’s democracy, advance our interests, and counter those who rail against us.”
In Ecuador, the US embassy opposed left-wing economist Rafael Correa well ahead of the 2006 elections that swept him into office. Two months before those elections, the embassy’s political counseloralerted Washington that Correa could be expected to “join the Chavez-Morales-Kirchner group of nationalist-populist South American leaders,” and noted that the embassy had “warned our political, economic, and media contacts of the threat Correa represents to Ecuador’s future, and had actively discouraged political alliances which could balance Correa’s perceived radicalism.” Immediately following Correa’s election, the embassy cabled the State Department with their game plan:
We are under no illusions that USG efforts alone will shape the direction of the new government or Congress, but hope to maximize our influence by working in concert with other Ecuadorians and groups who share our views. Correa’s reform proposals and attitude toward Congress and traditional political parties, if unchecked, could extend the current period of political conflict and instability.
The embassy’s worst fears were confirmed. Correa announced that he would close the US air base in Manta, increase social spending, and push for a constituent assembly. In April 2007, 80 percent of Ecuadorean voters endorsed the proposal for a constituent assembly and in 2008, 62 percent approved a new constitution that enshrined a host of progressive principles, including food sovereignty, the rights to housing, health care and employment, and executive control over the central bank (an enormous no-no in the neoliberal playbook).
In early 2009, Correa announced that Ecuador would partially default on its foreign debt. The embassy was livid, about this and other recent actions, like Correa’s decision to align Ecuador more closely with the left-wing Bolivarian Alliance for the Peoples of Our America (ALBA) group of nations (which was initiated by Venezuela and Cuba in 2004 as a counter-force to the Free Trade Area of the Americas, then being pushed by the Bush administration). But the ambassador was also conscious that the US had little leverage over him:
We are conveying the message in private that Correa’s actions will have consequences for his relationship with the new Obama Administration, while avoiding public comments that would be counterproductive. We do not recommend terminating any USG programs that serve our interests since that would only weaken the incentive for Correa to move back into a more pragmatic mode.
The partial default was successful, and saved the Ecuadorean government close to $2 billion. In 2011 Correa recommended the same medicine for indebted European countries, particularly Greece,advising them to default on their debt payments and “ignore” the IMF’s advice.
The Streets Are Hot
During the Cold War, the supposed threat of Soviet and Cuban communist expansion served to justify countless interventions to remove left-leaning governments and prop up right-wing military regimes.
Similarly, the WikiLeaks cables show how, in the 2000s, the specter of Venezuelan “Bolivarianism” has been used to validate interventions against new anti-neoliberal left governments, like those of Bolivia, depicted as having “fallen openly into Venezuela’s embrace;” or Ecuador, seen as a “stalking-horse for Chávez.”
US relations with the left government of Hugo Chávez soured early on. Chávez, first elected president in 1998, broadly rejected neoliberal economic policies, developed a close relationship with Cuba’s Fidel Castro, and loudly criticized the Bush administration’s assault on Afghanistan following the 9/11 attacks (the US pulled its ambassador from Caracas after Chávez proclaimed: “You can’t fight terrorism with terrorism”).
He later strengthened the government’s control of the oil sector, increasing royalties paid by foreign corporations and using oil revenue to finance popular health, education and food programs for the poor.
In April 2002, the Bush administration publicly endorsed a short-lived military coup that removed Chávez from power for forty-eight hours. National Endowment for Democracy documents obtained through the Freedom of Information Act showed that the US provided “democracy promotion” funding and training to groups that backed the coup and that were later involved in efforts to remove Chávez through a managerial “strike” that paralyzed the oil industry in late 2002 and plunged the country into recession.
WikiLeaks cables show that, following these failed attempts to topple Venezuela’s elected government, the US continued to back the Venezuelan opposition through NED and USAID. In a November 2006 cable, then Ambassador William Brownfield explained the USAID/OTI strategy to undermine the Chávez administration:
In August of 2004, Ambassador outlined the country team’s 5 point strategy to guide embassy activities in Venezuela for the period [2004–2006] . . . The strategy’s focus is: 1) Strengthening Democratic Institutions, 2) Penetrating Chavez’ Political Base, 3) Dividing Chavismo, 4) Protecting Vital US business, and 5) Isolating Chavez internationally.
The close ties that exist between the US embassy and various opposition groups are apparent in numerous cables. One cable from Brownfield links Súmate — an opposition NGO that played a central role in opposition campaigns — to “our interests in Venezuela.”Other cables reveal that the State Department has lobbied for international support for Súmate and encouraged US financial, political, and legal support for the organization, much of it funneled through the NED.
In August 2009, Venezuela was rocked by violent opposition protests (as has occurred a number of times under both Chávez and his successor Nicolas Maduro). One secret cable from August 27 cites USAID/OTI contractor Development Alternatives, Incorporated (DAI) referring to “all” the people protesting Chávez at the time as “our grantees”:
[DAI employee] Eduardo Fernandez said that “the streets are hot,” referring to growing protests against Chavez’s efforts to consolidate power, and “all these people (organizing the protests) are our grantees.”
The cables also reveal that the US State Department provided training and support to a student leader it acknowledged had led crowds with the intention “to lynch” a Chavista governor: “During the coup of April 2002, [Nixon] Moreno participated in the demonstrations in Merida state, leading crowds who marched on the state capital to lynch MVR governor Florencio Porras.”
Yet, a few years after this, another cable notes: “Moreno participated in [a State Department] International Visitor Program in 2004.”
Moreno would later be wanted for attempted murder and threatening a female police officer, among other charges.
Also in line with the five-point strategy as outlined by Brownfield, the State Department prioritized efforts to isolate the Venezuelan government internationally and counter its perceived influence throughout the region. Cables show how heads of US diplomatic missions in the region developed coordinating strategies to counter the Venezuelan regional “threat.”
As WikiLeaks first revealed in December 2010, the US chiefs of mission for six South American countries met in Brazil in May 2007 to develop a joint response to President Chávez’s alleged “aggressive plans … to create a unified Bolivarian movement throughout Latin America.” Among the areas of action that the mission chiefs agreed on was a plan to “continue to strengthen ties to those military leaders in the region who share our concern over Chávez.” A similar meeting of US mission chiefs from Central America — focused on the “threat” of “populist political activities in the region” — took place at the US embassy in El Salvador in March of 2006.
US diplomats went to great lengths to try to prevent Caribbean and Central American governments from joining Petrocaribe, a Venezuelan regional energy agreement that provides oil to members at extremely preferential terms. Leaked cables show that, while US officials privately acknowledged the economic benefits of the agreement for member countries, they were concerned that Petrocaribe would increase Venezuela’s political influence in the region.
In Haiti, the embassy worked closely with big oil companies to try and prevent the government of René Préval from joining Petrocaribe, despite acknowledging that it “would save USD 100 million per year,” as was first reported by Dan Coughlin and Kim Ives in the Nation. In April 2006,the embassy cabled from Port-au-Prince: “Post will continue to pressure [Haitian president René] Preval against joining PetroCaribe. Ambassador will see Preval’s senior advisor Bob Manuel today. In previous meetings, he has acknowledged our concerns and is aware that a deal with Chavez would cause problems with us.”
The Left’s Record
One must keep in mind that the WikiLeaks cables don’t offer glimpses of the more covert activities of US intelligence agencies, and are likely only the tip of the iceberg when it comes to Washington’s political interference in the region. Still, the cables provide ample evidence of US diplomats’ persistent, determined efforts to intervene against independent left governments in Latin America, using financial leverage, the manifold instruments available in the “democracy promotion” toolbox — and sometimes even through violent and illegal means.
Despite the Obama administration’s restoration of diplomatic relations with Cuba, there is no indication that policy toward Venezuela and other left governments in Latin America has fundamentally changed.
Certainly, the administration’s hostility toward the elected Venezuelan government is unrelenting. In June 2014, Vice President Joe Biden launched the Caribbean Energy Security Initiative, seen as an “antidote” to Petrocaribe. In March 2015, Obama declared Venezuela an “extraordinary security threat” and announced sanctions against Venezuelan officials, a move unanimously criticized by other countries in the region.
But, despite incessant US aggression, the Left has largely prevailed in Latin America. With the exception of Honduras and Paraguay, where right-wing coups ousted elected leaders, nearly every left movement that came to power in the last fifteen years remains in office today.
Largely as a result of these governments, from 2002-2013 the poverty rate for the region fell from 44 to 28 percent after actually worsening over the prior two decades. These successes, and the willingness of left leaders to take risks in order to break free of the neoliberal diktat, should be an inspiration for Europe’s new anti-austerity left today.
Certainly some of the governments are experiencing significant difficulties today, in part due to a regional economic downturn that has affected right- and left-wing governments alike. But seen through the lens of the cables, there are good reasons to question whether all of these difficulties are homegrown.
For instance, in Ecuador — where president Correa is under attack from the Right, and from some sectors of the Left — protests against the government’s new progressive tax proposals involve the same opposition-aligned business leaders that US diplomats are seen strategizing with in the cables.
In Venezuela, where a dysfunctional currency control system has generated high inflation, violent right-wing student protests seriously destabilized the country. The odds are extremely high that some of these protestors have received funding and/or training from USAID or NED, which saw its Venezuela budget increase 80 percent from 2012 to 2014.
There is still much more that we can learn from the WikiLeaks cables. For the “Latin America and the Caribbean” chapters of The WikiLeaks Files, we pored through hundreds of WikiLeaks cables, and were able to identify distinct patterns of US intervention that we describe at greater length in the book (some of these previously reported by others). Other book authors did the same for other regions of the world. But there are over 250,000 cables (nearly 35,000 from Latin America alone) and there are undoubtedly many more notable aspects of US diplomacy in action that are waiting to be uncovered.
Sadly, following the initial excitement when the cables were first released, few reporters and scholars have shown much interest in them. Until this changes, we’ll be lacking a full account of how the US state sees itself in the world, and how its diplomatic arm responds to the challenges posed to its hegemony.