U.S. Crisis Deepens Divisions in S. America
Wednesday, October 1, 2008
RIO DE JANEIRO, Sept. 30 -- As his popularity has surged and his nation's booming economy has lifted thousands from poverty, Brazilian President Luiz Inácio Lula da Silva has largely refrained from the angry criticism of the United States that can be heard nearly any day from other South American leaders.
Not this time.
Last week, Lula told the U.N. General Assembly that the "boundless greed" of a few should not be shouldered by all, and on Monday he said emerging economies had done their best to have "good fiscal policy" and "can't be turned into victims of the casino erected by the American economy."
"This crisis belongs to the American bankers, to the European bankers. It doesn't belong to the Brazilian bankers," Lula said Monday. "It's not fair for Latin American, African and Asian countries to pay for the irresponsibility of sectors of the American financial system."
The U.S. financial crisis has stung emerging markets and angered leaders who have swallowed American advice about fiscal responsibility for years. In Latin America, where several leaders have made their ideological differences with the United States a central part of their rhetoric, the crisis appears to have further degraded U.S. credibility.
"They've always been critical of the U.S. for its negative agenda, drugs and immigration, but the economy was seen as the one positive thing, and this crisis probably puts that in a different light," said Michael Shifter, vice president for policy at Inter-American Dialogue in Washington.
Across Latin America, there is a growing division between countries that embrace certain U.S.-backed free-market policies, often referred to as the "Washington consensus," and those that renounce them. The leading anti-U.S. spokesman is President Hugo Chávez of Venezuela, who traveled to Brazil on Tuesday and urged Latin American countries to continue disconnecting from the U.S. economy, which he called a "wagon of death."
"The world will never be the same after this crisis," Chávez told reporters in Manaus, where he met with Lula and Bolivia's President Evo Morales. "A new world has to emerge, and it's a multipolar world."
Chávez predicted oil prices would drop to between $80 and $95 a barrel as a result of the financial turmoil. He also said the crisis shows why it is urgent to speed the creation of a Latin American regional development bank, known as Bank of the South.
Morales said that in Bolivia, companies are nationalized so that people can have money, while the United States "wants to nationalize debt and the crisis of the people that already have money."
Bolivia's finance minister, Luis Alberto Arce, said in an interview that countries such as Bolivia with few ties to international capital markets have just started to feel the impact of the crisis. But if the United States doesn't bolster its economy quickly, he said, Latin American countries can expect declines in commodities prices, exports and remittances from relatives living abroad.
In Argentina, the world's third-largest exporter of soy and wheat and second-largest exporter of corn, concerns are focused primarily on falling commodity prices and the potential for economic slowdown after several years of strong growth. Argentine President Cristina Fernández de Kirchner said Monday in Buenos Aires that "old paradigms are changing."