Evolving Latin America
By Robert D. Kaplan
Chief Geopolitical Analyst
Many U.S. presidents begin their term in office vowing to pay more attention to Latin America and then fail to do so. Indeed, the first summit of a presidential term is often with the leader of Mexico, either in Mexico City or Washington. The new White House staff surely acknowledges the importance of Latin America; it is just that crises elsewhere in the world quickly get in the way. By the time an American president gets done dealing with the Middle East, East Asia and Europe, it is time for him to run for re-election, or retire, whatever the case may be. Latin America has been, once again, forgotten.
Meanwhile, the importance of Latin America to the United States continues to climb. U.S. trade with Latin America — both in terms of imports and exports — has grown from 18.9 percent of America's total worldwide trade to 21.6 percent over the past decade. At the same time, however, the percentage of trade between the largest Latin American economies — Mexico, Colombia, Venezuela, Brazil and Argentina — and the United States has decreased dramatically. For example, the United States accounted for nearly a quarter of Brazil's overall trade in 2002, but the figure was only 12.5 percent in 2011 — a drop in half. And whereas three-quarters of Mexico's overall trade was with the United States in 2002, it went down to 64.2 percent in 2011. In other words, as Latin America becomes more important in economic terms to the United States, the United States becomes relatively less important to Latin America.
Europe, China and other parts of the world are clearly moving closer to Latin America in terms of trade, weakening slightly the influence Washington can wield in Latin American capitals (though Europe has been a significant trading partner of Latin America ever since Portuguese and Spanish colonialism). Concomitantly, ever since the promulgation of the Monroe Doctrine in the early 19th century, U.S. power in Latin America has remained simply too overwhelming for the development of truly healthy bilateral relationships. Make no mistake: Anti-Americanism lives on in Latin America. Do not dismiss it as a political force. The question is, what is its practical, functional effect?
For the moment, anti-American forces seem temporarily in retreat. The eventual passing of communist leader Fidel Castro in Cuba and anti-American populist Hugo Chavez in Venezuela will rob the Latin American left of highly symbolic poles of reference, especially since economic reality will eventually push both Havana and Caracas to moderate politically. And without Castro and Chavez as points of ideological orientation, leftist regimes in Ecuador, Bolivia and Nicaragua will see their relative diplomatic strength weakened. Ecuadorian President Rafael Correa and Bolivian President Evo Morales will try to harness a particular Latin American-style populism in the service of retaining power — that is, using the masses against the elite. And they may continue to succeed. But without the Cuban and Venezuelan leaders as charismatic lodestars, the populism of these two other countries will have less relevance in terms of hemispheric power struggles.
Brazil, the behemoth of South America, might be expected to lead a bloc of states presenting an alternative to U.S. leadership. To be sure, Brazil is a regional power, especially with Ecuador, Bolivia and Venezuela joining the Brazilian-Argentinian trading bloc of Mercosur. But Brazil, despite all the trendy media reports, is nevertheless hampered by corruption, a weak judicial system and, most important, falling economic growth (from 7.3 percent in 2010 to 1.03 percent in 2012), even as labor costs have gone up. The first generation of reforms that accounted for the Brazilian economic miracle must now be followed by a second generation. The challenges, therefore, for Brazilian President Dilma Rousseff are immense. For the moment, the United States does not feel really threatened by Brazil and in fact is quite comfortable with Brazil taking the lead on regional initiatives. Brazil's response to Washington is one of calculated cooperation.
Meanwhile, Argentina remains a self-contained mess. The country is strangled by economic distortions because President Cristina Fernandez de Kirchner's government keeps interfering in the markets to keep the costs of natural gas, electricity and other goods low for consumers. Another currency crisis looms amid rising labor unrest and limited access to international capital markets.
But perhaps the biggest trend working against a dynamic resurgence of anti-Americanism is the formation of the Pacific Alliance by Mexico, Colombia, Peru, Chile and maybe even Panama and Costa Rica. These are all countries whose organizing philosophical principle is the championing of economics over political ideology, and thus they want to take advantage of free trade with Asian markets.
In sum, the hard-core Latin American left is not only weakened by the imminent passing of Castro and Chavez, but by the domestic distractions of Brazil and Argentina and by the heightened proximity of Asian business opportunities. Were the United States and Mexico to forge an alliance based on energy cooperation and immigration reform — with American firms able to invest in the Mexican oil sector — you might almost imagine a distinctly pro-American dynamic in Latin America, except for the fact that Mexico's political influence in the region is both curtailed and compromised by its very proximity to the United States. Simply put, Mexico is too deeply enmeshed in its relationship with the United States to exert profound influence elsewhere in the hemisphere.
In all of these developments, there is no strong hint of the kind of crisis — or opportunity — that would give an American president the incentive to really concentrate on Latin America. Growing trade with the southern part of the hemisphere is an issue for business forums and the Treasury and Commerce departments; not so much for the National Security Council or the State Department. The truth is that foreign policy is driven by extreme diplomatic and military crises of the level that Latin America simply does not often provide. Yet this is not bad news for Latin America, but rather good news. Syria, for example, is important — but it's a disaster. Chile is not important — but it's a relative success story. Importance and success can be mutually exclusive in many cases.
If you really want to see the ironic rise of Latin America, consider Mexico: In much of the country, particularly in the north, drug cartels operate and the violence drones on there. But Mexico had the world's 14th-largest economy in 2011 according to the World Bank, and may edge higher over the next decade, even as large countries in Europe like Spain and Italy sink further into the economic and social abyss. A decade from now, even with its drug violence, Mexico could boast high-speed rail service and deepwater harbors on both the Atlantic and Pacific coasts linked by train. The dynamism you see in certain regions of Mexico like Queretaro are contrasted with the increasing decay and depressed atmosphere of a historically great city like Rome, the capital of a country mired in crisis.
To travel from Mexico to Europe is to see how the tectonic scales of power in the world are shifting, and how Europe is losing status compared to Latin America, even as the relationship between the United States and Latin America is becoming both more organic and subtle. Hard-core anti-Americanism in Latin America will not disappear, but it might well become less relevant. And as the United States becomes increasingly energy independent, it will have less incentive to be obsessed with the Middle East and may begin to rediscover its own hemisphere.