Wednesday, December 13, 2006

Regarding COHA's December 13 Press Release "Will Democrats Cut and Run from Bush’s Deeply Flawed Latin American Policy?"

  • Bush’s Latin American policy and what can be expected now that the Democrats control both Houses of Congress
  • Up to now, the Democrats have either ignored or lacked much wisdom on regional issues

Is there, or will there be, a revitalized Democratic Latin American policy as distinct from the farrago of ineptitude witnessed under the Bush administration? To begin, in Bush’s eye, the Cold War remains. The head of his personal list of enemies is Venezuela’s Hugo Chávez, and, of course, Fidel Castro. While this may be a faithful characterization of the Bush hemispheric strategy, it does not differ that much from the opportunism and occasional meretricious initiatives of the Clinton administration and its all-encompassing pursuit of free trade. Clinton’s controversial trade agenda predictably developed a sharp cleavage over policy both within the Democratic and Republican parties as well as between them.

Full article...

~ With due respect for your integrity, I wish to ask you the following:
Colonialism has acquired its greatest seccesses in Puero Rico, causing it's people to lean on dependency, lack of self-esteem, and self demeaning to the point of making our people believe that they are "Americans" as the colonial term applies to USians. We cannot go through life claiming defendeses of peoples' rights without encompassing each and every place where those rights are being trampled.

Yours truly,

Ramón E. Dapena, ex-Puerto Rican legislator and US citizen though not by choice but because of invasion and colonialism ~

Dear Ramon,

The people here mainly select the themes they wish to write and go ahead and do it. We had a young “independentista” a year or so ago and he did a couple of articles on that issue (maybe just one on that issue). We’ll see whether we can get one going on the subject. Believe me, I respect your obvious passion on the subject and we’ll try to service the issue.

My best,

Larry Birns
Director of COHA

Friday, December 08, 2006

Regarding COHA's December 21 Press Release "Washington (Perhaps Unwittingly) Unleashes Another Onslaught on an Already Precarious Caribbean Economy"

A correction has been made to the aforementioned piece, in which a statistic showed that 17% of Americans were in possession of a passport. Since publication, the author has updated the fact in accordance with the most recent data, which shows the figure to be closer to 25%.

Friday, November 17, 2006

Regarding COHA's November 15 "Washington Looks to Cement its Military Presence in Central America by Emphasizing its Ties to Honduras"

The Latest in a Series of COHA Reports on the Latin American Military
  • Daniel Ortega’s victory in Nicaragua’s recent presidential election could roil the U.S. – as well as its friends in El Salvador, Guatemala, Honduras and Panama – making Central America the new fulcrum for the Bush administration’s future regional security policy

When Honduran President Manuel Zelaya visited Washington this past June, he had two security-related requests for President Bush. The first was to convert the Colonel Enrique Soto Cano airbase (also commonly known as Palmerola) into a commercial air cargo terminal, while the second was to deploy U.S. Special Forces along the Mosquitia region in eastern Honduras to help combat drug-trafficking along the Caribbean coast. At the time of President Zelaya’s visit, there were numerous media reports indicating that a military facility would be built in the Mosquitia with Washington aid that would, most likely, house some form of a U.S. military presence.

Full Article

~Response from Armstrong A. Wiggins~

It is very sad you write a story about Military Presence in Central America... specifically in La Moskitia, Hondoras and you didn't mention anything about the Miskito Indian from la Moskitia that own that land and territories.. I think Daniel Ortega from Nicaragua needs to consult with Miskito from Nicaragua and Zelaya from Honduras need to do the same with the Miskitos from la Moskitia, Honduras.

COHA still don't get it!

-Armstrong A. Wiggins

Reply from COHA Staff:

Mr. Wiggins,

I agree with you that I should have made a clear reference to the Miskito people's position on the proposed military facility and I apologize for not doing so. However, the scope of my article was an analysis of Central American security and the U.S.' interests in the region, and as I was working under space limitations, I was unable to discuss the Miskito's position as well as other relevant issues to the proposed facility.

I agree that any proposed military facility should be the result of conclusive talks among the governments and Miskito people- I sincerely hope that this will be the case. COHA will continue to closely monitor the situationand report whatever events may occur. I do hope that even though I did not discuss it directly, my article helped raise awareness of events going on in the Mosquitia.

Finally, I can assure you that COHA does "get it." Since its foundation, COHA has fought to improve responsible policymaking and to promote the rights of people across the hemisphere, from the persecuted during the era of South AMerica military governments to those who suffered during the civil wars in Guatemala, Nicaragua, and El Salvador. We try our best to report on important events occurring throughout the region, particularly those regarding ethnic groups, like the Miskito, Colombia's U'wa, Chile's mapuches etc.

Friday, November 03, 2006

Regarding COHA's November 2 Press release: "Nicaragua Elections: Ortega Appeals to a Higher Power"

  • For the fourth time since his unceremonious electoral ousting from the presidential office in 1990, Daniel Ortega is looking to become the next leader of Nicaragua - and thanks to his forgiving supporters, along with his increasingly preachy sermons, he may achieve it
  • The U.S., in spite of the best covert efforts at intervention undertaken by Ambassador Paul Trivelli, has failed to bring cohesion to Ortega’s opposition and is likely to lose even more leverage in Latin America in the event of a Sandinista victory

In a campaign replete with warm-and-fuzzy rhetoric aimed at influencing the populace to look less critically at his infractions incurred during three-decades of public life, Daniel Ortega is once again running for president. Some analysts have concluded that this time he will not lose his bid as he did in 1990, 1996 and 2001, as his current closest competitor is straggling more than ten points behind him. However, looking beyond his evangelical-styled appearances at public rallies, where he never fails to pronounce the importance of reconciliation, it becomes increasingly apparent that Ortega does not really have a clearly etched platform regarding key issues such as land reform, free trade initiatives, workers’ rights or drug policy, only tactics of the day. Concomitantly, his likely victory has to be seen as providing momentum behind South America’s pink tide movement, and the strong likelihood that, to Washington’s great chagrin, he will develop some kind of a relationship with Venezuela’s Hugo Chávez and Bolivia’s Evo Morales. One clue to the true nature of his presidential bid is the fact that his past enmity towards the U.S. obviously still runs deep, as shown in his periodic blasts at the “empire” given at whistle stops along his campaign trail. At the same time, however, his style has been to minimize the stormy history of Nicaragua’s past and future bilateral relations between the two countries. Come November 5, Nicaraguans will have to decide if Ortega really is the changed man he claims to be.

Full article ...

~To the Editors, Ryann Bresnahan et al,

The progressives in Nicaragua have been betrayed enormously by Ortega, and his opportunistic alliance with --Aleman!-- and the Church in Nicaragua, The incredible vote which was unanimous to deny any woman an abortion]under any circumstances, was unbelievable, and besides the problems in that particularly oppressive content, was a measure of how far Ortega was willing to go to get elected.

Had Lewites not died, he would have been much closer to the core spirit and values of Sandinismo, and though they have little chance of winning, the remaining candidates for Lewites' party are at least honest partisans to represent the values that were inherent in the original Sandinista revolution.

I am very surprised, as a regular COHA subscriber and reader, and someone who appreciates the COHA research and papers, that this piece ignored the serious and deep flaws in the Ortega candidacy, not to mention his own personal liabilities in the allegations made towards him by his step-daughter.

The progressives had a real dilemma, given the US interference-- and may have had to support Ortega only for that reason. But he looks, sounds, and acts like someone who on the way to the presidency got corrupted.

Please follow up with another article in the near future on the status of women at this time in Nicaragua. I have at least three articles in Spanish from Nicaragua that describe the rage of the womens' movement there.

Thank you for your work, in general, though I take exception to this article.

David Green


COHA staff:

Dear David,

In all sincerity, I think that we were rather harsh on Ortega.
In fact, we raised all the points except for the abortion vote (which you brought up).
I do recall that Ortega put me up in the early 1980 when I was visiting the country. For this, he deserves some leeway. However, I agree with you.

Regarding COHA’s October 10 Op-Ed: “Pragmatism vs. Populism in South America”

  • The foreign policies of South American countries reflect the intricacies of national interests rather than any overarching ideology
  • Correspondingly, the perception of Washington among the South American public is characterized by substantial diversity
The reemergence of populism and the intriguing if possibly brief half-life of the left-leaning “pink tide” movement in South America have facilitated a somewhat misleading perception that the continent as a whole is headed towards an era of leftist, anti-U.S. policies. While the hostility between Venezuelan President Hugo Chávez and the Bush administration reached a new high at the 61st UN General Assembly session, most of the other South American nations have taken a decidedly more pragmatic stance with regards to Washington, essentially sitting out the spat now taking place around them. In fact, the majority of South American leaders often play both sides – cooperating with left-leaning Latin American stalwarts while accommodating themselves, at important junctions, to U.S. priorities. Thus the challenges posed by Hugo Chávez and often Evo Morales could represent the exception rather than the norm.

Full article...

~ Gentlemen: One of the things we need nowadays is objective information. Utilizing the term Populism is playing up to the detractors of a system for Social Justice, it is a tool to adhere the subterm "ism" to anything in order to get it installed in the minds of the public as an idelogical brother of "communism", "fascism", "nazism", et al. Please cooperate to a better and clearer understanding. Riggin Dapena, La Corunha, Spain

COHA is always ready to cooperate and we will consider the point that you made. Please remember that the “populism” piece was put in the dissent section and does not represent COHA’s official position.

Larry Birns
COHA Director

Wednesday, October 25, 2006

Regarding COHA's October 19 Press Release: "UN Delegations: Consider St. Lucia for the Security Council’s Latin American Seat"

Guatemala and Venezuela have persistently fallen short of the two thirds majority needed to secure GRULAC’s (the UN’s Latin American and Caribbean caucus) seat in the UN Security Council (UNSC) after more than two days of voting and 22 grueling rounds of balloting. Now, into the third day of voting, the results read: Guatemala 110, Venezuela 77. Voting was suspended on Tuesday until today, Thursday October 19, giving Venezuela and Guatemala’s ringmaster and vociferous supporter – the United States –time to lobby other governments into supporting their respective camps, or to consider a compromised third nominee.

Full article...

~Interesting idea. And I haven't seen think tanks trying to alter public debates on United Nations votes before.

Bob Press

Robert Press
Assistant Professor

Political Science
University of Southern Mississippi

~I'm a bit taken aback by your St. Lucia suggestion for the GRULAC Security Council seat. The choice between Venezuela and Guatemala should be a simple one - like choosing between St. Joan and Jack the Ripper even if Jack is always the US's favorite as long as he's our Jack.

I hope Chavez has other ideas, and if I were he I would never back off an inch from pursuing what all the UN neys know he deserves despite their cowardly votes against him. I'd go 122 ballots and many more to infinity until they threw me out bodily. He just may do that. If you can send me his email address, I'll recommend it.

I do enjoy your articles so please keep sending even though I disagree at times. I write a great deal about Venezuela for

Steve Lendman

Regarding COHA’s September 18 Press Release “Trinidad and Tobago’s Dirty Peg to the U.S. Dollar and Inflation Galore: Fateful Days for the Economy”

Thursday, October 12th, 2006

Mr. Anthony Wilson
Business Editor
Trinidad Guardian

Thank you for the time you spent in critiquing my analysis. You made several valid points and the necessary changes will be made to the article. However in several concerns you voiced, you had been overly hasty to prove the thesis wrong and missed important facts that compromise your position. For your benefit in the following I have included some sources from widely respected economic analysis providers.
Brittany Bond
Research Associate, Council on Hemispheric Affairs
I respond piece-meal leaving intact your original critiques.

Mr. Wilson: 1)COHA states that the Trinidad government is “disproportionately channelling investments into its natural gas and oil production.”
The government is described as engaging in a “biased allotment of funds to the energy sector.”
This statement is entirely bogus.
The TRUTH is the Trinidad government has made few direct investments in the energy sector. Such investments as have been made were made by State-owned companies such as NGC and Petrotrin. All projects were scrupulously analysed, were funded by foreign project financiers and were based on the balance sheets of the companies.
Most of the investments in the energy sector have been made by foreign and local private sector businesses.

COHA STAFF: According to reliable sources such as (Trinidad Government to Ease Inflationary Pressures 08/31/2006) and The Economist, (Trinidad’s dash for development 08/42/2006) there is warranted reason to believe that the Trinidad government is channeling extra investments towards natural gas and oil production. For example, Minister in the Ministry of Finance, Conrad Enill, made the announcement while speaking in the Senate on Tuesday August 22 on a government motion meant to increase the borrowing limit in the country from TT$8 billion to TT$20 billion to better manage excess liquidity in the economy. He also noted that while Trinidad and Tobago was not directly affected by record-high global oil prices due to Government’s TT$1.3 million subsidy on fuel, it was experiencing indirect effects with regard to inflation.

Mr. Wilson: 2) COHA states:
“Most significantly, this inflation-rate statistic is actually being negatively altered by Trinidad and Tobago¹s record-breaking gas and oil revenues. This is due to government restraint in raising interest rates in the energy sector so as not to deter investments from the only area supporting the country¹s economy. If gas and oil figures were not included in the average, the inflation rates would be seen as bordering on the astronomical. ”
This statement is entirely bogus.
The TRUTH is the all energy companies fund most of their capital expenditure requirements in US dollars from foreign banks. Even the local energy companies fund their capex requirements from foreign banks.
The Government (really the Central Bank) has little influence over interest rates on US dollars held in Trinidadian banks.
Therefore, rising interest rates have little impact on the energy sector

COHA STAFF: It is basic economics that in order to abate increasing inflation, a government should raise interest rates. In carefully reading the above quote from Trinidad’s Finance Minister, it is seen that although indirectly, Trinidad’s energy sector is, in fact effected by inflation.
In regard to energy companies trading funds, you are correct, in that it is in fact, relevant and important to mention that oil and gas are by-and-large traded in U.S. dollars.

Mr. Wilson: 3) The COHA analysis suggests that the TT dollar would appreciate if it was allow to float freely, “given the positive effects of foreign investment and trade surplus.”
This statement is false, misleading and shows a woeful lack of knowledge of Trinidad realities. One Trinidad reality is that the Central Bank has had to sell hundreds of millions of US dollars to the market to prop up the TT dollar thereby preventing its depreciation. Anyone who has even fleeting knowledge of the T&T economy would know this. If it were not so, the Central Bank would be in a position of having to buy US dollars from the market to maintain exchange rate stability.
As most people know, foreign investment and energy tax payments (trade surplus) are lumpy with tax payments being made quarterly and foreign investments being disbursed as necessary.

COHA STAFF: You say “One Trinidad reality is that the Central Bank has had to sell hundreds of millions of US dollars to the market to prop up the TT dollar thereby preventing its depreciation.” I am fairly certain that is another way of defining a Dirty Peg. A Dirty Peg if I must reiterate often creates an illusionary value of the smaller country’s currency vis-à-vis the currency it is pegged to.
This is very similar to the current issue at the IMF and World Bank where China’s peg to the U.S. dollar has become a very contentious issue because if China allowed it’s currency to float freer it would appreciate relative to the US dollar. As of now, it is artificially cheapened (just like the Trinidadian dollar) so that Chinese exports are cheaper in the U.S. and U.S. goods are more expensive in China.

Mr. Wilson: 4) The COHA analysis states: “Since the T & T dollar is kept at a lower pegged rate, foreigners can buy Trinidadians and Tobagonian products, like natural gas and other products, cheaper than if the currency was appreciating as would happen if it freely floated.”
If this argument were correct, it would mean that Trinidad nationals would be able to buy foreign products at cheaper prices. But it would also mean a flood of “cheap” foreign products into T&T with no guarantee that prices would be lowered as a result given the structure of the economy. (The proof of this is that lower import tariffs have had little impact on prices)
In my view, an appreciation of the exchange rate would lead to a massive draw-down of the country’s foreign reserves as everyone would expect the appreciation to be temporary.

COHA STAFF: Again, it is basic economics that an artificially appreciated currency from pegging means that this country’s (Trinidad’s) exports are equally artificially cheaper abroad and the imports from countries whose currencies are artificially cheapened by the peg (United States) are artificially more expensive. Therefore, no there would not be a flood of “cheap” foreign products into T&T; just the opposite.

Mr. Wilson: 5) COHA states: “So far, the Trinidadian Bank has concentrated all its efforts into managing monetary policy, largely ignoring the fiscal aspect of inflation risks.”
The TRUTH is that the Central Bank is responsible for managing monetary policy. As in most other countries, fiscal policy is the province of the Minister of Finance.

COHA STAFF:Thank you. Valid observation. It would be more correct to say the Trinidad and Tobago has concentrated all its efforts into managing monetary policy… There is a need to distinguish between the separate roles the Central Bank and the Minister of Finance play. This error will be corrected in my analysis.

Mr. Wilson: 6) COHA states: “For example, flushed with large sums of energy revenues, the Central Bank has taken on large-scale construction of roads, railways, factories and medical facilities.”
The TRUTH is that it is the Central Government that is responsible for undertaking the large-scale projects, not the Central Bank. The Central Government has NOT “taken on” the large scale construction of factories and medical facilities. The railway project is in the planning stage as is the construction of most highways.

COHA STAFF: Again, you are correct in pointing out my errors in enumerating the responsible bodies. It is not the Central Bank but in fact the Central Government that is taking on large-scale construction projects. This error too will be fixed in my analysis.
I am however not alone in cautioning Trinidad and Tobago in over-extending itself with these over ambitious construction projects. (you can refer to The Economist as well as Economic Intelligence Unit for similar voicing of concerns)

Mr. Wilson: 7) COHA states: “However, missing in these mega-projects are the doctors for the new facilities, as well as water sources for those communities desiccated because of the water-guzzling new factories.
Trinidad’s problems with provision of medical services and water are well known but the statement that doctors are “missing” in the “new” facilities is a figment of the authors over-active imagination. There are no “water-guzzling new factories” and existing petrochemical plants are supplied with desalinated water from the Gulf of Paria.

COHA STAFF: This analysis came from several of my news sources including the aforementioned Economist article which states:
“Flush with revenue, the government has gone on a spending spree: on free higher education and skills training as well as roads, a commuter railway, low-cost housing, a national cancer-treatment programme and leisure facilities. It seems to find such mega-projects easier to implement than reforming routine public services. Hospitals are short of good administrators and, sometimes, medicine. Waiting lists for operations are long.”
In relation to the problems of water guzzling factories consider the following assertion again from the Economist:
“But the boom is throwing up problems too, ranging from rising food prices to traffic jams, with two hours of gridlock each morning. In the rural south a middle-aged householder says his district has had no mains water for days because of the demand from thirsty factories.”

Mr. Wilson: 8) COHA states: “The government¹s asymmetrical spending, which benefits the energy sector, crowds out investment from less favored parts of the economy.”
It would be a stretch to claim that the Government’s spending is benefiting the energy sector. The TRUTH is that the Government’s asymmetrical spending is being poured into unnecessary building projects. These are crowding out less favoured parts of the economy, as stated.

COHA STAFF: To continue my consistency, please consider the following point recently enumerated by experts at the Economist:
“Some Trinidadians fear that the island is trying to grow too fast. If planned industrial projects go ahead, known gasfields could be used up in about 20 years. They worry about the environment, and note that growth is lopsided: agriculture is in swift decline, for example.”

Tuesday, August 22, 2006

Regarding COHA Report “The Rebirth of Populism in Latin America Poses A Powerful Challenge to the Neoliberal Order"

History may never repeat itself, but some patterns have a tenacious staying power. Latin America’s populist political movements, as today’s genera represented by Hugo Chávez in Venezuela would exemplify, display a recurring vigor which is not all that mysterious. On the one hand, powerful elites continue to dominate the region’s economic and political structures. In the context of more than two decades of recent neoliberal economic initiatives, the rich have become much richer, and everyone else has tended to fall steadily behind. Social justice throughout the region is at best spotty, and often tends to be little more than an elusive fantasy or the prospected gift of blowhards. On the other hand, Latin America’s less-favored inhabitants remain decidedly unsatisfied with the status quo, and indeed, see it as a noxious growth that must be cut at the root. The above are textbook conditions for the rise of populism.

Full article...

~ Dr. W. John Green
Could you kindly document where I have advocated reduced public spending adn a flattened tax structure, both of which you attribute to me personally. If you are unable to do this, kindly print a correction and retraction,

Yours faithfully

John Williamson~


Dr. Williamson,
It was not my attention to attribute those specific policies to you personally, nor do I think my wording actually does so. But it could be clearer, I agree.
I’ll speak to Larry Birns, COHA’s director about sending out a clarification, if you so desire.

John GreenCOHA Senior Research Fellow~

~Dr Green,
Your article states inter alia “Williamson’s advice…included…reduced public spending and a flattened tax structure…”. That seems to me absolutely unambigous, and is incorrect. I would appreciate a clarification, retraction, and apology.

John Williamson~

~COHA Responds

Dr Williamson,

Let’s look at the full quote.

“Williamson’s advice, aimed at developing countries around the globe, embodied ideas long favored by neoliberal economists that emphasized “free market” solutions. These included fiscal discipline, redirected (and reduced) public spending, and a flattened tax structure that dropped the higher brackets while raising the lower. Governments were advised to eliminate tariffs and encourage greater hospitality to direct foreign investment. However, without question, the most important of these “reforms” was the deregulation of the business environment and privatization of state-owned enterprises.”

My mistake here is not making enough of a break between these two sentences. The first seems defendable enough. So are the following sentences, except that I utterly fail to make it clear that I’m going on to address the general complement of policies often associated with what some would call a “neoliberal” take, and others a “free market” approach, and not your individual position. It was not my intention to attribute to you all policies associated with this general perspective, but one can look at it that way. I disagree, howver that it is “absolutely unambigous” as you say. If it were, we would not be having this exchange.
If you demand that I apologize for a sin against clear writing, I do so now, and will do so again in public as soon as possible.

Once again, Respectfully,
John Green~

~Dr. Green,

Actually my paper was directed primarily at Washington, and was about Latin America not “developing countries around the globe”, but we’ll let that pass. It did indeed embody some to the ideas favored by neoliberal economists–all the mainstream ideas they favored, like fiscal discipline, redirected public expenditure, and free trade, and none of their cranky ones like reduced public spending everywhere and flat tax structures. I do not see how anyone can read the second sentence as not applying to me, and accordingly I would indeed appreciate your using the mechanisms you have to publicise an apology.

John Williamson~

~COHA Responds:

Dr. Williamson,

I’m sorry this has happened. As I wrote, I agree that it can be read this way, and at best it is unclear. I simply hate getting it wrong, especially through imprecise writing. If I understand Larry’s intentions correctly, I believe COHA will be doing two things. One is to rewrite that paragraph to separate your personal policy recommendations from the larger list, and make that public. The second is to air this in COHA’s Forum section, and declare mea cupla. I’ll get back to you when this is done.

John Green~

Tuesday, August 08, 2006

Regarding COHA’s August 8 Press Release “Expanding the Panama Canal: A Wider Canal or More Governmental Payola?”

  • Under the Torrijos government, the expanding Panama Canal will not likely serve the needs of the vast majority of Panamanians. Much of the benefits will be tied to the commercial interests of the country’s accountants, bankers and lawyers, as well as their U.S. counterparts, and world trade
  • Final costs: $5 or $25 billion?
  • The current government, not yet corruption-free, is not sufficiently professional to be trusted as the steward of such an enormous and lucrative financial venture
  • Evidence of venality surrounds the Torrijos administration, as well as the canal’s management
  • Other administration flaws raise questions about Panama City’s capacity to supervise such an enormous project
In early May of 2006, Panama’s President Martin Torrijos announced the publication of the official summary of the proposed canal expansion project and rallied the nation to support the single largest public works project in that country’s history, after the construction of the Panama Canal. The fate of this project will be determined in the referendum scheduled for October 22 of this year. The expansion, proposed by the Autoridad del Canal de Panamá (ACP), includes the construction of a third set of locks as well as the expansion of existing ones, allowing for a faster transit of ships as well as accommodating larger “post-Panamax” vessels.
According to the ACP, an increase in tolls and foreign loans will pay for the estimated $5.25 billion project. While the government boasts that the project will generate a vast number of jobs for its large numbers of unemployed citizens, many Panamanians are coming to the conclusion that canal expansion may not be in their best interest at this time.

Full article...

~Dear Larry Birns,

I. There are factual errors in the piece. For example, your document says that the project includes widening the existing locks — this is not part of the proposal and has never been considered. On the Moscoso item you mentioned, I can tell you definitively that she is not serving in any role on the expansion project, in the Panamanian government or at the ACP.
I understand from our conversation where you were trying to go with this piece — and what precipitated COHA writing it — but the piece really does leave the impression that the project is wrong, that the ACP/Panamanian government is corrupt and that expansion would be a disaster for the country.

Again, as I know you know, there is total unanimity that the ACP (which is autonomous from the government) is doing a good job for the Panamanians and world trade—they are running the Canal better than the United States. Moreover, the ACP’s billions in contributions to the Panamanian government in six years exceed by far the contribution the U.S. gave to Panama from 1914-1999. And expansion is needed now — the impetus for the project is that the Canal is nearing full capacity. I would encourage you to review, in particular, the unique aspects of the proposal, such as the use of rolling gates and the benefits of Water Saving Basins, which are good for the environment and water conservation.

II. As I mentioned, the ACP is prohibited from creating debt for the Panamanian government. The costs for the project are prohibited from being transferred to the government of Panama and, by extension, to Panamanians. The impression or “take away” from the piece is that the project is corrupt, going to cost a lot more than the estimate and that the average Panamanian is going be left holding the bag. Below are the laws of the country which ensure the abovementioned items:

A. Panamanian Constitution, Title XIV Article 320
Article 320. The Panama Canal Authority shall adopt a triennial financial planning and management system, according to which it shall approve its annual budget by means of a justified resolution; this budget shall not be included in the general budget of the government of Panama.

B. National (Legislative) Assembly LAW No.28 (of July 17, 2006)

Article 2. The proposal approved by this Law shall be subject to the following provisions:
1. All of the works costs and pertinent financial or other liabilities which proceed there from shall be paid with moneys generated from Canal operations and from such tolls increases as may be determined from time to time, pursuant to relevant norms and procedures.

2. The Canal as defined in Law 19 of 1997 and given its inalienable nature, shall Not be mortgaged, or encumbered in any other way whatsoever, in order to guarantee the fulfillment of the liabilities originated by the project; nor shall it be the object of any precautionary measure to demand fulfillment of such liabilities.

3. During the construction of the project, payments by the Panama Canal Authority to the National Treasury in concept of surpluses shall not be less than those made in such concept for Panama Canal Authority Fiscal Year 2005. The total amount of the transfers in concept of fees per net ton and surpluses shall not be less than the total amount of the transfers made for Panama Canal Authority Fiscal Year 2006.

4. No reservoirs shall be built for the operation of the third set of locks.

5. Funding for this project shall not bear State endorsement or guarantee.

C. Panama Canal Authority Expansion Proposal, p. 72 of PDF
No guarantee or endorsement by the Government will be used. None of the Canal’s financing will bear the sovereign guarantee of the State. Consequently, the Canal’s financing contracts will not be consolidated with the sovereign debt. In other words, just as Canal finances do not form part of the public sector’s finances, the financing for building the third set of locks would not form part of the State’s public debt.

III. On the cost estimates

It is irresponsible to say that the project may cost $25 billion. No one believes the cost is going to be $16-25 billion. The Roger Pardo-Mauer’s quote was not reacting to the ACP’s project; it was in relation to an abstract question on Canal modernization/expansion and was not supported in any way, with backup, facts or third-party evidence. He did not know the details of the Canal’s proposal when he gave that answer.

Aside from Pardo-Mauer’s one line, there is no evidence that the project would cost substantially more than the ACP’s estimates. The ACP has spent the better part of three years modeling this project — with substantial outside help from academics and management consulting firms. In total, they have done more than 150 studies.

Here is some background on the research done for the costs:
ACP personnel developed the costs and estimates based on numerous demand forecasts, under the guidance of premier firms, using sophisticated financial modeling to provide their surveys and estimates.

* There are three main pillars to the cost estimate:
o First, the cost estimate is based on a detailed lock and navigational channels conceptual designo Second, this conceptual design was thoroughly analyzed in terms of the feasibility of its construction, to determine the sequence and interdependency of activities, and to accurately estimate the requirement for manpower, equipment, operating supplies, energy, administration and tests and materials, among other considerationso Third, the cost estimate was supplemented with the use of a state-of-the-art risk analysis model that evaluated and weighed factors such as uncertainty and contingencies
* The project’s cost estimate considers:
o Potential increases in manpower
o Equipment
o Operating supplies and materials costs
o Possible price fluctuations (particularly for key operating supplies and materials)
o Delays in the construction (such as weather, design changes, productivity fluctuations)
o Consequences and effects of shortages or timely availability of equipment, materials, and personnel
o Effect of inflation during the time period. The total estimate includes an average annual inflation of 2 percent and does not include possible financing costs per information from the General Comptroller’s Office and the International Monetary Fund World Economic Outlook Database of March 2006. Panama’s average inflation has been approximately 1.10 percent during the last 16 years (1990-2005)
* Cost Breakdown (in millions) Totaling 5,250:
o Locks
+ 1,1100 for Atlantic Lock+ 1030 for Pacific Locks+ 590 for Contingency (possible variations for each component along with an assumed inflation of 2%)
o Water Saving Basins
+ 270 Atlantic+ 210 Pacific+ 140 Contingency
o Access Channels for New Locks
+ 70 Atlantic (dredging)+ 400 Pacific (dry excavation)+ 180 Pacific (dredging)+ 170 contingency
o Existing Navigational Channel Improvements
+ 30 deepening and widening of Atlantic Entrance+ 90 widening of Gatun Lake Channel+ 120 Deepening and Widening of Pacific Entrance+ 50 Contingency
o Water supply improvements
+ 30 increase the maximum level of Gatun Lake+ 150 Deepening of the navigational channels+ 80 contingency

IV. Your piece also claims that the jobs creation estimates are way off and that there are contradictions between the government’s estimates and the ACP’s. This is not true. Both the government of Panama and the ACP have maintained that there will be job creation of 35,000 to 40,000 direct and indirect (6,500 – 7,000 will be direct during the high peak of construction). On medium-and long-term growth, both the government and ACP have maintained that, assuming certain GDP predictions and economic forecasts, (study performed by IntraCorp, March 2006) an additional 150,000 to 250,000 people by the year 2025 would have a job thanks to expansion.

Appreciate you addressing this. Please let me know if you need additional information.

Thank you again.

Chris Hayes Consultant on Panal Canal Expansion

Edleman Public Relations~

~Dear Larry:
It’s been too long. Hope you are well and still battling away. We will never forget your support during our darkest years in Panamà.
I’ve just received COHA’s “Expanding the Panama Canal…” and believe you might be interested in my comments.

After much study and investigation I came out with a positive opinion on the Canal expansion project, but also with a very strong position on the need for a “social Pact” of all sectors of society on the required social investments of the excess revenues produced by the expanded Canal, and a citizens’ monitoring system to guarantee the funds are not unwisely spent by politicians of all stripes and partisan colors.

The excess revenues between the years of ’07 and ’25 are estimated to be $29 Billion dollars. This money, well invested, could pole vault Panama into the First World – which necessarily means eradication of poverty and creation of a strong middle class. I believe the movement towards a consensus of a social pact is close to being achieved with UNDP as facilitator; we will know in the next few weeks. The only hold-out is the President, but we are keeping the pressure on strong.

Some notes on your report:

a) “The project is likely to go way over much as 5 times the amount”.
Budget overruns on a 7-8 year project are obviously a major concern,but inflation is calculated way over historical averages, material price increasesare built-in and there is a one billion dollar contingency built in; afterexamining it closely, I am comfortable with this risk factor.

b) “Many Panamanians are coming to the conclusion the Canal’s expansion may not be in their best interest…”.
Serious surveys consistently show from 60 to 70% positive votes for expansion, with an extra 10 points if a social pact process is started before the Referendum.

c) “…the project will only serve as another vehicle for the US to project its authorityin Latin America…”.
Wow! This is the first time in our history as a nation that the Canal is run by Panamanians (much better, may I say, than the U.S. did). The expansion project is built by Panamanians and will be approved by Panamanians. For the first time we will not have the gringos to blame. As for U.S. influence in Latin America, inmy view, it has never been weaker. Anti-U.S. positions seem to elect governments throughout the hemisphere.

d) “Revenues from the Canal in 2005 Fiscal Year were $489 Million…”
Wrong! Revenues were $1,250 Million. Profits to the Panama government were $489 Million.

e) “The Catholic Church of Panama is adamantly opposed to the expansion”.

f) “Bobby Eisenmann, a prominent Panamanian….purportedly wrote for the ACPpropaganda Journal “El Foro”, which is included weekly in La Prensa, a publication that Eisenmann partly owns. In exchange, Eisenmann allegedly has received a lucrative benefit from the insertion of the campaign brochure in the newspaper”.
Wrong, and shameful for COHA! How can anyone in his right mind believe that a man who risked his life on a daily basis for 21 years fighting a Dictatorship on principle is going to sell-out his soul “in exchange” for pennies going to a newspaper from which he retired 11 years ago and in which he holds a minority ownership position of less than ½ of 1%? Besides, what I wrote was an op-ed piece in La Prensa, and that’s what was reproduced by El Faro.

The other corruption assumptions under the same sub-title are equally wrong.

a) “Lack of press freedom…”.
Based on the firing of one columnist? ….come on, be serious! Panama has a vibrant critical Press that drives governments of all stripes up the wall on a daily basis.

b) “The expansion is not of immediate vital importance as post-Panamax shipsare not in wide use”.
Wrong. The expansion is needed for all ships due to lines of ships waiting to go through. Once we decide on the needed expansion, it is best to accommodate the post-Panamax size ships now in production.

c) “Observers must be vigilant when it comes to ensuring a fair Referendum in orderto prevent the type crisis now witnessed in Mexico”
Post-dictatorship Panama has had 6 electoral and referendum voting processes, and in all 6 the Opposition of the moment has won, and not once has the loser cried “foul”. We have an almost perfect electoral democracy (no Mexico comparison is possible).
We lack a citizens’ Democracy and require radical judicial reform and a continued fight against corruption (I chair the Transparency International – Panama Chapter).

Larry: I sincerely hope that my comments will help you balance out COHA’s position, as I always knew it…: hard and firm in its quest for justice, but with serious information.

A big abrazo from your long lost amigo,
I.Roberto Eisenmann, Jr.~

~ Hey Larry,
No problem; I’ve just read it & I’ve had a few minutes to spare todayso I’m responding at some length.
My impression is: what is Panama’s alternative? The Canal is their mostlucrative asset and from an overall shipping perspective, I don’t seeanyway around the argument that it must be expanded as soon as possible. If the status quo remains, the only option to increase Panama’s revenues from that asset is to watch traffic hit the capacity ceiling at some point in the next five years, then squeeze customers as much as possible when that ceiling is reached by hiking tolls further, until customer backlash from costs and delays pushes them to alternate routes.
I agree that the percentage increase in Asian-US trade is going toinevitably decrease, particularly given that the limit of importsubstitution for certain goods that were previously US domestic-sourcedis being reached, so Asian-US trade growth in such cases will fall more in line with US demand growth for those goods and will be less inflated by offshoring.

But I think it’s incorrect to assume that Panama Canal traffic growthis so directly correlative with Asian-US trade growth. In fact, Canal growth is being heavily buoyed by the diversification strategies of the major US shippers (Wal-Mart, et. al.), who have been convinced by the 2002 US West Coast port labour disaster and the 2004 congestion crisis in LA/Long Beach that they can no longer afford to keep all their supply-chain eggs in the LA/Long Beach basket, therefore, they must diversify import gateways more to the US East/Gulf Coasts via both the Panama Canal and increasingly, the Suez Canal.

This trend (which is believed to be a largely permanent supply chainshift)is a major factor in Panama Canal traffic growth above and beyondoverall Asia-US trade growth — representing a plus for the expansion argument that your article doesn’t mention. Also in Panama’s favour, I’d point out some significant advantages over its Suez competitor vis-à-vis import diversification to the US East/Gulf Coasts: the Suez is much more expensive toll-wise (even vs. the projected Panama rate hikes to fund expansion) and the route from Asia-to-US is longer via the Suez, meaning that more ships are required to offer weekly Suez service strings than Panama service…currently, the Suez’ pitch to shipping lines is that they can use larger, more cost-effective vessels, but Panama would theoretically undercut this advantage through its expansion.

Anyway, I personally believe the Panama government is doing the right thing by pushing for Canal expansion now. They have devised a construction plant that will keep transits volumes flowing during construction process. And more importantly, the alternative inherent in not moving forward is: (1)shippers will be forced to keep more of their US imports flowing through the West Coast when they otherwise wouldn’t have and (2) alternate trade routes will grow and take the profits Panama could have gained for itself(alternatives include not only the Suez but plans for new British Colombia and Baja port developments using rail links to US, and to a much lesser extent, the very nascent cross-Mexico land-bridge idea). In other words, consider the opportunity costs of Panama not moving forward.

Of course, I have no doubt the whole venture will be riddled with corruption, but who else but the Panama government can expand the canal? So I think of it as a necessary evil allowing the necessary expansion of just about the only asset Panama has that can create more employment and prosperity for the country. Even if I agree that the trickle-down effect will be heavily diminished by the people at the top taking an overlarge share of the booty, what other alternative is there for Panamanians given their limited assets?
I also think that now is the time to move forward, not later, because the Canal is just years away from reaching its capacity and developers providing carriers and shippers with other trade-route alternatives will be quick to take advantage of any delays in expansion by Panama. Meanwhile, Panama has studied this thing to death already; I don’t think they’ll gain any further insight by doing more studies.
I’m not saying the whole thing won’t go wildly over-budget and be a disaster; it’s Panama, after all, so that’s certainly possible. But the shipping industry is indeed willing to pay the higher tolls to underwrite this, the volumes are there and are fairly certain to continue growing, and the alternative is essentially a guaranteed loss, versus a potential albeit uncertain win. Anyway, that’s my opinion.

–Best regards, Greg Miller~

~ COHA Responds:

Several weeks ago, Ashley Dalman, along with a number of other COHA research associates who had collaborated with her on the research project, issued a study on the recent proposal by the Panamanian government to increase the capacity of the Panama Canal. COHA’s major thesis was not to suggest that the canal does not require expansion, but rather that the project’s estimated cost (over $5 billion) may, in practice, dramatically exceed that figure and could cost as much as $25 billion accounting for over-runs, inflation and the inevitable factor of corruption. Given the nature long history of graft and venality on the part of past Panamanian governments, as well as the already swarmy track record of the Torrijos administration, COHA argued that the latter may not be the best-suited candidate to be the steward of such an ambitious endeavor. Two other concerns which COHA has taken up in its essay are:

1) the validity of the government’s claim of the number of jobs that will be created from the expansion project

2) the lack of public discussion concerning the possible environmental impact.

Additionally, in reference to Chris Hayes’ letter re-printed here, COHA recognizes the impartiality, up to this point, of the Canal Commission, the ACP; however, with Panamanian history so full of insidious corruption incidents—often involving U.S. principals—and the ubiquitous nature of Panama’s lack of civic rectitude, one would be wise to be somewhat wary of any adverse pressure on the autonomous nature of the ACP and whether the Torrijos administration is a fit implementing body for the project.

COHA acknowledges the factual errors that Mr. Hayes has graciously pointed out. Like all research projects, this one is not immune from an occasional mishap and COHA will immediately modify its findings to reflect these facts.

COHA Director, Larry Birns will be addressing the statements made by Roberto Eisenmann concerning the canal expansion as a way to transform Panama into a Singaporean-like society. We have also sampled the large response of emails that we have received on the subject and reprinted some of them above.

Forum Editor~

Monday, August 07, 2006

Regarding COHA’s August 7 Press Release “Salvaging Washington’s Cuban Train Wreck”

With Fidel Castro temporarily transferring his authority to his brother Raúl a number of days ago, the instability that could accompany any significant shift in the Castro regime is now under close review in Washington. The best that President Bush and Secretary Rice are able to do is exhort the leaders to turn to democracy. But such exhortations are small change compared to what is at stake in the game that is being played out in the Caribbean. Cuba, after years of malign neglect by one U.S. president after another, once again has landed on U.S. radar, but maybe too late. The relatively subdued nature of the words uttered from Crawford by President Bush and Secretary of State Rice were welcomed. Of course the explanation for this was that U.S.-Cuban policy, dating back to the Eisenhower administration, through Kennedy, Reagan and Clinton to this day, was spawned by the Cold War and Washington’s inability to make the transition to a time when old hatreds should exist no more, because they were no longer needed.

Full article...

~Mr. Birns:
You are correct that there is a train wreck in Cuba. Remarkably, you do not seem to know who has been driving the train. In your most recent Bush-bashing tirade, you have once again baffled me with your Birnsian Logic. Let me give you some examples. Your effort to demean the US attitude toward Cuba as being the vestige of “old hatreds” from the Cold War makes no sense. Actually, in recent history America has demonstrated itself to be a most forgiving nation. America does not disdain Cuba for its past any more than we hold grudges against Japan, Germany, or Italy. We are even trying to get along with Vietnam. But we do hate Castro and his minions. We do not abhor them for what they did forty years ago. We abhor them for what they are today. (In that regard, I hope you had the chance to read the article in today’s The Wall Street Journal about Cuba’s Dr. Molina.)

Castro has created one of the world’s saddest, poorest countries, and in the face of his abject, extraordinary failure, not to mention the economic failure of virtually all modern totalitarian regimes that have no oil, he insists on maintaining his island-prison and communist dictatorship. Contrary to your assertions, it occurs to me that the main cause of Cuban poverty could be Castro, not the US embargo. After all, Cuba is free to sell everything they produce to Europe and Canada, combined markets bigger than the USA. The real trouble is that their economic system does not produce. The Castro economic model is so frail and unproductive that there is little or nothing of value to sell, either to themselves or to anyone else. Castro presides over such a dismal dump of a country that he cannot even compete with his Caribbean neighbors for European tourists, except, of course, for the Sex Tourism trade, where Castro continues to operate a world-class destination.

I especially find your logic regarding the Cuban embargo hard to grasp in light of economic observations expressed in your previous articles. Typically, Birns, Chavez and Castro berate the USA for abusing Latin America with its economic interests. Now you are telling us that the USA is abusing Cuba by not exercising its economic interests. I am confused. Oh wait…I think I get it…Birnsian Logic is simple once you accept the postulate that everything the USA does is bad.
And now we have Castro’s disastrous leadership being propped up by Chavez. I ask you, Larry, who is the villain? Is it the USA, who refuses to support Castro, or is it Chavez, who is funding this tyrant and artificially prolonging his cruel system of government? By the way, the Chavez largess is laughably reminiscent of the former Russian strategy of paying to support the failed economies of its communist satellites. Both you and Castro know how that turned out. Despite today’s oil prices, Chavez himself presides over one of the world’s poorest economies, as judged by per capita GNP. How can you admire his payoffs to Castro, to Kirchner, to Morales, now to his new friends in Africa, much less justify $4 billion in weapons purchases, when his own people are in such dire need?

You try to convince us that the different USA investment policies towards China and Cuba are driven by merchantilism, not morality. Here again, your argument seems to be missing an important piece. The USA is certainly wary of China. Very different from Castro, however, China’s communists have been making significant strides toward a free market economy. Economic freedom has often led to greater political freedom. China is moving in a direction that is more and more consistent with Western principles, and we are correct in cooperating with them as long as they are on that track. We are trying to trade with Vietnam based on their similar changes in attitude. We are dealing with Libya only after Khadafi made a 180 degree change in his terrorist philosophy. We do not trade with Iran or North Korea. You and Madeline may not have noticed, but in the past forty-seven years, Castro has not taken one step towards granting any shred of freedom, economic or otherwise. There is, in fact, a very big difference between the economic conduct today of China and that of Castro, and $200 billion in USA trade is a by-product of China’s growing embrace of free enterprise and competition. Castro could take a lesson from the Chinese. However, there is no evidence to indicate that he will ever consider economic reforms, and certainly no evidence or logic to support your belief that USA diplomacy, investment, or charity will alter Fidel’s hubristic commitment to his ruinous autocracy.

Henry McDonald ~

Thursday, August 03, 2006

Regarding COHA’s August 3 Press Release “Democratic Decay in Venezuela”

Since September 11, 2001, the Bush White House has taken a hard rhetorical line against Venezuelan President Hugo Chávez. Its accusations have been numerous, ranging from assertions that Chávez harbors regional hegemonic aspirations to claims that he provides financial and material support to leftist guerrilla organizations in neighboring countries. The administration’s most oft-cited grievances, however, relate to Chávez’s democratic credentials. Washington maintains that the outspoken leader’s “Bolivarian Revolution” has assaulted democratic institutions and that, left to his own proclivities, he will turn one of Latin America’s oldest democracies into a full-force dictatorship.

Full article...

~I just finished reading “Democratic Decay in Venezuela” by Timothy Hatfield. I was disappointed, to say the least, to read such a piece on COHA. As I read I kept wondering, is this piece really about Venezuela? Or is it about the United States we now live in? Certainly many of his statements could easily be applied to our Government.

Of course every story has two sides. But generally speaking, one side is the truth or much closer to it. There is no dearth of the opinion expressed by Mr. Hatfield across the web and in the US print / broadcast media. If you really believe his piece is factual, you should cease publishing the kind of material you have in the past. But you should not publish a piece just because it is well written and “intellectually rigorous.” The world has always seen plenty of untruths that are well written. Unlike Fox News, COHA has no obligation to be “fair and balanced.” If that’s what you want to call it. Please spare us from such future diatribes.

Greg Stricherz

Wednesday, July 26, 2006

Regarding COHA’s July 26 Press Release “Corn-based Ethanol: Offering Some Relief from Globalization’s Merciless Quest to Replace Fossil Fuel"

  • Corn versus sugar-based substitute fuels
  • Latin American corn producers could again become competitive
    Brazil wants entry into U.S. ethanol market
  • U.S. agro-industry ultimate beneficiary of federal government’s promotion of corn ethanol

Contrary to the usual outcome of Washington’s subsidies to U.S. farmers, recent grants for ethanol producers could actually improve many lives, both at home and abroad. As the Bush administration aggressively encourages the production of ethanol, a renewable, more environmentally friendly biofuel, to replace increasingly pricey gasoline in automobiles, domestic and foreign corn markets will have to undergo some major adjustments. The U.S. hopes to decrease gasoline consumption by augmenting the production of compounds such as E-85 fuel, which is a mixture of 85 percent ethanol and 15 percent gasoline, that can replace regular gasoline in almost every vehicle sold today in the U.S. This could make a real dent in U.S. reliance on foreign petroleum as a result of a major shift to a domestic, non-hydrocarbon fuel source.

Full article ...

~I usually find your articles right on. But you surely missed the mark on this one. There is ample evidence that it takes more than a gallon of gas to make a gallon of corn-based ethanol. So WHERE is the savings, the ecological responsibility, the eye on the future?
With over half the world living in hunger, why would you support using a food staple to make something that allows American to continue living like they believe is their god-given right rather than finally assuming some social responsibility?
Thank you,
Greg Stricherz~

~Dear Greg,
We thought we were being skeptical in the ethanol piece, citing the fact that little seemed to be gained from the process, making some of the same points that you have made. Perhaps we didn’t emphasize that enough. We will be more careful next time.
My best,
Larry Birns

~ Dear Larry,
I am truly ashamed of myself. I will have to admit I read only the first paragraph. I couldn’t believe what I was reading and immediately wrote my email. With the way the world is going, I have grown very intolerant of ideas I don’t like.
I have now gone back and read the whole piece. I do apologize for my haste. Perhaps I can remember to keep myself in check in the future.
And I want to emphasize that I do find your information extremely valuable in the world of corporate media.

Thank you,
Greg Stricherz~

Thursday, July 20, 2006

Regarding COHA’s July 20 Press Release “MERCOSUR Meeting in Cordoba Begins Today”

Venezuela’s July 4 official accession to the Mercado Común del Sur (MERCOSUR), of which Brazil, Argentina, Uruguay, and Paraguay already are a part, undoubtedly adds decisive economic clout to the trade group; however recent squabbles and some misguided moves make it clear that the country’s inclusion also aggravates various traditionally anti-Chávez Venezuelan constituents as well as the smaller MERCOSUR states. The latter already fear the growing clout of dominant bloc members, Argentina, Brazil, and now Venezuela.

Full article...

~I was struck by the patronizing and arrogant tone of the article. For example: the country has little to offer its new trade partners, (then why did they agree to Venezuela’s membership?)… While some Venezuelan economic theorists (these would be who?) claim that multilateral integration is unnecessary …most orthodox thinkers (these would be who? What “orthodoxy” exactly? what about UNorthodox thinkers?) go further by insisting that Chávez’s way is the path to ruin. (as does Condoleezza Rice, the CIA, the entire economic elite, etc. etc. etc.) These constituents fear that the lower tariffs provided by MERCOSUR will weaken the local non-oil-based economy… (Theorists, thinkers and constituents; such polite names for those who denounce (hate?) Chavez. Do they want to see him dead, as many business people have called for? And what would you call the economic advisors who assist Chavez? Not that we hear from any of them in the article!)

(It’s nice that you mention that the people and groups whose views youare presenting in such fine detail supported a coup against him. You also say that they supported “a general strike”. This is false. There was no general strike. There was a management instigated lockout at the state-owned oil company which was meant to destroy the economy and cause Chavez to be overthrown. Therefore their present “fears” seem self-serving and fake.) “Chávez typical antagonizing…could cause a lamentable departure from progress…his persistently conjured-up vision”… this sounds like an unruly schoolchild’s report card.

Finally, you graciously (and modestly) order Chavez how to behave; evidently he needs lessons: Chávez must avoid spurring the departure of Paraguay and Uruguay…President Chávez should proceed with great caution…Chávez should step lightly…He should be more the observer than the galvanizer…

Who the hell do you think you are? What qualifies you to instruct a head of state who has been in office since 1998, raised the living standards of his country, eliminated illiteracy, and successfully carried out commercial and diplomatic missions around the world etc. etc. etc. etc. etc.? Of all the international thinkers whose opinions he might solicit - for instance Noam Chomsky, Professor F.T. Lee, and Tariq Ali, just to name three, not to mention his own experienced people such as Ali Rodriguez (former head of the state-owned oil company, former acting president of OPEC, present foreign minister) - what gives you the idea that he should (or will) listen to YOU?

I think you owe Chavez an apology, and maybe you could provide him or his representatives a chance to answer the attacks of his enemies in your overbearing and condescending article.

Richard Coleman~

~COHA Responds:

I think that it would be helpful for you to be reminded of the fact that we have 31 interns here at COHA and they work very hard – often seven days a week – to give a voice in Washington to something akin to what I am certain is your point of view. When an intern turns in a credible and well-researched piece investigating an issue like some aspect of President Chavez’s policies, we’re not going to easily turn it down because it is not entirely congruent with our own thoughts on the subject – at the very least, that would smack of Stalinism.

As for our mandate, we get part of it from my being present, as an official of the United Nations Economic Commission for Latin America (CEPAL), at the time of the Pinochet coup. There we witnessed the small non-structural mistakes being made by President Allende that did so much damage to his admirable experiment. Regarding COHA’s bona fides on Venezuela, we have done hundred upon hundreds of studies which have been very supportive of the Chavez presidency and the various admirable reforms he already has, or would like to see implemented, a fact which President Chavez has seen fit to publicly acknowledge, to our great pride.

Surely your offensive rant doesn’t mean to suggest that a respect for Chavez demands silence on the part of his well-wishers when important differences come up. If this is so, one becomes not a heavy hitter for a democratic socialist cause, but somehow dissolves into advocating some kind of authoritarian trajectory. It is shameless to implicitly demand that the choice is that one must either slavishly dedicate one’s intellectual fiat to others, or have to be mute to some of Chavez’s less thoughtful sorties.

We at COHA immensely respect Chavez, enough to counsel him in a forthright way – and as a friend of the court – and we know that when we say to him, ten cuidado, he will give thoughtful consideration to what we say, because that is the kind of relationship we have established with this good man. In all humility, we ask you to arm yourself with the same weapons which would then allow you to substitute a reasoned dialogue for your otherwise harsh, if shallow rhetoric.

COHA Director Larry Birns~

Tuesday, July 11, 2006

Regarding COHA’s July 11 Press Release “Mexican Election Still Far from Over, as the Plot Somewhat Thickens”

  • More than a week after Mexico’s presidential election, there is still no clear winner
  • Although ruling PAN party candidate Felipe Calderón ostensibly won by the slimmest of margins in last week’s re-tabulation of votes, a long and what could prove to be a turbulent legal process lies ahead before he can actually be certified as president-elect
  • Left-leaning PRD candidate Andrés Manuel López Obrador has rightly protested the results of the election, citing mounting evidence of fraud and malfeasance. He is seeking victory not by means of violence and hysteria, but by a vote-by-vote recount
  • While the electoral authorities have repeatedly preached about their body’s own accomplishments, in fact, IFE’s credibility is flagging. Given the process in which it evolved, candidate López Obrador has every right and reason to challenge IFE’s role and the manner in which the ruling party conducted itself. The PRD’s search for validation of the election is merited

Full article...

~Dear Sirs:

Regarding Michael Lettieri’s July 11 article on Mexican Election Still Far from Over …, I would like to note that your credibility is being compromised by two assertions made by Andres Manuel Lopez Obrador that are repeated in your article that turn out to be completely untrue.

1) The video AMLO showed on the ballot box stuffing turned out to be a voting place president returning to the proper voting box about 10 ballots that were mistakenly put in the wrong ballot box. This was done in front of all the party representatives and the polling station workers and everyone involved agreed it was done completely legally and with no bias toward any candidate.

2) The so-called 3 million missing votes were never missing at all because all the political parties had agreed that votes with incomplete or inconsistent information would be left out of the rapid tally known as the PREP. These votes were placed in a separate area and the political parties were able to consult this area and see the results of these `inconsistent’ votes, which were to be included at all times in the final district tally. It’s still not clear why AMLO referred to them as missing votes when his party knew where they were and even consulted them.

It’s perfectly fine to take sides. I certainly enjoy reading from a variety of points of view. However, for the sake of your institution’s credibility, please make sure you don’t repeat assertions that have been thoroughly proven to be incorrect.


Thomas Black~

~COHA Responds:

Regarding the first point, at the time of the article’s writing and publication, it was still uncertain as to whether what was witnessed in the video was fraud or whether it was, as the IFE claimed, a misinterpreted relocation of ballots. Since then, it has become apparent that in this particular incident, as Mr. Black notes, no malfeasance was present. However, the video is not the only evidence López Obrador has offered of possible wrongdoing, and numerous organizations have noted irregularities in the electoral process. These groups include Global Exchange – which mounted a larger, broader, and more comprehensive monitoring effort than many – and Mexico’s own Alianza Cívica, perhaps the most important and highly regarded pro-democracy organization in the country. While this particular case was eventually disproved, its symbolic weight was substantial.

Regarding the second point, COHA never referred to the votes as missing, but simply noted that they had been left out of initial PREP results. This decision was, regardless of its legal and electoral basis, confusing for many, and compounded the IFE’s perceived mismanagement of the election.

~(EXCERPTED) Here I go again after struggling with Michael Lettieri’s most recent “analysis” of the Mexican presidential election: Mexican Election Still Far from Over, as the Plot Somewhat Thickens. I am in full agreement with most of Lettieri’s closing remarks.

And I quote:
“The PRD’s decision to protest the official results of the July 2 election through legally defined channels is nothing less than a test of the strength of Mexican democracy. It is no easy task that now confronts the TEPJF, as it must sort through hard evidence and heated rhetoric to make a decision which it will undoubtedly be forced to justify to either the PAN or the PRD, according to the circumstances. Dealing with the uncertainty that will undoubtedly dominate Mexico until that ruling is announced is a formidable task and one which has been complicated by the IFE’s incessant self-promotion. In the weeks to come, all actors, including the media, must behave in a responsible manner. At this point, the only certainty about the Mexican presidential election of 2006 is that it is far from over.”

But, I must take exception in the above paragraph to Lettieri’s reference to “the IFE’s incessant self-promotion” statement, as it seems more the product of his fabrications not supported by sound and solid evidence. Unfortunately, most of his presentation seems to parrot the PRD’s contention of fraud without giving serious consideration to the well structured electoral process put together by the IFE during the past 12 years. Perhaps Lettieri will do well to follow his own advice to the media to “behave in a responsible manner.” I presume he does not claim to be above those mundane limitations.


Sergio Ferragut~

~COHA Responds:

The IFE has, without a doubt, been its own biggest supporter. Anyone who has listened to the IFE discuss its own stature or importance would be hard pressed to disagree.
This is not to say that COHA hasn’t discussed some of the body’s more favorable aspects and its significance in historical perspective. In a February 15, 2006 report (Courting the Vote: Electoral Courts and Councils Take on the Challenge of Guaranteeing a Free and Fair Vote Throughout Latin America), COHA wrote that the IFE carried a “difficult historical burden,” yet noted that “its legitimacy is now unchallenged.” A June 6, 2006 release (Flirting with Danger: Mexican Presidential Campaign Grows Tense) observed that the IFE was “clearly capable of administering the ballot.”

This respect for the body’s nuts and bolts competency remains. As an observer, I, and my delegation, commented on the remarkable organization of the electoral processes, which the IFE administered. Ballots, boxes, and voting booths were all top notch. The system was close to, if not completely, airtight. That is not to say that the election was entirely inoculated against fraud. Bad intentions can pervert good systems, and it is likely – especially given Mexico’s history – that this occurred in some cases.

More importantly than the minutiae of fraud, however, was COHA’s assertion, which has been echoed by others, that the IFE failed to generate confidence and project an image of independent rectitude in the days after the vote. In the previously mentioned February report, we noted that “questions still remain over [the IFE’s] ability to serve as an effective mediator in Mexico’s brawling political arena” and that “the uncertain enforcement of its own, sometimes cripplingly vague, guidelines, has only hastened the deterioration of the IFE’s effectiveness as a regulatory institution.” It appears, in the aftermath of July 2, that such problems have come to a head.

It is the IFE’s loss of prestige, rather than any minor fraud allegation, which is troubling – more so because it is not entirely unfounded. PAN and PRI legislators effectively blocked PRD nominees to the IFE’s general council, and since then political scientists have noted that there are clearly defined voting patterns within the body, with some members breaking towards the PRI and others towards the PAN. If the body is indeed split between partisan members, the lack of PRD representation – given that the party’s showing in the congressional elections puts it on par with both the PRI and PAN – is troubling. Moreover, if much of the country perceives a partiality to both the PAN and PRI in the IFE’s actions, election results will always be distrusted. ~

Tuesday, June 27, 2006

Regarding COHA’s June 27 Press Release “Fox Chooses U.S. Over Latin America, Continuing Mexico’s Accommodation to Washington’s Regional Primacy”

In the latest test of its tenacious allegiance to the U.S., Mexico has once again planted itself squarely in Washington’s corner. Verbalizing what would eventually be its position, Foreign Minister Luis Ernesto Derbez announced to reporters at a lunchtime meeting in Brazil on June 13, that in the race for the temporary UN Security Council seat between U.S.-favorite Guatemala and Venezuela, his country would support the former, and that “the position is quite clear.” The competition for the Security Council slot has sparked vigorous lobbying from Washington in an attempt to block Caracas’ bid. Even veiled efforts have been made, including a meeting in Secretary of State Rice’s office, in order to coerce Chilean foreign minister Alejandro Foxley, and a confidential diplomatic note – leaked to the BBC – which underscored the U.S. position. Yet it is likely that Derbez, just like his predecessor Jorge Castañeda, did not need much of a push. Under President Vicente Fox, Mexican foreign policy in recent years has consistently trended away from an independent stance, in favor of near obeisance to pro-U.S. initiatives, and the supremacy of Washington’s hemispheric wish list.

Full article...

~Mr. Birns and Mr. Lettieri:

Mexico has made remarkable advances since 1991 towards true democracy, with political parties that actually compete for votes based on ideas, not handouts and coercion. Less recognized is that Mexico has made equally great strides towards free enterprise, and a system of societal meritocracy. Mexico has steadily been moving away from one-party, strongman political rule, corporate oligarchy, and racism, although she still has much to accomplish. Mexico, like Chile, is rapidly distancing itself from the failed political and economic models that guided Latin America throughout the 20th Century. It should be no wonder to you or anyone that modern Mexican leadership rejects retrograde politicians such as Chavez and Castro. Mexico is moving forward. Venezuela is moving backward. The citizens of nations that continue to pursue free enterprise and democracy are being well-served. The citizens of nations that accept dictatorial rule are doomed to poverty, as has been consistently demonstrated time and again for centuries. I am surprised that you have not noticed.

Mexico’s philosophical opposition to the dogma and doctrines of Chavez has nothing to do with obeisance to the United States, any more than the political and economic philosophies in Canada, Australia, Japan, and most of Europe represent US obeisance. The simple truth is that democracy and free enterprise work. Dictatorships do not work. Mexico understands, but obviously Venezuela does not, nor would it appear, does COHA.~

~COHA Responds:

Yes, Mexico has made significant process since 1991, as you correctly point out, but it has a very long way to go to achieve authentic independence and bona fide sovereignty. Our contention that free markets don’t exhaust the definition of a full filled democracy and that the number of billionaires isn’t a faultless indicator of economic justice. To choose between today’s Mexico and Venezuela, surely one would have to agree that when it comes to exercisable options, Caracas is well ahead of Mexico’s cut.

Tuesday, June 06, 2006

Regarding COHA’s June 6 Press Release “Flirting with Danger: Mexican Presidential Campaign Grows Tense”

  • Mexico crackles with anxiety as the July 2 presidential vote approaches; growing bitterness threatens the country’s newfound stability
  • The seeds of deep political divisiveness planted during the campaign could present grave challenges for the incoming government
  • President Fox is largely to blame for the race’s polarization, as his constant interventions – some in violation of electoral regulations – have led opposition candidates to complain of an “election by the state” and have done grievous damage to the tattered remains of his reputation
  • Mounting social unrest has added to an already volatile mix, leading some to fear that a potential post-ballot dispute could quickly turn nasty and further compromise Mexico’s still unconsolidated democratic institutions and traditions

With just under a month to go until Mexico’s July 2 presidential election, deep uncertainties have taken hold of the country. As the top two contenders, left-leaning Andrés Manuel López Obrador of the Partido de la Revolución Democrática (PRD) and Felipe Calderón Hinojosa of the ruling conservative Partido de Acción Nacional (PAN), begin their final campaign drives, the two men appear to be in a virtual tie. Some polls suggest that Calderón may hold a wafer-thin advantage – a dramatic reversal of the situation as little as two months ago when López Obrador’s lead seemed insurmountable. Yet the numbers are still unsettled, and much will depend on the June 6 debate, where Calderón and López Obrador will square off on live television.

Full article...

COHA has received a number of comments regarding its June 6 report, “Flirting with Danger: Mexican Presidential Campaign Grows Tense.” These have ranged from high praise to harsh criticism. A frequent comment was that Michael Lettieri’s evaluation of President Fox was overly critical. Below, COHA reprints one such letter (slightly edited) and offers the author’s response to several themes which appeared frequently in readers’ comments.

~Dear Sirs,

Living in Mexico I feel that the recent letter prepared by Michael Lettieri simply expresses a perception that is distorted.
If Fox did nothing else other than defeat the PRI, that was enough.

He faced a congress controlled by PRD and PRI, if PRD cared for the country as much as their own power they could have joined with PAN in helping the forward movement of Mexico viz when Fox attempted to appoint an experienced group of executives as a board to bring Pemex into the 21st century, he was shot down.

In the U.S. I have never seen a presidential election when the incumbent party did not push the candidate representing their party. If Blair appears to support Bush, as Thatcher supported Reagan, it is no big deal. That the former Spanish Prime Minister intervened in Mexico’s presidential race on behalf of his ideological compatriot, will not affect the race.
The article makes it appear that Mexico is on the brink of disaster; this is simply wrong. The gentleman from COHA is expressing a narrow view which is dependent on sophistry.

Arthur J. Kreizel~

~COHA Responds:

Many readers shared Mr. Kreizel’s belief that COHA’s rather rough treatment of President Fox was unwarranted, yet I do not feel this is the case. While I share the belief that Fox deserves plaudits for his work in defeating the PRI both prior to his 2000 campaign and during it, to suggest that simply ending the one-party system was sufficient reeks of defeatist fatalism. Frankly, to claim that defeating the PRI was “enough,” sanctions failure and lack of vision, and provides an excessively gracious six year free-pass.

Mexican democracy is still in a nascent phase, and has hardly been fully consolidated on all levels. Important changes in subnational practices, institutional structure, civic culture and social participation still remain unconsummated. Moreover, contemporary politicians are less than six years removed from an authoritarian system, and are struggling to accept the values of democracy. It was this inexperience – a flaw which all were guilty of – that helped stymie Fox’s early attempts at reform. And as much as the opposition parties are deserving of criticism in this failure, neither can Fox be completely exonerated.

While Fox was not entirely inactive, as the countless signs shamelessly proclaiming “El gobierno de cambio cumple” (“the government of change delivers”) next to bridges and highways attest, I feel that there are two areas where he has fallen short. First, while Mexico’s macroeconomic indicators are better than ever, the country remains highly unequal and growth has not been inclusive enough, a fact evidenced by the unremitting stream of northward migration to the United States. Second, and I believe perhaps more importantly, Fox has done little to help the country advance a democratic culture. A 2006 survey by Mexico City daily El Universal found that only 50 percent of respondents felt that Fox had aided the development of democracy in Mexico, and his behavior in the current campaign has underscored that sad reality.
As previously noted, Mexican democracy is exceedingly youthful, and that is precisely why Fox’s interjections into the campaign are so problematic. To compare the Mexican political system to that of the U.S. or U.K. overlooks that fact. For one, such actions have only had a negative influence on Mexico’s political tone. Secondly, quite frankly they were in violation of campaign laws. To suggest that Aznar’s visit was “no big deal” is to excuse the PAN’s breach of regulations – the event may have been insignificant because it had no impact on the electorate, but it was hardly legal. The establishment of the IFE was one of the great legacies of Mexico’s democratic transition, and that body has come to play an important role as a referee on an admittedly rough and tumble playing field. For Fox and the PAN, who as much as anyone have benefited from the IFE’s contributions to democratization, to systematically trample the organization’s strictures – both in letter and in spirit – is a display of rank hypocrisy at best.
Because of this cutthroat approach to Mexico’s electoral campaign, at the time of the COHA article’s publication, it appeared as though conditions existed which would have made a post-election conflict likely. I shared this feeling with many others, including distinguished Mexican historian Enrique Krauze, who also expressed concern that a dispute could arise, although the degree to which we feared disintegration perhaps differed. At any rate, I was hardly suggesting that a revolution was looming, though I did fear an acrimonious post-ballot conflict. Since then, the climate has cooled somewhat with the June 13 signing of a civility pact between all of the major parties participating in the election, a move which represents a significant and important step towards ensuring governability after July 2. I do not think chaos is inevitable, but I feel there is reason to believe that a minor crisis could emerge.

Even if the election and its aftermath proceed smoothly, however, Mexico may not be clear of danger. A “disaster,” as Mr. Kreizel puts it, can take many forms, and more worrisome than a July 3 conflict would be the lingering effect on Mexican democracy of a tainted electoral process and ensuing political gridlock. Already, many Mexicans are disenchanted with the nature of their democracy, feeling that it fails to adequately address problems or offer meaningful representation. According to a 2004 study, 54 percent of Fox supporters in 2000 were dissatisfied with democracy, and the El Universal poll put dissatisfaction with democracy overall at 55 percent.

While Mexicans are sanguine about their country’s political prospects (47 percent of those surveyed by El Universal predicted a better situation next year), this optimism could be fleeting. A Calderón presidency stonewalled by the PRD, or a López Obrador government receiving the same treatment from the PAN, would dash those hopes and exaggerate feelings of disenchantment. In this sense, the winner on July 2 is far less important than the manner in which that triumph is attained. Whichever candidate emerges victorious will have to reconcile the country’s divisions and move forward with an agenda that benefits all Mexicans. The bitterness sown during the campaign, with both Calderón and López Obrador employing – to varying degrees – polarizing language, will only complicate the prospects for progress, which all agree would be an undeniably “disastrous” outcome for the nation.

Michael Lettieri ~