Economics and Economics and InterventionIntervention

A New Power Emerges in the West…A New Power Emerges in the West…

• 1823: Monroe Doctrine—1823: Monroe Doctrine—

• U.S. steps forth as thethe major power in the Americas• Seeks economic and political control of Latin America• Imperialism:Imperialism: Direct intervention, conquest,

annexation (i.e. Hawaii)• Colonialism:Colonialism: Direct intervention, formal control (i.e.

army, U.S. law) of external territory (i.e. Puerto Rico)• Neocolonialism (Interventionism): Economic /

political “influence” / action according to interests of neocolonialist power

What goes on in the Americas, stays in the Americas. No more European colonization in the Americas (U.S. only!).

Colonialism vs. Neocolonialism:Colonialism vs. Neocolonialism:What’s the difference?What’s the difference?

• Colonialism = LandColonialism = Land

• Neocolonialism = MoneyNeocolonialism = Money• After claiming territories after the After claiming territories after the

Spanish-American war (1898), U.S. Spanish-American war (1898), U.S. colonialism in Latin America generally colonialism in Latin America generally comes to an end…comes to an end…

• ……but neocolonialism surges ahead!but neocolonialism surges ahead!

Early 20Early 20thth Century Century• U.S. has the gold and

is making the rules

• Major rise of MNCs—mostly U.S. owned in Latin America

• Rules in U.S.’s favor, not Latin America’s

U.S. MNC’s (~1900)U.S. MNC’s (~1900)American Sugar Refining CoAmerican Sugar Refining Co Sugar Sugar GE / RCA / AT&TGE / RCA / AT&T Trans, CommTrans, CommUFCOUFCO Fruit, Fruit, Trans, CommTrans, CommStandard Fruit & SteamshipStandard Fruit & Steamship Fruit, TransFruit, TransAmerican Tobacco CompanyAmerican Tobacco Company TobaccoTobaccoStandard OilStandard Oil PetroleumPetroleumNational City Bank (Citibank)National City Bank (Citibank) FinanceFinanceAsarco Asarco (Am Smelt / Refining Co.)(Am Smelt / Refining Co.) Mining (Silver, Gold)Mining (Silver, Gold)Anaconda Copper MiningAnaconda Copper Mining Mining (Copper)Mining (Copper)Int’l Telegraph and TelephoneInt’l Telegraph and Telephone CommunicationsCommunicationsW. R. Grace and Co.W. R. Grace and Co. Fert, Trans, MiningFert, Trans, MiningAluminum Co. of Am. (ALCOA)Aluminum Co. of Am. (ALCOA)Mining (Bauxite)Mining (Bauxite)

Panama CanalPanama Canal

You mean the Colombia Canal?

Panama Panama Canal Canal ZoneZone

Part of U.S:Part of U.S:1903-19791903-1979

Joint control:Joint control:1979-19991979-1999

PanamanianPanamaniancontrol:control:

20002000

10 miles 10 miles widewide

1904: Roosevelt Corollary1904: Roosevelt Corollary• Roosevelt reasserts Monroe DoctrineRoosevelt reasserts Monroe Doctrine• U.S. could “supervise” internal affairs of U.S. could “supervise” internal affairs of

countries in Latin America and Caribbean: If countries in Latin America and Caribbean: If U.S. determined any “chronic wrongdoing” by U.S. determined any “chronic wrongdoing” by any country in Latin America, U.S. intervention any country in Latin America, U.S. intervention would be justifiedwould be justified

• Under Roosevelt, theUnder Roosevelt, the U.S. used the CorollaryU.S. used the Corollaryto justify interventionto justify intervention

• Still (unofficially) used today!Still (unofficially) used today!

““Interventionism”Interventionism”• ““Mechanism” to enforce neocolonialismMechanism” to enforce neocolonialism• Make “adjustments” in / on / with external locations Make “adjustments” in / on / with external locations

for political / economic reasonsfor political / economic reasons• May involve political or economic influence, May involve political or economic influence,

military, paramilitary, special forces, unofficial military, paramilitary, special forces, unofficial invasions, sanctions, aid, etc.invasions, sanctions, aid, etc.

• Ultimately used to gain / maintain political and / or Ultimately used to gain / maintain political and / or economic control (of economic control (of U.S. investmentsU.S. investments))

Q: Q: How many times has the U.S. How many times has the U.S. intervened in Latin America since intervened in Latin America since the Monroe Doctrine (1823)?the Monroe Doctrine (1823)?

1845: Texas, formerly a part of Mexico, joins the U.S.1846: The U.S., fulfilling the doctrine of Manifest Destiny, goes to war with Mexico and ends up with a third of Mexico's territory. 1850, 1853, 1854, 1857: U.S. interventions in Nicaragua. 1855: Tennessee adventurer William Walker and his mercenaries take over Nicaragua, institute forced labor, and legalize slavery. He's ousted two years later by a Central American coalition largely inspired by Cornelius Vanderbilt, upon whose trade Walker was infringing. "The enemies of American civilization-- for such are the enemies of slavery-- seem to be more on the alert than its friends." --William Walker 1856: First of five U.S. interventions in Panama to protect the Atlantic-Pacific railroad from Panamanian nationalists. 1890: U.S. Troops into Marines clash with Chilean nationalist rebels 1891: Black labor revolt on U.S.-claimed Navassa Island (Haiti) defeated 1894: U.S. Troops begin month-long occupation of Bluefields, Nicaragua1895: U.S. Navy and Marines land on Panamanian isthmus in Colombia1896: U.S. Marines land in port of Corinto, Nicaragua1898: U.S. declares war on Spain, blaming it for destruction of the Maine. (In 1976, a U.S. Navy commission concludes that the explosion was likely an accident.) The war enables the U.S. to occupy Cuba, Puerto Rico, Guam, and the Philippines. 1899: U.S. Troops again land in Bluefields, Nicaragua1903: The Platt Amendment inserted into the Cuban constitution grants the U.S. the right to intervene when it sees fit.

1903: U.S. Marines intervene in Honduran Revolution1903: When negotiations with Colombia break down, the U.S. sends ten warships to back a rebellion in Panama in order to acquire the land for the Panama Canal. 1904: U.S. sends customs agents to take over finances of the Dominican Republic to assure payment of its external debt. 1905: U.S. Marines help Mexican dictator Porfirio Díaz crush a strike in Sonora. 1905: U.S. seizes control of Dominican Republic’s financial institutions to protect American investments1905: U.S. troops land in Honduras for the first of 5 times in next 20 years. 1906: Marines occupy Cuba for two years in order to prevent a civil war. 1907: Marines intervene in Honduras to settle a war with Nicaragua. 1908: U.S. troops intervene in Panama for first of 4 times in the next decade. 1909: Liberal President José Santos Zelaya of Nicaragua proposes that American mining and banana companies pay taxes and appropriates church lands, legalizes divorce, and executes two Americans for participating in a rebellion against him. He is then forced to resign through U.S. pressure. The new president, Adolfo Díaz, is the former treasurer of an American mining company. 1910: U.S. Marines occupy Nicaragua to help support the Díaz regime. 1911: The Liberal regime of Miguel Dávila in Honduras has irked the State Department by being too friendly with Zelaya and by getting into debt with Britain. He is overthrown by former president Manuel Bonilla, aided by American banana tycoon Sam Zemurray and American mercenary Lee Christmas, who becomes commander-in-chief of the Honduran army.

1912: U.S. Marines intervene in Cuba to put down a rebellion of sugar workers. 1912: Nicaragua occupied again by the U.S. to shore up the inept Díaz government. An election is called to resolve the crisis: there is one candidate, Díaz. The U.S. maintains troops and advisors in the country until 1925. 1914: U.S. bombs and then occupies Vera Cruz, in a conflict arising out of a dispute with Mexico's new government. President Victoriano Huerta resigns. 1914: Marines claim the Dominican Republic as a U.S. protectorate until 1925. 1915: Marines occupy Haiti to restore order; exists as U.S. protectorate until 1934. 1916: Pancho Villa, in the sole act of Latin American aggression against the U.S, raids the city of Columbus, New Mexico, killing 17 Americans. 1917: U.S. troops enter Mexico to unsuccessfully pursue Pancho Villa.1917: U.S. Buy Virgin Islands from Denmark1917: Marines intervene again in Cuba, to guarantee sugar exports during WWI. 1918: U.S. Marines occupy Panamanian province of Chiriqui for two years to maintain public order. 1919: U.S. Marines land during election campaign to ensure order1921: President Coolidge strongly suggests the overthrow of Guatemalan President Carlos Herrera, in the interests of United Fruit. The Guatemalans comply. 1925: U.S. Army troops occupy Panama City to break a rent strike and keep order. 1926: Marines, out of Nicaragua for less than a year, occupy the country again, to settle a volatile political situation. Secretary of State Kellogg describes a "Nicaraguan-Mexican-Soviet" conspiracy to inspire a "Mexican-Bolshevist hegemony" within striking distance of the Canal.  

1929: U.S. establishes a military academy in Nicaragua to train the National Guard as the country's army. Similar forces are trained in Haiti and the Dominican Republic. "Until now Central America has always understood that governments which we recognize and support stay in power, while those which we do not recognize and support fall.--Undersecretary of State Robert Olds 1930: Rafael Leonidas Trujillo emerges from the U.S.-trained National Guard to become dictator of the Dominican Republic. 1932: The U.S. rushes warships to El Salvador in response to a “communist-led” uprising. President Martínez, however, prefers to put down the rebellion with his own forces, killing over 8,000 people (the rebels had killed about 100). 1933: President Roosevelt announces the Good Neighbor policy. 1933: Marines finally leave Nicaragua, unable to suppress the guerrilla warfare of General Augusto César Sandino. Anastasio Somoza García becomes the first Nicaraguan commander of the National Guard.1933: Roosevelt sends warships to Cuba to intimidate Gerardo Machado y Morales, who is massacring the people to put down nationwide strikes and riots. Machado resigns. A pro-Machado counter-coup is put down by Fulgencio Batista, who, with Roosevelt's blessing, becomes Cuba's new strongman. 1934: With U.S. approval, Sandino assassinated by agents of Somoza, who assumes the presidency of Nicaragua two years later. U. S. Secretary of State Cordell Hull later proposes to intervene in the internal affairs of Nicaragua. 1936: U.S. relinquishes rights to unilateral intervention in Panama. 1940: U.S. establishes military bases on Jamaica, Bahamas, Guyana, others

1941: Ricardo Adolfo de la Guardia deposes Panamanian president Arias in a military coup-- first clearing it with the U.S. Ambassador. 1943:The editor of the Honduran opposition paper El Cronista is summoned to the U.S. embassy and told that criticism of the dictator Tiburcio Carías Andino is damaging to the war effort. Shortly afterward, the paper is shut down by the government. 1944:The dictator Maximiliano Hernández Martínez of El Salvador is ousted by a revolution; the interim government is overthrown five months later by the dictator's former chief of police. The U.S.'s immediate recognition of the new dictator does much to tarnish Roosevelt's Good Neighbor policy in the eyes of Latin Americans. 1946: U.S. Army School of the Americas opens in Panama as a hemisphere-wide military academy. 1948: José Figueres Ferrer wins a short civil war to become President of Costa Rica. Figueres is supported by the U.S., which has informed San José that its forces in the Panama Canal are ready to come to the capital to end "communist control" of Costa Rica. 1950: U.S. Troops are deployed to crush an independence rebellion in Ponce, Puerto Rico.1954: Jacobo Arbenz Guzmán, elected president of Guatemala, introduces land reform and seizes idle land parcels from United Fruit. The CIA trains and organizes a small force to overthrow him in Honduras. When Arbenz naively asks for U.S. military help to meet this threat, he is refused; when he buys arms from Czechoslovakia he labeled a Communist. Guatemala is "openly and diligently toiling to create a Communist state in Central America... only two hours' bombing time from the Panama Canal." --Life

1954 (cont’d): The CIA broadcasts reports detailing the imaginary advance of the "rebel army," and provides planes to attack the capital. The army refuses to defend Arbenz, who resigns. The U.S.'s hand-picked dictator, Carlos Castillo Armas, outlaws political parties, establishes the death penalty for strikers, and undoes Arbenz's land reforms. Over 100,000 citizens are killed in the next 30 years of military rule. "This is the first instance in history where a Communist government has been replaced by a free one." --Richard Nixon1957: Eisenhower establishes Office of Public Safety to train Latin American police forces. 1959: Fidel Castro takes power in Cuba. Several months earlier he had undertaken a triumphal tour through the U.S., which included a CIA briefing on the Red menace. "Castro's continued tawdry little melodrama of invasion." --Time, of Castro's warnings of an imminent U.S. invasion 1960: Eisenhower authorizes covert actions to get rid of Castro. Among other things, the CIA tries assassinating him with exploding cigars and poisoned milkshakes. Other covert actions against Cuba include burning sugar fields, blowing up boats in Cuban harbors, and sabotaging industrial equipment. 1960: The Canal Zone becomes the focus of U.S. counterinsurgency training. 1960: A new junta in El Salvador promises free elections; Eisenhower, fearing leftist tendencies, withholds recognition. A more attractive right-wing counter-coup comes along in three months. "Governments of the civil-military type of El Salvador are the most effective in containing communist penetration in Latin America." --John F. Kennedy, after the coup

1960: Guatemalan officers attempt to overthrow the regime of Presidente Fuentes; Eisenhower stations warships and 2000 Marines offshore while Fuentes puts down the revolt. [Another source says that the U.S. provided air support for Fuentes.] 1960s: U.S. Green Berets train Guatemalan army in counterinsurgency techniques. Guatemalan efforts against its insurgents include aerial bombing, scorched-earth assaults on towns suspected of aiding the rebels, and death squads, which killed 20,000 people between 1966 and 1976. U.S. Army Col. John Webber claims that it was at his instigation that "the technique of counter-terror had been implemented by the army." 1961: U.S. organizes force of 1,400 anti-Castro Cubans and sends it to the Bay of Pigs. Castro's army routs it. 1961: CIA-backed coup overthrows elected Pres. J. M. Velasco Ibarra of Ecuador, who has been too friendly with Cuba. 1962: CIA engages in campaign in Brazil to keep João Goulart from achieving control of Congress. 1963: CIA-backed coup overthrows elected social democrat Juan Bosch in the Dominican Republic. 1963: A far-right-wing coup in Guatemala, apparently U.S.-supported, forestalls elections in which "extreme leftist" Juan José Arévalo was favored to win. 1964: João Goulart of Brazil proposes agrarian reform and the nationalization of the oil industry. Shortly thereafter, he is ousted by a U.S.-supported military coup.

1964: The free market in Nicaragua: The Somoza family controls "about one-tenth of the cultivable land in Nicaragua, and just about everything else worth owning, the country's only airline, one television station, a newspaper, a cement plant, textile mill, several sugar refineries, half-a-dozen breweries and distilleries, and a Mercedes-Benz agency." --Life World Library 1965: A coup in the Dominican Republic attempts to restore Bosch's government. The U.S. invades and occupies the country to stop this "Communist rebellion," with the help of the dictators of Brazil, Paraguay, Honduras, and Nicaragua. 1966: U.S. sends arms, advisors, and Green Berets to Guatemala to implement a counterinsurgency campaign. "To eliminate a few hundred guerrillas, the government killed perhaps 10,000 Guatemalan peasants." --State Dept. report on the program 1967: A team of Green Berets is sent to Bolivia to help find and assassinate Cuban revolutionary, Che Guevara. 1968: Gen. José Alberto Medrano, who is on the payroll of the CIA, organizes the ORDEN paramilitary force, considered the precursor of El Salvador's death squads. 1970: Salvador Allende elected in Chile. Suspends foreign loans, nationalizes foreign companies. For the phone system, pays ITT the company's minimized valuation for tax purposes. The CIA provides covert financial support for Allende's opponents, both during and after his election.1972: U.S. stands by as military suspends an election in El Salvador in which centrist José Napoleón Duarte was favored to win.

1973: U.S.-supported military coup kills Allende and brings Augusto Pinochet to power. Pinochet imprisons well over a hundred thousand Chileans (torture and rape are the usual methods of interrogation), terminates civil liberties, abolishes unions, extends the work week to 48 hours, and reverses Allende's land reforms. 1973: Military takes power in Uruguay, supported by U.S. The subsequent repression reportedly features the world's highest percentage of the population imprisoned for political reasons. 1974: Office of Public Safety is abolished when it is revealed that police are being taught torture techniques. 1976: Election of Jimmy Carter leads to a new emphasis on human rights in Central America. Carter cuts off aid to the Guatemalan military and reduces aid to El Salvador. 1979: Ratification of the Panama Canal treaty which is to return the Canal to Panama by 1999. 1980: A right-wing junta takes over in El Salvador. U.S. begins massively supporting El Salvador, assisting the military in its fight against FMLN guerrillas. Death squads proliferate; Archbishop Romero is assassinated by right-wing terrorists; 35,000 civilians are killed in 1978-81. The rape and murder of four U.S. churchwomen results in the suspension of U.S. military aid for one month. The U.S. demands that the junta undertake land reform. Within 3 years, however, the reform program is halted by the oligarchy.

1980: The U.S., seeking a stable base for its actions in El Salvador and Nicaragua, tells the Honduran military to clean up its act and hold elections. The U.S. starts pouring in $100 million of aid a year and basing the contras on Honduran territory. 1981: The CIA steps in to organize the contras in Nicaragua, who started the previous year as a group of 60 ex-National Guardsmen; by 1985 there are about 12,000 of them. 46 of the 48 top military leaders are ex-Guardsmen. The U.S. also sets up an economic embargo of Nicaragua and pressures the IMF and the World Bank to limit or halt loans to Nicaragua. 1981: Gen. Torrijos of Panama is killed in a plane crash. There is a suspicion of CIA involvement, due to Torrijos' nationalism and friendly relations with Cuba. 1982: A coup brings Gen. Efraín Ríos Montt to power in Guatemala, and gives the Reagan administration the opportunity to increase military aid. 1983: Another coup in Guatemala replaces Ríos Montt. The new President, Oscar Mejía Víctores, was trained by the U.S. and had cleared his coup beforehand with U.S. authorities. 1983: U.S. troops take over tiny Granada, intervening shortly after a coup has overthrown the previous, socialist leader. One of the justifications for the action is the building of a new airport with Cuban help, which Granada claimed was for tourism and Reagan argued was for Soviet use. Later the U.S. announces plans to finish the airport... to develop tourism. 1983: Boland Amendment prohibits CIA and Defense Dept. from spending money to overthrow the government of Nicaragua. Reagan sends in forces to topple the Nicaraguan government shortly thereafter.

1984: CIA mines three Nicaraguan harbors. Nicaragua takes this action to the World Court, which brings an $18 billion judgment against the U.S. The U.S. refuses to recognize the Court's jurisdiction in the case. 1984: U.S. spends $10 million to orchestrate elections in El Salvador– however, the military in El Salvador has already declared that it will not answer to the elected president. 1989: U.S. invades Panama to dislodge the CIA-trained Manuel Noriega, an event which marks the change of strategy from thwarting Communism to waging a war on drugs. 1994: U.S. sends troops to support a naval blockade against the military government of Haiti. The troops restore President Aristide to office three years after coup1996: The U.S. battles global Communism by extending most-favored-nation trading status for China, and tightening the trade embargo on Castro's Cuba.2000: “Plan Colombia,” the lynchpin of the “War on Drugs,” begins2002: A U.S.-led commando operation coup fails in an attempt to remove freely-elected left-populist president Hugo Chavez of Venezuela2004: President George W. Bush tightens travel and financial restrictions on Cuba2004: Ex-President Aristide of Haiti is re-elected amid great controversy. U.S. forces enter Haiti to keep order. Shortly thereafter, Aristide “disappears,” claiming he was kidnapped by the United States. U.S. claims he resigned from office.

101?101?

Eventually, enough is enough…Eventually, enough is enough…

MexicoMexico 1910, 19381910, 1938 OilOilNicaraguaNicaragua 1927-331927-33 Coffee, UFCOCoffee, UFCOBrazilBrazil 19301930 Coffee, SugarCoffee, SugarPanamaPanama 19471947 Mili bases, PCZMili bases, PCZSurinameSuriname 19501950 MiningMiningBoliviaBolivia 19511951 Tin, Oil, SilverTin, Oil, SilverGuyanaGuyana 19591959 Sugar, CoffeeSugar, CoffeeGuatemalaGuatemala 19541954 UFCOUFCOHonduras Honduras 19551955 UFCOUFCOCubaCuba 19591959 Sugar, TobaccoSugar, Tobacco

Rise of Rise of PopulismPopulism

Why?

Land Reform.Land Reform.Workers Rights.Workers Rights.

Land Reform?Land Reform?• Legacy of Latifundia / HaciendasHaciendas

• Wealthy landowners want to maintain the status quo (they are in the minority)– Privatized and corporatized

• Many rural laborers want MinifundiaMinifundia– Privatized (small family farms), not corporatized

• Natives prefer EjidosEjidos– Collectivized, but not Communist

So who’s going to win?So who’s going to win?

Sign of the TimesSign of the Times• Privatization ($)

– Owned by individual or corporation

• Corporatism ($)– Private, but in the hands of a company, not an

individual

VS.VS.• Collectivism ($?)

– Done for the common good, could be owned by a group (co-op), a tribe, a state, etc..

• Communism (not for $)– State-owned

What do you do?• Q: Q: If you were a non-land owner /

peasant and had everything you owned taken away, including your land, your money, and your freedoms, would you:

a. Be fine with the status quo.b. Move to a neighboring country.c. Try to change the system from within.d. Support a collectivist movement.e. Something drastic?

• Business = GovernmentBusiness = Government• Government = BusinessGovernment = Business• No unionsNo unions• Low, low wagesLow, low wages• Slave-like conditions Slave-like conditions • No rights (beatings, torture, death)No rights (beatings, torture, death)• Often worked for coupons / “Company Money”Often worked for coupons / “Company Money”• No other optionsNo other options• No ownership of land for workersNo ownership of land for workers

Follow the model…Follow the model…

Hershey Hershey Chocolate Chocolate

FactoryFactory(rail line, etc.)(rail line, etc.)

Cuba: ~1915

Sugar Production Land Tenure: Sugar Production Land Tenure: Cuba, 1940Cuba, 1940

22.5%22.5%15%

5%

55%

2.5%

Export DestinationsExport Destinations(1937)(1937)

• U.S. helps Cuban independence from SpainU.S. helps Cuban independence from Spain• Cuba wants independence, however…Cuba wants independence, however…• U.S. has major sugar investments in CubaU.S. has major sugar investments in Cuba• U.S. owns / controls 70-90% of Cuban sugar U.S. owns / controls 70-90% of Cuban sugar

American Sugar Refining CompanyAmerican Sugar Refining Company • U.S. keeps military in Cuba to prevent U.S. keeps military in Cuba to prevent

rebellion / protect investments (Establishment rebellion / protect investments (Establishment of Guantanamo Military Base)of Guantanamo Military Base)

• Teddy Roosevelt and “Gunboat Diplomacy”Teddy Roosevelt and “Gunboat Diplomacy”

Cuba: 1903Cuba: 1903

1903: Platt Amendment1903: Platt AmendmentCuba agrees to:Cuba agrees to:• Give U.S. naval base in Cuba: Give U.S. naval base in Cuba:

Guantánamo Bay…Guantánamo Bay…Forever!!Forever!!

• Cuba would not transfer Cuban land to Cuba would not transfer Cuban land to any country other than the U.S., any country other than the U.S.,

• Allow U.S. intervention in Cuban affairs Allow U.S. intervention in Cuban affairs whenever the U.S. deems necessarywhenever the U.S. deems necessary

• Can never negotiate any treaties with any Can never negotiate any treaties with any country other than with the United Statescountry other than with the United States

““The Golden Rule”The Golden Rule”• 99+% of all major reform efforts in Latin

America: legal reform, establishment of worker-owned businesses, major changes in labor rules, etc., eventually failed:– Powerful military / corporate actions (Monroe

Doctrine) with opposing interests– Corruption of leaders (both sides)– Lack of financial / political resources– Lack of alternatives– Lack of education / information / interest outside

of immediate area

……all but one!:all but one!: Cuba Cuba• Since Jan 1, 1959 through

today, Cuba is the exception to nearly every rule about Latin America (except language)

• Overthrew American-sponsored leader: Fulgencio Batista

• Collectivized, then Communized with the backing of the Soviet Union

• Only Lat Am country to lead a “successful” challenge to the Monroe Doctrine?

Pre-Castro Cuba• 75% of Cuba's farmland owned by U.S. 75% of Cuba's farmland owned by U.S.

companies and / or foreign individualscompanies and / or foreign individuals

• Corruption: Batista placed Corruption: Batista placed into office under U.S.-into office under U.S.-supported coup (Corollary)supported coup (Corollary)

• Havana was the “Latin Las Havana was the “Latin Las Vegas” in the ‘30s, ‘40s, ‘50sVegas” in the ‘30s, ‘40s, ‘50s– Prohibition in U.S.Prohibition in U.S.– Gambling (Mafia)Gambling (Mafia)– ProstitutionProstitution– Casinos mostly U.S.-ownedCasinos mostly U.S.-owned

1/1/59: 1/1/59: Roosevelt Corollary Roosevelt Corollary Goes into Action!Goes into Action!

• Castro Takes Over– Wealthy Cubans flee – To Miami, Guatemala, NY– Castro redistributes land

to over 200,000 families• Eisenhower plans

invasion– CIA Director: Allen Dulles– CIA-trained Cuban exiles– Some say Mafia involved

• JFK becomes president• 1961: Bay of Pigs Invasion

1962: Cuban Missile Crisis1962: Cuban Missile Crisis

• 13 day standoff13 day standoff• ““Khrushchev Blinked”Khrushchev Blinked”

Embargo: 1963Embargo: 1963

1963: The Embargo Begins1963: The Embargo Begins

• U.S. U.S. Federal Law:Federal Law:-- No ECONOMIC exchange of any sort with No ECONOMIC exchange of any sort with

Cuba: ILLEGAL!Cuba: ILLEGAL!• EconomicEconomic embargo still in effect embargo still in effect• The rest of the world trades with CubaThe rest of the world trades with Cuba• What about the Roosevelt Corollary:What about the Roosevelt Corollary:

-- Is it in our interest to continue the Is it in our interest to continue the embargo or should we trade with Cuba?embargo or should we trade with Cuba?

BACARDI

• Bacardi was Bacardi was originally a Cuban originally a Cuban companycompany

• They saw the writing They saw the writing on the wall (Cuban on the wall (Cuban Revolution) and leftRevolution) and left

Land of Paradox!Land of Paradox!

Currencies!Cuban PesoCuban Peso

(not convertible)(not convertible)Cuban Convertible Cuban Convertible

PesosPesos

U.S. DollarsUS: Illegal tender since 1963

Cuba: “Illegal” since 2004, charge 10% to convert

Food!

For the rest For the rest of the worldof the world

For CubaFor Cuba

HavanaHavana

Architecture!

Wash D.C.Wash D.C.

Travel!Travel!U.S. ENTRY / EXIT REQUIREMENTS / TRAVEL TRANSACTION LIMITATIONS: The U.S. Treasury Dept requires that persons subject to U.S. jurisdiction be licensed to engage in any travel-related transactionstransactions related to travel to, from, and within Cuba.  Transactions related to tourist travel Transactions related to tourist travel are not licensable.are not licensable.   This restriction includes tourist travel to Cuba from or through a third country such as Mexico or Canada.  Travelers who fail to comply with Department of Treasury regulations will face civil penalties and criminal prosecution upon return to the United States and may face up to a $250,000 fine and up to 10 years in jail.

This is a This is a U.S.U.S. law! law!

Not a Cuban law.Not a Cuban law.

Cuba

The UN Vote on the Embargo:The UN Vote on the Embargo: (11/13/12)(11/13/12)

FOR AGAINSTAGAINST• United States 188188 countriescountries• Israel around thearound the• Palau worldworld

2121 consecutive years that the UN has consecutive years that the UN has voted voted overwhelminglyoverwhelmingly to end the to end the

embargo: should it continue?embargo: should it continue?

(3 abstentions)(3 abstentions)

http://www.washingtonpost.com/world/the_americas/un-once-again-votes-to-condemn-us-embargo-against-cuba/2012/11/13/8c3b15b0-2dbb-11e2-b631-2aad9d9c73ac_story.html/

The Rest of Latin AmericaThe Rest of Latin America• Wealthy landowners / MNCs remain in charge• Little successful land reform• World becoming aware:

Lack of Access to Land = PovertyLack of Access to Land = Poverty• Efforts begin to decrease poverty:

From “Above” From “Above” (“Golden Rule” Economics)(“Golden Rule” Economics)- Corporations and Governments- International Financial Institutions (WB, IMF, WTO)- International Agencies (U.N., USAID, etc.)From “Below”From “Below”- Non-governmental organizations (NGOs)- Other non-government-led efforts

Non-Governmental Organizations (NGOs)Non-Governmental Organizations (NGOs)(from “below”)

• Amnesty InternationalAmnesty International

• OxFamOxFam

• Rainforest AllianceRainforest Alliance

• World Wildlife FundWorld Wildlife Fund

• The Nature ConservancyThe Nature Conservancy

• Heifer ProjectHeifer Project

• Farmer-to FarmerFarmer-to Farmer

“Grassroots” organizations

Free Trade = Fair Trade?Free Trade = Fair Trade?

• Local producers have difficulty competing:Local producers have difficulty competing:

-- Less access to quality landLess access to quality land

-- Government subsidies / price Government subsidies / price supportssupports

-- “Dumping” “Dumping” excess products on Lat excess products on Lat AmAm

CocaCoca

• Andean: in climate and cultureAndean: in climate and culture• Domesticated by IncasDomesticated by Incas• Natives have been growing and Natives have been growing and

using coca plants for centuriesusing coca plants for centuries• Chewing on leaves relieves Chewing on leaves relieves

hunger, fatigue, altitude hunger, fatigue, altitude sickness; part of native ritualssickness; part of native rituals

Q: Q: Are Coca and Cocaine the Are Coca and Cocaine the same thing?same thing?

Q: Q: Are Corn and Whiskey the Are Corn and Whiskey the same thing? same thing?

The Refinement / Distillation The Refinement / Distillation process is the key!process is the key!

Cocaine was legal in the Cocaine was legal in the U.S. prior to prohibition!U.S. prior to prohibition!

Coca Cultivation and Leaf Production:Coca Cultivation and Leaf Production:1996 and 20001996 and 2000

• Coca grown on Coca grown on small plots in Peru small plots in Peru and Bolivia (largely and Bolivia (largely by natives)by natives)

• Coca grown on large Coca grown on large estates in Colombia estates in Colombia (drug lords)(drug lords)

Coca:Coca:Q: Q: Is it OK or not OK to grow Is it OK or not OK to grow

coca plants?coca plants?

Plan Colombia

Source: http://justf.org/Country?country=Colombia

Colombia: Homicide Rates(1975-2005)

2010 Homicide Rates 2010 Homicide Rates (by country)

Colombia: #7 in worldColombia: #7 in world

The Geography of the Global Drug Trade

Colombia through Mexico / Caribbean to the United States / Europe

Cocaine Flows to the United States:Cocaine Flows to the United States:Dual CorridorsDual Corridors

(Juárez)

Plan Colombia: Plan Colombia: US contributed BILLIONS of US contributed BILLIONS of $$$ to South America since $$$ to South America since 1999 to help eradicate 1999 to help eradicate cocaine productioncocaine production

Supply driven?Supply driven?Demand driven?Demand driven?

Q:Q: Will reducing the Will reducing the supply eliminate supply eliminate the demand? the demand? Or if we reduce Or if we reduce demand will that demand will that limit the supply?limit the supply?

Maybe there’s another Maybe there’s another way to “intervene?” way to “intervene?”

http://www.smithsonianmag.com/people-places/The-Secrets-Behind-Your-Flowers.html