‘Fox, Lula and Leadership for the Americas

In the Americas, one of the defining experiences of the past two decades has been the growth of income inequality between countries. As measured by Gross Domestic Product (GDP), this is the case at all levels. Just as the gap between wealthy and middle-income countries has grown, so has the gap between middle-income and poor countries. And as the flow of income has grown more unequal, so has the ability to exercise political and economic power.

A list of the continent's rich and powerful countries, of course, is a list of one. Within the hemisphere, the United States probably wields more economic and political power than ever before. In this context, it has fallen to Mexico and Brazil, the two most powerful of the hemisphere's middle-income countries, to stake out strategies of resistance, accommodation and/or self-protection. These strategies have not been the same. Mexico's president, Vicente Fox, as we have argued here before, seeks to play the role of honest broker between the United States and the rest of the Americas. He has positioned himself as the Latin American leader who can most credibly open doors of good will in Washington.

Brazil's President Lula, on the other hand, has positioned himself as the Latin American leader who can most credibly organize, support and protect an independent community of Latin American nations. He has been cautiously (sometimes very cautiously) cultivating a countervailing force to U.S. economic and political power.

These are not mutually exclusive positions. Fox would like Mexico to be part of that countervailing force, but at the same time he wants to play a role in facilitating communication between the hegemonic power of the North and the dependent countries of the South. He has continued his talks with Venezuela's leftist president Hugo Chavez on proposed cooperation between Pemex and the Venezuelan state oil company, PDVSA, particularly in the development of their joint refining capacities. But he has kept Washington happy by speaking favorably of a gradual opening of Pemex to private investment.

Lula seeks to build Southern power, but would also like a non-antagonistic relationship with Washington. He is promoting U.S.-Mercosur negotiations as an alternative to the U.S.-promoted country-by-country negotiations to form a Free Trade Area of the Americas (FTAA), but he has voiced no opposition to the eventual enactment of a continent-wide free-trade zone that would include the United States.

He has the backing, particularly among the leaders of the continent's middle-income countries, to pursue the promotion of regional solidarity in the face of what some leaders have called the U.S. "empire." The revival of Mercosur and Hugo Chavez's proposed hemisphere-wide oil company, "Petroamerica," both spring from a practical kind of regional solidarity: a hope that more trade and investment can be generated within Latin America itself.

These moves spring from a desire to negotiate with Washington from a position of greater strength, reducing the South's debilitating dependence on the North.

And Lula has taken the relationship with Venezuela's Chavez a step further.

The two South American presidents signed a "strategic alliance" this week that included Venezuela's purchase of two dozen Super Tucano light-attack aircraft from the Brazilian firm Embraer and an agreement between the countries' state oil firms PDVSA and Petrobras that will allow the Brazilians to develop natural gas projects off the Venezuelan coastline and oil fields in the Orinoco oil belt. Chavez has also pledged to back Brazil's quest for a permanent seat on the UN Security Council.

The arms deal will be worth $170 million, according to the Brazilian newspaper O Globo, and it comes on the heals of Venezuela's earlier purchase of 40 military helicopters and 100,000 rifles from Russia that was harshly criticized by Washington. The sale, providing additional protection for Chavez's radical reforms, is a clear signal that Lula, while not willing to antagonize the U.S. government to the degree that Chavez has, is ready to demonstrate his willingness to lead a measure of resistance to Washington's hegemonic power.

Meanwhile, Fox took his brokerage role to North Africa last week where he promised Algerian President Abdelaziz Bouteflika that he would support Algeria's attempt to join the World Trade Organization, support the creation of a Palestinian state and work toward a reform of the UN Security Council that would give more adequate representation to the world's developing nations. While Washington has yet to give him the migration accord he wants so dearly, Vicente Fox is still building his leadership role on the basis of his access to the ear of George W. Bush.