Introduction
Thank
you, Miguel, for that generous introduction. I  am
happy to be back at this prestigious center for the study for foreign affairs.
CSIS has been a catalyst for thought over the years, and the work you do
here adds to the intellectual vigor of our foreign policy. Today, I would like
to briefly discuss my thoughts on Latin America, where we are now and where we
ought to be headed, and then share some of my impressions from my recent visit
to Brazil, Argentina, and Uruguay.
While
in the Southern Cone, I encountered a perception, held by some, that the United
States is not engaged with our partners in the hemisphere. In my view, that is
not only untrue but would be practically impossible and completely undesirable.
My message was that the United States is engaged in Latin America per force of
our historical circumstances and by design.
 First,
we are bound together by shared values. There is now a consensus in the Americas
in favor of democratic government. This consensus began to emerge more than
twenty years ago. In the late Seventies, only about a quarter of the people in
Latin America enjoyed some form of democratic government. Today, all of the
nations are democracies except Cuba. We are becoming a community of states based
on this common belief, as was codified in the Inter American Democratic Charter
that establishes democratic government as the birthright of all citizens of the
hemisphere.
Our
shared values are derived from a common history. The history of the Americas is
a history of the progress of freedom. We struggled for independence here in the
New World. We established democratic governments here to secure our rights and
allow us to explore the opportunities that this vast and plentiful hemisphere
has to offer. No other region has made such progress and has so much potential.
History
tells us that natural and political geography dictate patterns of trade.
Neighbors of like-mind are our most likely trading partners. The U.S. sells more
to Latin America and the Caribbean than to the European Union. Trade with our
NAFTA partners is greater than our trade with the EU and Japan combined. We sell
more to the Southern Cone common market (MERCOSUR) than to China. Latin America
and the Caribbean comprise our fastest growing export market. These commercial
relationships bind the prosperity of United States to the prosperity of the
hemisphere.
President
Bush has said he believes that the 21st century will be known as the
"Century of the Americas." Having been the governor of a border state,
the President sees the nations of this hemisphere as partners and neighbors. He
has been very personally engaged in the affairs of the region. He believes that
emergence of democratic states in the Americas ... and the prospects for the
growth of hemispheric trade and development ... make this a defining moment.
The
United States is engaged with Latin America ... necessarily and happily so. We
share values, history, and geography. During the Cold War, American statesman
used to say of Europe and NATO, "We are there, and we are committed."
One might say of the United States and Latin America today, "We are here,
and we are committed." The President believes in the future of the
Americas, and our policy reflects his confidence and his vision.
Challenges
This
is a very exciting time in the history of the Western Hemisphere.
There are many opportunities. There are also many challenges. While we
are optimistic, we are not naive. The enormous progress we have made in the past
twenty years has not severed the region from its past. The ideas of freedom and
equality are being put into the practice of democracy and markets throughout the
hemisphere, but this historic evolution is not without difficulties or
opposition. These are nations that are still struggling with the legacy of
poverty, statism, and authoritarianism.
U.S.
Policy
I
am confident that the forces of democracy and freedom are on "right side
history," but there have been and will be setbacks. The leadership of the
United States is critical to overcoming these obstacles to progress. The Bush
Administration's agenda for our hemisphere has four goals: to strengthen
security, promote democracy, encourage responsible governance, and stimulate
development.
Security
It
is often said that security is the first function of the state. Since September
11, no issue has captured the attention of the public as security has. The
attacks on that day were brutal reminders to us all of the danger that evil men
pose to open and democratic societies, the value of our way of life, and the
necessity of our leadership in the world.
We
were very heartened by the expressions of sympathy and condolences offered by
people throughout the Americas. Led by Brazil, our friends in the OAS invoked
the clause in the Rio Treaty recognizing the attack on the United States as an
attack against all. We are deeply grateful for the support of our neighbors in
the war against terror.
Our
first war of the twenty-first century is peculiar to our time. Our enemy is a
lethal combination of transnational criminal networks and terror organizations.
Today, many challenges to our values and our interests arise from such
combinations, even here in our own hemisphere.
Terrorist
organizations are operating in Peru and the tri-border region of Argentina,
Paraguay, and Brazil. In Colombia, narcotics traffickers and terrorists are
waging a vicious campaign of political violence that kills three thousand people
every year.
If
Colombia is to succeed as a state, it must be able to control its national
territory and protect the lives and property of its citizens. President Bush has
asked the Congress to allow us to enhance our military and intelligence
assistance to the Colombian government in its war against terror.
Colombia
can defeat the terrorists, but it needs help from its friends to do it. They
need training, arms, equipment, and intelligence to implement a successful
military strategy.
The
United States has a national interest in the success of democracy in Colombia
and the region. Our values and the future of our hemisphere are at stake. As
President Bush said, "Our first commitment is to democracy and political
freedom. Freedom -- the freedom to vote, speak, worship, and own -- is the great
idea of our time, and of all time."
Democracy
and Good governance
Terror
is not the only threat to democracy and freedom in the region. A democracy
ultimately rests on the confidence of the people it serves. It is the
responsibility of leaders, not merely political leaders but of all civic
leaders, to maintain the trust of the public. Corruption in the leadership
class, motivated by greed for money or power, is poison to democracy and
inimical to freedom. In Latin America, there are countries that are suffering
leadership crises.
I
do not say that corruption is unique to Latin America. In my view, moral
failings are evenly distributed throughout the human population. One only has to
examine the front page of the Wall Street Journal to find evidence of corruption
in the United States. It is incumbent upon leaders to create an environment in
which the darker side of human nature is held in check and incentives are
provided for good behavior.
Absent
those restraints and incentives, corruption may run rampant. As Alan Greenspan
observed in his testimony two days ago, the corruption in the corporate
boardroom resulted from a failure of checks on corporate leaders and frenzied
capital markets that offered perverse incentives to express greed.
Some
have suggested that the democratic and free market model has failed in certain
Latin American states. That is a misinterpretation of events. The model has no
more failed in Latin America than in the North America, Europe or Asia. The
failures that have occurred are the result of the imperfect and incomplete
implementation of democracy and markets. The challenge in Latin America is for
the leadership class to overcome the legacy of poverty and statist government...
and eliminate the perverse incentives that the remaining elements of the old
regime still offer.
On
my visit to Argentina, I expressed our sincere desire for economic recovery
there. Argentina has been a
stalwart ally of the United States and a champion of democracy in many
international fora. We stand ready to aid Argentina directly and through
international institutions, but it is incumbent on Argentines to put forward a
sustainable economic program. I am sure that they will do so. Despite their real
suffering, the Argentines remain committed to democracy.
That
commitment is evidence of their faith in themselves and their confidence in
their country's future.
Democracy
is always a work in progress. It requires the constant effort of leaders and
citizens to make sure that its institutions are honest and work as they were
intended. That is its great strength and weakness. There is no perfect
democracy, as there are no perfect people. But democracy is endlessly
perfectible. The challenge is to work continuously toward that end.
To
help meet that challenge, the Bush Administration has undertaken to provide
incentives for good governance with a new approach to foreign aid. President
Bush announced the Millennium Challenge Account initiative last March. We will
increase our core development assistance by 50% over the next three years,
resulting in a $5 billion annual increase over current levels by fiscal year
2006 and beyond.
These
monies will be directed to those countries that govern justly and honestly,
uphold the rule of law, fight corruption, invest in their people, and promote
economic freedom.
Democracy
is more than an election. It is a civic culture. Public integrity, equality
before the law, respect for individual rights, economic opportunity, and healthy
political institutions are essential to freedom. In the absence of any one of
these, the people suffer and lose confidence. The practice of liberal government
and market economics is the surest way to a civil society.
Furthermore,
scholarly studies demonstrate that there is a strong dynamic relationship
between good governance and economic success.
Uruguay,
a country with a tradition of good governance, enjoys the most equitable income
distribution in Latin America and public confidence in its leadership. Chile,
ranked as the top country in Latin America for fighting corruption and other
indicators of good governance, has benefited from the fastest economic growth
over the past decade.
Development
Our
ultimate goal is an American community of democratic states prospering together.
The Free Trade Area of the Americas would create the largest free market in the
world, stretching from Canada to Chile.
We
intend to complete negotiations by January 2005 and fully implement the
agreement by the end of that year.
The
FTAA will give a powerful impetus to investment, innovation, efficiency and
growth in Latin America, as NAFTA did in Mexico. More than half of the 3.5
million new jobs created in Mexico since 1995 are connected to trade. World Bank
studies have documented that developing countries which trade freely grow their
GDP and reduce poverty faster than developing countries that do not ... faster
even than the developed countries, such as the United States. By 2005, the
Americas will be a $13 trillion market. Even a very small increase in growth,
just one percent, would produce a tremendous amount of new income, roughly $130
billion. Latin America would benefit disproportionately from that new income.
Opening
the hemisphere to free trade will provide political benefits as well. Mexico's
entrance into NAFTA heralded unprecedented political modernization. The prospect
of increasing capital investment is an enormous incentive for reform. Capital
goes where it is welcome and where it will be protected from political risk. The
competition for capital demands respect for individual rights and the rule of
law. FTAA can be a transformational force in Latin America.
Conclusion
 Before
I conclude, I would like to share an anecdote from my trip to the Southern Cone.
Ambassador Hrinak, our envoy to Brasilia, related an interesting observation to
me about Brazil. She said that there is a sense of confidence in Brazil today
that was not present fifteen years ago. That confidence was well expressed by
Foreign Minister Lafer in a recent editorial. He eloquently argued that Brazil
had nothing to fear from trade negotiations with the United States ... and
everything to gain. I believe that is true also because we are not looking for
markets to exploit. We are looking for confident partners with which to build a
better future.
I
look forward to Brazil and the United States assuming the co-chairmanship of the
FTAA negotiations in November. Working together with all our partners in the
region, I believe we can fulfill the promise and potential of the Americas.
Thank
you for you time and attention. I will be happy to take whatever questions you
may have about our policies or my trip to the Southern Cone.
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July
16, 2002
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