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From the Vol.1,No.9 issue of Electronic Intelligence Weekly

IBERO-AMERICAN NEWS DIGEST

Argentine Government's Days Are Numbered

Argentine President Eduardo Duhalde named Roberto Lavagna, formerly Ambassador to the European Union, Economics Minister on April 26, five days after his previous Minister resigned. Lavagna's assignment, as he put it, is to walk "the delicate balancing line between the necessities of the foreign investors and those of the people." He told reporters that there are two extremes which must be avoided: those that say, "Everything with the International Monetary Fund, and nothing for the people," and those that say, "Everything with the people, and turn your back on the Fund."

Since satisfying both of these antithetical interests is no longer physically possible, President Duhalde's regime can have no longevity to speak of.

Within hours of Lavagna's being sworn in, Treasury and IMF officials communicated to Argentine officials in Washington and Buenos Aires, that they give the new economics team two weeks to implement three central demands: Eliminating the economic subversion law (under which several bankers have been jailed for looting their banks); changing the bankruptcy law to remove provisions which provide some protection for debtors; and signing bilateral austerity agreements between the Federal government and each and every province.

The idea that the provincial governments could somehow adhere to the IMF's demand for a 60% cut in the provincial budgets, or the Federal government attain fiscal deficit targets, is insane, given the economic hecatomb resulting from the failure to break with the IMF and dollar system, and reorganize national banking:

*In March, imports were 71% less than the same month the year before, totalling only $592 million. Imports of capital goods fell by 78%; of consumer goods, by 76%. Exports rose by 3%, but primarily because of the 28% rise in grain export revenues, resulting from the approximately 70% devaluation of the currency. Exports of manufactured goods, however, fell by 10%, reflecting the lack of production and trade financing.

*Tax revenues in April came in at 18.5% less than the year before, a collapse so severe that Economics Ministry spokesmen said they may have to postpone payments of Federal public-sector workers for at least a week.

*According to official government statistics released this week, unemployment now stands at 30%. In this, one of the world's premier agricultural producers, it is now the case that 40% of the population cannot afford to meet basic nutritional needs.

The survival of a generation of children is threatened: In the northwestern province of Catamarca, children are fainting in school due to lack of food, and the supplementary food programs for the poor, made available through the schools, have been axed due to budget cuts. Fainting occurs most frequently on Mondays, following the weekend, when children, at home for two days, obviously haven't eaten. School officials say education can't even occur, since undernourished children can't concentrate, or are too ill to do so. Of 10 million children under the age of 14 in the country, 6 million live below the poverty line, and 2.5 million of these are classified as indigent.

Last December, the average wage was $623 monthly; today it is $207. Argentina has fallen from first to ninth place in Ibero-America in terms of per-capita income, according to the Equis consulting firm. It is estimated that by the end of May, of 14 million people able to work, 7 million will be unemployed.

UNCTAD Secretary-General Attacks IMF Policy Toward Argentina

"Argentina has the bad luck to have been chosen as the test case for a new, inflexible political hard line, being followed by the IMF and U.S. Treasury," warned Rubens Ricupero, a Brazilian and the Secretary-General of UNCTAD. The country is on the verge of "political and social disintegration," and there must be a "more positive international effort to seek an emergency solution," he said.

In statements reported in the Brazilian paper O Estado do Sao Paulo April 26, Ricupero attacked IMF policy toward Argentina, likening that nation's current situation to that of Germany, Austria, and Hungary at the beginning of the 1920s. Powerful nations shouldn't overestimate Argentina's ability to elaborate consistent economic plans, he warned. "To expect Argentina to take the first steps [to impose austerity] is unrealistic. Today it can't do that." To make an example of Argentina, "only ends up punishing the innocent."

Ricupero, who was in Brazil to present UNCTAD's annual report, warned that if other countries don't act to help Argentina, "when political and social disintegration occurs, and no one knows where it will end, there is always the risk of contagion ... and even the IMF's calculation of non-contagion is risky, because sooner or later, it could occur."

Billionaire Cisneros at Center of Venezuelan Machinations

Bush family friend Gustavo Cisneros is at the center of operations to put something back together in Venezuela. It was Cisneros, the multi-billionaire head of the Organizacion Diego Cisneros business empire, who in 1985 got the Venezuelan Supreme Court to ban EIR's book Dope, Inc., because the book raised questions about Cisneros's ties to dope-money-launderers. He's now the man playing all four sides of the street in Venezuela: He was with President Hugo Chavez from the outset of his regime; he was all over the coup to overthrow Chavez; and he's now in the middle of attempting to shape what comes next.

After various Venezuelan Deputies charged that the U.S. and Cisneros financed "the coup within the coup" which split the opposition movement to Chavez, Cisneros called in Defense Minister Jose Vicente Rangel for a meeting at his Caracas mansion on April 24. The two assured the press afterwards that Cisneros had no role in the coup, and Cisneros denounced as baseless a Newsweek story on his involvement.

The next day, U.S. Ambassador Charles Shapiro met with Chavez briefly, and much longer with Rangel. Shapiro assured the press afterwards that relations between the two governments "are good, and we intend to improve them." He gave no details of what he discussed with Rangel, but said they covered "all subjects."

On April 28, Chavez named Rangel his Vice President, in his first big post-coup reshuffle.

The same day, the New York Times Sunday Business Section featured a laudatory story on Cisneros's role as the power broker in Venezuela, including his close personal relations with Assistant Secretary of State Otto Reich (the old Iran-Contra hand who was up to his ears in the coup within the coup) and former President George H.W. Bush. The article was clearly approved by Cisneros, who granted an interview to the Times reporter in which he modestly denied the reports that he has personal Presidential aspirations.

Meanwhile, the political situation in Venezuela remains highly volatile. On May 1, hundreds of thousands of Venezuelans marched for and against Chavez's fascist regime. The marches were peaceful, but the slogans demonstrated the implacable opposition between the two sides.

Brazilians Warn of United States' 'Oppressive Unilateralism'

The Bush Administration-orchestrated summary dismissal April 22 of Brazilian Ambassador José Mauricio Bustani as Director General of the United Nations' Organization for the Prohibition of Chemical Weapons (OPCW), coming on the heels of the fiasco of the botched coup attempt against Venezuelan President Hugo Chavez, is sending shockwaves through Brazil's elite.

The influential, usually pro-American, newspaper O Estado de Sao Paulo published editorials April 21 and, again, April 24, going after the attitude of "supremacism" dominating the Bush Administration. "The American superpower acts in coherence with the arrogant vision of the world of the neo-conservatives in power in Washington, the policy of what could be called 'supremacism.' We are dealing with the affirmation of an imperial-style hegemony, displease whom it will," Estado de Sao Paulo wrote April 21.

"For the Republican establishment, for example, the criticism of the role played by the United States in the Venezuelan crisis is of little importance,... The planned ouster of Brazilian diplomat José Bustani is also supremacism. The United States accused him of partiality. But it is because he was not a 'yes-man' that the Americans orchestrated his overthrow.... Then, the Americans ask why they are so little loved in the world." On April 24, O Estado de Sao Paulo again went after "The Oppressive Unilateralism of the USA," under which "the government of President Bush wiped off the slate the most elemental conventions which should guide relations between countries."

Journalist Miriam Leitao—known as an unofficial spokesman of the Planalto Presidential Palace—wrote in her O Globo column of April 28, that, so far, the Americas have been "either relegated to oblivion, or handed over to the logic of the anti-Castro Cubans, who hold various key posts. As if this vast region, with its potentials, differences, and dilemmas, was merely the island which for 40 years has been the stone in the shoe of the U.S. government.... In the case of Bustani, the Americans had to do their dirty work right to the end. They had to be explicit in their authoritarianism.... Brazil wants to look forward, but it is doubtful that it will be possible to have a more tranquil relationship with the United States of George W. Bush, which has surpassed itself in its ability to create problems."

Top FARC Officials Now Wanted by U.S. and Interpol

The friends of New York Stock Exchange head Richard Grasso in the narcoterrorist Revolutionary Armed Forces of Colombia (FARC) took two big hits last week.

First, the international police agency Interpol put FARC chief "Tirofijo" and 13 top commanders on its international terrorist wanted list. The list includes Raul Reyes, the FARC's "money man," whom Grasso, during his 1999 visit to the jungles of Colombia, had greeted for the cameras, and invited to the New York Stock Exchange.

Then, on April 30, Attorney General John Ashcroft announced a grand jury indictment on murder charges of six top members of the FARC for the 1999 kidnapping and murder of three American citizens, who were environmental and indigenist activists involved with Colombia's Indian tribe known as the U'wa.

Ashcroft portrayed the FARC as "a fiercely anti-American terrorist organization," as well as narcotics traffickers, and declared, "Today, the United States strikes back at FARC's reign of terror against the United States and its citizens. Just as we fight terrorism in the mountains of South Asia, we will fight terrorism in our own hemisphere.... Today's action is a step toward ridding our hemisphere of the narcoterrorism that threatens our lives, our freedom and our human dignity."

Ashcroft confirmed that the U.S. would be seeking the extradition of those charged, and said the Bush Administration would be working with the Colombian government on efforts toward their capture.

European Union Exempted FARC From its Terror List

The member-states of the European Union made a deliberate decision May 2 to exclude the FARC and ELN from its list of international terrorists, while adding Peru's Shining Path (Sendero Luminoso) and Colombia's paramilitary United Self-Defense of Colombia (AUC). Inclusion on the EU list means that all assets of the targetted organization must be frozen by member-states of the EU. According to France and Switzerland, the FARC was not included because of the difficulty it would pose removing them from the list, should peace negotiations be renewed under the next Colombian administration. Late last year, the EU countries reportedly (or at least, "officially") stopped granting entrance visas to known FARC members.

Mexican Supreme Court Rules a Fox Privatization Scheme Unconstitutional

In the wake of the Mexican Congress's rejection of the energy privatization scheme of the Vicente Fox Administration, the Mexican Supreme Court on April 27 ruled 8 to 3 that a decree issued last year by the Fox government which opened the door to private-sector electrical generation for the public market, was unconstitutional. The court ruled that it was "an authentic fraud upon the law," which, if allowed to stand, would "de facto and de jure," permit the privatization of electricity.

Fox's decree allowed industrial companies owning generators to power their own plants, to sell off any "excess" energy produced, up to 50% of their capacity, to the Federal Electrical Commission. At the initiative of the PRI and the PRD Parties, the Congress filed a suit before the Supreme Court, charging that the Executive Branch's decree was unconstitutional. The Supreme Court agreed, ruling that the Constitution is clear, that the generation, transmission, distribution, and supply of electricity, for public use belongs exclusively to the state, as established in Article 27, Point Six, of the Mexican Constitution.

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