06/17/16 – Mark Weisbrot – The Scott Horton Show

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Introducing Mark Weisbrot.
He's got a brand new book out, Failed!
What the Experts Got Wrong About the Global Economy.
And he is especially an expert in American, well, Latin American affairs, but I mean to say US-Latin American affairs, because they are so closely intertwined all the time.
Welcome back to the show, Mark.
How are you?
Thanks.
It's great to be here.
Very happy to have you here.
Now, I haven't read the book, sorry, and I can't really go over all this stuff, but what I really do want to talk to you about is what's going on in Brazil.
You know, I had almost arranged an interview with this LA Times reporter about a story he did about this leaked audio, but that just fell through.
So that seemed to be a real big, important story.
I guess, you know, if you could start by just giving us the background about the president, how long she's been in power, what the impeachment is about, what's going on.
Give us your take on it as best you can, and I'll try to come up with some good follow-up questions for you here.
Sure.
Well, Dilma Rousseff is the president of Brazil, and she was elected in 2010 and then re-elected in the fall of 2014.
And the opposition there is trying to impeach her.
Well, they have impeached her in the sense that it's a system kind of like ours.
So the House has voted, the lower house has voted to impeach her, and then the Senate also voted in favor of the impeachment.
And so then she will be put on trial sometime in August, it looks like.
And if the Senate votes by two-thirds to get rid of her, then she's right now suspended, actually, for up to 180 days.
And there's an interim president, and if they vote to confirm her impeachment or removal, she'll be removed from office.
That's the procedure in terms of what's going on right now.
The politics, of course, are a much more complicated story.
Ah, yes.
Well, so here's my basic sketch understanding, is that they're impeaching her in the name of this bookkeeping trick that hardly amounts to high crimes and misdemeanors, and that on the face of it, it's clear that the reason that she's been impeached is because her Department of Justice, whatever they call it there, her prosecutors were going after them for committing crimes.
And now, so then the question comes down to, I think, unless I missed the summary there, the question was whether she was just politically prosecuting them or whether they're just politically prosecuting her, Mark.
And it doesn't just come down to whether you're left-wing or right-wing, does it?
Well, I think it does in this case because she did give the prosecutors autonomy for the first time in Brazil's history to go after everyone.
They went after people in her party as well.
And allies and contributors and business people who are associated with her party, they put them in jail.
And so the thing is that the people who are trying to impeach her are, there's a lot of evidence that's emerged that they're just trying to do it, or to get rid of her, they're trying to do that to block the investigation, to protect themselves.
There was a recorded conversation transcript that leaked a few weeks ago between Senator Romero Juca and former oil industry executive Sergio Machado.
And in this conversation they say it pretty clearly that they've got to get rid of Dilma to protect themselves from this investigation, themselves and their allies.
So that seems to be what is going on right now.
And there's been a shift in the international media, which previously was like the Brazilian media just a few months ago.
It was very much like the Brazilian media in the sense it was completely against the government, the Workers' Party government.
And now you can read the press here and get a good feel for what is actually going on.
All right, now, I guess, see I'm not left or right on this, so maybe my perspective is a little bit unique.
My primary interest, of course, is in American non-intervention.
So my primary concern would be that the CIA or the National Endowment for Democracy is behind this or working on this.
I know I read that some of the people leading the coup had come to the United States to visit D.C. and talk with some officials.
And I don't know if you know or if you have some suspicions or speculations or what, but what can you tell us, do you think?
Yes, I think that the executive branch of this government is in favor of this coup, and I think they want to get rid of Dilma.
And, you know, they've been pretty quiet about it.
And that in itself says something, because this is obviously something bad is going on, and they generally do comment on situations like this where a president is going to be, you know, unconstitutionally removed from office.
And they've been very careful to say nothing at all.
But on April 20th, one of the senators, the senator that was really leading the impeachment in the Brazilian Senate, Aloysio Nunes, came to the United States, and he had a lot of meetings, and one of them was with Tom Shannon, who is the third-ranking U.S. State Department official, and he's the one that's basically in charge of handling this situation.
He's also a former ambassador to Brazil, and he's been involved in other coups.
For example, the military coup in Honduras in 2009, and he was involved in consolidating that and making sure that the elected president could not return to office.
And so he's very likely, I mean, just this meeting, we don't know what happened at the meeting, but the fact that he met with him right just a couple of days after the lower house voted to impeach Dilma is a very strong indication.
It's kind of a dog whistle diplomacy where nobody here really notices it, and the media kind of ignores it.
But in Brazil, everybody knows that this is their way of showing support for the coup because he didn't have to meet with this guy at that particular moment.
And by doing that, they send a very strong signal through the whole region that the U.S. really supports this.
And this really isn't any surprise if you follow Latin America, as we do over the past, you know, 15 years.
Our government has been against all of the left governments in the region and has supported any number of efforts to get rid of them by various means, including coups.
But now as far as the NED down in Brazil now, do you have any information about that at all?
Well, the National Endowment for Democracy, no, I mean, you do have information.
Brazil doesn't allow, they don't have any NED-funded organizations there.
I think they actually don't allow it.
How about the CIA?
Well, they have the State Department.
They got an embassy, right.
The USAID, we actually got Freedom of Information documents under the Freedom of Information Act in 2005 showing that the State Department did fund an effort to change legislation there in a way that would weaken their workers' party.
So you do have that evidence.
And, you know, the other stuff mostly goes on under the table.
You don't see it.
But as I said, the meeting with Shannon was a definite signal.
And I think it's very, very likely that the United States is supporting this coup.
And, you know, they have their reasons.
I mean, basically, Brazil, under the workers' party, has done very well for Brazil.
I mean, they reduced poverty by 55 percent and extreme poverty by 65 percent.
And, you know, until this recession in the last couple of years, they did extremely well and better than they had done for, you know, more than 20 years in terms of poverty reduction and growth.
But from the U.S. State Department point of view, what they really care about more than anything is whether the country is going to support U.S. foreign policy in the region.
And Brazil didn't do that.
They opposed the military coup in Honduras.
They opposed the expansion of U.S. access to Colombian military bases in 2009.
And they also, ironically, at the request of the Obama administration, they helped broker a deal to try and end the standoff with Iran a few years ago with Turkey and Russia, where it was a nuclear fuel swap arrangement.
And that also upset especially Hillary Clinton, who is the Secretary of State, and others.
And so they didn't consider – I mean, Brazil was part of this kind of alliance of left governments who took seriously the notion that they're sovereign countries and should be able to have their own policies, including foreign policy.
I'm totally with you on that.
And just to help make the point for the libertarian audience as well, that you don't have to agree with leftist politics.
I mean, for me, some of this land reform and stuff is probably perfectly libertarian and overdue.
It's not like they've gone from total freedom to now socialism.
They've gone from hardcore right-wing conservative, even fascist governments, to more left-leaning governments.
So it's not like anything the socialists are doing is definitely the wrong thing necessarily.
On the other hand, I don't have any faith in socialist economics to work well.
If they did some good for a while, I'm not surprised that things aren't looking so rosy right now.
But on the other hand, it ain't none of my damn business, Mark, other than being a curiosity to me.
And other than me wanting to try to whatever I could do to help keep my government out of there.
Because they have a right to make those choices.
And to try and fail and figure out which of their policies work and which ones they don't, without a bunch of spooks from the superpower to the north coming and dictating to them how things have to be.
And by the way, you might even remind us about America has a very long and very bloody history in Brazil.
Americans, we hear about Guatemala and Chile sometimes, but Americans don't know about American-backed fascist dictatorships in Brazil.
No, that's right.
The U.S. was involved in the 1964 coup.
And there's a lot of Brazilians there.
That was the military dictatorship, which ruled until the mid-80s.
And so we really only have about a little more than 20 years of democracy in Brazil.
And yeah, so a lot of people in Brazil remember that, and they're comparing the coup.
Well, there is kind of some direct link.
I mean, they're comparing the current coup to that.
I mean, Dilma herself was imprisoned and tortured under the military dictatorship.
And one of the congressmen who supported the impeachment, when he made his speech on that Sunday, I think it was May 17th, in support of impeachment, he specifically praised the military officer who was responsible for her torture.
So these are the kind of people that are behind this impeachment.
It's really an extreme authoritarian right-wing.
A lot of it is very extreme right.
And I'll tell you a story about, this is my Brazil story, Mark, as long as we're talking about it.
I hardly ever cover this issue, but it's so important.
Not my story, but the issue is.
But my story, I think, is telling.
I knew a guy who was in Brazil, I believe in Sao Paulo, could have been Rio, on 9-11.
And he said that everyone was gathered around watching the TVs in the store window, just like in the old movies of the 50s or whatever, right?
They're gathered around on the sidewalk and they're watching the towers burn on TV.
And he said, it's not that anyone was whooping and celebrating and happy about it, but they were kind of doing that very subtle, close to their chest, little fist pump.
Like, yeah, finally the Americans got a little bit of a taste of this.
That was what the people on the streets of Rio thought.
That was their reaction.
The people standing around the store window thought, good, you know, finally they got a little bit of a taste.
Instead of, oh my God, that's terrible.
And you know, Americans, I mean, there's only two answers to that.
Either Brazilians are evil or America has murdered a lot of Brazilians and they got some real hard feelings.
Yeah, you do have that.
I mean, you do have a lot of, throughout the region.
I mean, I don't know that, you know, the media always calls it kind of anti-American sentiment, but I think it's just more of an, you know, it's an anti-imperialist thing.
I mean, they, you know, the reason they elected all these left governments in the 21st century was because they were able to vote the way they wanted to, you know, whether you agree with them or not.
They, in the past, they couldn't because, and these aren't really socialist governments.
I mean, they're more social democracies of the kind that you have in, or mostly had, I should say, in Europe.
Like Alaska.
Yeah.
Like pale and socialist Alaska, where everybody gets a cut of the oil wealth.
I get it.
Yeah, in a way it is kind of like, and certainly in the oil-producing countries.
But I think the main thing is that they, you know, they finally had real democracy in this century in the sense that they could elect governments that they wanted.
And, of course, the idea of national sovereignty isn't always taken up by the left.
I mean, there have been non-left governments too that have believed in national sovereignty in various ways.
But it just, it happens to be, it happens to be at this time in history, it is the left that has taken up this cause.
So the United States has not really changed its response to this.
Its foreign policy in the region didn't change under the Obama administration, for example, even though he changed, with one exception, I mean, he did begin opening relations to Cuba.
But that didn't really change much of what else is going on throughout the region.
And I think the opening to Cuba was part of the same strategy.
They just mainly did it to try and get rid of the government there as well.
Yeah, well, the old thing wasn't working, so I guess it was worth a shot.
I hadn't taken yet.
All right, now, in the pitch for your book here at global.oup.com, global.oup.com, that's where I'm looking at your book, Failed, What the Experts Got Wrong About the Global Economy, Mark.
And it says here, one of the things you talk about in the book is an examination of why the International Monetary Fund has lost most of its influence in middle-income countries over the past decade and a half, and I guess, you know, probably specifically in Latin America.
Why is that?
Well, because their policies failed.
That's one reason.
I mean, part of it is that people, there's a preference for national sovereignty and a regaining of sovereign control over economic policy, so that means that they don't want the IMF deciding, you know.
So it's not that their reforms worked so well that now they don't need aid anymore?
Yeah.
You know, even the IMF wouldn't try that.
They could.
They could try that because they had these two decades in Latin America.
Well, you decide whether I'm the devil or his advocate, but I'm trying, you know.
You know, you had two decades in the last two decades of the 20th century, the 80s and the 90s, where you had hardly any economic growth at all, and that's when the IMF, you know, the total income per person grew by 5.7% over 20 years.
And, you know, that was a huge slowdown.
I mean, the previous 20 years it grew by 90%.
So this was a huge unprecedented economic failure, and that is one of the reasons why you had these unprecedented elections in the 21st century.
And the IMF was very heavily involved in that, and it was involved in failures in Asia, in Russia, really throughout the world.
And so in the 21st century, a lot of countries voted with their feet.
You know, in Brazil in particular, for example, when Lula da Silva, he was Dilma's predecessor, who was the first one to win from the Workers' Party.
He ran for president in 2002 for the fourth time since the dictatorship.
And he, you know, he sat down with his political opponents in the IMF during the election campaign, and the IMF told all three of them that this is what your macroeconomic policy is going to be for the next couple of years, no matter who wins the election.
So this is what I'm talking about in terms of economic sovereignty.
You know, they didn't have it, and it held them back for about a year or two.
And then they did very well when they got to pursue their own policies.
Well, you know, I'm sorry, I guess I should ask you about this in the first place.
I don't know, it should go without saying, I hope people understand the way that the IMF operates and just basically shaking these countries down, tricking them or bribing their leaders into debts that the population can't pay.
So then they default and steal all their resources and give them to politically connected corporations and this kind of thing.
So it's just a shakedown.
It's just gangsterism.
It's pure gangsterism.
So it's pretty easy to see why people would want to not go along with that anymore, get burned once or twice, and that would be about the end of that.
Figure out another way to raise up some capital and develop your economy instead of going to these guys who clearly don't mean well, these economic hitmen.
Yeah, I think that they definitely have a bad track record.
And so they did lose that.
And, you know, it's interesting, you don't hear much about it, but that was really, I think, the biggest change in the international financial system in basically 30 or 40 years was that loss of power in middle-income countries.
Now you still have the IMF very much involved in Europe, but there it's not really making the decisions.
It's really, you know, the powerful European governments making decisions for the Eurozone, and the IMF is more of an implementer.
And it's not really the power itself, whereas in Latin America it really was the IMF.
And, of course, that means the U.S. Treasury Department, because that's who runs the IMF for, you know, most of the world.
All right, well, listen, I hope I do get a chance to read this book at some point, Mark, but I sure do appreciate your time.
And, oh, by the way, I didn't say you write for Just Foreign Policy over there with our friend Robert Naiman, too, right?
That's right.
Great.
Okay, Mark Weisbrot, everybody.
Thank you again.
Thank you.
Again, check out global.oup.com for his brand-new book.
I'm sure it's on Amazon, too.
Brand-new book, Failed!
What the Experts Got Wrong About the Global Economy.
And check him out at Just Foreign Policy.
Thanks, y'all.
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