Nikolas Kozloff

When you can’t stamp out progressive social change, the next step is to try to desperately derail it or otherwise water it down. That’s exactly the kind of strategy pursued by the likes of former Secretary of State Condoleezza Rice, who concluded a South American tour a year ago designed to ostracize the bad countries, namely Venezuela, Bolivia, and increasingly Argentina, and to cultivate ties with the good countries such as Brazil and Chile. Having woken up to the fact that its free trade and neo-liberal agenda for the region lay in tatters, and that wielding a Big Stick to defang its enemies could not work politically, the Bush White House pursued stealthy diplomacy. Rice’s strategy was to divide and rule, to contain radical social change and to steer it within acceptable boundaries. Because South America was headed on a new trajectory which was more independent of Washington, Rice hoped that the "responsible" left as exemplified by Brazil’s Lula and Chile’s Bachelet would steer the region away from the likes of Venezuela’s Chávez and Bolivian President Morales.

One year later with a fresh Democratic administration in Washington, what is the U.S. attitude towards different left leaning regimes in South America? That is the question posed by a recent article in Time magazine, provocatively headlined "Brazil’s Lula: A Bridge to Latin American Left?" The article implies that Bush did not dutifully look out for U.S. interests in South America, and this created "a problem" because it allowed for the expansion of the anti-U.S. left throughout the region.

Thankfully for Time magazine, it now looks as if Brazil will act as a broker between the United States and Venezuela, paving the way for a possible diplomatic rapprochement. In his first meeting with a Latin leader, Obama sat down with Brazilian President Lula da Silva in Washington on Saturday. During the encounter, Lula told his U.S. counterpart that America should do its utmost to improve ties with Venezuela and Bolivia and to build a relationship based on trust and not interference.

Publicly, Lula and Chávez have been political allies for the past several years. Nevertheless, it needs to be said that the Brazilian leader has adopted a more conservative approach towards politics and economics than his Venezuelan counterpart. Both Venezuela and Brazil are energy giants and see themselves as natural political leaders in the wider region. Behind the façade therefore, there may be a slight geopolitical rivalry between the two South American nations. Lula surely does not want a return to the Big Stick of the Bush years, but he would probably like to supplant Venezuela as a regional power so that Brazil can assume its natural place in the South America sun.

Lula may get his wish. The economic picture has shifted dramatically recently and Brazil stands to benefit most in the new geopolitical equation. A year ago the U.S. was not in the midst of a frightening economic mess and Venezuela was getting a much better financial yield on its oil exports. Despite Chávez’s recent victory in his country’s constitutional referendum — which allowed the Venezuelan leader to run indefinitely for reelection — Venezuela is no position to assume a greater regional role right now. Formerly, Chávez was wont to throw around development aid to Bolivia and other nations with reckless abandon, but within the new economic milieu he will be severely constrained in his wider ambitions because of the lower price of oil.

A year ago, Brazil was certainly an important diplomatic player but it has now emerged as perhaps the dominant strategic force in the region. Though Brazil has suffered as a result of the world economic slowdown, the country is still in a better position than many other nations. Indeed, as noted by a recent report by the Council on Hemispheric Affairs, "while most of the developed world is undergoing a financial crisis, Brazil still retains some positive strength, with the country still recording significant economic and social achievements at home. For this and other reasons arising from the Brazil’s impressive statistics, Lula is emerging as the de facto spokesman for Latin America."

Brazil, the report goes on, is "far better off than the European and American economies. Its banks are solvent, credit, though increasingly viscous, is still flowing from BNDES, Brazil’s national development bank, to favored companies such as Petrobras [the Brazilian state oil firm] and consumers remain more confident than their North American counterparts. The absence of these negative factors that are primarily propelling the crisis abroad is helping to shield Brazil from the worst of the downturn." Interestingly, the report concludes, Brazil may be the only one of 34 major economies to avoid recession in 2009.

With its newfound clout, what does Brazil seek on the international stage? Lula has long coveted a permanent seat on the United Nations Security Council and may want to become a world energy powerhouse. Indeed, Brazil might seek to supplant Venezuela as the main South American oil supplier to the United States. "Such observations that Obama would welcome Lula as an alternative energy supplier," notes the Council on Hemispheric Affairs, "seem to run counter to Lula’s putative pledge to Hugo Chávez, in which he promised to act as an advocate for Venezuela during his meeting with Obama. Is Lula positioning himself as Latin America’s Otto Von Bismarck?"

Within this new "Bismarckian" game of chess Lula may wish to appear as Venezuela’s paternalistic protector while simultaneously looking out for wider Brazilian interests. If Lula could ever bring off a meeting or summit with Chávez and Obama, it would constitute a huge political coup and Brazil’s diplomatic prestige would be enormously enhanced.
There is some indication that Obama might be somewhat amenable to Lula’s entreaties.
Back during the U.S. presidential campaign, Obama was vague about what U.S. foreign policy towards Venezuela ought to be. Reluctant to tackle this hot potato, Obama issued rather contradictory statements about his attitude towards the Andean nation. Now that he has been swept into office, what is Obama’s policy? Judging from the contradictory statements put out by the State Department, the administration is conflicted.

At first, the State Department praised Venezuela’s recent constitutional referendum as free and fair. But then, diplomats reversed course. According to the Wall Street Journal, the positive remarks "set off a furor among Venezuelan opposition activists and some commentators because the description of Venezuela’s referendum seemed markedly different from the tone set by the Bush administration, which repeatedly voiced worry that Mr. Chávez was undermining Venezuela’s democracy."

As the right laid into Obama, the State Department quickly backpedaled. As noted in the Wall Street Journal, "U.S. officials are scrambling to assert that the Obama administration hasn’t softened U.S. policy toward Venezuela, where President Hugo Chávez recently won a controversial referendum allowing him to run for office as many times as he wants." The reports suggest that there may be disagreement within the State Department about how to handle Chavez; different factions may not see eye to eye. Like the Carter administration, which had somewhat contradictory policies at different times towards left wing movements in Latin America, Obama has not quite figured out what course he wants to chart.

This lack of coherence in official U.S. policy towards Venezuela suggests that Lula might be able to at least nudge the U.S. in another direction. Given Brazil’s new economic and political clout, and the U.S.’s reduced position world-wide, Lula is in an ideal position to reform regional politics in a dramatic way. Within the new diplomatic triangle between Venezuela, Brazil and the United States, Lula wants his country to be paramount. In the new arrangement, the United States will cease its political interference in South American affairs while Venezuela will become a junior partner to Brazil. If Lula can achieve these ends, he will indeed emerge as a very important figure on the world stage.