Nikolas Kozloff

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Unfortunately, there is a pay wall so one cannot read the entire piece though you get a clear gist from the introduction. The article deals with the extreme diplomatic and political sensitivities associated with President Rousseff's drone program. Brazil is an emerging world power, and must tread lightly in neighboring countries like Paraguay and Bolivia which guard their sovereignty closely.

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With the U.S. now losing a degree of its economic and political hegemony throughout the world, a key question will be how Washington reconciles itself to emerging powers such as Brazil. A South American powerhouse in the midst of an agricultural commodities boom, Brazil has witnessed the dramatic growth of its middle class and has been increasingly throwing its weight around in the realm of international affairs. In secret diplomatic cables recently disclosed by whistle-blowing outfit WikiLeaks, U.S. diplomats openly admit that Washington is engaged in an undeclared contest with Brazil for regional influence.

 

So far this rivalry has not become overtly antagonistic, yet beneath the surface lurk tensions which could break out into the open. When and where are such rivalries most likely to cause frictions? Perhaps, the small landlocked nation of Paraguay, which sits on the Brazilian border, could be one source of conflict. Brazil has made Paraguay into a veritable economic satellite, yet a recent political shakeup in Asunción stands to benefit U.S. interests.

 

Under President Fernando Lugo, Paraguay joined South America's "Pink Tide" to the left which had challenged Washington's traditional standing throughout the hemisphere. Though Lugo cultivated friendly ties with Washington, the Paraguayan leader also staked out an independent foreign policy and challenged American priorities. On the military front, for example, Lugo outright rejected any Pentagon collaboration under the so-called "New Horizons" program.

 

Washington Stages a Comeback

 

The overall political equation was hardly agreeable to Washington, yet, in light of recent developments, the U.S. may be poised to stage a comeback. Just over a month ago, in a kangaroo process akin to a "quasi-coup," Lugo was ousted from power by his country's right wing Congress. In a stunning rebuke, legislators accused Lugo of encouraging land seizures which resulted in violent clashes with security forces. In a sham, the Senate gave Lugo a mere two hours to defend himself in a public trial. When Lugo's lawyers requested more time to argue their case, they were rebuffed by the President of the Senate. Then, in an upset, Lugo's rightist Vice President Federico Franco assumed his old boss' job.

 

Washington meanwhile hasn't been too enthusiastic about calling for Lugo's reinstatement. Perhaps that is not too surprising in light of the history. Indeed, WikiLeaks cables show that the State Department was very concerned about Lugo, a politician who championed land reform and cultivated links to Hugo Chávez of Venezuela. Suspiciously, no sooner had Lugo been removed from power than legislators met with a group of U.S. generals to discuss the possibility of building a new military base on Paraguayan soil.

 

Brazil Reacts to Paraguay's Political Crisis

 

Brazilian President Dilma Rousseff, on the other hand, has been far more outspoken in opposing Paraguay's shakeup. That is not too surprising, given that Rousseff, a protégé of former Workers' Party (or PT) President Luiz Inácio "Lula" da Silva, was a kind of ideological kindred spirit to the progressive-minded Lugo. Responding to rising outrage in civil society, Brazil voted to suspend Paraguay from South American trading bloc Mercosur, a development which prompted a strong rebuke from the new de facto Franco regime in Asunción.

 

The conventional wisdom is that Paraguay's shakeup represents a big geopolitical blow to Brazil and an upset triumph for Washington. The Center for International Policy remarks "in Paraguay the most backward political and economic forces have gained ground, opening up the possibility of a closer alliance with the United States, which gains an ally in a place where it can do much harm to Brazil." There's a degree of truth in such interpretations, but the situation is a bit more complex and nuanced than analysts let on.

 

Whatever its' public rhetoric about leftist solidarity in South America, Brazil has been a cynical operator all too willing to deal with the U.S. while secretly inveighing against upstart Venezuela, and WikiLeaks documents are replete with such double-crossing. Fundamentally, while Brazil may be suspicious of Washington, the South American juggernaut is also wary of Chávez and surely does not want to see pesky Venezuela extending its influence into the Southern Cone. Paraguay, then, offers unusual insight into the "Brasilia-Washington-Caracas triangle" and the scramble for geopolitical influence in the heart of South America.

 

Radicalization in the Countryside

Though Brazil may express political solidarity with the Paraguayan left, the South American nation is compromised by its octopus-like economic interests reaching far afield. In recent years, so-called "Brasiguayos" (Brazilian farmers who moved to Paraguay to cultivate soybeans) have established a huge presence across the border. A socially conservative group some 350,000 strong, the Brasiguayos have spent years locked in violent disputes with Paraguay's campesino squatters. It is widely believed in Paraguay that the Brasiguayos have illegally taken over large swathes of land.

 

Through his calls for agrarian reform, Lugo hardly ingratiated himself amongst the Brasiguayos. Furthermore, shortly after he was elected, the Paraguayan invited Hugo Chávez to his country to discuss rural collaboration. Chávez, who had earlier pushed his own ambitious land reform project in Venezuela, declared that he was willing to help Paraguay develop an "agro-industrial center" and provide agricultural and technical assistance.

In a candid aside, Paraguay's Minister of Agriculture told the Americans that he was concerned about "radical actors surrounding the President." Specifically, the official was worried "about Venezuelan President Hugo Chávez' presence in rural areas, and [he] predicted an increase in illicit activity where the Paraguayan state has a weak presence." In further conversations, landholders "shared similar concerns about a 'chavista' influence in rural areas, and the growth of marihuana plantations by peasants from some of the same social groups demanding land."

 

Upping the Ante on Energy Resources

 

In yet another provocation, Lugo issued fiery nationalist rhetoric on the campaign trail before assuming the presidency. Brazil, Lugo charged, should pay more for electricity which it received from Itaipu, a hydroelectric dam jointly owned by Brasilia and Asunción. The facility lies along the two nations' common border, and according to Americas Quarterly, "the electricity that fattens the Paraguayan coffers also supplies São Paulo state, Brazil's industrial engine, with power."

 

Much to Brasilia's chagrin, Chávez inserted himself into the energy imbroglio by supporting Lugo's nationalist claims. During a summit of the radical ALBA bloc of Latin American nations, which included Venezuela, Bolivia, Ecuador and Cuba, members stated that Lugo's proposals were a "prerequisite" leading to "the full sovereignty of Paraguay over all its hydroelectric resources." With Chávez, Evo Morales of Bolivia and Rafael Correa of Ecuador looking on, Lugo declared "we believe that a compañero, a friend like Lula cannot defraud us. Lula cannot tell us no when it comes to a just price and free availability of that energy [Itaipu]."

 

Whether Lula was moved by such solidarity and idealistic rhetoric is unclear, but according to sensitive e-mails leaked by WikiLeaks, Brazil is very concerned about securing ongoing energy access to Itaipu. The Strafor Corporation, a company that fronts as an intelligence publisher but provides confidential intelligence services to large corporations and U.S. government agencies, was particularly interested in finding out more about Brazil's agenda in Paraguay. One confidential source told the company that Brasilia was concerned about sabotage and unrest at Itaipu, adding that the Brazilian military had a contingency plan to secure the hydroelectric facility in the event of instability.

 

Meeting with the Americans

 

If Brasilia did not have its hands full enough with such worries, the Paraguay border presented yet another problem. Along the long and porous Brazilian-Paraguayan frontier, smugglers traffic in drugs and illegal arms and this contributes to rampant crime in Brazil's dangerous favelas. Far from distancing itself from the U.S., WikiLeaks documents reveal that Brazil shares Washington's concerns about the Paraguayan border and holds joint meetings with the Americans to discuss the situation.

 

In 2005, for example, the U.S. Ambassador in Brasilia hosted a lunch for General Jorge Armando Félix, the Minister for Institutional Security [the rough equivalent of the U.S. National Security Advisor]. During the meeting, the two discussed transnational crime and counter-terrorism operations in the Tri-Border area abutting Brazil, Paraguay and Argentina.

Brazil, then, is enmeshed in an extremely delicate game in the Southern Cone. On the one hand, the South American juggernaut does not want to jeopardize its relations with Washington, but on the other hand Rousseff would like to exert control over Paraguay, a country which has traditionally been a Brazilian buffer state. The Chávez card, meanwhile, adds yet another level of intrigue into the mix, making for an unusual geopolitical triangle.

 

Brazil Shows Paraguay Who's Boss

One WikiLeaks cable, dating to late 2008, hints at such underlying tensions. With land invasions running high in Paraguay, Brazil staged military exercises along the two nations' common border. According to the U.S. Ambassador in Asunción, Brazilian troops repeatedly encroached on Paraguayan territory. "We now have to demonstrate that we are a power," Brazil's Southern Command Chief warned, "and it is important that our neighbors know about it." In another shot across the bow, the officer reportedly remarked that Brazil would intervene if Itaipu dam were taken over by "social movements."

 

In an escalating war of words, Lugo retorted "Brazil can do what it wants inside its territory" but "we will not accept any interference." The President added, "If you believe that military exercises at the border or press statements are going to scare us, they will not." The Paraguayan military, meanwhile, went on alert as Lugo traveled personally to the border. The U.S. Ambassador no less accompanied the Paraguayan leader, and privately Lugo officials believed the diplomat's presence represented "a show of U.S. support for Paraguay to Brazil."

Perhaps, press reports speculated, the Brazilian military was sending a message to Venezuela. Just two months prior to Brazil's military encroachment, Chávez visited the rural Paraguayan department of San Pedro, known as the "epicenter of campesino activity." Within the area, agitation against the Brasiguayos was reaching a tipping point and Chávez, fanning the flames, had "singled out the department…for local development assistance."

 

One political analyst told the Americans that "the purpose of the Brazilian military exercises was to warn…Chávez that Paraguay is linked to Brazil's security plan and to not meddle in Paraguay's internal affairs by financing pro-Venezuelan political campesino groups." If that was the intention, however, then the Brazilian maneuvers surely backfired. In a sign that he would not back down, Lugo banned foreigners from owning property for agricultural purposes.

 

Removing the Chávez Card

 

Fast forward a couple of years to Lugo's ouster, and the new political milieu in the Southern Cone would seem to benefit the U.S. while hindering Brazil. The rightist de facto Franco administration in Asunción has realigned itself with Washington and opted out of South America's leftist Pink Tide. After Rousseff moved to suspend Paraguay from Mercosur over the Lugo affair, Asunción even warned Brazil that it might cut off the electrical supply to its powerful neighbor via Itaipu.

 

Yet, look beneath the surface rhetoric and the new geopolitical configuration may serve to benefit Brasilia in certain respects. The incoming Franco administration has shown itself to be very partial to agribusiness and therefore the Brasiguayos have little to fear in the countryside. Needless to say, with Lugo now gone the prospects for land reform look more distant than ever. Moreover, there is little chance of Chávez causing any rural mischief at this point, since Franco and his clique are virulently anti-Venezuela.

 

Indeed, if there was any big loser in the Paraguay reshuffle, it was Chávez, whose larger hemispheric ambitions have been dealt a severe blow. The removal of the Venezuela card, then, simplifies the geopolitical battle in the heart of South America which now pits two powers against each other where once there were three. In Paraguay, Washington has political and military leverage, while Brazil enjoys economic influence. So far, Rousseff has been careful not to upset the Obama administration, preferring instead to pursue a kind of "under the radar" diplomatic strategy. As the U.S. stages a comeback in Brazil's backyard, however, Rousseff may wonder whether the time has come to finally push back.

My latest about Brazil and its wider role in South America now out. Click here to read the article.

My big piece about up and coming power Brazil and what's behind the story in terms of big power rivalry with the U.S. To read the article, click here.

For some time, I have been writing about revelations stemming from correspondence between the State Department in Washington and various U.S. embassies based around Latin America.  Leaked WikiLeaks documents have revealed growing U.S. concern over the left tide in the wider region and crucial strategies to derail progressive change.  More surprisingly, perhaps, the cables also hint at key fissures within the South American left --- tensions which the U.S. has been all too willing to exploit.

 

Divide and rule tactics may work to a degree with Ecuador, Venezuela or Bolivia, but the U.S. will have a tougher time managing Brazil.  Indeed, what struck me most as I poured through the documents was the marked difference in tone between U.S. embassy cables emanating from Quito, La Paz and Caracas on the one hand, and Brasilia on the other. 

 

It's clear from just a superficial read that American diplomats are much more cautious and level-headed with the Brazilians than elsewhere in the Andes, where U.S. officials tend to be much more direct and confrontational.  For Washington, Brazil promises to be the chief geopolitical worry in the decades to come, not Venezuela.

 

An exporting dynamo and powerhouse with a growing middle class, Brazil is using its newfound economic clout to venture into world politics like never before.  Unlike the Andean region, which has been plagued by chronic volatility, Brazil's political institutions look relatively stable.  Provided that Brazil's economic fortunes continue to soar, the South American juggernaut will surely be a force to be reckoned with in future. 

 

Behind Mercosur's Façade

 

Speaking with the Americans, leading members of the Brazilian political establishment remarked that their country should serve as "the natural leader of Latin America, or at least of South America."  Leading, however, is obviously a very different concept from standing shoulder to shoulder with smaller nations, and for those who view South America as essentially marching relentlessly toward regional integration along leftist lines, WikiLeaks cables can serve as quite a corrective.  Indeed, Brazilian conservatives were reportedly very unhappy with their government's "overly acquiescent approach to Bolivia, Ecuador, and Venezuela." 

 

As one reads the cables, a more complex and nuanced picture emerges of Brazil, a country torn by many conflicting impulses and agendas.  To be sure, Brazil is a member of trading bloc Mercosur which has helped to politically align sympathetic leftist regimes in South America.  Yet, if the diplomatic cables can be believed, many influential Brazilians view Mercosur with a healthy degree of skepticism and during the era of former president Luiz Inácio "Lula" da Silva, "most parts" of the Brazilian government were opposed to the trade bloc, seeing little benefit to their country from such integration. 

 

Lula, who himself came up from the ranks of organized labor, favored Mercosur but recalcitrant elements including the Ministries of Finance and Development saw matters differently.  Chafing under Mercosur's yoke, these technocrats complained that Brazil provided too much money toward the trade bloc's infrastructure fund, while other countries donated much less.  In particular, the influential industrial lobby complained that Mercosur was "selling out" commercial interests for the mere sake of preserving the trade bloc's unity.  Like the U.S., then, where Republicans routinely complain about multilateralism, the United Nations and doling out foreign aid to needy countries, Brazilian officials too "complained that underdeveloped areas in Brazil's northeast will get short shrift compared to needy areas" elsewhere in South America. 

 

As Brazil starts to accrue more power, the country may run into an image problem.  Like the U.S., which has been criticized for its sorry environmental record on climate change, Brazil too could find itself politically isolated from its more radical neighbors.  According to one WikiLeaks cable, environmental subjects within Mercosur are "very messy" with "no cooperation of note."  Reportedly, Argentine officials believed that Brazil was "focused on its position as a major player with China and India, not as part of Latin America, while Venezuela, Ecuador, Cuba, and Bolivia form a separate block with their own interests."

 

The Cocaine Connection

 

Brazilian skittishness was also evident toward its radical neighbor Bolivia.  Publicly, Lula and the Brazilian left proclaimed their solidarity with Chávez protégé Evo Morales, a radical indigenous coca grower.  But cables reveal Brazilian concern over political stability and the drug trade.  As early as 2004, prior to Morales' election as president, the Brazilians viewed instability in Bolivia with "grave concern," including the "disturbing convergence of an energized indigenous movement with the drug problem."

 

In some ways, then, the Brazilian relationship to Bolivia echoes U.S. ties to Mexico, a country which has also been convulsed by the drug trade.  For years, high level officials at Lula's GSI or Institutional Security Cabinet had viewed Brazil as essentially a corridor country for outbound narcotics to other nations, but "the brutal reality of violent, drug-driven crime in Brazil's cities has shattered that outlook…and huge quantities of cocaine and other drugs appear in large and small Brazilian communities throughout the country."    

 

The GSI, as well as the police were concerned "about the potential for increased cocaine flows into Brazil from Bolivia in the event of a Morales victory."  "We are clearly the target," remarked one GSI official, "for the low-grade coca based narcotics produced in Bolivia, which are flooding Brazilian cities, with devastating social consequences."  Feeling increasingly frustrated, the Brazilians had sought to convey their concerns to La Paz, via "indirect channels" and even through policy suggestions.  When Brasilia suggested that its Andean neighbor should substitute alternative crops for coca leaf, however, Bolivia balked and "fell back on the traditional crop argument," thus "shutting down further discussion." 

 

Brazil's Voracious Energy Needs

 

Like Mexico, which supplies oil to the U.S., Bolivia is an energy supplier to Brazil and provides natural gas.  In 2005, the Brazilian Minister of Mines and Energy said his country was "worried" about the reliability of its natural gas supply emanating from Bolivia.  If the gas supply decreased or prices skyrocketed, the official conceded, Brazil would "face a serious problem."

 

So concerned was Brazilian intelligence that high level officials developed contingency plans.  At the GSI, analysts sought to evaluate what the likely impact of an energy shortfall might be.  In the midst of Bolivia's presidential election season, Lula hoped that any new regime would "not allow radical new government policies or general instability to damage Brazilian energy industries."  If need be, Lula would reportedly take the same tone with Bolivia that "a parent would take when firmly disciplining an errant child."

 

Brazil to Chávez: We Run Things Here

 

Publicly, Brazil has demonstrated solidarity with Hugo Chávez and his protégé in Bolivia, Evo Morales.  However, WikiLeaks cables suggest that Brazil is ambivalent about the volatile Andean region and skeptical about Venezuelan leadership.  In 2007, for example, Brazil was reportedly skittish about Chávez's moves to establish a so-called "Bank of the South" which would counteract the International Monetary Fund.  Brazil already had its own development bank known as BNDES, and would "need to be convinced" of the efficacy of further institutions.  In the effort to foster its own regional agenda, Brazil has promoted BNDES, which finances infrastructure development through the trans-Andean highway. 

 

Whatever his own interest in BNDES, Lula was reportedly willing to go along with Bank of the South as long as Brazil was given a prominent place at the table.  In a snub, however, Chávez reportedly went behind Lula's back and negotiated with Argentina, causing the Brazilians to become "absolutely livid."  Perhaps, these types of developments made Brazil even more skeptical of Chávez and determined to assert its own independent leadership in the wider region.

 

Further cables underscore this subtle geopolitical shift.  In August, 2009 Lula traveled to Bolivia's coca growing region of Chapare.  There, the Brazilian met with Morales in a stadium "amid a festive atmosphere" of 10,000 cheering coca leaf growers.  Publicly, the two praised each other but beneath the surface lurked tensions.  Speaking to U.S. officials, Brazilian diplomats said they had grown quite frustrated with Bolivia on counter-narcotics and economic policy, adding that they wanted to "provide Morales with alternatives to the radical advice he is receiving from Venezuela and Cuba." 

 

Are Brazilians the New Gringos? 

 

It would be an overstatement to claim that Bolivia is a Brazilian satellite, but some WikiLeaks documents suggest that the small Andean nation could be quietly moving away from Venezuela in the hopes of gaining a new benefactor.  As far back as 2008, Brazilian legislators claimed that Bolivia was "tired of the Bolivarian idea."  According to Brazil's Chairman of the National Defense Committee and Senate Foreign Relations, the Bolivian ambassador in Brasilia "apologized…for some disagreements between presidents Lula and Morales a couple of years ago and agreed…that the two countries need to continue their tradition of friendly relations."

 

The WikiLeaks cache ends in early 2010, so we don't know much about the further ins and outs of this diplomatic game.  What's clear though is that Brazil's footprint has only increased in its own "near abroad," leading to new political frictions.  Today, the Bolivian left and indigenous peoples are probably just as prone to attack Brazilian imperialism as Washington's dictates.  At issue once again is BNDES, an institution which is fast outstripping the World Bank.  When BNDES announced it would support road construction through remote indigenous territory in Bolivia, the effort sparked protest from local Indians who accused Evo Morales of being a foreign lackey.  

 

BNDES, which seeks to create strong Brazilian multinationals via below-market loans, could fall under greater criticism in the years ahead.  With support from BNDES, companies like oil giant Petrobras, iron flagship Vale, and steel maker Gerdau have been conducting a big push into neighboring countries.  The Brazilian wave however has been met with wariness and resistance from Paraguay to Guyana to Peru to Ecuador, where local residents have protested large boondoggle projects. 

 

Big Power Rivalry in the Southern Cone?

 

As BNDES extends its influence, and Brazil ramps up diplomatic and political ties to Peru and even Colombia, Chávez's Venezuela has become eclipsed.  Such developments have not escaped the attention of Argentina, Brazil's historic rival for dominance in the Southern Cone.  If WikiLeaks cables are any indication, Buenos Aires has become increasingly alarmed by the unpredictable nature of Brazilian foreign policy, and even fears that its South American neighbor may be tempted to back up its interests through military means.   

 

My interest was particularly piqued by one cable dated to 2009, in which Argentine nuclear non-proliferation officials complained to U.S. diplomats "about the direction of Brazilian security policy in the final years of the Lula Government."  The Argentines were concerned about "yellow lights," such as Lula's outreach to Iran and North Korea.  Moreover, Argentine officials were worried about "the pace of Brazilian military purchases," and had even pondered what Buenos Aires might do in the event that Brasilia chose to develop a nuclear weapon.

 

The Argentines were particularly looking forward to Brazil's presidential transition in 2011, because Lula's "unmatched popularity and his late-in-the-term detachment from political considerations had allowed him to become a risk-taker in foreign and defense policy."  Any successor, the Argentines hoped, "would shy away from such controversial policies in his or her first years, perhaps retrenching on the Iran relationship and becoming more cooperative on new nuclear confidence-building instruments."

 

While it's true that Brazil has become somewhat less of a "risk-taker" under Lula's successor, Dilma Rousseff, the South American giant will certainly be a huge force to be reckoned with in the years to come.  How Brazil's rise reconfigures South American politics, particularly in regard to Argentina, could be interesting to watch.  What is most importantly reinforced from the WikiLeaks documents, however, is the notion that the U.S. may now face a real competitor in the region.