Alliance for Progress - AbsoluteAstronomy.com

The Alliance for Progress (Alianza para el Progreso) initiated by U.S.

United States

The United States of America is a federal constitutional republic comprising fifty states and a federal district...

President of the United States

The President of the United States of America is the head of state and head of government of the United States. The president leads the executive branch of the federal government and is the commander-in-chief of the United States Armed Forces....

John F. Kennedy

John Fitzgerald "Jack" Kennedy , often referred to by his initials JFK, was the 35th President of the United States, serving from 1961 until his assassination in 1963....

in 1961 aimed to establish economic cooperation between the U.S. and South America.

Origin and goals

In March 1961, President Kennedy proposed a ten-year plan for Latin America:
The program was signed at an inter-American conference at Punta del Este

Punta del Este

Punta del Este is a resort town on the Atlantic Coast in the Maldonado Department of southeastern Uruguay. It is located on the intersection of Route 10 with Route 39, directly southeast of the department capital Maldonado and about east of Montevideo...

, Uruguay

Uruguay

Uruguay ,officially the Oriental Republic of Uruguay,sometimes the Eastern Republic of Uruguay; ) is a country in the southeastern part of South America. It is home to some 3.5 million people, of whom 1.8 million live in the capital Montevideo and its metropolitan area...

, in August 1961. The charter called for:

an annual increase of 2.5% in per capita income,
the establishment of democratic governments,
the elimination of adult illiteracy by 1970
price stability, to avoid inflation or deflation
more equitable income distribution, land reform, and
economic and social planning.

First, the plan called for Latin American countries to pledge a capital investment of $80 billion over 10 years. The United States agreed to supply or guarantee $20 billion within one decade.

Second, Latin American delegates required the participating countries to draw up comprehensive plans for national development. These plans were then to be submitted for approval by an inter-American board of experts.

Third, tax codes had to be changed to demand "more from those who have most" and land reform was to be implemented.

U.S. aid to Latin America

Because of the program, economic assistance to Latin America nearly tripled between fiscal year 1960 and fiscal year 1961. Between 1962 and 1967 the US supplied $1.4 billion per year to Latin America. If new investment was included, this amount rose to $3.3 billion per year.

But economic aid to Latin America dropped sharply in the late 1960s, especially when Richard Nixon

Richard Nixon

Richard Milhous Nixon was the 37th President of the United States, serving from 1969 to 1974. The only president to resign the office, Nixon had previously served as a US representative and senator from California and as the 36th Vice President of the United States from 1953 to 1961 under...

entered the White House.

Authors L. Ronald Scheman and Tony Smith state that the amount of aid totaled $22.3 billion.

But this amount was not necessarily net transfers of resources and development. Latin American countries still had to pay off their debt to the US and other first world countries.

In addition, profits usually returned to the US, and profits frequently exceeded new investment.
In March 1969, the US ambassador to the OAS

Organization of American States

The Organization of American States is a regional international organization, headquartered in Washington, D.C., United States...

, William T. Denzer, explained to the House Committee on Foreign Affairs

United States House Committee on International Relations

The Committee on Foreign Affairs of the U.S. House of Representatives, also known as the House Foreign Affairs Committee, is a standing committee of the United States House of Representatives which has jurisdiction over bills and investigations related to the foreign affairs of the United States...

"When you look at net capital flows and their economic effect, and after all due credit is given to the U.S. effort to step up support to Latin America, one sees that not that much money has been put into Latin America after all."

Business lobbying

The alliance charter included a clause encouraged by US policy makers that committed the Latin American governments to the promotion "of conditions that will encourage the flow of foreign investments" to the region.

U.S. industries lobbied Congress to amend the Foreign Assistance Act

Foreign Assistance Act

The Foreign Assistance Act is a United States Act of Congress. The Act reorganized the structure of existing U.S. foreign assistance programs, separated military from non-military aid, and created a new agency, the United States Agency for International Development to administer those...

of 1961 to ensure that US aid would not be furnished to any foreign business that could compete with US business "unless the country concerned agrees to limit the export of the product to the US to 20 percent of output". In addition the industries lobbied Congress to limit all purchases of AID machinery and vehicles in the US. A 1967 study of AID showed that 90 percent of all AID commodity expenditures went to US corporations.

Controversies

To many experts, the foreign aid program was a sham since five times more dollars were leaving Brazil in the form of earnings, dividends and royalties paid to American companies than entering the country as direct investments. In his book Hidden Terrors
Hidden Terrors
Hidden Terrors is book about American foreign policy in Brazil and Uruguay in the 1960s and early 1970s. It was written by A. J. Langguth and the ist edition was Published 1978 by Pantheon Books in New York.- See also :*History of Uruguay...

(Pantheon Books, 1978, p. 66), A. J. Langguth describes the jokefull way Brazilians referred to the program as being one in which it was Brazil that was giving foreign aid to the United States after tax credits, assistance in locating and other privileges given to foreign firms were taken into account. Ivan Illich

Ivan Illich

Ivan Illich was an Austrian philosopher, Roman Catholic priest, and "maverick social critic" of the institutions of contemporary western culture and their effects on the provenance and practice of education, medicine, work, energy use, transportation, and economic development.- Personal life...

advanced a "potent and highly influential critique" of the Alliance, seeing it as "bankrolled and organized by wealthy nations, foundations, and religious groups."

Military version

During the Kennedy administration, between 1961 and 1963 the U.S. suspended economic and/or broke off diplomatic relations with several countries which had dictatorships, including Argentina, the Dominican Republic, Ecuador, Guatemala, Honduras, and Peru. But these suspensions were imposed only temporarily, for periods of only three weeks to six months.

By 1964, under President Johnson, the program to discriminate against dictatoral regimes ceased. In March 1964 the US approved a military coup in Brazil, and was prepared to help if called upon under Operation Brother Sam.

In 1965 the US dispatched 24,000 troops to the Dominican Republic to stop a possible left-wing take over under Operation Power Pack

Operation Power Pack

The second United States occupation of the Dominican Republic began when the United States Marines Corps entered Santo Domingo on April 28, 1965. They were later joined by most of the United States Army's 82nd Airborne Division and its parent XVIIIth Airborne Corps...

.

The Alliance for Progress included U.S. programs of military and police assistance to counter Communist subversion, including Plan LASO in Colombia.

Rockefeller study

Because the perception was that the Alliance for Progress was a failure, shortly after taking office, on February 17, 1969, President Richard Nixon

Richard Nixon

commissioned a study to assess the state of Latin America. Nixon appointed his most powerful political rival, New York Governor Nelson Rockefeller

Nelson Rockefeller

Nelson Aldrich Rockefeller was the 41st Vice President of the United States , serving under President Gerald Ford, and the 49th Governor of New York , as well as serving the Roosevelt, Truman and Eisenhower administrations in a variety of positions...

to direct the study. The poor relationship between the two politicians suggested that Nixon would not be that interested in the results of the study. There was a lack of interest for the region in the late 1960s to early 1970s.

In early 1969, Rockefeller and his advisors took four trips to Latin America. Most of the trips turned out to be an embarrassment. Rockefeller wrote in his report preface that,

There is general frustration over the failure to achieve a more rapid improvement in standards of living. The United States, because of its identification with the failure of the Alliance for Progress to live up to expectations, is blamed. People in the countries concerned also used our visit as an opportunity to demonstrate their frustrations with the failure of their own governments to meet their needs...demonstrations that began over grievances were taken over and exacerbated by anti-US and subversive elements which sought to weaken the United States, and their own governments in the process.

The major part of the Rockefeller report suggested a reduction of U.S. involvement, "we, in the United States, cannot determine the internal political structure of any other nation". Because there was little the United States should or could do toward changing the political atmosphere in other countries, there was no reason to attempt to use economic aid as a political tool. This was the justification to reduce economic aid in Latin America. The Rockefeller report called for some aid to continue, but the report recommended creating more effective aid programs.

Success and failures of the plan

Growth in regional output per capita in Latin America in the 1960s was 2.6%, exceeding the Alliance for Progress goal of 2.5%. In contrast to 2.2% growth per capita in the 1950s, GDP growth rate per capita in the region reached 2.9% in the latter half of the 1960s and accelerated to 3.3% in the 1970s. Overall nine countries (including Brazil and Mexico) reached the target goal, ten nations did not reach the goal, and only Haiti had lower growth.

Adult illiteracy was reduced but not wiped out. In some countries, the number of people attending universities doubled or even tripled. Access to secondary education also showed increases. One out of every four school-age children were provided with an extra food ration. Many people were provided with new schools, textbooks, or housing.

The Alliance for Progress saw the start of long-range reform, with some improvements in land use and distribution, slightly improved tax laws and administration, the submission of detailed development programmes to the OAS, the creation of central planning agencies, and greater local efforts to provide housing, education, and financial institutions.

Health clinics were built across Latin America. However, success in improving health care was hindered by population growth.

Of the 15 million peasant families living in Latin America, only one million benefited from any kind of land reform. The traditional elites resisted any land reform.

Minimum wage

Minimum wage

A minimum wage is the lowest hourly, daily or monthly remuneration that employers may legally pay to workers. Equivalently, it is the lowest wage at which workers may sell their labour. Although minimum wage laws are in effect in a great many jurisdictions, there are differences of opinion about...

laws were created but the minimum wages offered to Nicaraguan workers, for example, were set so low as to have no appreciable effect on the wages received. In other nations, such as El Salvador

El Salvador

El Salvador or simply Salvador is the smallest and the most densely populated country in Central America. The country's capital city and largest city is San Salvador; Santa Ana and San Miguel are also important cultural and commercial centers in the country and in all of Central America...

, minimum wage laws encouraged employers to use labor-saving machinery.

In Latin America during the 1960s thirteen constitutional governments were replaced by military dictatorships. According to some authors, such as Peter Smith, this was a failure of the Alliance for Progress. Peter Smith wrote, "The most striking failure of the Alliance of Progress occurred within the political realm. Instead of promoting and consolidating reformist civilian rule, the 1960s witnessed a rash of military coups throughout the region...By the end of 1968 dictators were holding sway in several countries."

Results

The Alliance for Progress achieved a short-lived public relations success. It also had real but limited economic advances. But by the early 1970s the program was widely viewed as a failure.

The program failed for three reasons:

Latin American nations were unwilling to implement needed reforms, particularly in land reform.
Presidents after Kennedy were less supportive of the program.
The amount of money was not enough for an entire hemisphere: $20 billion averaged out to only $10 per Latin American.

The Organization of American States

Organization of American States

The Organization of American States is a regional international organization, headquartered in Washington, D.C., United States...

disbanded the permanent committee created to implement the alliance in 1973.

External links and further reading

Horowitz, David [PDF]

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