UNASUR (all S. American countries) addresses the "sytemic crisis of northern capitalism."

[Peace Patriot]

This is so important--both to the U.S. and to Latin American countries--that I'm going to quote the entire article (which has a "Creative Commons" license at the bottom).

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UNASUR: South American Alliance Confronts Economic Crisis

By W.T. WHITNEY JR. - CORREO DEL ORINOCO INTERNATIONAL 8/26/11

Unasur Foreign Ministers met in Buenos Aires this week to discuss financial integration and independence from the US dollar.

The Union of South American Nations (Unasur) has emerged from a bevy of regional alliances to assume a major role in work toward Latin American integration. With the Paraguayan Senate’s approval August 13 of Paraguay’s entry into Unasur, the alliance now includes all 12 South American nations.

Unasur has, since 2008, carried out independent, cooperative planning in a variety of areas, but none of them economic. Now, debt crises, worldwide economic slowdown, and a possible devaluation of the US dollar have impelled them to action. What is needed, according to the Argentinean Communist Party newspaper Nuestra Propuesta, is “a common strategy to shield South America from contamination by the so-called ‘central countries’...profoundly sick and fully decadent”.

On July 28 an extraordinary Unasur summit took place in Lima, Peru, so timed because heads of state were attending the inauguration that day of Ollanta Humala as Peru’s new president. A proposed agenda was shelved in favor of economic matters. Leaders and advisors established broad goals and determined a schedule of future meetings.

Unasur finance ministers met in Lima on August 5 and again in Buenos Aires, Argentina, on August 12, this time joined by central bank officials. That gathering served as the eleventh meeting of the Unasur working group on financial integration and the inaugural meeting of Unasur’s South American Economic and Financial Council.

Argentina’s Economics minister, Amado Boudou, afterwards told reporters that Unasur would be “developing a regional fund for dealing with the international financial crisis”. Absorbing a smaller fund created in 1978, this new one, aimed at countering speculative attacks on local currencies, would be supported by “monetary authorities and central banks” and by commercial transactions. Local currencies and the sucre, a new continent-wide currency, would replace the dollar in regional transactions. Plans were laid to develop the Bank of the South and form strictly South American development banks. Three working groups were established, one each on currencies, reserve funds, and regional development banks.

Economic specialists met yet again in Buenos Aires on August 24, this time with Unasur foreign ministers, for a review of recommendations prior to a regular Unasur summit meeting set for Asuncion, Paraguay, on October 29. There, heads of state are expected to approve what is shaping up as an overarching plan for economic sustainability.

SOUTH AMERICA: A SUPERPOWER

“We have shown more resistance to the crises and (have been) much more dynamic in being able to survive them than the central economies”, explained Minister Boudou, adding that, “South America is being converted into one of the principal motor economies of the world”. Later on in Caracas, Venezuelan President Hugo Chavez agreed: “South America is destined to be a bloc”, he said, predicting that for the sake of economic overhaul, internal conflicts will be resolved and ideological differences overcome.

Acceptance by left leaning Unasur founders of right wing Colombian President Juan Manuel Santos’ nomination of Maria Emma Mejia to the post of Unasur Secretary General bears out Chavez’s last point. Mejia, speaking earlier in Buenos Aires, highlighted South American economic strengths, noting that the region’s economy is growing at a 4.5 percent annual rate, dollar reserves total $600 billion, and South American internal commerce, worth $100 billion annually, is projected at $120 billion. South America survived the 2008 economic crisis remarkably intact, reports Aporrea.org writer Raul Crespo.

Soon after the August 12 meeting, President Chavez announced repatriation of gold worth $12 billion, transfer of Venezuelan cash reserves from US and European to Russian, Brazilian, and Chinese banks, and nationalization of Venezuela’s gold mining industry.

Obstacles to Unasur plans include: divided loyalties of Brazilian and Argentinean capitalists tied to the US and European economies; cash flight to foreign banks from Argentina and other countries; likely reluctance of multinational corporations to deal in regional currencies; and international oil and food price volatility, fed by speculation. And, according to Crespo, new dependence on raw materials sales to China adds risk from reduced demand there stemming from a possible economic downturn.

Argentinean Nobel Peace Prize winner Adolfo Perez Esquivel joined others in critiquing a meeting held behind closed doors lacking representation from social movements. Food sovereignty and environmental sustainability are still not on the agenda, say critics.

In any event, the August 12 and 24 meetings were, according to Venezuelan Foreign Minister Nicolas Maduro “the first time in 200 years that South America got together to talk about the economy. In another era, the IMF would have already arrived with its structural adjustment programs. We are breaking off ties with neo-liberalism. (This is) work carried out in unity to confront the systemic crisis of northern capitalism”.

http://venezuelanalysis.com/news/6448
http://www.correodelorinoco.gob.ve/wp-content/uploads/2011/08/COI78.pdf
(my emphasis)

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Despite some notable potential problems, mentioned at the end of the article (--including UNASUR not addressing food sovereignty and environmental concerns), this series of meetings on South America's economy, by economic and foreign ministers and heads of state, is a momentous development in several respects:

1. UNITY. With Paraguay's legislature at long last voting to join UNASUR and Colombia now rid of its Mob Boss (Bush Jr pal, Alvaro Uribe, who was running Colombia as a criminal enterprise and was notable for breaches of regional peace and warmongering), South America is able to act as a "bloc" to protect the interests of the people of South America, most especially against U.S. bullying and interference and U.S. bankruptcy (due to egregious looting by the rich and war profiteering). As Venezuela's Nicolas Maduro points out, the U.S. dominated IMF, with its ruinous "austerity" programs, was not invited to these meetings. South America has now become UNIFIED, as well as organized, against U.S. "neo-liberalism" (free trade for the rich, the poor majority be damned).

2. ACTION. This series of meetings in Lima, Buenos Aires and Asuncion--including one meeting whose agenda was scrapped in favor of economics--in effect represents South America's united "Declaration of Independence" from U.S. imperial/colonial rule (which, over the last century, had replaced colonial rule by Spain and Portugal). The Bushwhack instigated worldwide depression, followed by Obama and the Scumbag Congress making things worse, has had the result of stimulating more unity and more concerted action in South America to concretize the goals of the leftist democracy movement that has swept the region: peace, independence, cooperation, social justice, use of the region's resources to benefit the people who live there and prosperity for all. The governments of South America have now mobilized to implement this vision. It was being implemented in fits and starts over the last decade; now it is unified, comprehensive and in motion throughout the continent.

3. VINDICATION. Even the Colombian rightwing has had to acknowledge the results of this leftist-led policy, as Maria Emma Mejia articulates them: regional economic growth (4.5%) (--in the midst of a worldwide depression!), accumulation of cash reserves ($600 billion) and a dramatic 20% increase in "south-south" trade. These gains are mostly in the leftist countries, and the prosperity is best distributed in the leftist countries. (Colombia remains mired in one of the worst rich/poor discrepancies in LatAm.) And the extraordinary acceptance, by UNASUR, of a rightwing Secretary General (Maria Emma Mejia), underlines the success and confidence of regional leftist policy and goals. Venezuela was the pioneer of all of these gains. Venezuelans were the first to elect a leftist government, the first to begin economic reforms and were the first people to propose this new vision, of "south-south" cooperation and prosperity for all, which has transformed the region. From the Venezuelan peoples' defeat of the U.S.-supported rightwing coup in 2002, to Venezuela's initiation of south-south mutual aid (notably Venezuelan aid to Argentina after the IMF/"neo-liberal" destruction of that economy), Venezuela's proposal of the Bank of the South, Venezuela's alliance with Brazil (after a leftist government was elected there), and alliance with all the other leftist governments, as they got elected over the last decade (following Venezuela), Venezuela has been the most visionary and has taken the most heat from the U.S. and its controlled press. The vindication is that Venezuela was right to follow its own path away from U.S. corporate/war profiteer domination to social justice and prosperity--a path that the entire continent has now embarked upon.

4. POLITICAL RIGHTS AND INTEGRATION ARE NOT ENOUGH--ECONOMIC RIGHTS AND INTEGRATION ARE ESSENTIAL TO REAL DEMOCRACY. We here in the U.S. have essentially lost our right to vote, although most people--ignorant of 'TRADE SECRET' control of voting results--think they still have a right to vote, to speak out (where?), to organize (in support of whom?), etc. But even if we did still have political rights, while we might be able to mitigate the worst looting by the rich, our economic rights--to a decent job, to a living wage, to the integrity of pension systems, to fair prices for essentials, to a safe workplace, to education and training, to upward mobility, to prosperous, well-ordered communities, etc.--would still be very attenuated in this predatory capitalist system. The Clinton boom established that clearly--that the rich in a predatory capitalist system can take the jobs elsewhere--outsource them to the cheapest labor markets abroad--and thus abrogate all rights to jobs, decent wages, good communities, etc. MORE is needed than re-establishing our political rights--although political rights are certainly the first step. Our society needs to be re-envisioned. Its PURPOSE needs to be re-made.

Is the purpose to get filthy rich or to create a decent society in which all share the prosperity from our common labors and all share responsibility for social cohesion? Venezuela was the first country in this hemisphere to begin re-purposing their society along more humanistic/progressive lines since the Reagan Era of Looting began. And Venezuelans were also the first to recognize that they could not do it alone. To achieve general prosperity and social justice requires regional cooperation and ultimately world cooperation. This flurry of UNASUR activity, specifically on economic integration with the common goals of social justice and strength-in-numbers, indicates that all of South America is now on the path pioneered by Venezuela. Each country is, and will continue to be, unique in some aspects of policy but the common purpose is now confirmed in economics, the pivot of social justice. Political rights are a vital first step; economic rights are the goal. Both are essential to real democracy.

[ChangoLoa]

1. South America survived the 2008 economic crisis remarkably intact

Truly remarkably and it has been a great demonstration of solidity... indeed, this happens for the first time in history!!!

So, that's GREAT!!

Except for Venezuela whose economy shrinked by 4,6% between 2008 and 2010 (-7,6% if you consider demographic growth) according to the Central Bank.

http://www.bcv.org.ve/c2/indicadores.asp
retrieve AGREGADOS MACROECONÓMICOS
then "PIB por Sectores Institucionales. Precios Constantes. Base 1997"

In the excel file, calculate:
(2010 GDP - 2008 GDP)/2008 GDP
Or: (55,807,510 - 58,525,074)/ 58,525,074

-4,6% between 2008 and 2010.

That means the Venezuelan crisis has been 10 times worse than in the US, where the contraction of the product amounted for -0,5% in the same period)

Check US stats here
http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1
retrieve "Domestic Product and Income"


BY THE WAY, isn't Correo del Orinoco a Venezuelan government newspaper??

What does the ".gob.ve" means??

[Peace Patriot]

3. They could afford to shrink, after such spectacular sustained growth,

and they went positive on growth in early 2010--basically had only a year of stagnant growth (late 2008 to early 2010)--and have grown ever since. Remember, they were FIRST out of the starting block on reducing poverty, putting money in peoples hands and spreading the wealth, and this year Venezuela was designated "THE most equal country in Latin America" on income distribution, by the UN Economic Commission on Latin America and the Caribbean. Also, Venezuelans recently rated their own country one of the highest in the world on their own well-being and future prospects, which tells us that any stagnant growth or shrinkage in 2009 has not hurt ordinary people. Their main problem in 2009, just after the Bushwhack-induced crash, was the plunge in oil prices to $40/barrel. Because of that, they had to be cautious on budgeting, but they never cut social programs, and that is why and how they are recovering despite all that loss of revenue and why and how Venezuelans feel so well off today. They were cushioned from the crash.

You are so anti-Chavez that I don't trust any stats that you dig up or your interpretation of them. But even if it's true that they suffered loss of growth (rather than simply zero growth) in the year after the Bushwhacks crashed the world economy, the factors that I cited cushioned that slowdown and made recovery from it possible. The Crash of '08 was entirely due to deregulation and criminal malfeasance by the Bush Junta. It was no fault of Venezuela's and Venezuela was better prepared than most of the world because of its prior and continued social spending. And as soon as oil prices starting going back up, Venezuela's economy started to grow again. It has no drag on it, like we do, of endemic and raging unemployment and a squeeze on the poor and middle class like we have never seen, coming from both the government and the corporate rulers. Growth means NOTHING if it is "jobless growth"--the rich getting richer but NOT creating jobs, the poor and middle class falling off the cliff and the society heading to ruin.

In any case, comparison to the U.S. is "apples and oranges." The starting conditions are so different and the economies are so different that it is very difficult to compare them. But they do have this in common: putting money in ordinary peoples' hands is a MUST when the rich hoard their money after looting everything in sight. That principle applies to all mixed capitalist/socialist economies (--and the U.S. is also mixed, although with a different formula), basically the entire western world. This is what the Chavez government did after the hoarding/looting by the rich in 1990s--put money into the hands of ordinary people--and that is why the spectacular growth occurred and why Venezuela landed on its feet, in this Bushwhack catastrophe, despite the crash in oil prices. Slow or stagnant growth with high employment--and also resources poured into education and business startups--is a very different thing than slow or stagnant growth, or even some growth, with high UN-employment, getting worse by the day, small businesses going under, manufacturing and jobs pouring out of the country with dreadful outsourcing and even government employment being drastically reduced (the most insane thing of all). Venezuela's economy is on the uptick. The U.S. economy is on a steep slide and no one knows where it will end, and the government is doing NOTHING to prevent it.

Medical costs continue to go through the roof. Tuition even at public universities goes up every few months, it seems. Transportation to work or school or other trips costs twice what it did only a few years ago, with no rise in wages, and ever increasing unemployment, to catastrophic levels in some areas. People are being squeezed in every way imaginable--from having to spend $600-800 per year per child just for public school elementary and high school attendance, all in new fees imposed because the rich are not paying their fair share of taxes--to credit card usury and high food prices and doubling and tripling of the costs of any government transaction. Peoples' savings are utterly drained; they cannot pay their bills and are living on credit, if they have it. And on and on and on. And still the government does nothing--except when it is further catering to the rich. This is a catastrophe in the making that Venezuelans will not suffer because they have a government that is looking out for their interests allied with OTHER governments that are looking out for their peoples' interests, strongly allied with Venezuela in a pact to create prosperity for all in an independent region where political leaders are actually responsive to the people, unlike ours.

You don't want to give Chavez any credit because that's your kneejerk position. To an objective observer--and I have no stake in Venezuela--Chavez and his government have been the pioneers of this new prosperity and unity in South America, and have done extremely well, under enormous pressure from the U.S. and its rightwing allies within Venezuela, as to economic growth and equitable wealth distribution. Their staring down of Exxon Mobil and getting a much better deal for Venezuela on the oil contracts is worth ten years of Chavez government all by itself--but they have done so much more. They have not only changed Venezuela from a very unfair to a much fairer society, they have re-introduced the concept of "government of, by and for the people" to the western hemisphere. That is why they are so hated by the oligarchs and their propagandistic press, here and there. They have changed the paradigm from "get rich while you can" to "take care of your brothers and sisters." And our rich and Venezuela's rich don't want to hear that. They want government "of, by and for" themselves and to hell with everybody else.

This is a profound change in South America and in the world. Credit to Chavez, to his government and to the Venezuelan people.

[Judi Lynn]

2. Wonderful progress, may it NOT be interrupted. "We are breaking off ties with neo-liberalism."

Returning later to finish reading this great article. So glad to see it, realizing this information just doesn't get to us through our own filthy corporate news sources.