U.S. Interests In Honduras Matter

By INVESTOR'S BUSINESS DAILY | Posted Wednesday, July 08, 2009 4:20 PM PT

Diplomacy: Outsourcing U.S. foreign policy to the OAS may sound good, but the reality remains that all nations, including ours, have interests. That may be why the U.S. is now shifting to a more workable stance on Honduras.

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Related Topics: Latin America & Caribbean

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Secretary of State Hillary Clinton on Tuesday announced a realistic plan to resolve the Honduras crisis by forging a deal with Costa Rican President Oscar Arias to mediate a solution to the issue of who rules the Central American country.

Acting after meeting with ousted President Mel Zelaya, who was thrown out June 28 in a constitutional process, her initiative shows just how badly relying on the Organization of American States (OAS) has failed for the U.S. The new Arias plan may just succeed.

It couldn't come at a better time. Last Friday, OAS Secretary-General Jose Miguel Insulza strutted like a colonial grandee into Tegucigalpa, threatening sanctions and the expulsion of Honduras if it didn't restore Zelaya. He refused to meet President Roberto Micheletti, warning: "We are not going to Honduras to negotiate."

It only strengthened Honduras' resolve against letting Zelaya return. After Insulza raised the stakes, Zelaya tried to fly into Tegucigalpa's airport, setting off riots that left two dead.

Government support strengthened though, with the Church, businesses and crowds in the streets all holding together.

"Honduras is an example to the world. We don't have money. We don't have oil. We have balls," read a hand-lettered sign from a defiant street protester in support of his government.

With sentiment like this, Hondurans signaled they would set their own course, follow their own constitution and pay whatever price, no matter what the OAS did. "Better six months of isolation than 20 years of Chavez," Micheletti said.

Arias isn't impartial as a mediator, given his vote to condemn and expel Honduras from the OAS. But he has a record of successful mediation in El Salvador, winning the Nobel Peace Prize in 1987, and is willing to engage all parties instead of dictate a solution. The existing government in Honduras is still free to reject anything outrageous, which couldn't be any worse for Honduras than OAS threats.

For Clinton, it's a sign that reality has sunk in and Zelaya, an unpopular, vainglorious and anti-U.S. leader, is unlikely to be returned to power. Not only does Honduras' constitution forbid it, but Hondurans don't want it, and time is running out. Instead, elections may be moved forward, or amnesties issued as talks start Thursday.

Maybe history is forcing the new Clinton stance: The last time the U.S. tried to reinsert a deposed leader, in 1994 with Haiti's Jean Bertrand Aristide, the result was chaos. Clinton was first lady then.

Venezuela's Hugo Chavez, of course, thrives on chaos and is doing all he can to stoke it. But the U.S. in particular doesn't need chaos in Honduras, given the country's strategic location as a transit point for illegal drugs and the threat that criminal cartels pose to the political stability of regional governments.

The new Clinton plan also serves to strengthen the interests of Honduras' neighbors in the emerging bloc of Panama, Colombia and Mexico, all of which do not want a chaotic Honduras.

The three nations did stress earlier that there should be no foreign interference in Honduran affairs, even as they went with the OAS consensus, and all have moved in this direction. Panama offered mediation. Mexico offered asylum to Zelaya. Colombia stopped a 60-person Venezuelan convoy "battalion" of aid headed to Honduras at its border to ward off Chavista cash and interference.

What it adds up to is U.S. interests — not those of Venezuela or Nicaragua — becoming predominant in ending the crisis in Honduras, and in a way that's acceptable to Hondurans and their neighbors.

This will work far better than letting the OAS continue its grandstanding. Sure, some may say Hillary blinked. But it's a good blink.

Honduras And Drugs

By INVESTOR'S BUSINESS DAILY | Posted Thursday, July 02, 2009 4:20 PM PT

The Hemisphere: A Honduran official has warned that deposed President Mel Zelaya was in league with Venezuela's Hugo Chavez to ship drugs to the U.S. If true, can this really be the man the U.S. wants back in power?

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Read More: Latin America & Caribbean

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Foreign Minister Enrique Ortez dropped a bombshell last week when he said Zelaya, the president who was thrown out by a constitutional process June 28 after defying the law, had a little side business with the Caracas caudillo allowing cocaine to roll into Honduras from Venezuela before heading to the U.S.

"Every night, three or four Venezuelan-registered planes land without the permission of appropriate authorities and bring thousands of pounds . . . and packages of money that are the fruit of drug trafficking," Ortez told CNN En Espanol. "We have proof of all of this. Neighboring governments have it. The DEA has it."

If Ortiz is right, the U.S. effort to restore Zelaya to power would be suicidal for U.S. efforts to destroy drug organizations south of our border. It would undercut Mexico's and Colombia's savage drug wars and give drug lords such as the Sinaloa cartel's Shorty Guzman, who has bases in Honduras, reason to strengthen operations.

It also means the U.S. must start asking questions about Chavez's role in the drug trade now that U.S.-Venezuelan diplomatic ties are being restored. Right now, it's such a hot potato that nobody in either the State Department or the Drug Enforcement Administration wants to comment on it.

Zelaya's return would put the U.S. in a dilemma. The U.S. has gone along with the Chavez-led global consensus denouncing Zelaya's exit as a coup d'etat and condemning the current Honduran government. But that position means the U.S. would have to cut off a $43 million aid package to Honduras that includes drug-fighting.

This is why the legal definition of "coup" is so touchy.U.S. policymakers are stalling about labeling Zelaya's removal as such — though hotheads in the Obama administration, such as U.N. Ambassador Susan Rice, don't hesitate to use the term.

It also would represent a sorry retreat on current policy.

In 1989, the U.S. took out Manuel Noriega in a military operation over his ties to the Medellin cartel. In 1994, the U.S. cut off aid to Colombia when its new president, Ernesto Samper, was caught on tape with the kingpins of the Cali cartel and taking their cash.

Restoring Zelaya and then pretending the drug war can be won would be a travesty, harming the interests of the U.S. and all the battered nations fighting drugs alongside us.

Ortez's warning lacks detail. But it does describe the well-known problem of traffickers using Central American countries as transshipment points for drugs. This has gotten worse since Zelaya made his alliance with Chavez two years ago.

The aircraft landings, many of which become known after they've crashed with multiton shipments — cannot happen without the president of a small country knowing about them.

The recent high-profile murder of an attorney investigating money-laundering in Guatemala highlighted the problem of corruption extending all the way to the president of that country. Before he was shot dead in the street, Rodrigo Rosenberg videotaped testimony calling Guatemala's president his murderer and said the motive was to cover up the drug-linked corruption he was probing.

This same drug onslaught has slammed Honduras with crime and corruption. The country now has the highest murder rate in the hemisphere, with 4,000 dead in 2008.

It's a fact that the crime has gotten worse under Zelaya, whose commitment to the war on drugs is weak. The leftist demagogue's call to legalize drugs last October didn't come out of some principled libertarian impulse.

If Zelaya is behind Honduras' drug problems, then he can't be allowed back into the country. An international investigation must be undertaken, and Honduras must provide information.

If Zelaya is found to be in league with Chavez on drugs, then the quarrel over whether or not he was removed in a coup becomes a small matter. Then the only place for this former dictator is a jail cell, the same as Noriega got.

Honduras Defiant

By INVESTOR'S BUSINESS DAILY | Posted Wednesday, July 01, 2009 4:20 PM PT

Democracy: Nations aren't usually put to the fearsome test to "live free or die." But Hondurans are accepting it as the world pressures them to reseat a potential dictator in office. They aren't bending.

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Read More: Latin America & Caribbean

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On Tuesday, all 192 members of the U.N. General Assembly voted to condemn Hondurans' removal of President Mel Zelaya from office. He was ousted this week after brazenly defying a Supreme Court ruling against a reelection referendum. Using the language of the effort's ringleader, Venezuela's Hugo Chavez, the U.N. called the constitutional act "a military coup."

The same day, the Organization of American States gave Honduras three days to reinstall Zelaya as president or its membership would be suspended.

The World Bank "paused' lending until Zelaya is back. The Inter American Development Bank followed suit.

Standard & Poor's warned of a credit downgrade. Tourists were told by embassies to leave. Three bordering nations cut off trade. Nations pulled ambassadors. Venezuela's despot, Hugo Chavez, cut off cheap oil. He now bucks for an OAS-led military invasion if his leftist pal Zelaya is not restored to power.

The U.S. has its own bag of potential sanctions for Honduras, although as new facts emerge about Zelaya's involvement in the drug trade and his mental instability, doesn't look as though it intends to use them. Still, the Sword of Damocles over Honduras could mean a suspended free trade treaty, a cutoff of its $200 million in aid, and an end to its immigration agreement with the U.S.

As the world follows Chavez's lead in trying to force Honduras to accept a lawless man as its leader, disasters for Honduras loom.

The tiny country is impoverished. Its seven million people have a per capita income of just $1,635 a year. Its economy has been enfeebled by Zelaya himself. He has fixed prices and wages, and opened the door to drug traffickers, creating a burgeoning narcostate.

It seems impossible that Honduras could withstand new draconian pressure and isolation over taking Zelaya back.

Yet evidence shows that Hondurans consider the latter fate worse. If Zelaya is restored as president, he will resume his dictatorial ambitions while Hondurans lose their future freedoms. Oh, the OAS will tell them "dialogue" will solve it.

But Hondurans know better: If the rule of law won't dissuade Zelaya from being dictator, why would sweet talk work?

Honduras' new, constitutionally appointed leader, Robert Micheletti, defied the global blowhards sitting in judgment of Honduras and said he wasn't leaving.

To Chavez, he said: "You don't scare me." He also warned Zelaya that if he flew back to assume office, he'd be arrested. Honduras' Congress, and its Supreme Court are holding the line, too.

This can only be happening because they are listening to the only people whose opinion matters: Hondurans, some 80% of whom approve of the Court action. "Everyone here is celebrating," a business leader told Latin Finance.

Tuesday, thousands of these Hondurans peacefully rallied in the streets, in vivid contrast to the 200 pro-Zelaya thugs who trashed fast food joints and burned garbage a day earlier.

Hondurans will have to prove it. Accepting a fate as an international pariah state bears a hefty price. But plucky Hondurans have made their choice, valuing freedom over world esteem. If against all odds they win, their choice will strike the biggest blow for democracy since the fall of the Berlin Wall.

The chain reaction that ensues may topple the false democracies in Nicaragua, Bolivia, Ecuador, Venezuela and Cuba. Just as Hondurans aided freedom fighters to crush Sandinista communism in the '80s, they'll now turn back the tide of false democracies.

If only America could be at their side for the victory this time.

On Free Trade, White House Must Lead

By INVESTOR'S BUSINESS DAILY | Posted Tuesday, June 30, 2009 4:20 PM PT

Trade: President Obama's encouraging words to Colombia's president Monday signaled an improving outlook for the two nations' long-delayed free trade treaty. It's good news, but he must take that message to Congress.

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Read More: Latin America & Caribbean

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Contrary to what you might think from the administration's responses to Iran and Honduras, not all of our friends are being snubbed or our enemies embraced.

Obama showed considerable respect for our friend and ally Colombia at a working meeting with President Alvaro Uribe at the White House Monday, declaring at a joint press conference that "we are grateful for his friendship."

It was a commendable show of leadership, and an appropriate response to Colombia, an invaluable ally in fighting drugs, terrorism, as well as being a democratic model for the region. "President Uribe's administration I think has under very difficult circumstances performed admirably on a whole range of fronts," Obama said.

Better still, Obama said that passing Colombia's long-stalled free trade treaty was at the top of the bilateral agenda.

"There are obvious difficulties involved in the process, and there remains work to do. But I'm confident that ultimately we can strike a deal that is good for the people of Colombia and good for the people of the United States," Obama said.

Great start. Now, Obama needs to follow up with strong action.

Obama told Uribe he's dispatching U.S. Trade Representative Ron Kirk to work toward a solution. Kirk is an able trade rep, but it was hardly news. Obama had already issued that order last April at the Summit of the Americas in Trinidad.

Politically, Obama could do much more. Kirk's all alone out there with Congress and must confront not just ignorant elected protectionists, but monied special interests, including Big Labor, which opposes free trade on principle.

Unions gain nothing for their members by opposing the pact. They will actually damage themselves because U.S. goods now face tariffs when sold to Colombia, so union opposition to a deal effectively puts a billion tariff dollars each year into the Colombian government's coffers — not into the pockets of private-sector union members. Given this, it's pretty clear the U.S. unions' real game is about clout. That's why Kirk needs stronger support, and not just words.

By imposing a timetable for getting the pact through, Obama can do that. He should also make the big speech on trade he's been promising for months, assuring Americans that free trade is good.

Obama could also dispatch some of his loyalist big guns to Congress to twist the arms of leadership to permit a vote on free trade with Colombia. He's got lots of candidates.

Vice President Joe Biden, who while in the Senate played a pivotal role in helping Colombia go from failed state to success story in 1999's Plan Colombia, knows the Senate well. He could help.

So could Chief of Staff Rahm Emanuel, who helped muscle NAFTA through Congress in 1994 and could do the same for Colombia. The latter commands respect and fear on Capitol Hill and just his bringing it up could signal to protectionists that the game is up.

Why not get former President Bill Clinton to help, too? His support for Colombia is deep, and, based on his real commitment to free trade, his personal charm could make a difference.

The importance of moving forward can't be underestimated. The economies of both countries are in the dumps, and free trade is a proven way to create jobs. Uribe warned Obama that Colombia's 18% jobless rate was an invitation to the poor to join illegal armed groups — the kind that commit crimes against labor unionists.

Meanwhile, as the turmoil in Honduras showed, there's also a strategic imperative to getting a Colombia trade deal. Latin American diplomats say it will help the U.S. to counterbalance the growing influence of regional troublemakers like Venezuela's Hugo Chavez.

"It's critically important for the U.S. to sign the free trade agreement with Colombia," Mexico's ambassador to the U.S., Arturo Sarukhan told IBD last week. "There is no more important geopolitical mistake the U.S. could make than to not ratify that treaty."

Obama's leadership is on the line. He needs to move more forcefully to get a Colombia free trade deal done. It's time to get involved.

Honduras Dicator

The Flight Of Rosales

By INVESTOR'S BUSINESS DAILY | Posted Wednesday, April 29, 2009 4:20 PM PT

Americas: Even after consolidating his rule, Hugo Chavez's appetite for power is growing. He's now driven a top opponent into exile and Venezuela's democracy to a new low. So who would like to challenge him now?

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Read More: Latin America & Caribbean

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Not long ago, many respectable commentators hailed Venezuela's 2006 and 2008 election results as cause for optimism about the long-term future of Venezuela's democracy.

Sure, Chavez won the presidency and the right to unlimited elections. But in 2006, he lost a referendum that would have expanded his grip on power and better still, his opponents gained mayoralties and governorships in 60% of the country's states and cities.

They believed these results could mean a slow awakening of Venezuela's multiparty system in a country long written off as Hugo Chavez's fiefdom and lead eventually to a shift of the political pendulum.

That's over now, with Chavez driving anyone who crosses him into exile or prison. There's some real question now as to whether any credible opposition can revive with such threats.

Making good on his pre-election threats to jail Manuel Rosales, the man who opposed him for president in 2006, Chavez cooked up corruption charges against him. In recent days, government goons surrounded his house, even before charges were issued.

Rosales somehow escaped, and made his way to Peru, joining two other Venezuelan political exiles — former Yaracuy Governor Eduardo Lapi, and former oil workers union boss Carlos Ortega. Lapi told IBD in 2005 that his own election had been stolen. And Ortega led a legal strike in 2002-2003. Both were hit with phony corruption charges, thrown into prison, and then escaped to asylum in Peru.

Another opponent, Gen. Raul Baduel, a former defense minister who saved Chavez's hide in a 2002 coup and warned him not to steal the election in 2006, wasn't so lucky.

In early April, military intelligence agents burst into his apartment with guns drawn and no arrest warrant. Baduel remains in jail on corruption charges, which he calls politically motivated.

None of these men are small-time activists. They're all pillars of Venezuela's visible opposition, leaders who command vast public support. Assuming the 2006 election was honest, Rosales drew nearly half the votes of Venezuela's voters. Lapi drew nearly half at a minimum in his governors race.

And Ortega, as elected president of the oil workers union, commanded the support of more than half of Venezuela's oil workers. For supporting Ortega, Chavez summarily fired about 18,000 workers — reading their names off over the radio.

Are the men guilty? It's impossible to know.

For one thing, corruption is a way of life in Chavez's Venezuela. The only rule is that so long as Chavista minions stay loyal, they can line their pockets in peace. Derisively known in Venezuela as Boliburguesa (Bolivarian bourgeois), these sanctioned crooks occupy swathes of fancy real estate in Caracas and further afield in Miami Beach, with no visible sources of support.

In recent years they've been caught in large money transfers that drew attention of law enforcement elsewhere, in cases with names like "the suitcase scandal," the "Stanford Bank" Ponzi scheme, and a recent money-laundering incident at Bank of America in Charlotte, N.C.

There's also Chavez's own family, which has mysteriously acquired vast ranch lands in Barinas state. No one knows how.

There's an issue of accountability and transparency across the board, so it's strange that only dissidents get charged with corruption.

For another thing, Chavez controls the courts. El Nuevo Herald on April 26 reported the case of Yuri Gomez, a judge who was thrown out of office for crossing Chavez on a case against a crony, signaling that there is no judicial independence. She, too, is in exile.

All of this raises questions as to whether Venezuela ever can be a democracy so long as Chavez is in the saddle.

President Obama has tried to make nice with him in a bid to nudge him in that direction, but that's not going to do much good with Chavez knocking the opposition into prison and exile.

The worst of this is, no one will want to take their places after seeing these leaders in these fates. That bodes ill for any peaceful change of government so long as Hugo Chavez rules. Some stronger measures are going to be needed.

Chavez: U.S. Is a Threat to Venezuela

Saturday, June 27, 2009

CARACAS, Venezuela — President Hugo Chavez says a U.S. general shouldn't be raising concerns that Venezuela is buying arms, and the American commander is wrong to argue there isn't a "conventional military threat in the region."

Chavez says the U.S. is a threat to Venezuela, and that's why his government is strengthening its military.

The comment is aimed at Gen. Douglas Fraser, who took over as commander of U.S. military operations in Latin America and the Caribbean this week. Fraser has questioned an apparent Venezuelan military buildup.

Chavez said Saturday that Fraser should look in a mirror, adding: "General, you're the threat!"

Venezuela has signed deals with>>>