The Long Shadow of Uncle Sam

The awful social conditions in Central America are the direct consequence of economic policies imposed by the International Monetary Fund, the World Bank and bodies such as the U.S. Agency for International Development. Throw in U.S. military training and assistance to prop up the local elites and wipe out popular resistance, and there's no doubt which government is ultimately to blame for the holdup of the St. Mary's College bus near the town of Santa Lucia Cotzumalguapa, in southwest Guatemala.

"Structural adjustment" -- that is, the export of Reagonomics to poor countries -- hit Central America in the 1980s and early 1990s. Policies of enforced economic austerity, combined with cheap imports and the destruction of tariff protections have mightily increased polarization and systemic violence.

Here are some striking figures on the consequences of structural adjustment, supplied to me by Peter Rosset of the Oakland-based Institute for Food and Development, also known as Food First.

In Guatemala, the average wage is now only 68 percent of what it was before structural adjustment took its toll, and there are now 1.2 million more people living below the poverty line. Food production per person has dropped 10 percent.

What we have seen in Guatemala, as throughout Central America, is the destruction of the peasant way of life. How can any peasant hope to sell his corn and beans (also, in Guatemala, wheat) if a tidal wave of such commodities from the United States sends prices through the floor?

In the old days, we had the PL480 program -- "Food for Peace" -- whereby the U.S. government subsidized the exports of agricultural commodities from the Midwest. Since 1985, we've also had "Food For Progress," with U.S. commodities going to countries agreeing to submit to "structural adjustment." Then, once the local farmers have been wiped out, the United States starts to raise the price, just as a drug pusher does.

In Guatemala, such subsidized food imports have shot up from 6 percent to 40 percent of all cereals landed in the country. The country has been flooded with free food, which has forced the peasants into destitution and crime.

In El Salvador, the numbers are just as bleak. The share in national income of the richest 20 percent went from 43 percent to 54 percent across the period of structural adjustment. The share of the poorest 20 percent fell from 5.6 percent to 3.4 percent. Remember, the cause of the 1980s war in El Salvador was precisely the huge distance between the many desperate and the wealthy few. Now, the gap is actually worse.

The United States waged war on the Sandinista revolution in Nicaragua, imposed an economic embargo and armed the Contras to lay waste the countryside. Since the end of Sandinista rule in 1991 and the imposition of structural adjustment, per capita gross domestic product has plunged 30 percent. Total investment is down 37 percent. Industrial production -- i.e., jobs -- is down 14 percent. Credit for farmers is down 62 percent. Unemployment now stands at 65 percent.

Aside from destroying farmers through economic austerity programs, the United States bears prime responsibility for the violence. It trained Central American armies in violence, taught their officers and their torturers in the School of the Americas, tutored puppet governments and mercenaries in war, and sent in weapons. Amid social disintegration and carnage throughout the 1980s, Central American refugees fled north. There, in the ghettoes of Los Angeles and other cities, their children joined gangs and became steeped in the violent culture of American gang life -- and then got deported home.

Today, youth gangs are an enormous problem in Central America, especially in El Salvador and Guatemala, terrorizing the local population.

Having created this wasteland of ruin and desperation, the United States now promotes tourism in Central America. Learn a little history before you get in a bus or send your students south to "see other ways of life."