Alliance for Progress

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For a Peruvian political party, see Alliance for Progress (Peru).

The Alliance for Progress initiated by U.S. President John F. Kennedy in 1961 aimed to establish economic cooperation between North and South America. The aid was intended to counter the perceived emerging communist threat from Cuba to U.S. interests and dominance in the region.

1 Origin and goals
2 US aid to Latin America
3 Business lobbying
4 Success and failures of the plan
5 Military version
6 Results
7 Quotes
8 See also
9 Notes
10 External links

[edit] Origin and goals

In March 1961, President Kennedy proposed a ten-year plan for Latin America:

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The program was signed at an inter-American conference at Punta del Este, Uruguay, 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.<ref name="talon">Smith, Peter H (1999). Talons of the Eagle: Dynamics of U.S.-Latin American Relations. Oxford University Press. ISBN 0-19-512998-9. p. 150-152</ref><ref name="columbia"> "Alliance for Progress". The Columbia Encyclopedia (6). (2001).</ref>

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.<ref name="columbia" />

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. <ref name="talon" />

[edit] US 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 entered the White House.<ref name="talon" />

Authors L. Ronald Scheman and Tony Smith state that the amount of aid totaled $22.3 billion.<ref>Smith, Peter H (1999). Talons of the Eagle: Dynamics of U.S.-Latin American Relations. Oxford University Press. 0195129989. p. 152
Citing:
Scheman, L. Ronald (1988). The Alliance for Progress: A Retrospective. New York: Praeger.p. 10-11
Smith, Tony "The Alliance for Progress: The 1960s," in Lowenthal, Abraham F. (1991). Exporting Democracy: The United States and Latin America. Baltimore: Johns Hopkins University Press. p. 72</ref>

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

"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."<ref name="talon" />

[edit] 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 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.<ref>Cox, Ronald W (1994). Power and Profits US Policy in Central America. University Press of Kentucky. 0813118654. p. 83-85</ref>

[edit] Success and failures of the plan

Regional output in Latin America in the 1960s was 2.4 percent, nearly matching the Alliance for Progress goal of 2.5 percent.

In contrast to 2.1 percent growth in the 1950s, GDP in Latin America reached 2.7 percent in the later part of the 1960s and climbed 3.8 percent between 1970-1974.

Overall seven countries reached the target goal of 2.5 percent GDP, twelve nations didn't reach the goal, and Haiti and Uruguay had lower GDP.

Adult illiteracy was not wiped out, although it was reduced. But in some countries the number of people going to universities doubled or tripled. Access to secondary education also showed increases.

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.<ref name="talon" />

Minimum wage 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.<ref name = "Cambridge"> Bethell, Leslie (June 29, 1990). The Cambridge History of Latin America. Cambridge University Press. ISBN 0-521-24518-4. p. 342.</ref> In other nations, such as El Salvador, minimum wage laws encouraged employers to use labor-saving machinery. ^{[citation needed]}

The most significant failure of the Alliance for Progress was the number of new dictatorships that emerged in the region during the 1960s.<ref name="talon" />

[edit] 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<ref name="since">Bell, P M H (2001). The World Since 1945. Oxford University Press. 0340662360.</ref>.

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

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

[edit] Results

The Alliance for progress achieved a short-lived public relations success. It also had real but limited economic advances.<ref name="since" />

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. <ref name="talon" />

The Organization of American States disbanded the permanent committee created to implement the alliance in 1973. <ref name="columbia" />