[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]
THE STRATEGIC IMPORTANCE OF THE
WESTERN HEMISPHERE: DEFINING U.S.
INTERESTS IN THE REGION
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON
THE WESTERN HEMISPHERE
OF THE
COMMITTEE ON FOREIGN AFFAIRS
HOUSE OF REPRESENTATIVES
ONE HUNDRED FOURTEENTH CONGRESS
FIRST SESSION
__________
FEBRUARY 3, 2015
__________
Serial No. 114-12
__________
Printed for the use of the Committee on Foreign Affairs
Available via the World Wide Web: http://www.foreignaffairs.house.gov/
or
http://www.gpo.gov/fdsys/
______
U.S. GOVERNMENT PUBLISHING OFFICE
93-156 PDF WASHINGTON : 2015
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COMMITTEE ON FOREIGN AFFAIRS
EDWARD R. ROYCE, California, Chairman
CHRISTOPHER H. SMITH, New Jersey ELIOT L. ENGEL, New York
ILEANA ROS-LEHTINEN, Florida BRAD SHERMAN, California
DANA ROHRABACHER, California GREGORY W. MEEKS, New York
STEVE CHABOT, Ohio ALBIO SIRES, New Jersey
JOE WILSON, South Carolina GERALD E. CONNOLLY, Virginia
MICHAEL T. McCAUL, Texas THEODORE E. DEUTCH, Florida
TED POE, Texas BRIAN HIGGINS, New York
MATT SALMON, Arizona KAREN BASS, California
DARRELL E. ISSA, California WILLIAM KEATING, Massachusetts
TOM MARINO, Pennsylvania DAVID CICILLINE, Rhode Island
JEFF DUNCAN, South Carolina ALAN GRAYSON, Florida
MO BROOKS, Alabama AMI BERA, California
PAUL COOK, California ALAN S. LOWENTHAL, California
RANDY K. WEBER SR., Texas GRACE MENG, New York
SCOTT PERRY, Pennsylvania LOIS FRANKEL, Florida
RON DeSANTIS, Florida TULSI GABBARD, Hawaii
MARK MEADOWS, North Carolina JOAQUIN CASTRO, Texas
TED S. YOHO, Florida ROBIN L. KELLY, Illinois
CURT CLAWSON, Florida BRENDAN F. BOYLE, Pennsylvania
SCOTT DesJARLAIS, Tennessee
REID J. RIBBLE, Wisconsin
DAVID A. TROTT, Michigan
LEE M. ZELDIN, New York
TOM EMMER, Minnesota
Amy Porter, Chief of Staff Thomas Sheehy, Staff Director
Jason Steinbaum, Democratic Staff Director
------
Subcommittee on the Western Hemisphere
JEFF DUNCAN, South Carolina, Chairman
CHRISTOPHER H. SMITH, New Jersey ALBIO SIRES, New Jersey
ILEANA ROS-LEHTINEN, Florida JOAQUIN CASTRO, Texas
MICHAEL T. McCAUL, Texas ROBIN L. KELLY, Illinois
MATT SALMON, Arizona GREGORY W. MEEKS, New York
RON DeSANTIS, Florida ALAN GRAYSON, Florida
TED S. YOHO, Florida ALAN S. LOWENTHAL, California
TOM EMMER, Minnesota
C O N T E N T S
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Page
WITNESSES
Shannon K. O'Neil, Ph.D., senior fellow for Latin America
studies, Council on Foreign Relations.......................... 12
Ms. Bonnie Glick, senior vice president, GlobalConnect Division,
Meridian International Center.................................. 21
Evan Ellis, Ph.D., author........................................ 33
Mr. Eric Farnsworth, vice president, Council of the Americas and
Americas Society............................................... 49
LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING
Shannon K. O'Neil, Ph.D.: Prepared statement..................... 15
Ms. Bonnie Glick: Prepared statement............................. 24
Evan Ellis, Ph.D.: Prepared statement............................ 35
Mr. Eric Farnsworth: Prepared statement.......................... 52
APPENDIX
Hearing notice................................................... 72
Hearing minutes.................................................. 73
Written responses from Mr. Eric Farnsworth to questions submitted
for the record by the Honorable Jeff Duncan, a Representative
in Congress from the State of South Carolina, and chairman,
Subcommittee on the Western Hemisphere......................... 74
THE STRATEGIC IMPORTANCE OF THE
WESTERN HEMISPHERE: DEFINING U.S.
INTERESTS IN THE REGION
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TUESDAY, FEBRUARY 3, 2015
House of Representatives,
Subcommittee on the Western Hemisphere,
Committee on Foreign Affairs,
Washington, DC.
The committee met, pursuant to notice, at 11 o'clock a.m.,
in room 2172 Rayburn House Office Building, Hon. Jeff Duncan
(chairman of the subcommittee) presiding.
Mr. Duncan. A quorum being present, the subcommittee will
come to order. I will start by recognizing myself and the
ranking member to present our opening statements.
Since this is our first subcommittee hearing in the 114th
Congress, I will recognize members of the subcommittee that may
be present after my opening statement and the ranking member's
opening statement for 1 minute to present their opening
remarks, introduce themselves to the committee and, if they
wish to do so, they may also submit remarks for the record.
So I will now yield myself as much time as I may consume to
present my opening statement. My name is Jeff Duncan. I am
proud to be the subcommittee chairman on the Western
Hemisphere.
I previously served as subcommittee chairman in the House
Homeland Security Committee, the Subcommittee on Oversight and
Management Efficiency and I am glad to be here in the Western
Hemisphere Subcommittee.
So let me extend a warm welcome to the returning members of
the subcommittee and I am grateful for the friendship and
partnership of the ranking member, Mr. Sires, from New Jersey.
I look forward to working closely with Albio and the
members of this subcommittee to help make the Department of
State and USAID's action in the Western Hemisphere as efficient
and effective as possible in order to advance U.S. interests in
the region.
I would also like to introduce our new members and the only
one on my side of the aisle is Mr. DeSantis from Florida. But
the other members on the subcommittee are Ted Yoho from
Florida, Tom Emmer from Minnesota--on the minority side, Mr.
Joaquin Castro of Texas, Robin Kelly of Illinois, and Alan
Lowenthal of California.
Each bring a wealth of experience and I am glad to have
them on the subcommittee. On the majority side, our staff is
Mark Walker--I guess the chief of the subcommittee staff--and
Rebecca Ulrich, who formerly worked for me in my office and
also on the subcommittee on Homeland Security, and Joske
Bautista on the end down there working for the subcommittee.
Those are on the majority side and I hope the ranking
member will introduce the--some of his staff members on the
minority side because we work closely together. It is important
for our members to lean on our team to make sure we are
effective and if we can do that.
Today, I want to consider the strategic importance of the
Western Hemisphere for U.S. interests. While our attention is
often captivated by events in Asia, Europe, the Middle East,
and North Africa, I do not believe that crises and firefighting
should determine the level of a region's priority for the
United States.
I have travelled extensively in the region--Argentina,
Brazil, Canada, Colombia, Mexico, Paraguay and Peru both in my
private life and also through official duties. I have got a
deep affinity for the entrepreneurial people and cultures of
the region.
I also firmly believe that U.S. should pay more attention
to countries in the Western Hemisphere. These countries by
virtue of proximity, trade, travel or culture have the ability
to truly influence the United States and our lack of focus on
issues right here in our own neighborhood is a disservice to
the American people and to our committed partners within the
region.
Although Roosevelt pledged the United States to the policy
of a good neighbor in 1933, the U.S. has drifted in many ways
toward benign neglect of our neighbors in Latin America and the
Caribbean.
U.S. disengagement, evidenced by unsustained U.S. attention
and tactical rather than strategic approaches in the region,
has enabled other actors to step into the vacuum of leadership.
While countries in the Western Hemisphere do not experience
the same level of chronic instability as others around the
globe, this region is unique by virtue of its geography.
With no ocean separating the Americas, both threats and
opportunities in Canada, the Caribbean, Latin America have a
greater potential to impact the United States homeland and the
American people as well as American businesses. Therefore, we
must remain vigilant and truly engaged.
This year promises to be a very interesting year. With
President Obama's Cuba policy shift and recent bilateral talks
in Havana, this subcommittee will do its due diligence to hold
the administration accountable for its actions on Cuba in order
to require demonstrable results that benefit the Cuban people.
Venezuela's unstable situation, deteriorating economic
conditions with major shortages and inflation at over 60
percent, declining oil production and human rights abuses also
require sustained U.S. attention.
Furthermore, this year's election of a new secretary
general at the Organization of American States, or the OAS, and
Federal municipal elections in 13 countries in the hemisphere
promise to keep us focused on advocating for transparency,
adherence to the rule of law and democratic governance, as well
as religious and press freedoms in the hemisphere.
Over 68,000 unaccompanied children crossed the U.S.-Mexico
border last summer. This subcommittee will work to keep the
administration accountable to securing the U.S.-Mexico border
and preventing a second surge of migrants from Central America
through wise use of American tax dollars.
Finally, the U.S. assumption of the chairmanship of the
Arctic Council later this spring provides an excellent
opportunity for active leadership on energy, security and
freedom of navigation issues in and around the Arctic.
Since coming to Congress in 2011, I have had three simple
priorities summarized by the acronym JEFF--create jobs for the
American people, promote U.S. energy security and exports and
return to the wisdom of our Founding Fathers.
I believe there are many ways to dig deeper into each of
these areas with U.S. interests in the Western Hemisphere.
First, we have seen many opportunities for U.S. businesses to
engage in the region and create more American jobs in the U.S.
as a result.
This region as a whole is one of the fastest growing
trading partners. For instance, according to the inter-American
dialogue, between 2000 and 2013, U.S. sales to Latin America
more than doubled as did the region exports to U.S. markets.
In fact, the U.S. provides almost 90 percent of the $60
billion of remittance income to the region and has six free
trade agreements involving 12 countries in the Western
Hemisphere. This includes four individual FTAs, NAFTA, CAFTA,
Dominican Republic.
Opportunities also exist for more trade with the Pacific
Alliance countries of Chile, Colombia, Mexico, and Peru, which
represent 36 percent of the region's economy, 50 percent of its
international trade and 41 percent of all incoming foreign
investment.
Additionally, with Canada, Chile, Mexico, and Peru all
participating in Trans-Pacific Partnership (TPP) negotiations,
I am very interested to see how TPP will impact the region.
Similarly, Chile became the 38th participant in the visa
waiver program 1 year ago this month and U.S. Departments of
State and Homeland Security have been in discussions with the
Governments of Brazil and Uruguay about the criteria for
joining the visa waiver program. That will make it easier for
citizens to travel between our countries and for private sector
investment and collaboration within these countries.
Second, energy opportunities abound in the region today. I
am excited about the potential for U.S. energy exports from our
neighbors in the hemisphere. In the 113th Congress, I authored
legislation to implement the Outer Continental Shelf Trans
Boundary Hydrocarbon Agreement between Mexico and the United
States.
This was approved by the House and ultimately signed into
law by the President. I believe we can do so much more on the
energy front. The Western Hemisphere is home to nearly a third
of the world's oil and the region has nearly 337 billion
barrels of estimated recovery in oil, and 20 percent of the
world's proven oil reserves.
The abundance of U.S. reserves in oil and natural gas and
shale gas resources, the capability to export, liquefy and
compress natural gas and the administration's recent
announcement of offshore drilling in the Atlantic, the U.S. has
many reasons to partner with like-minded countries who seek to
spur economic growth, achieve energy security, and reduce
energy cost.
Venezuela's dire situation, resulting impact on its
Petrocaribe program, has caused 18 Central American and
Caribbean nations that receive its oil on preferential terms to
look elsewhere for energy security. The U.S. is a natural
partner for these policies.
On January 27th, the ranking member and I co-hosted an
event with Members of Congress and Caribbean leaders who were
in Washington for the Caribbean Energy Security Summit.
We discussed ways to deepen energy cooperation to assist
Caribbean nations in achieving energy security. Given current
circumstances and the additional potential for offshore
resources--resource exploration that Aruba, the Bahamas, the
Dominican Republic and Trinidad are considering, U.S.
businesses have a significant opportunity to engage.
Similarly, the potential for cooperation with Canada
through the Keystone Pipeline and Mexico's energy sector
reforms could truly take us a long way toward becoming North
American energy independent if we work together to achieve that
goal.
Likewise, energy opportunities in Argentina, Brazil,
Colombia, and Peru could also make our hemisphere even more
energy independent. And then, finally, in addition to jobs and
energy I believe that we must recall the wisdom of our Founding
Fathers.
In 1793, George Washington warned a young America that a
reputation of weakness could lead to a loss of America's rank
among nations and that if we desire to secure peace it must be
known that we are at all times ready for war.
Washington also believed a uniform and well digested plan
was vital to meeting these objectives. These words still ring
true today--peace through strength. In the 112th Congress, I
authorized legislation to address Iran's activity in the
Western Hemisphere.
Passed by both houses of Congress and signed into law by
President Obama, this legislation required that U.S. develop a
strategy to counter Iran's activity in the region.
The recent mysterious death of Argentine prosecutor Alberto
Nisman underscores the importance of being alert instead of
ignoring congressional concerns, as it seems the administration
has done.
Nisman bravely and boldly gave his life, holding the
Government of Iran accountable for its role in the 1994 AMIA
terrorist attack. Through meticulous work he exposed Iran's
operations in the Western Hemisphere using Embassies, mosques,
front companies, intelligence bases and sleeper cells to
accomplish its purposes.
I remain deeply concerned about Iran's actions in the
Western Hemisphere with evidence of a growing presence of
China, North Korea, and Russia here in the Americas. We must
remain ever vigilant.
With that, I turn to the ranking member, Albio Sires, for
his opening statement. I look forward to hearing from our
expert panel of witnesses and I thank you for being here today
and I look forward to a lot of great things happening on this
subcommittee. And with that, I yield to the ranking member.
Mr. Sires. Thank you, Mr. Chairman, and congratulations to
you and a warm welcome to our witnesses who have been here
today. Before I get started, I also want to recognize some of
the new members that we have in our subcommittee--from Texas,
Joaquin Castro, from Illinois, Robin Kelly, and from
California, Alan Lowenthal.
Welcome to the committee, and I also want to recognize the
former chairman who we work great--great 2 years. Nice to see
that you are still interested working with us on the Western
Hemisphere although you have moved on. Nice to see you, man.
And I want to express my appreciation to you, Mr. Chairman,
for immediately reaching out and meeting with me to discuss how
we can work together. We share many of the same concerns and
aspirations and I feel encouraged by our desire to move forward
in a bipartisan manner.
I look forward to working with you and the members of the
subcommittee to address the numerous issues affecting our
nation and neighbors in the hemisphere.
I am certain that the members of this subcommittee all
agree on the strategic importance of the Western Hemisphere to
U.S. interests. We may disagree on varying degree--to a varying
degree on the scope and manner by which we approach certain
issues.
But we ultimately want a similar peaceful, democratic, free
and prosperous hemisphere--a hemisphere that upholds the Inter
American Democratic Charter and respects basic human rights of
free speech and assembly; a hemisphere whose citizens can elect
their leaders freely and democratically without fear or
coercion; a hemisphere whose citizens are safe and secure and a
hemisphere whose leaders uphold the rule of law and whose
citizens can aspire to some hope--to the same hopes and
opportunities that we have in our country.
I have long advocated for a more focused engagement with
the hemisphere. Yet, after 9/11 our focus has been on the
Middle East, Asia and elsewhere. However, I believe we are
finally turning the page in this regard.
While I have some clear differences and concerns with
recent policy action taken in regards to Cuba, overall there
are positive indications that the Western Hemisphere is finally
getting the focus and attention it rightly deserves.
Late last year, the U.S. hosted the Presidents from
Honduras, El Salvador and Guatemala to address the high level
of violence and lack of opportunity affecting their countries.
In 2015, Mexican President Enrique Penna Nieto was the
first leader--the first head of state to visit Washington. With
oil prices falling and the economies of oil-exporting nations
like Venezuela hurting, the U.S. hosted a Caribbean energy
summit that could help the region diversify their dependence
from Petrocaribe.
Additionally, the administration's recent announcement
committing $1 billion for Central America is a significant
step. If approved, it will go far in helping improve the
safety, security and economic well-being of the region that is
amongst the most violent in the world and a pathway for illicit
drugs bound for the United States.
For detractors that doubt the strategic relevance of the
region to the United States, I need only to remind them of the
humanitarian crisis that erupted on our southern border.
Thousands of young women and children fled their country
escaping violence or were lured by coyotes with false hope of a
broken U.S. immigration system.
It is also but a down payment compared to the cost of doing
nothing, and yet this issue merely underscores lingering
problems in terms of weak institutions, corruption and poverty.
Indeed, together with changing demographics and economic
trends, there will be many challenges facing the hemisphere.
But there are also many opportunities that will serve to
integrate us further. More than half of the U.S. immigrants
come from the Western Hemisphere. Geographic proximity has
forged strong and robust commercial ties.
In spite of an increasing Chinese presence, U.S. trade with
the region was more than three times that of China in 2013.
Canada is our number one trading partner and Mexico is a close
third.
Today, we are witnessing a global economic adjustment with
a decline in oil and commodity prices. China's economy is
cooling and with it is demand for natural resources from key
markets in South America.
Countries that benefited from high commodity prices will
face difficult decisions while importers will be given some
breathing room. On the other hand, the U.S. economy is
rebounding alongside a North American energy transformation
with broad geopolitical implications. Elsewhere, there is a
combination of promise and concern.
Mexico has come a long way but the context behind the death
and disappearance of 43 university students has revealed
shortcomings in dealings with corruption and violence.
Brazil and Argentina are countries with which our relations
can be much improved. The sudden tragic death of Argentina
prosecutor Alberto Nisman was a shock. But I implore Argentine
authorities to commit themselves to fully investigate the
matter and continue his work to bring those behind the horrific
1994 AMIA bombing to justice. And in Colombia, our strongest
regional ally, there is a potential to end a 50-year-old
conflict.
While I have many reservations about trusting the FARC, I
stand completely committed to supporting the people of Colombia
as they move forward and I believe the United States should do
the same.
I look forward to hearing from our witnesses and working
with the chairman and our members to address these issues.
Thank you.
Mr. Duncan. I want to thank the ranking member and he is
exactly correct that we are going to work well together and I
value our relationship.
I heard one thing that he said. I wanted to make sure I
clarify. I heard him say China was our best trading partner.
Canada is our largest and best trading partner. That was in his
notes and I am not sure if what he said but what I heard. But I
just want to make sure that--that Canada is our largest trading
partner and I think that is what you intended to say.
Mr. Sires. My accent.
Mr. Duncan. Yes, sir. What I would like to do is, because
this is our first meeting I would like to give all the members
a chance for 1 minute to introduce yourself.
If you want to state, you know, your goal as a subcommittee
member or maybe what your focus is so we all can get to know
each other just a little bit better and the audience can as
well.
So I will start by recognizing the first member is Mr.
DeSantis from Florida for 1 minute.
Mr. DeSantis. Well, thank you, Mr. Chairman. I look forward
to our work over these next 2 years. We have some important
things that we need to tackle, most recently with what the
administration has done with Cuba policy.
Here you have a regime that was really struggling with
their patrons in Moscow and Caracas, roiled by lower energy
prices, and this is essentially a unilateral concession, a huge
lifeline to the Castro government.
I think it was a major mistake. We worked very hard on this
committee last Congress to stand up for the people in Venezuela
who were chafing under the Maduro regime. I think the
administration has had a tepid response to that.
Finally, there has been some action taken in the last few
days but I think we have got to unequivocally stand with those
freedom fighters in Venezuela.
And I think, finally, we do have to be concerned with the
rise of rogue state actors in our hemisphere and we have seen
that with Iran. We have seen it with North Korea and we also
have, of course, rival states like Russia and China who are
seeking to have a foothold here. So I look forward to it and
congratulations on your chairmanship.
Mr. Duncan. Thank you. The Chair will recognize Mr. Meeks
from New York for 1 minute.
Mr. Meeks. Thank you, Mr. Chairman, and I also want to
thank my good friend, Ranking Member Sires, and I am delighted
to be serving on this subcommittee once again and I look
forward to working with you on a region that must be a top
priority for our nation.
As a New York representative, I am mindful at all times of
the benefits of harmonious and thriving relationships with the
region. Canada borders my state and our partnership is deep and
thriving.
Top energy--Canada is our top energy supplier, top trading
partner. The list is long, and I know my colleagues to the
south can say similar things about Mexico. In all my years on
this committee I do not recall a more promising time in
hemispheric developments.
While it is true that we still have many intractable
problems to tackle, it is also true that today we will be
discussing developments that not long ago seemed out of reach.
In my estimation we are finally witnessing the dismantling of
deeply entrenched Cold War vestiges.
When I travel to Colombia, most of the people I meet have
known nothing but civil war conflict that has raged in the
nation for over 50 years. Now, the world's longest lasting
civil war is on the brink of peace as the FARC guerrillas and
the Government of Colombia engaged in talks in Havana.
A little over a year after making the Colombia embargo
permanent, speaking at the White House to a room full of over
200 Latin American diplomats, President Kennedy proposed the
Alliance for Progressive Initiative.
It was a 10-year planned partnership with regional
governments to facilitate social and economic advancement in
Latin America to, in his words, ``build a hemisphere where all
men can hope for a sustainable standard of living and all can
live out their lives in dignity and freedom,'' and at that
unveiling JFK made an acknowledgement that would ring true for
some decades to come when he said, ``Let me be the first to
admit that we North Americans have not always grasped the
significance of this common mission.''
So I know, Mr. Chairman, that in just a couple of months at
the upcoming Summit of the Americas our nation will demonstrate
that we Americans do fully grasp the significance of our
commonality with our neighbors in the region and I am confident
that recent changes by the Obama administration to U.S.-Cuba
policy and other forward-looking policy changes toward Latin
America and the Caribbean will put America more in sync with
our regional allies.
Let me just say this as I close that I am looking forward
to hearing from our witnesses today about the significance of
the monumental changes on the horizon for our region and how we
might embrace and advance a common agenda in the months ahead.
I have read your testimony and I know that you have an
expansive wealth of knowledge to gain and I have to gain from
your knowledge. I look forward to hearing your testimony. Thank
you.
Mr. Duncan. Thank you, Mr. Meeks.
The Chair will recognize Mr. Emmer from Minnesota for 1
minute.
Mr. Emmer. Thank you, Mr. Chair. My name is Tom Emmer and I
am from Minnesota. I want to thank you and Ranking Member
Sires.
I am excited to serve on this subcommittee because of the
strategic importance of the region to the United States and the
entire world. Serving as a major trade, energy and economic
region, the Western Hemisphere offers numerous emerging
opportunities to the United States today and for the decades to
come.
I am looking forward to learning--listening and learning
from my colleagues and meeting and working with leaders from
the region to continue to advance more transparent and open
cooperation between the U.S. and members of the Western
Hemisphere and I look forward to working specifically on issues
of energy, trade, diplomatic relations and security during the
114th Congress.
Again, I am honored to be part of this subcommittee and I
can't wait to get to work.
Thank you, Mr. Chairman. I yield back.
Mr. Duncan. Thank you. I am taking in order members'
arrival. So Mr. Yoho from Florida is recognized for 1 minute.
Mr. Yoho. Thank you, Mr. Chairman, and congratulations on
chairing this committee. I look forward to it and working with
you on this.
I think this is a great first hearing that will let new
members--new members to the subcommittee like myself really get
an overview of the Western Hemisphere and the implications in
the region that it has for our national security and economy.
You know, I grew up in--I was born in Minnesota but I have
lived in Florida 52 of my 60 years and it is home to me and I
have had the pleasure of working as a large animal veterinarian
in Florida for 30 years, and we deal a lot with the farmers and
ranchers we have gotten to know and the extension of the
agricultural sector into the South America mainly.
And I look forward to bolstering those and I look forward
to strengthening our relationships in the whole Latin American
and Western Hemisphere and the security in the region, I think,
is utmost that we pay attention.
I have got members in the--family members in the Coast
Guard and I hear daily of stories of the narco trade, the
illegal immigration, human trafficking and I look forward to
bringing some common sense resolutions to that to make our
nation stronger as we bolster our relationship with those
countries; and I look forward to hearing from the experts here
and I know we are going to have a productive 2 years, and thank
you.
Mr. Duncan. I thank the gentleman.
The Chair will recognize the former chairman of the
Subcommittee on Western Hemisphere, now the chairman of the
Asia and the Pacific Subcommittee, Mr. Salmon, for an opening
statement of 1 minute.
Mr. Salmon. Thank you, Mr. Chairman.
My top priority is just to do whatever I can to make you
look good and my second priority is just do whatever the
gentlewoman from Florida tells me to do.
The third thing is I really am very, very concerned about a
phenomena we saw last year that really had strong implications
in my state with regard to Guatemala and El Salvador and the
whole Central America problem with unaccompanied minors at the
border.
I think we are going to see it again in a very big way, and
we have never really done anything to resolve it. The House
worked its will last August and passed legislation which the
Senate never took up.
But it hasn't gone away. We don't know exactly why it
tapered off. A lot of people think it was just weather. But the
violence in Guatemala, Honduras, El Salvador continues. The
drug trafficking and the gangs that bolster that drug
trafficking, the coyotes--all of those things have not gone
away.
There are great things happening in the Western
Hemisphere--great exciting things, and you have noted a lot of
them. But there are some real challenges too and they are
showing up right at our door and causing some real serious
issues within our country and I hope we get a handle on it.
I hope it is something that we intend to focus some
attention on, because, as we went to the border of Guatemala
and Mexico and saw first hand with General Kelly what was going
on right there in terms of drug trafficking, people
trafficking, gun trafficking, it hadn't gone away and I really
hope that we focus some attention and ultimately address it as
a Congress and try to get it fixed. Thank you.
Mr. Duncan. I thank the gentleman for his leadership. I am
just really following up and continuing your great work. So the
Chair will recognize Mr. Castro from Texas for 1 minute.
Mr. Castro. Thank you, Chairman. It is an honor to serve on
this subcommittee. I think the task for us in the years ahead
is to continue to develop the infrastructures for diplomacy,
economic development and cooperation within the Western
Hemisphere.
There are things that happen in Latin America that if they
happened in other parts of the world this body, the Congress,
and the United States would respond much more swiftly and much
more strongly, and I will use the example that Chairman Salmon
pointed out.
We had a subcommittee hearing on all the kids that came
from Central America. But there was never a full committee
hearing on that situation. That needs to change in the future.
We need to attend to this region much better than we have
before.
Mr. Duncan. I thank the gentleman.
Mr. Lowenthal from California is recognized for 1 minute.
Mr. Lowenthal. Thank you, Chairman Duncan and Ranking
Member Sires. I want to thank you both for holding this
important hearing focusing on the Western Hemisphere and its
relationship to our U.S. interests.
As a first time member of this subcommittee and as a former
legislator for southern California and also as a former
professor at Cal State Long Beach where I had the very good
fortune of spending a year sabbatical at the University of
Yucatan, I am really pleased to be focusing much more on our
relationship with Mexico and Central America and parts of the
region, especially since so many of the families in my region,
in my district, are directly impacted by events that occur in
the region.
I am here to learn, as the chairman asked me, also what
would be my focus. As I pointed out, I am an educator. I would
like to see, with 28 percent poverty, how we work with the
region in terms of educational opportunities, how--what are the
successes in education.
I am also concerned about our collaboration on the energy
and climate partnership, on clean energy and I would like to
understand what that means and how that works; and I, too,
would like to understand more about unaccompanied minors, both
the causes and potential solutions than what we have and I
thank you for holding this hearing.
Mr. Duncan. Thank you, Mr. Lowenthal.
And the Chair will now recognize the former chairman of the
full committee and a mentor of mine, Ms. Ros-Lehtinen from
Florida.
Ms. Ros-Lehtinen. Well, thank you so much, Mr. Chairman. It
is a pleasure and a privilege to serve on your subcommittee. I
think it is important to note that, according to financial
reports, U.S. producers export three times more to Latin
America than they do to China.
Thirteen out of 17 Latin American countries import more
goods from our country--from the United States than from any
other country in the world.
So even those countries with strong anti-American rhetoric
silently continue to do business with us as sources for trade
and investment and that is where we need to take a real deep
look at our region.
As we have seen with the misguided secret negotiations with
Cuba, our foreign policy seems to have left democracy and human
rights as distant priorities. This is an unacceptable premise
for our country, the greatest democracy in the world.
Our policies toward our hemisphere must champion democratic
freedoms and fundamental rights whether it is my native
homeland of Cuba, Venezuela, Nicaragua, Ecuador, Bolivia, and I
know, Mr. Chairman, that under your leadership this
subcommittee will continue to do our investigation about Iran's
destabilizing role in Latin America; and I know that we will
look at the murder of Alberto Nisman, the AMIA Jewish Community
Center prosecutor, and the mystery surrounding his death.
So thank you, Mr. Chairman. I can't think of anyone who
could be a better chairman except, of course, Mr. Salmon--both
equally good.
Mr. Duncan. Well, nobody could beat Matt Salmon. But
anyway, thank you, and the last member to be recognized, Ms.
Kelly from Illinois, for 1 minute.
Ms. Kelly. Thank you, Mr. Chair. I am both thrilled to be
on Foreign Affairs and also on this committee. I am very
interested in learning as much as I can and, also, I want us to
develop ways we can partner in peace and fair trade that we can
all benefit from no matter the country.
This committee was of particular interest because,
representing Chicago, I have a significant Mexican and Polish
population. Also, as a Chicago rep with crime pipelines that
have links to Latin America, I am very concerned about
transnational crime, drug trafficking and illicit finance.
Those are both big concerns.
And, lastly, I am interested in finding ways we can
continue to find productive and positive ways to build our
relationship with Cuba and its people.
Thank you.
Mr. Duncan. I thank the members, and from what I am hearing
we are going to have a very active and beneficial time to make
us all better congressmen and make the committee effective; and
make the United States a better partner in the region.
So we can't do that at every committee hearing but so I
need to say that pursuant to Committee Rule 7 members of the
subcommittee will be permitted to submit written statements to
be included in the official hearing record.
Without objection, the hearing record will remain open for
5 days to allow statements, questions and extraneous materials
for the record subject to the length and limitation in the
rules.
So now it is a pleasure of mine to introduce our
distinguished panel today and the first panelist is Dr. Shannon
O'Neil. Dr. O'Neil is a senior fellow for Latin American
studies on the Council on Foreign Relations.
Her expertise includes U.S.-Latin American relations,
trade, energy and immigration. She also directed CFR's
independent task force on North America, ``Time for a New
Focus''--I think there is a copy of the book at your desk--as
well as an independent task force on ``U.S.-Latin America
Relations: A New Direction for a New Reality.''
Dr. O'Neil holds an MA in international relations from Yale
and a Ph.D. in government from Harvard.
Our second panelist is Ms. Bonnie Glick. Ms. Glick served
as senior vice president--serves currently as senior vice
president for Global Connect Division at Meridian International
Center.
Prior to joining Meridian, Ms. Glick served 12 years as a
U.S. diplomat in the Department of State. She served in the
U.S. Embassy in Managua, Nicaragua and in the period
immediately after the electoral defeat of the Sandinistas. It
is an interesting--I would like to talk with you more about
that.
Ms. Glick also holds an MA in international affairs from
Columbia University, an MBA from the Robert H. Smith School of
Business at University of Maryland.
Our third panelist, Dr. Evan Ellis--Dr. Evan Ellis is a
research professor in Latin American studies and an
accomplished author. He has given testimony on Chinese
activities in Latin America to the U.S Congress, and has
discussed his work regarding China and other external sectors
in Latin America on various media outlets.
Dr. Ellis holds a Ph.D. in political science from Purdue
with a specialization in comparative politics.
And our last panelist, Mr. Eric Farnsworth--Mr. Farnsworth
is vice president of the Council of the Americas and Americas
Society. Mr. Farnsworth began his career in Washington with the
U.S. Department of State. He also served as senior advisor to
the White House Special Envoy for the Americas.
He holds an MBA in international relations from Princeton's
Woodrow Wilson School and we are glad you guys are here. I have
enjoyed getting to know Eric and look forward to talking with
him more.
So we have got a lighting system. We are going to recognize
each of the panelists for 5 minutes. That also goes for the
committee.
When we get to the question period we are going to adhere
to the 5-minute rule, and I will try to adhere to that as
closely as possible due to the essence of time. So if you hear
a light tapping and not a--then that means wrap it up with a
sentence.
I don't want to go to the second part of that. So we would
like to try to stay on time. So before I recognize you to
provide your testimony I am going to continue to--I have
already explained that.
So after our witnesses testify we will have 5 minutes to
ask questions and so, Dr. O'Neil, I am going to start with you.
It is kind of strange how the committee has been set up.
Usually it runs the other way in recognizing them but we are
going to start on the right.
Dr. O'Neil, you are recognized for 5 minutes.
STATEMENT OF SHANNON K. O'NEIL, PH.D., SENIOR FELLOW FOR LATIN
AMERICA STUDIES, COUNCIL ON FOREIGN RELATIONS
Ms. O'Neil. Great. Good morning. So Mr. Chairman, Ranking
Member and members of the subcommittee, thank you for the
invitation to testify today and I am grateful for the
subcommittee's interest on the Council on Foreign Relations'
Independent Task Force on North America, and I am pleased to
have the opportunity to discuss it and the strategic importance
of North America for U.S. interests.
And if it would be acceptable to the chair, I would like to
have the entirety of the referenced task force report entered
into the record.
Now, home to nearly 500 million people living in three
vibrant democracies, North America today is an economic global
powerhouse. At over $20 trillion, the three nations of Canada,
Mexico, and the United States account for over a quarter of
global GDP.
Moreover, North America is increasingly interdependent as
geography, markets, policies, the choices of millions of
individuals and the choices of hundreds and thousands of
companies have transformed it into one of the most integrated
regions in the world.
And given these deep and indelible links, a stronger North
America can only enhance U.S. competitiveness, U.S. security
and well-being and it can also bolster U.S. influence globally.
Now, in my time here I want to talk about two opportunities
in particular that stand out for areas of cooperation and these
are energy and economic competitiveness.
Starting with energy--never before have the energy
prospects of these three nations been so dynamic as they have
been transformed by new energy finds in the three nations, by
new technologies and by new rules, particularly in Mexico, that
are together unleashing an unanticipated potential.
An increasing energy production so far has brought jobs, it
has boosted economic growth and it has lowered prices for
industrial and individual consumers in all three nations.
Now, as each of these three countries undergo their own
changes and transformations, energy should become a fundamental
pillar for the North American partnership. Greater regional
cooperation and integration will boost economic, geopolitical,
and environmental benefits for these three nations.
To truly harness North America's energy promise, the United
States should work closely with its neighbors to integrate
North America's energy markets. So this will involve
significant investment in resources, in cross border
infrastructure and electricity grids, so physically linking
North America's energy fields, refineries and markets.
It will also mean developing regional energy strategies and
environmental standards, coordinating on issues such as
regulations, safety procedures, energy efficiency guidelines
and technologies for lower carbon energy.
Common efforts like these will better ensure the three
countries benefit from the potential economic gains while also
reaching environmental and carbon objectives.
Now, let me turn to North America's economic potential.
Now, over the past two decades North America's economic ties
have deepened dramatically by virtually all measures.
Today, each of these nations is the others' largest trading
partners with intra-regional trade of over $1 trillion a year,
and as important is the changed nature of this trade,
reflecting the rise of a truly regional production platform.
So rather than sending each other finished products the
United States, Mexico and Canada today trade in pieces and
parts. So this back and forth along assembly lines, between
plants and between these countries in the making of every car,
every plane, every flat screen TV or computer it means for
every item that is imported from Mexico to the United States,
40 percent of its value on average, was actually made in the
United States and for Canada the number is 25 percent.
And it is precisely through this integration of joint
production of goods that the United States, Canada, and Mexico
have become more efficient and competitive together than they
would have been alone.
And as this new Congress begins its work, made in North
America should be a foundation of U.S. policy. So this means
working toward the free unimpeded movement of goods and
services across North America's common borders.
This will require reducing non-tariff barriers, revising
rules of origin, mutually recognizing or harmonizing differing
regulations, expanding preclearance or other proven programs
for trusted travellers, and investing in border infrastructure
necessary to speed trade and travel.
It also means prioritizing and completing free trade
agreements with which the United States, Canada, and Mexico are
all part, specifically today the Trans-Pacific Partnership, and
it should mean incorporating our North American neighbors and
other free trade agreements we consider including the Trans-
Atlantic Trade and Investment Partnership, or TTIP, with
Europe.
Now, the costs of not engaging our neighbors are even
higher than they have been in the past. In a world of regional
blocs, deepening U.S. ties with its economic allies and
particularly its neighbors will help maintain our national
competitiveness, and America's dream of energy self-sufficiency
depends, too, on its neighbors, on linking energy and
electricity grids to ensure safe, stable and resilient
supplies.
The United States is already a global superpower but with
its neighbors it could extend its reach even further, and so I
would ask you as policy makers to put North America at the
forefront of your imaginations and, importantly, on your
agendas.
Thank you.
[The prepared statement of Ms. O'Neil follows:]
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Mr. Duncan. And the Chair will recognize Ms. Glick for 5
minutes.
STATEMENT OF MS. BONNIE GLICK, SENIOR VICE PRESIDENT,
GLOBALCONNECT DIVISION, MERIDIAN INTERNATIONAL CENTER
Ms. Glick. Mr. Chairman, Ranking Member and members of the
committee, thank you for the invitation to testify today. I am
here representing Meridian International Center, a Washington,
DC-based nonprofit that focuses on the promotion of global
leadership through international engagement.
I also come in my capacity as a former executive of the IBM
Corporation and as a former Foreign Service officer. By
crossing sectors from public to private to nonprofit, I have
seen the impact that U.S. engagement in the Western Hemisphere
can have and today I will focus my remarks on the economic
importance of remaining engaged with our neighbors to the
south.
I would like to say that the importance of Latin America is
best summed up in a Spanish word, intercambio. An intercambio
is an interchange, kind of a clumsy word in English but quite
elegant in what it implies.
We no longer teach or train our neighbors. It is no longer
a one-way street. The intercambios that exist today are really
the superhighways of information and knowledge exchange. All
parties involved benefit and this leads to economic growth.
Emerging market country strategies have for years focused
on moving up the value chain in terms of their exports,
producing higher valued goods and services. Several Latin
American countries' economies have seen successes that mirror
the Asian Tigers. I will call these the Latin American Tigres.
When U.S. companies are looking for countries in which to
invest, countries where there are good prospects for growth,
long term return on their investments and strong partnerships,
it makes sense to look toward Latin America.
The global economy calls for the diversification of
investments and successful countries where we have used our
bilateral government-to-government relationships based mostly
on foreign assistance and dependency have morphed into
countries where businesses can have relationships based on
mutual interests and growth.
Colombia is an example of U.S. foreign assistance that
worked. Today, Colombia is a thriving democracy and an example
of an economic and financial powerhouse in the region.
Medellin, once the drug capital of the world, is now one of the
leading financial and industrial centers in Latin America.
This once profoundly dangerous city is now listed by Forbes
Magazine as one of the 10 best cities in the world for
international retirees. Colombia is now a Latin Tigre. Another
example of its success is in the oil industry. Colombia's oil
giant, Ecopetrol, is a para statal company that is well managed
with revenues of nearly $38 billion.
The current downturn in oil prices has certainly impacted
Ecopetrol, but its asset base and reserves will allow it to
weather the economic storm.
Colombia lets the world know that it is open for business.
Indeed, in 2014 it rose from spot number 53 to number 34 on the
World Bank's ease of doing business index.
Brazil is the biggest player in South America. Its period
of prosperity when the BRIC was the preeminent force of nature
in emerging markets began in the late '90s with the government
decision to privatize some of Brazil's Government-owned
enterprises. Moving massive and poorly performing industries
into private hands led to sustained growth of around 5 percent
per year.
However, the Brazilian Government has often looked at the
economic miracle of Brazil as a means to provide expanded, and
sometimes unaffordable, services to the country's large
population.
Brazil has now become a burdensome place to do business,
and it is near the bottom of the list of the World Bank's ease
of doing business index in the unenviable 120th spot. But
international investors, including Americans, will not flee
from Brazil.
Brazil has the largest offshore oil discovery on Earth. The
deepwater offshore exploration and production will continue and
expand in the decades to come. Brazil's oil industry, with the
opportunities for investment by American oil companies, means
that U.S. oil can diversify their holdings and can weather
global economic storms with less risk.
This mitigated risk allows those same American companies to
expand operations and employment very directly in the United
States and in other operations abroad.
U.S. equipment manufacturers can generate significant
sales, in turn boosting our own economy and stimulating job
creation at home. For many years, Chile held a role as the
darling among Latin American countries that is slowly being
supplanted by Columbia.
Chile remains a financial and mining industry giant in the
region, but the newly returned presidency of Michelle Bachelet
has many an industry seeing the return of more socialist
tendencies that are less business friendly. The new tax regime
will be the first test of the global business community's
patience with Chile.
Today, I would like to discuss briefly Mexico in the
context of its multilateral role in the newly formed trade bloc
known as the Pacific Alliance.
Mexico wields a tremendous amount of influence due in no
small part to its proximity to the world's economic golden
goose--us. Mexico currently sits at spot number 39 on the World
Bank's ease of doing business index and Mexico is the lynchpin
country forming the Pacific Alliance, as mentioned by the
chairman--a free trade area comprised of Mexico, Colombia,
Peru, and Chile.
It was formed in 2013 as a counterbalance to the Mercosur
trade bloc. The Pacific Alliance counterweight, though, packs
quite a punch. In its first year, the Pacific Alliance's trade
with external partners outpaced Mercosur's, and this pattern
appears likely to continue.
This newly formed trade bloc of Latin American Tigres shows
great promise in the global economy with average annual growth
of 4.2 percent. We should not relax, however, and think that
U.S. companies can sit back and reap the rewards from
relationships that are driven by geography.
The name of the emerging trade bloc gives clues as to its
orientation. The Pacific Alliance means a pivot to Asia.
Indeed, the superhighway I referenced earlier is every bit a
present day reality.
American businesses must fasten their seatbelts for the
ride. Businesses should remain engaged so as not to lose market
share to China and the Asian Tigers. Engagement, investment,
collaboration, partnership, and active participation all ensure
that our businesses will grow, will continue to maintain a
footprint in the most stable region of the world outside North
America, and will create jobs and investment opportunities for
Americans at home and abroad.
I thank you very much for your time today.
[The prepared statement of Ms. Glick follows:]
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Mr. Duncan. Thank you.
I am going to ask the witnesses try and stay on time, if
you can. Dr. Ellis, you are recognized for 5 minutes. Thank
you.
STATEMENT OF EVAN ELLIS, PH.D., AUTHOR
Mr. Ellis. Thank you. Chairman Duncan, Ranking Member
Sires, distinguished committee members, thank you for the
opportunity to share my analysis with you today. I will
summarize my written remarks for the committee.
I wish to highlight the four challenges in Latin America
and the Caribbean--organized crime, Russia, Islamic radicalism,
and China.
The passage of drugs, immigrants, and illicit goods through
the region to the United States continues to fuel criminal
organizations, deepening the crisis violence and the lack of
opportunity in those societies.
El Salvador's facilitation of a truce between Mara
Salvatrucha and Barrio 18 in 2012 and the Guatemalan President
Otto Perez Molina's appeal to legalize drugs to reduce the
violence and criminality in his country shows just how
desperate the situation has become.
Trans-Pacific crime also merits more attention. Recent
examples include the sourcing of precursor chemicals by the
Sinaloa cartel from Chinese mafias, metal ore shipments to
China from cartel-controlled parts of Michoacan and the use of
Chinese banks to launder money by the Brazilian gang First
Capital Command.
Russia--Russia is the external actor which has most openly
challenged the United States in Latin America. Since 2008, it
has repeatedly deployed military aircraft, warships, and
submarines close to the United States including three port
calls in Havana by the signals intelligence ship Viktor Leonov
most recently on January 20th, the day before our U.S.
Government team headed toward Havana to meet with Cuban
officials.
Russia's defense minister, Sergei Shoigu, said last
February that his country seeks to resupply and maintain its
warships in Nicaragua, Cuba, and Venezuela; to operate its
military aircraft from their airfields, and possibly to reopen
the Cold War era surveillance facility at Lourdes, Cuba.
Last November, Minister Shoigu further said that Russia
would send long-range bombers to fly patrols near the U.S.
including in the Caribbean and the Gulf of Mexico.
Iran--Iran has used Embassy personnel to recruit terrorists
in the region including those by Mohsen Rabbani, who developed
networks of operatives throughout region such as the Guyanese
emir and Islamic radical Abdul Kadir sentenced in 2010 for the
plot to attack the JFK Airport.
Latin America is also a source of terrorist financing
including the narco trafficker Chekry Harb and the money
launderer Ayman Joumaa, who channeled part of their drug
earnings to Hezbollah and other terrorist organizations.
Terrorists also conduct operations in the region. Just 3
months ago, for example, Hezbollah operative Muamad Amadar was
arrested near Lima, Peru, stockpiling explosives for use in
that country.
The recent suspicious death of Argentine special
prosecutor, Alberto Nisman, the day before his testimony to the
Argentine Congress does raise disturbing questions about the
current Argentine Government's relationship with Iran.
China--the PRC has most significantly impacted the region's
security environment although not openly challenging the United
States. Of the more than $100 billion it has loaned to the
region since 2005, three-quarters of that have gone to the ALBA
regimes in Argentina, helping to keep governments like
Venezuela's solvent so that they could continue to operate as
bases for criminals and as entry points for other actors who
would do us harm.
China has also chosen CELAC, which excludes the United
States and Canada, rather than the Organization of American
States as its preferred vehicle for building its relationships
with the region.
The PRC has expanded its military activities in Latin
America, undermining U.S. efforts to remain the security
partner of choice. In October 2013, while Washington was
distracted by the budget crisis, a PLA naval flotilla for the
first time conducted combat exercises with our allies in Chile
as well as with Brazil.
Chinese companies sell military aircraft, helicopters,
satellites, trucks and armored vehicles to both U.S. partners
and its adversaries in the region and possibly sales to
Argentina of the FC-1 fighter, the P-18 Corvette, the X-11
helicopter and the V-1 armored personnel carrier.
My recommendations--there is a need to think more
strategically about the contribution of Latin America and the
Caribbean to U.S. national security and prosperity; to see it
as more than simply a source of drugs and immigrants that needs
to be controlled.
The U.S. rapprochement with Cuba and the April Summit of
the Americas provide an opportunity to reinvigorate the OAS as
the premier multilateral institution for the Americas. The U.S.
can also facilitate engagements by other actors whose
priorities are consistent with our objectives in the region
including India, Japan, and South Korea.
I also recommend greater attention to how in a major
conflict involving the United States elsewhere in the world our
adversaries might use their commercial position and assets in
the region to shape the outcome by impacting U.S. coalition
formation, deployments, sustainment, and political will.
Finally, we need to be clear to ourselves where we draw the
line regarding activities by extra hemisphere actors in the
region that potentially threaten our national security and,
further, to make those lines known to them in less ambiguous
terms than has occurred to date.
Thank you, Mr. Chairman.
[The prepared statement of Mr. Ellis follows:]
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----------
Mr. Duncan. Thank you. And the Chair will recognize Mr.
Farnsworth for 5 minutes.
STATEMENT OF MR. ERIC FARNSWORTH, VICE PRESIDENT, COUNCIL OF
THE AMERICAS AND AMERICAS SOCIETY
Mr. Farnsworth. Thank you very much, Mr. Chairman. Good
morning. Congratulations to you for your chairmanship.
Thank you, Mr. Salmon, for his previous leadership and let
me also thank Mr. Sires for your continued interest in these
issues. To Mr. Meeks, it is wonderful to have you back, sir. We
are looking forward to working with all of you in a bipartisan
manner.
Mr. Chairman and Mr. Ranking Member, I would submit to you
today that strategic U.S. interests in the Western Hemisphere
are as profound as our interests almost anywhere else on the
globe.
The region is directly connected to our own day to day
well-being from economic prosperity and growth to national and
energy security and promotion of our most fundamental values.
Let us be clear eyed about this. Our most immediate
neighbors have the greatest impact on our strategic interests.
It is significant and consequential that we have a northern
neighbor, Canada, which is both our top trade partner and top
energy supplier and which is stalwart in working with us to
address the toughest global challenges.
At the same time, North America, including Mexico, our
second largest export market and also our third largest energy
supplier, is becoming a fully integrated production platform
with tightly knit supply chains and ever deepening commercial
ties.
As China and other nations have emerged to challenge the
preexisting global economic order, the ties that bind us within
North America have created economic efficiencies, built
competitiveness and directly contributed to the economic growth
our citizens both desire and deserve.
The challenges that Mexico continues to face on the
security side are also our concern because they undermine the
rule of law, vacuum up resources and have the potential to
spill over onto us. So it is therefore critically important
that we get relations with our two most immediate neighbors
right.
Beyond North America, it is profoundly in the self-interest
of the United States to see a hemisphere where every nation is,
in Vice President Biden's words, middle class, democratic, and
secure.
These are precisely the characteristics that define our
best, longest lasting, and most effective global partnerships,
and it is also why we believe so strongly that trade and
investment expansion in the Western Hemisphere is a strategic
issue.
In the first instance, trade and investment supports our
own economic strength and security, as the President noted
during his State of the Union Address in January, and we heard
a number of statistics from Congresswoman Ros-Lehtinen so I
won't repeat that in terms of the importance of the Western
Hemisphere to the U.S. economy.
At the same time, trade and investment also support efforts
to build and strengthen middle classes abroad, breaking down
traditionally restrictive patterns of economic organization and
offering greater opportunities to grow and innovate, supported
by the rule of law.
Formal trade agreements reinforce these activities while
linking our economies closer together on a more permanent basis
consistent with U.S. values. We can do more and we should, and
I have several specific ideas along these lines in my written
testimony.
Nonetheless, while regional economic progress over the past
decade is noteworthy, continued success is not guaranteed. The
dramatic fall in oil prices is already straining regional
economies and reducing the growth on which continued poverty
reduction depends.
Hydrocarbons are plentiful across the Western Hemisphere
and, Mr. Chairman, you made that point very eloquently already,
directly supporting U.S. energy security but petroleum
dependent nations like Venezuela and its client states in the
Caribbean Basin, among others, are now in deep economic
trouble, having squandered immense wealth generated during the
past decade of high energy prices.
And there is perhaps nothing more motivating for dramatic,
even radical, political change that fosters populism or
potentially worse than fear and prospects for economic
stagnation or retrenchment and one needs to look no further
than the recent elections in Greece to prove that particular
point.
It is therefore also in our strategic interest to promote
broad based economic growth in Central America and the
Caribbean, and there is a significant role here for Congress.
As we were starkly reminded by the summer--by the summer of
2014 crisis of unaccompanied minors on our southwestern border,
most of whom came from Central America, families will take
desperate measures when their livelihoods are at stake and
their personal security and the rule of law cannot be
guaranteed. These issues are interconnected, significantly
exacerbated if not caused by the illegal drug trade and gang
culture in a number of countries.
That is one reason why it is so important that we have full
economic and security cooperation with both of the drug transit
and drug producing nations including across the full range of
cyber crime law enforcement and why it is so harmful when such
cooperation breaks down, as we have seen with regard to
Venezuela.
Beyond the pressing need to improve dramatically the
personal security profile in parts of the region, however, the
Western Hemisphere is, thankfully, a region largely at peace
with only last vestiges of guerrilla conflict ongoing in
Colombia.
With that nation actively involved in the peace process,
which the United States has done so much to enable through our
active policy and financial support for the Colombian people on
a bipartisan basis, we must now begin to think in terms of
supporting the peace once an agreement is struck.
And finally, Mr. Chairman and Mr. Ranking Member, if I
could offer just a very brief word about Latin America and the
Caribbean in the overall global environment.
No longer can we assume that we can engage solely on our
own terms. We must increasingly contend for the region in the
manner that we traditionally have not had to do.
China's growing presence and long-term commitment is change
in the economic and political dynamic. At the same time,
Brazil's rise has been universally and appropriately praised
but with its interest in developing an increasing global
profile, coupled with an increased capacity to realize greater
ambitions, we must also recognize the Brazilian pursuit of its
own foreign policy interests does not always coincide with our
preferences.
That is okay. Competition is good in both politics and
business. But it does mean that we have to engage meaningfully
with the region on a sustained and creative basis, finding ways
to promote our interests effectively by working closely in
partnership with others wherever we can while recognizing the
rapidly changing nature of hemispheric relations.
Thank you again for the opportunity to testify. I look
forward to your questions.
[The prepared statement of Mr. Farnsworth follows:]
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----------
Mr. Duncan. I want to thank all the witnesses for those
great opening testimonies. You know, sitting here listening I
am thinking we could talk about U.S. policy in Cuba, Venezuela
and their energy sector and economic problems, unaccompanied
children, upcoming elections in the region, Canada and Keystone
Pipeline, Mexico reforms in the energy sector and other reforms
or the 43 children and their death.
We could talk about Argentina and Alberto Nisman. We could
talk about Iran and the Iranian threat and activity in the
hemisphere, energy in the region, the opportunities in the
Caribbean and energy as a whole, TPP and trade, trade and the
Panama Canal, the successes in Colombia, and those were just
the things I wrote down in the last 30 seconds of your
statement.
There is a lot of different areas we could talk about and
so let us get started. I recognize myself for 5 minutes and
then I will take it to the ranking member and then in order.
One thing that concerns me and a lot of folks is the visa
waiver program and what we see with terrorism acts in Paris and
what the visa waiver program may mean going forward to safety
and security in the United States.
And so, Ms. O'Neil, you talked about--a little bit about
preclearance, which I think preclearance and visa waiver are
two different issues but they are very similar.
One year ago this month, Chile was designated the 38th
participant in the visa waiver program and Brazil and Uruguay
have indicated an interest in that program, and so when I think
about the Iranian threat in the Western Hemisphere, the visa
waiver program and all of these things, I would like to ask you
to delve into that a little bit more.
In a case such as these do you believe that it will take--
what will it take for these countries--Uruguay and Brazil--to
make necessary changes that you talked about in your statement
in order to adapt the visa waiver program and what are your
thoughts on that, just real quickly, and I am going to move on?
Ms. O'Neil. Thank you. I mean, I think the preclearance
type program--trusted traveller type programs of which visa
waivers are part--can be a win-win situation and, one, because
it allows us to process people faster but it also allows us to
know who is coming and know a lot more about them than in
traditional types of visa programs where you show up.
And so the electronic--you know, submitting electronic
information, having the information well beyond that person
travels anywhere near the U.S. borders actually can be quite
useful.
Also, for countries to participate in these, as we have
seen with Mexico and Canada which have much deeper and much
broader types of programs because of the shared geographic
borders, but in other countries that participate they too have
a much better sense because of the types of standards they have
to reach to participate with us.
They too have much more information about who is in their
country, who is--you know, should be there, who should not,
whether citizens or visitors or the like.
So I think in that sense in trying to make the whole
region, the whole hemisphere more secure, in many ways visa
waiver programs can be very helpful, because it encourages, if
not forces, those countries to come up to some standards in
terms of the information that they have about their own people
residing in their country and those who might then apply to
come and visit us.
Mr. Duncan. Right. Well, thank you for that and I will just
for the record talk about Paraguay and a lot of the folks that
come to Paraguay into that tri-border region on falsified
documents and close proximity to Brazil and Uruguay really
concerns me, and so thank you for that.
I just want to ask Dr. Ellis, did you read the Department
of State's report on the Iranian threat in Western Hemisphere
as required by Public Law 112-220?
Mr. Ellis. I have read it.
Mr. Duncan. All five pages of it? So you talked a little
bit about the Iranian threat. Do you think the State Department
did the Public Law service in what they did?
I personally don't think they went far enough in what the
law required and the intent. What are your thoughts on that?
Mr. Ellis. Thank you very much. I think it is a wonderful
question, sir. To me, the State Department was correct on a
technicality, but missed some of the bigger issues. I think,
certainly, under President Rouhani Iran has lowered its profile
in the region.
It is unclear whether at the level--at the classified level
whether things such as recruitment of radicals in Iran and Qom
and other places and the madrassas continues or what the Quds
Forces continue to do in the region.
But beyond what Iran is diplomatically doing previously
under Ahmadinejad, what concerns me also is a continuing role
through Iran and in others of organizations such as Hezbollah
which, clearly, continue to finance activities often in
combination with terrorist organizations, and even if Iran
itself has lowered its profile, I think the activities of
Islamic radicals continue to be a significant threat that we
need to keep our eye on.
Mr. Duncan. Thank you. Something I will focus on is the
Iranian threat. In the remaining time, I want talk to Ms. Glick
about Colombia, the successes that we have seen in Colombia
with the partnership, with the training there, helo pilots and
the helicopter assistance the U.S. has given in pushing back
the FARC and pushing back the narco trafficking.
How can we take that Colombia model, in your opinion, and
apply it to maybe other countries in the region? Is there
opportunity in Nicaragua and Honduras, in your experience
there? How do you see that Colombia model maybe being
transported to other areas?
Ms. Glick. I think the key with Colombia is that we had an
actively engaged partner in President Uribe in the time that we
were negotiating and working with Plan Colombia. The United
States invested, and I use that term deliberately, invested
nearly $1 billion in Plan Colombia and we see a return on the
investment.
President Uribe, President Santos--they are able to engage
with law enforcement as well as coordinating across the
military and with civil society as well. There is volume.
Mr. Duncan. You mentioned that. Let me ask you, do you
think the judicial side of it--the civil society and judicial
component of enforcement of rule of law--I personally think
that is a vital aspect whether it is Mexico or whether it is
Guatemala or whether it is other countries. So----
Ms. Glick. That is entirely correct, sir, and to have that
as a partner rather than just as an imposition from the United
States, rather than us wagging our fingers and saying you have
to do this, the Colombians actually did it and they took it on
themselves to take back their country.
So if we can get that similar type of engagement in Central
America with governments there, heck yeah, we can move forward
and we can have successes like we have in Colombia.
Mr. Duncan. Are you familiar with what the Colombians are
doing to train the law enforcement and judiciary folks from the
Latin American countries, whether it is Guatemala, Honduras,
Nicaragua? From what I understand, and I have seen some of it,
some of the training, can you touch base on that?
Ms. Glick. I think, sir, I will have to get back to you
with a little bit more detail. But the region looks at Colombia
as a success and it is wonderful to then be able to see the
region taking care of the region and that is what Colombia is
coming out as a leader and doing.
Mr. Duncan. I am going to highlight successes. Dr. O'Neil,
are you familiar with what the Colombians are doing in that
regard?
Ms. O'Neil. I am familiar with that, and in particular some
of the work that they have done in Mexico. General Naranjo came
up and was an advisor to Pena Nieto who had been the head of
the national police in Colombia before he just went back
recently.
I think what is interesting when you think about models of
Colombia for other places, particularly places like Mexico
where all of us should have real concerns about, they have done
the incredibly important economic reforms but they have yet to
really institute a democratic rule of law and strengthen it
throughout the country.
One of the big lessons from Colombia, to me, which you just
touched on, is that they also--their society chimed in and
participated with Uribe and so Uribe, along with the money that
we provided and the help, also instituted a wealth tax and that
money went just for security and to two things.
One, it gave them resources to fight the threats that they
had, but it was also done in a very open and transparent way so
there was not corruption involved.
That money didn't go in to the black hole of government,
and so that also helped Colombia begin to clean up its
institutions, which it has done. And so as Mexico or others, as
we work with them, there are many things we can do, the
Colombians can do as well.
But they also need to bring along their society and have
people invest in their own country and the public good of
democratic rule of law.
Mr. Duncan. All right. Well, thank you so much. My time is
up. I will recognize the ranking member for 5 minutes.
Mr. Sires. Thank you, Mr. Chairman.
Mr. Farnsworth, you know, as the price of oil declines it
has taken a significant toll on other countries, especially in
Venezuela. The Venezuelan people are suffering. Obviously, they
have been suffering for a long time, shortages. Of course,
President Maduro now blames Vice President Biden for all the
troubles that he is having.
Are we going to see mass protests? Are we--do you think he
survives this? I mean, I have friends in Venezuela I talk to
all the time and they can't even get sanitary paper.
Mr. Farnsworth. Well, thank you, sir, for the question. I
think it is a critically important, one, not just for the
Venezuelan people, but also for the region as a whole and the
truth of the matter is nobody really knows.
That is certainly one thing that is being discussed
actively at senior levels of councils all across the
hemisphere. I would simply say that the situation has gotten
dramatically worse, as you have said, since the death of Hugo
Chavez.
President Maduro has for a number of reasons proven
incapable to change the course of Venezuela economically.
Certainly, the price of energy has contributed directly to
that, but that is not the only reason why Venezuela is in
trouble.
I would hesitate to sketch out what is going to happen and
I think Yogi Berra had the great quote, ``I don't want to make
predictions about the future,'' but the fact of the matter is
this is a very serious issue and it is an issue that I would
contend isn't just for the United States.
I would like to see a very active role, for example,
countries like Brazil, countries like Colombia, countries like
Mexico, other regional countries to really take a leadership
position here. At the recent meeting last week of the CELAC
countries, for example, this did not seem to be a priority.
At the Summit of the Americas in April in Panama, it could
be a priority, because ultimately if this goes from bad to
worse or worse to worst, we are going to see a humanitarian
crisis and I think that it is in nobody's interest, clearly,
not the Venezuelan people.
Mr. Sires. And I have read reports where supposedly Cuba
has over 30,000 people in Venezuela and they are basically
propping up the army and security.
I was just wondering, with all that and the declining of
oil prices and all these Caribbean countries depending on
Venezuela for petroleum, where do these countries go now if
something happens there?
Mr. Farnsworth. Well, let me--if I can just follow up with
that and then just a couple comments. But I think this was
precisely the reason why the Vice President recently called
together and then they met later with all, the leaders of the
Caribbean Basin, to talk about energy security in the Caribbean
Basin.
There are a number of things we can do on clean energy, for
example, but one of the things I would like to see would be a
much more aggressive use of natural gas exports into the
Caribbean Basin.
It is a cleaner energy. It is plentiful in terms of the
United States, and it is an energy source that could be
employed in the Caribbean Basin with some improvements in terms
of infrastructure, transportation, what have you.
But we have not, since the first Caribbean Basin initiative
in the early 1980s, really seen the Caribbean Basin in a
strategic way and I think we have the opportunity now,
certainly, because of the changes that have happened
exogenously through the energy markets globally, we have the
opportunity to change the way we look at the Caribbean Basin
including Central America into a more strategic way with energy
as an important tool that really undergirds that new approach.
Trade, energy, people to people, tourism, I mean, these are
all issues that I think will go a very long way sort of to
trying to address the question of where do these countries,
which are in very difficult conditions financially, where do
they go next and I think we can be an obvious answer to that.
Mr. Sires. Dr. O'Neil?
Ms. O'Neil. Let me just add one brief comment. One is that
the cost of the end of subsidized oil is somewhat less, given
the fallen oil prices.
So if these countries are buying on world markets it is
much less than it would have been in the past. But I do think
this is an area for North America, and as our production--
Canada, United States and hopefully Mexico--with the changing
rules, as our production of gas, of oil, of other energies
increases that looking at the region, looking at stability and
resiliency and particularly where the Caribbean fits in, I
think this is an area where we can work with our neighbors to
provide a much more secure local geography including them.
Mr. Ellis. I just want to add two quick comments. One is
that there are--not all of the nations in the Caribbean are
particularly happy with the prospect of increased U.S. gas
exports, specifically Trinidad and Tobago, and also while it
does not always involve explicitly energy exports, China has
stepped up in a major way offering credits to the region as we
saw at the recent China CELAC conference in Beijing, and in
many ways although energy dependence and worries about
Venezuela plays favorably to the United States, as we saw from
our recent initiative, it also helps to push those nations
farther into the hands of China with respect to China's
potential aid to them.
Mr. Sires. You know, a few years ago--I go to Colombia
often and a few years ago I had the opportunity to have dinner
with one of the presidents of the university, and he made a
statement to me.
He says that the second most foreign language studied in
Colombia is Mandarin. Is that accurate? I assume it is. He told
me but----
Mr. Ellis. I suppose it depends on whether it is a public
or private university. There definitely is a significant
increase in Mandarin language studies.
A few years ago, to the extent that there was any knowledge
in Colombia of Asia, it was primarily Japan. But we have
certainly seen in some of the most prestigious universities, at
Universidad Externado, Universidad de los Andes and others,
there is an increase. But it is still a very marginal language.
Mr. Sires. One last question. Of the report of 30,000
Cubans in Venezuela, do you think that is accurate?
Mr. Ellis. It very well may be if you combine the doctors
and medical trainers and others and, of course, the reports of
significant penetration of the Venezuelan intelligence
services.
Mr. Sires. Thank you. Thank you, Mr. Chairman.
Mr. Duncan. Ms. Ros-Lehtinen from Florida, 5 minutes.
Ms. Ros-Lehtinen. I don't want to jump ahead of anybody
here because I came kind of last.
Mr. Duncan. Actually, you are next on the list.
Ms. Ros-Lehtinen. All right. I like it.
Mr. Duncan. I believe so.
Ms. Ros-Lehtinen. Well, then thank you so much. Mr.
Chairman, as we look around the region, as these wonderful
panelists have pointed out, what we see is deeply troubling.
Democracy has been slowly eroding in the countries in the
region by the hands of elected tyrants who use populist
promises of reform and change and then they twist their systems
into convenient arrangements where they retain the final word.
And one needs no further proof to see how countries are
following this undemocratic principles and have changed their
constitutions to fit their whims like Venezuela, Bolivia,
Ecuador, Nicaragua, and leaders of these countries do not
believe in the rule of law, separation of powers,
constitutional order, free and fair elections, an impartial
judicial system.
We have seen how these leftist experiments have led many
countries to curtail basic freedoms. These illegitimate
institutions are often utilized for the financial advantage of
members of their own regime to illicitly make money off the
backs of their own suffering people.
And corruption is one of the greatest problems facing the
region at this point. An economy tainted with corruption cannot
sustain an environment necessary to create the conditions for
greater economic development.
Venezuela is a good example of this. It is a sham of a
country, and it is in great deal of corruption going on there.
You see the store shelves literally empty yet Maduro goes on
all of these fancy trips.
They have archaic systems like artificial currency controls
that are exploited by the connected elites and denied to the
private sector.
Many surrounding the regime have made themselves rich at
the expense of the average Venezuelan, giving rise to the
phenomenon of a self-professing socialist who display a great
preference for owning luxury homes and luxury vehicles.
And just recently Maduro arrested Venezuelans for the gall
of having them wait in line for food, and has gone so far as
arresting pharmaceutical executives and blaming them for the
medical shortages in the country.
In reality, as we know, Maduro has no one to blame but
himself, and these are corrupt practices that are reprehensible
and cannot but hurt the welfare of the people. Without a doubt,
they are contributing factors to the near state of collapse
that we see in Venezuela's economy.
And against corrupt abuses of this sort the U.S. must
always be vigilant and its goal--our goal should always be
clear to support and defend those who fight to expose and fight
to end corruption.
So I ask the panelists how can the United States help
tackle institutional corruption in our own hemisphere. Is it
possible to use the economic influence of our great country in
the hemisphere in order to channel those countries into real
and substantive democratic reforms?
And is organized crime and a plummeting economy directed by
Venezuela a security risk for the entire hemisphere,
specifically for Caribbean countries? And I will leave it to
anyone who would like to testify. Dr. Ellis, I think you were
going to testify.
Mr. Ellis. Thank you--a wonderful question. For me,
actually corruption is one of the centers of gravity for
attacking the real malaise that is going on across the Americas
right now.
If I could quickly make another observation--that as was
rightfully pointed out, Venezuela not only is a tragedy for
some people, it is also a tragedy for the rest of the region.
We can talk, for example, about Leamsy Salazar who recently
came as cooperating with U.S. authorities and has made the
claim that the current head of the Venezuelan Parliament,
Diosdado Cabello, is actually the head of the largest narco
trafficking organization, Cartel de los Soles.
Essentially, the record amounts of cocaine that we are
seeing coming through the Caribbean as well as destabilization
of the Columbian borderlands, other places like that, Venezuela
is not simply a problem for its own people.
But with respect to corruption itself, there are in part
technical solutions that our own engagement through State and
DoD can support. There are some interesting things with respect
to both institutionalization of things like lie detector tests
but also institutional support.
You had a case in Honduras not too long ago where a
significant portion of the police force was identified as being
corrupted and none of them were fired. So I think it is a
combination of diplomatic pressure and others.
But also I think a holistic whole of government solution is
critical, because corruption is important to reestablishing the
connection between the citizens and the government. Alvaro
Uribe was mentioned before and to me part of the magic of what
the success of Colombia is, and our Mexican allies hate when we
gringos talk to them about the lessons of Colombia.
But to me part of what was the systematic concept, the idea
that you have to reestablish the faith of the government in its
people and with that you get intelligence and investment and
everything else.
And so as I look at some of our plans, one of the things
that I think is very important is that we not just add together
individual programs but that we think about how are we going,
little by little, to fight this systematically. Thank you.
Ms. Ros-Lehtinen. Thank you so much and I regret that I am
out of time. Thank you , Mr. Chairman. Thank you, Dr. Ellis.
Mr. Duncan. Thank you, and, you know, with the Summit of
the Americas coming up it is important to think about these
issues and hopefully we can lead a congressional delegation
there.
The next gentleman that I am going to recognize has spent a
lot of time in Latin America developing relationships. I saw
that first hand on a Codel Royce back in November. So, Mr.
Meeks, you are recognized for 5 minutes.
Mr. Meeks. Thank you, Mr. Chairman, and, you know, we
looked at the challenges and I guess the--there is a lot of
progress in the region also and you have nations like Brazil
and Chile and Colombia and Uruguay and they are not just
keeping economic gains at home.
In fact, what I think is significant that they are sharing
them in the form of now they are giving foreign aid themselves
to some other countries, and democracies like Peru and Panama
that have stood the test of time on making tremendous progress
against unrelenting inequality, and they are growing the middle
class and poverty is starting to reduce in those areas.
And just a few days ago, Prime Minister Portia Simpson-
Miller of Jamaica spoke here at the House about the enduring
advancement in her nation and I am sure that there are many
other CARICOM nations that are moving forward there.
And then, you know, but I want to ask another quick
question. I think that, Mr. Farnsworth, looking at the Council
of the Americas, I don't know, you all had something--you were
either talking to somebody I need to talk to but when I looked
at your latest issue where you talk about Cuba and Colombia or
political change and peace finally at hand you must have known
something that we didn't know.
This was in advance of some of the announcements that have
come out and you talk about in there also though, which I want
to ask a quick question about, which has been something that I
have worked on a lot in Colombia and that is the plight of
African Colombians because they are still in the middle as, you
know, with negotiating peace they are still in the middle of
the FARC battle and violence is happening in that area, et
cetera.
So given what is going on all over the place, could you
basically just give us a quick--and there is a good article in
this issue, by the way, on the plight of African Colombians in
the middle of this war zone still continuing?
Mr. Farnsworth. Well, Mr. Meeks, thanks for the opportunity
and thank you for the plug for our magazine. We appreciate it
very much.
You are really truly the expert on these issues so I
hesitate to try even to respond to your question, but simply to
say that these are not only critically important issues but
they are issues that need to be addressed seriously because
they stem from history, they stem from culture but they also
stem from the idea of economic exclusion and when you--when you
have societies that don't fully value every person in society
be it Afro-Colombians, be in the indigenous population, being
folks with physical disabilities, what have you, this is
critically important for the long-term development of the
region as a prosperous middle class region that I think we all
seek.
You cannot pursue the same type of economic model across
the region that has traditionally been pursued, which is to say
that a certain smaller number of elites have access to power,
have access to the levers of the economy, have access to the
judicial system and can advance themselves and their families
whereas the broader majority of people don't have the same
access.
And that is what we have seen in some way as driving these
changes that we have seen across the Western Hemisphere over
the last 10 years or so, which is to say as democracy itself
has become much more institutionalized, and that is a very good
thing. You now have traditionally marginalized populations,
which have access to political power and have been voting into
power people, who want to make sure that the benefits of the
modern state accrue to the broader population.
That is a very good thing, in my judgment. Having said
that, that does bring political changes and sometimes there are
leaders who take a mandate and go too far with it, as we have
seen from some of the countries that have already been
mentioned.
In the case of Colombia, however, I think it is accurate to
say that the Colombian Government is aware of the issue,
recognizes that more needs to be done, recognizes fundamentally
that peace has to come to the region for all of Colombia, but
also that you can't just then bring peace and say okay, our job
is done--that you then have to proactively work with the
affected communities in terms of economic development, in terms
of social inclusion and all the things that we might take for
granted here in the United States.
Mr. Meeks. Thank you, Mr. Farnsworth. Let me ask Dr. O'Neil
a quick question because I agree with you. I am a big supporter
of TPP and I think that it will go a long way.
I believe that the groups that I am looking for like
African Colombian and others benefit. In fact, when you look at
Peru as they reduce their poverty some of it is because of the
economic growth that they were able to gain as a result of our
trade agreement with them.
But, now, as we move toward TPP we know that--my question
to you would be is how would TPP affect the U.S. trade
relationships with other--with our existing partners like
Colombia?
Is it--will it also open the opportunity to more
negotiation, maybe going back to talk about trade with the
Americas--that when I first arrived at Congress we were talking
about trade with the Americas, all of the, you know, countries
in Latin America and in South America?
Ms. O'Neil. Well, many of our partners within the Western
Hemisphere are included in the TPP negotiations. Colombia is
not yet, as you well know, but would very much like to be
included.
So I think setting up this platform there is then an
opening for countries like Colombia who would want to come in
and accept what is--what has been negotiated and join this and
one of the real benefits is as we look at world trade over the
last 30 years it has changed in the way it is done in almost
every country.
We are not sending finished goods. We are sending--the
majority of things are pieces and parts that are moving back
and forth. And so in that free trade agreements are
increasingly important in the Western Hemisphere, because it
allows this comparative advantage that many countries have. It
allows us to work together to create competitive products that
can be sent wherever they are around the world.
So I think these types of agreements, TPP, are incredibly
important for actually bringing benefits and particularly the
value added side that Ms. Glick was talking about. That is the
future for us in the United States but also for these
countries, for these middle classes for what we hope for them
and we hope to work together with. And so there I do agree with
you.
I think these trade agreements are vital that we do that,
and that once it is decided between the current negotiating
partners that we open it up to those that want to join and some
will not want to join, as we well know, but others will and so
there is an open platform for them to join with us in this
increasingly regional but global agreement.
Mr. Meeks. Thank you.
Mr. Duncan. Thank you. The gentleman's time has expired and
now the Chair will recognize the newest member of the committee
on the Republican side, Mr. Emmer, from Minnesota, for 5
minutes.
Mr. Emmer. New Minnesota. Thank you, Mr. Chair, and Dr.
O'Neil, if I could take you back. In your written testimony you
advocate for energy to ``become a fundamental pillar of North
America's new partnership.''
If you could give a little bit more detail how should
Canada, Mexico, and the U.S. work to deepen our trilateral
relationship on energy and if you wouldn't mind since in
reference to an earlier question--I don't remember who asked it
but we were talking about the Caribbean Basin, maybe expand it
into that.
Ms. O'Neil. I think there are many ways that we could
deepen our ties, and right now is a very important moment to do
so in part because Mexico is changing the rules in its energy
sector.
After 70-plus years of being closed and having been
controlled only by a state-owned enterprise it is now going to
be open for private investment and in the coming months they
are going to do their first auctions, allowing in all sorts of
national or all international energy companies, and it is
really a time to right the rules there to create a very open,
transparent, competitive and safe industry that will affect us,
given our geographic proximity.
So it is a moment to do so. I mean, one of the biggest
things I believe is infrastructure, and we have seen with both
of our neighbors, these are two of our largest energy partners
and trade goes back and forth each way and if we deepen that
these are also areas--these are democracies.
These are open societies. Of course, there are some issues
here and there but these are very stable, you know, energy
partners compared to many other places around the world which
we have talked about even here in the Western Hemisphere.
But if we can tie ourselves we actually provide a very
stable, but also resilience is very important for our energy
sector. I live in New York City and back a couple years ago
when Hurricane Sandy came in we understood for 2 weeks what it
is like not to have power, what it is like to be without energy
and the importance of resilience in our system whether it is
electricity, whether it is gas supplies and the others is vital
for economic production but just for our well-being.
In fact, in that particular moment our ties with Canada
both in terms of our electricity grids but our agreements with
utility companies brought New York City and the area much more
quickly, and I do believe, now that Mexico is changing, we can
do the same thing along the southern border and to benefit all
the states that are along that border and even those further
in, providing a resiliency there so that if there are problems
in the power grid, whether it is because of overloading or
whether it is because of cyber security and other challenges
that we will have as we go forward, infrastructure is vitally
important to make sure these flows are safe back and forth.
And the other thing, let me just mention quickly, is this
side of we are a geographic region together and we have one of
the biggest economic blocs, and so what we decide to do on
energy and the mix we have in terms of clean and renewable and
other types of traditional will affect the world.
And so as we think about how we will change it over the
next several years and decades, doing it with our neighbors is
increasingly vital. So as we set energy guidelines, standards
for cars, for safety and the like that, too, will be important
to make sure that the economic benefits stay within the region
so that we don't have differing types of regulations between
Canada, between the United States and Mexico.
So when you are a company, a manufacturer or others you
think about the region, the types of systems you had put in
place or the types of energy choices you make you will be doing
it within a region and particularly given, as I was speaking
about, this underlying economic production platform that
happens now that is occurring in North America, having energy
incentives align across the three countries I think is very
important as we grow on that economic side.
Mr. Emmer. You know, if you could expand on that just a
little bit, because the security issues in Mexico are a little
bit different than the security issues we face in Canada, and
you talk about infrastructure and I would agree completely.
But how do you ensure or what can we do to ensure that it
can be done first so that you attract private investment
because they want to realize a return but that you can do it in
a low risk safe manner, cost effective manner?
Is there anything the U.S. should be considering in that
regard as you move forward with, for instance, Mexico?
Ms. O'Neil. In the energy sector in particular in that
narrow area there are things we can do and many, you know,
international oil companies are used to dealing in areas that
are quite risky.
And so they have some means of doing it already, systems in
place for some types of things. But overall, I think this gets
to our larger relationship with Mexico and I believe right now
Mexico is at really a fundamental place.
It has done, I would want to acknowledge, an incredible set
of economic reforms that can set that country up for growth and
prosperity down the road.
But it has yet to really grapple with the corruption in
rule of law and we are seeing that over just the last few
months some of the challenges.
But in every crisis there is an opportunity and so if his
government decides that for their legacy and for Mexico for the
future to really take on corruption, to change the rules that
are there, to try to dive in and create a new justice system,
which is already happening but which has been slow to be
implemented, if they do take this on and make it their priority
I think we can come in whether through the Merida Initiative or
other types of programs that we have and help them do that, and
they will need to do things like retrain almost 40,000 lawyers
and judges and official clerks in the new justice system and we
have lawyers and other organizations that can do that.
We can help bring in Colombians or others, as we were
speaking about, who know how to professionalize police forces.
There are things we can do to help this government when they
decide to step in.
Mr. Emmer. Thank you very much. I see my time has expired.
Mr. Duncan. Thank you. Great line of questioning. When we
were there on Codel Royce in November in Mexico a lot of the
things you talk about, Dr. O'Neil, were discussed, and just for
the record we were there when the 43 children were still
missing before they found any remains and demonstrations in
Mexico City of basically college-age kids and the paintings of
the children and themselves that were missing it was quite
moving.
But one thing we did we met with civil society about the
corruption and bribery that goes on within the judicial system
of folks that are arrested so having someone there as a public
advocate and what they are trying to do.
I think the reforms if they--if they take hold I think it
absolutely right that Mexico will benefit from that
economically, and so I am excited about some of the things you
talked about.
Great line of questions, especially on the energy sector.
Cross border energy, whether it is our natural gas and Mexico's
development of their natural gas but the electrical grid is
already shared in certain border towns and so how do we work
with our members.
So thanks for that line of questioning, Tom, and I will now
yield 5 minutes to the gentleman from California, Mr.
Lowenthal.
Mr. Lowenthal. Well, thank you. First of all, my goals have
been met. I really came just to learn and to listen. I have
learned a lot about corruption.
I have learned more about energy, trade, security issues,
economic development, drugs. But I am going to ask a question
or two. I want to switch to something that Mr. Farnsworth said
about talking about how these--how nations are in our
hemisphere are beginning to deal with some of the marginalized
populations.
Just recently, Senator Markey--I don't think you know--
Senator Markey and I introduced legislation that would direct
the Department of State to further demonstrate its commitment
to the LGBT human rights as a foreign policy priority of the
United States by establishing a position within the State
Department in the Bureau of Democracy, Human Rights and Labor
just for to deal with LGBT issues.
I wondered if you could talk to me a little bit about
either Mr. Farnsworth or anybody else on the panel really the
state of affairs with regard to the LGBT community in the
Western Hemisphere.
We know that there are some nations like Jamaica, Honduras
where the plight--where I am very concerned and many of us are
very concerned about the plight of the LGBT community.
Yet there are other countries like Uruguay and Costa Rica
where there have been tremendous positive movement. And I am
wondering how do we begin to deal with it in terms of U.S.
interests as we begin to really begin to focus on human rights
issues whether it is Cuba or anywhere in the states. Is this an
issue that we can play some role in?
Mr. Farnsworth. Well, thank you very much for the question
and welcome to the subcommittee.
Mr. Lowenthal. Thank you.
Mr. Farnsworth. It is very nice to see you again, Mr.
Lowenthal. You know, these are issues that fit squarely within
the concept of social inclusion and, again, the idea that
everybody has a unique and important role to play in the
development of the country based on their unique
characteristics and you cannot by law or legislation or
informally exclude whole sectors of society.
That just doesn't work anymore. And so you ask what are
some of the things the United States can do. Well, in the first
instance, education I think is critically important.
The idea that some behaviors simply are not acceptable, and
I think this is something that the State Department has tried
to do and is doing a little bit more of, can do more--other
governments as well.
But like anything these are some difficult issues. They are
long ingrained within the Western Hemisphere. Each country is
different. Each community within countries can be different at
times and I think the real answer is just to keep pushing, keep
raising consciousness, if we can use that term of art that was
popular some time ago, but the idea that certain behaviors are
just not acceptable in a region that values democracy, that
values human rights and that values the individual uniqueness
of every of its citizens.
Mr. Lowenthal. Anybody else want to take a stab at that?
Ms. Glick. Quick stab at it. You mentioned Uruguay which
was, I think, the first country in the world that legalized gay
marriage.
Mr. Lowenthal. Yes.
Ms. Glick. It is one of these things that this is the arc
of history that you are seeing move right before our eyes
quickly in the United States as well as in other countries in
the world. As Mr. Farnsworth said, these are long ingrained
traditions.
There is a lot of impact that comes from various religious
groups as well. I think that it is--the easiest way to look at
this is the same way in which we look at issues related to the
LGBT community in the Unites States. They are going to have an
impact.
There will be changes in some countries. There won't be
changes in others in the long or in the short term, and it will
be an interesting thing to watch and see progress.
But I think in terms of social inclusion and engaging with
civil society this too is something that is going to come
largely from the populations themselves, and is it really one
of the things that the United States has to raise the flag
about.
I am not entirely sure that it is our responsibility or
even our right to do so. We can call out human rights
violations and hate crimes when we see them. I think that is
very valuable.
But I think in terms of these populations and communities
in their own countries they can look to the United States for
examples and they can look to other countries in the region as
well as examples.
Mr. Lowenthal. Thank you. I too want to keep raising the
issues like marginalized populations on this committee. I want
to maybe just quickly, if I have a minute, I have heard a lot
about the development of the energy sector, the interdependence
between and the relationship between the United States and our
partners.
I haven't heard very much about except a little bit from
Dr. O'Neil about renewable energy, climate change, a real--is
there--what kind of commitment? Would anybody really like to
address that? Dr. Ellis.
Mr. Ellis. Thank you very much. There actually is
considerable progress in renewable energy across the Americas.
I actually can say this is one of the areas in which China, for
better or worse, has been beneficial with respect to the
combination of low cost loans and other things.
When we look at countries such as Ecuador, but other
countries such as Brazil, we find tremendous advances in the
hydroelectric sector although that, of course, has side impacts
on things such as local populations who live there and that has
created problems as well.
Significant impacts in solar--the number one Chinese
investment, over $1 billion, programmed in Chile is not in
copper but is actually in the north of the country in solar
power.
And so in many ways we do see that leadership, I think, in
renewable in part through the United States but in part through
other actors as well, and Japan and others have played
constructive roles in that as well.
Mr. Lowenthal. Thank you.
Mr. Duncan. The gentleman's time has expired. I am going to
allow just briefly if you would like to chime in--I know Mr.
Farnsworth wanted to just real briefly.
Mr. Farnsworth. Thanks, sir. Just one statistic--Latin
America has the cleanest energy matrix of any region in the
world based on hydro, based on some of the renewable in their
energy matrix, and therefore, is an obvious partner for us in
developing some of these issues.
Mr. Duncan. Yes. Thank you. Only because I like you. No, I
am just kidding.
Well, that concludes--in the sense of time that concludes
the hearing. I think the panelists have been absolutely
fabulous, very insightful in providing information, today, I
think that we have all benefitted from. I am going to ask that
the record will remain open for 10 days for submission of
remarks or extraneous materials that might be beneficial to the
overall concept of the hearing.
I look forward to having further conversations with all the
panelists as we go forward. I plan on helping America focus on
this hemisphere and rebuilding some ties and relationships
which I think are very, very important.
I look forward to working with the ranking member, and I
appreciate his input and with that the committee will stand
adjourned.
[Whereupon, at 12:41 p.m., the subcommittee was adjourned.]
A P P E N D I X
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Material Submitted for the RecordNotice deg.
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Written responses from Mr. Eric Farnsworth, vice president, Council of
the Americas and Americas Society, to questions submitted for the
record by the Honorable Jeff Duncan, a Representative in Congress from
the State of South Carolina, and chairman, Subcommittee on the Western
Hemisphere
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