"The devastation and destruction in El Salvador are massive", said CISPES Executive Director Cherrene Horazuk after a 10 day visit to the country in late March and early April.
"Much of the country is rubble. There are massive fissures and scars ripping along many deforested hillsides. Everything is focused on the earthquakes and their aftermath and the topic runs into every discussion." The two massive earthquakes in January and February totally exposed the levels of poverty and misery in El Salvador generated by 10 years of ARENA governments and their implementation of the neoliberal model. Along the sides of major highways, like the devastated Pan American you now see signs saying "help us, we need food." Months after the earthquake, in some communities people have gone without drinking water for a week at a time. The struggle continues for food, water and basic survival, the battle for dignified housing has begun. The consensus is that the 1.5 million Salvadorans affected by the earthquakes will probably end up with tin shacks as "permanent" housing. The psychological trauma from the earthquakes in the general population is massive, reaching what is classified as "catastrophic stress". Domestic and intra-familial violence is up 20-30% in official figures.
The popular response of the FMLN and the social movement is to organize. In Nejapa over 10,000 residents were affected by the quakes and over 600 houses destroyed or left uninhabitable. In late March residents blocked the near-by Troncal del Norte highway to demand relief aid from the government. The next day the Salvadoran military showed up and said "what aid do you need?", and trucks with relief supplies arrived the day after. In the province of La Libertad, among others, departmental wide emergency committees now exist in 150 municipalities and communities within them. These committees help those affected by the earthquakes in organizing themselves and their communities to carry out the most effective reconstruction possible and to monitor relief aid received.
On March 7th the Consultative Group met in Madrid to review the Salvadoran government's reconstruction plan. The Salvadoran government was criticized by various European governments for the closed manner in which it developed its plan. The Salvadoran government hoped to obtain about $2.1 billion in grants and loans from the Madrid process to help rebuild the country. The donor governments, the World Bank, and the Inter-American Development Bank (IDB) only made commitments to give El Salvador $1.3 billion: $300 million in donations, $300 million in funds from reoriented existing IDB and World Bank loans, and $700 million in new loans. Given the shortfall in funds obtained in Madrid, the question remains, how will El Salvador finance its reconstruction? According to the World Bank, by selling off what is left of state owned businesses and public services.
The FMLN reconstruction plan (see ESW #92) would transform El Salvador if fully implemented. Blocking its path is an increasingly intransigent ARENA government. The right wing in El Salvador has always been hostile to the transformative agreements resulting from the 1992 Peace Accords. Institutions created by the accords, like the National Civilian Police (PNC) and Attorney General for Human Rights, played an important role in democratizing Salvadoran society. Now ARENA seeks to totally subvert the accords. It is blocking the appointment of a new, full time Attorney General for Human Rights. It has forced PNC officers to live in police stations, away from their families, on call at all times in an effort to alienate them from the general public. The right-wing seeks to use the earthquakes as a way to say, "the Peace Accords are over", further polarizing Salvadoran society and creating an authoritarian mentality. Also looming on the horizon are ARENA's hopes of obtaining a NAFTA style free trade agreement with the U.S. for El Salvador, Guatemala, Honduras, and Nicaragua. The Central American governments desperately want this free trade agreement with the U.S. to give the region a head start versus the rest of Latin America with the proposed implementation of the Free Trade Area of the Americas (FTAA) in 2005. President Flores wants NAFTA for Central America by June 2002.
FTAA would only increase the misery and poverty the neoliberal model causes in El Salvador and the rest of Central and Latin America. The Central American governments are very much in favor of the hemispheric trade agreement. Under FTAA, multinational corporations would have almost unlimited freedom to roam the hemisphere, reaping profits. Dollarization would be extended to all of the Americas. Labor unions, the right to organize, and minimum wages would be pushed aside. Intellectual property rights would include the "right" of multinationals to patent traditional medicinal remedies from plants of and even the genetic DNA patterns of potential resistance to endemic diseases existing with-in indigenous populations. More maquilas and biopiracy by multinationals would be the order of the day.
There IS an alternative! The Right (in the U.S. and El Salvador) seeks to tie the hands of the FMLN and the social movement by signing international trade agreements such as NAFTA for Central America and the FTAA that would institutionalize unjust neoliberal policies. But we CAN stop them. Join us in our struggle to defeat Fast Track. It is the first step in defeating NAFTA for Central America and the FTAA.
The Political Economic Costs of Dollarization There is more to dollarization than its immediate costs. Dollarization as an overarching economic policy will simply widen the gap between rich and poor and increase US economic and political control over El Salvador.
Inability to Manipulate Monetary Policy: Once El Salvador is fully dollarized it will no longer have the ability to adjust monetary policy in keeping with the constantly adjusting world economy. Many "pro-dollariists" think this is a good thing: it will prevent El Salvador from devaluing its currency. Devaluation: when a country lowers the value of its money against another currency, ie: the dollar note that used to be able to buy 5 oranges, after a devaluation can now buy only 3 oranges. Devaluation = Inflation. This is bad for the average Salvadoran because the money they earn cannot buy as much as it could before. El Salvador, however, has not needed to devalue its currency for years. There are times when monetary flexibility is mandatory, as in the case of an external shock. External shocks cannot be helped in a global economy and happen through no fault of the countries affected. For example, El Salvador has no control over the price of oil but a sharp rise or decrease in oil prices can have a profound effect on the economy. Dollarization does not allow El Salvador to self adjust its monetary policies to deal with the crisis, leaving it more vulnerable to the ebbs and flows of the global economy.
Salvadoran Economy Too Closely Tied to US Economy: The fact is that the Salvadoran and US economies are in two totally different states-one is a large industrialized world power, the other is a small finance and maquila based economy with 30% of its population living in misery (surviving on less than $1 a day in the city and less than $0.67 in the country side). And yet, despite these vast differences, the "pro-dollarists" want to tie the Salvadoran economy to the ups and downs of the US economy. Doing this is the equivalent of trying to set Jupiter and Pluto on the same lunar cycle. Essentially, Alan Greenspan, head of the Federal Reserve, will control the health of the Salvadoran economy. Greenspan has stated, though, that he will in no way take the economies of other countries into account when determining US monetary policy. What is good for the US is not necessarily good for El Salvador. Any contraction in the US economy may have devastating effects for El Salvador. If the US hits a recession or needs to hold back dollars from the world economy, El Salvador will be hard pressed to find dollars with which to operate its economy. The ability for the US to hold back dollars can also have far reaching political effects, as was the case when the US held back dollars from Panama in its attempts to oust Noriega. Just imagine what would happen if the FMLN won the presidency and attempted to social and economic reform!
Interest is the price of obtaining money, the higher the risk for the lender, the higher the price of buying the money. Lenders determine interest rates based on a number of factors: inflation, current interest rates, growth of the GDP, investment in education and skills of its workers, unemployment, average productivity, strength of the export sector, the price of exportable goods, direct foreign investment, legislation, the presence or the absence of a fiscal deficit, expectations of national enterprises, political conflict, etc.. Monetary policy is just a small part of the overall picture. For El Salvador, a country with a low rate of growth (especially after 3 devastating earthquakes in the span of one month!), high unemployment, low levels of education (and getting worse with the new drive to privatize the public school system), an export sector based on primary products and the maquila (products that demand low prices), a recent history of political conflict, and a huge fiscal deficit (and growing!), the likeliness of low interest rates for the general Salvadoran public is miniscule. Those who will benefit from lowered interest rates are big businesses that produce for export. Banks loaning money need to be paid back with dollars. Because the central government can no longer print money, dollars must be obtained through trade. Big companies that produce for export have a much better chance of obtaining those dollars than the average Salvadoran who wants to set up a small store or food establishment that depends on its Salvadoran customers obtaining and buying their products with dollars, especially in a country whose minimum wage is the definition of living in poverty.
From Boston to Los Angeles, CISPES organized educational and cultural activities to raise funds in support of grass roots organizing and post-earthquake reconstruction in El Salvador. Today, Romero's people struggle against natural disasters and an economic model that marginalizes almost half of the population. Without a doubt, we know that if Romero were still with us today, he would be on the frontlines, offering help to those most in need fighting side by side with them for better living conditions.
Keeping Romero's example alive and his undying commitment to the people of El Salvador is why CISPES committees in Boston, New York, Austin, DC and Los Angeles, among others, united with the Salvadoran and progressive Latin American communities in the United States. Together, they made a call for justice and solidarity with the people of El Salvador and promoted the CISPES campaign, "El Salvador: Not for Sale!"
Thus far, CISPES has raised over $100,000 for earthquake reconstruction, strengthening community organizing and the development of leadership in municipalities such as Tecapán and the Las Marías coffee cooperative in the department of Usulután, Candelaria in Cuscatlán, and Guadalupe, Tepetitan and San Cayentano Istepeque in San Vicente.
As part of CISPES' commitment to support organizing work El Salvador, the money collected will fund the strengthening of community organizing efforts and the development of local leadership within affected communities. CISPES supports the formation of local leadership councils that coordinate and monitor the distribution of aid that is received. We do this with the firm conviction that the 1.5 million people affected by the quakes are those who best know how to develop plans to reconstruct their own communities. We believe that it is through the medium of self-organization that communities will obtain the best tools with which to defend their own interests and to demand their participation in national reconstruction Monsignor Romero said that "the world of the poor teaches us that liberation will come only when the poor are no longer simply the receptors of aid but when they themselves are the masters and protagonists of their own struggle for liberation." Twenty-one years later, we commemorate and continue his example.
For more information on the "El Salvador: Not for Sale" campaign, contact your local CISPES committee or the CISPES National Office.
During El Salvador's civil war in the 1980's, international solidarity played a critical role in opposing US intervention and in supporting the Salvadoran people's struggle for social and economic justice. Now, the people of El Salvador are extending their solidarity to the people of Colombia and call on people of conscience around the world to join them in saying, "No to Plan Colombia!"
International Host Committee: José Saramago, Nobel Literature Laureate, Portugal; Adolfo Pérez Esquivel, Nobel Peace Laureate; Bishop Pagura, President of the World Council of Churches, Argentina; Professor Heinz Dieterich, President of the Forum for the Emancipation and Identity of Latin America, Mexico; Mumia Abu-Jamal, Political Prisoner, USA; Doctor Ramsey Clark, Former US Attorney General, USA; Professor Noam Chomsky, MIT, USA; Professor James Petras, New York State University, USA; Professor R. James Sacouman, Acadia University of Nova Scotia, Canada; Professor Henry Veltmeyer, St. Mary's University of Halifax, Canada; Ahmed Benbela, Ex-President of Algeria, President of the Arab Parliament, Algiers.
For more information, contact www.geocities.com/eventopaz/ or the Enquentro or CISPES: 212-229-1290.
The FTAA (Free Trade Area of the Americas) is designed to turn all of the Americas into a huge US-dominated, hemisphere-wide economic bloc. El Salvador is being used as a laboratory to test the FTAA - Neoliberal policies that make up the FTAA are already being implemented in El Salvador:
Using this year's devastating earthquakes as an excuse to continue implementing neoliberal policies, the Salvadoran government proposes that a special US Central America free-trade agreement be enacted as soon as possible. In practice, this agreement will be the beginning of FTAA implementation - it will lay the groundwork for full hemispheric FTAA implementation!
Produced by CISPES, a national organization with chapters around the country.
CISPES National Office 19 W 21st St, Room 502 New York, NY 10010 (212) 229-1290 e-mail: cispesnatl@people-link.net
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