The Brasilia Consensus, a Model for Latin America

Global Analyst Online / IPS

Estrella Gutiérrez

CARACAS, Oct 07 (IPS) – Following the extreme neoliberalism of the Washington Consensus, which gave rise to a lost decade in social terms, Latin America is experimenting more successfully with a home-grown formula: the Brasilia Consensus, which combines the market economy and social inclusion.Michael Shifter, president of the Washington-based Inter-American Dialogue think tank, coined the term "Brasilia Consensus" in contrast with the Washington Consensus. It is also called "Lulaism" after former Brazilian president Luiz Inácio Lula da Silva, or "the Brazilian model." And it has a growing following in Latin America among governments of both left and right.

"The Brazilian model has had a very positive impact as an example of how things can be done differently, by promoting growth without relinquishing social equity," José Rivera, the permanent secretary of the Latin American and Caribbean Economic System (SELA), told IPS.

He said Latin America and the Caribbean "should share the regional aspiration of integration and be united in the common goal of reducing asymmetries and making progress in repaying major outstanding social debts."

Rivera said there were "positive examples, especially home-grown ones, of governments that deal efficiently with the unpaid social debts in the region, where one out of three Latin Americans live in poverty and nearly 90 million people survive on less than a dollar a day."

In an interview with IPS, Shifter said the features of the Brasilia Consensus "remain intact and valid," although Lula left office in January 2011 and the international and regional contexts have worsened.

"The model has not changed, with its three central concepts: economic growth, social equity and democratic governance," he said.

Its validity is confirmed by its spread as a governance guide for many countries in the region, whatever the political ideology of their presidents. This contrasts with the decline of other, more radical, proposals led by Venezuelan President Hugo Chávez in the first decade of this century.

The Brazilian model takes the opposing view to the package of measures imposed by Washington-based international financial institutions and power brokers on Latin America during the foreign debt crisis that broke out in the early 1980s, and during the 1990s.

The 10-point Washington Consensus, summarising neoliberal ideology, enforced harsh adjustments to eliminate the fiscal deficit, including the redirection of spending, financial and monetary liberalisation, tax hikes, opening of markets and investments, and massive privatisation, in order to repay debt and establish a new basis for economic growth.

In practice, far from generating growth, the reforms fuelled regional deindustrialisation and caused GDP to fall for nearly a decade, marked by financial crises, several of which were of global scope.

But the worst aspect was its impact on people. During the so-called lost decade, all forms of social spending were cut, especially in education, health, housing and aid for the most vulnerable sectors, while labour conditions also worsened.

As a result, poverty and extreme poverty increased, shanty towns grew in the cities, and the informal economy and informal labour expanded, among other negative impacts.

During his eight years in power (2003-2011) Lula established a different model, based on macroeconomic and fiscal stability, an autonomous monetary authority and free exchange rates, added to aggressive industrial and domestic production policies.

Another priority of the Brazilian model is social inclusion, with wage raises, formal job creation and high spending on policies to eradicate hunger, reduce poverty, improve education and health and redistribute income across society.

The guiding principle is democracy, along with the extension of human rights, incentives for citizen participation and organisation from the grassroots up.

Shifter said Lula’s successor, President Dilma Rousseff, "decided to keep a lower global profile than Lula, but the Brasilia Consensus model has not been affected." She has "a different leadership style and other priorities," he said.

Rousseff has implemented different policies to stimulate the economy and cushion the effect of the economic recession in the countries of the industrialised North, especially Europe. She has also taken care to reinforce social programmes in this unfavourable new scenario.

A recent statement by Rousseff underscores her position. "What I want, and what I fight for, is for Brazil to become the sixth social power," she said, now that her country has become the sixth largest economy in the world and is heading for fifth position.

Among the Latin American countries whose governments take the Brasilia Consensus as their guide, with variations, Shifter mentioned Chile, Colombia, El Salvador and Uruguay. Other administrations adopt certain elements, while he described Argentina and Paraguay – until its president Fernando Lugo was ousted in June – as "hybrids" between Lulaism and Chavism.

He particularly mentioned the case of Peruvian President Ollanta Humala, who chose Lulaism over Chávez’s Bolivarian model, initiating the latter’s regional decline.

He also found it remarkable that Henrique Capriles, the opposition candidate in Venezuela’s elections on Sunday Oct. 7, "stressed that Lula was his model, which his platform confirmed.”

All rights reserved, IPS – Inter Press Service, 2012.

This article may not be republished, broadcast, framed, or redistributed without the written permission of IPS – Inter Press Service. Republication of this material without permission from IPS, the copyright holder, constitutes a violation of United States and international copyright laws and may result in legal action.


Co-ops Offer Ray of Hope for Youth Facing Bleak Job Market

Global Analyst Online / IPS

Beatrice Paez

TORONTO, Canada, Oct 08 (IPS) – Youth worldwide are facing limited job prospects in the traditional channels of employment, and in the midst of the job crunch, cooperatives are seeking ways to connect with this untapped pool of talent.It begins with reserving a seat for young, future cooperative leaders this Oct. 8 to 12 at the International Summit of Cooperatives in Quebec City. About 150 youth from across the globe have been invited to represent their respective cooperative organisations.

It’s an opportunity for them to network with their peers and learn from their cooperative elders, said Stephanie Guico, the coordinator of the Future Leaders programe at the conference. While there will be special panels and events designed around them, the young leaders, from the ages 20-35, will be expected to bring their own contributions.

“I hope they’re going to bring a youth voice, innovative ideas, new perspectives. I hope they won’t censor themselves,” Guico told IPS. “There’s a lot to be gained from listening to youth who are more in touch with integration into the virtual area and ways of collaborating and communicating that are new.”

“I think there’s a generation now that has grown up with a certain type of cooperation through social media,” said Charles Gould, executive director of the International Cooperative Association, a non-governmental organisation that strives to shape global policy on behalf of cooperatives.

“It ought to make them more receptive to the cooperative model but they haven’t heard about it as a business model,” he told IPS.

No one knows more about creating connections through social media to answer a need than social entrepreneur Dev Aujla, who will be addressing the young leaders.

Aujla, founder of DreamNow, a charitable organisation in the business of turning ideas into social goods, collaborated with Rolling Stone Magazine’s “climate hero” Billy Parrish, a climate change activist, to write a book.

Parrish and Aujla’s paths crossed online, as Facebook friends who had never met but who shared similar principles, and dedicated their lives to mobilising youth to address their community’s issues. Their book “Making Good” serves as a game plan for youth interested in pursuing careers as social entrepreneurs.

The non-linear career path often comes with the territory if you become a social entrepreneur, and while it can be daunting, it is becoming an attractive option for those wanting a job that pays well enough and is rooted in serving the community, said Aujla.

And for those interested, the cooperative model can provide a base of support, because it doesn’t require a lot of a capital, and he said, with cooperatives “you can take any industry you can imagine and reinvent in a way that does good.”

The cooperative model speaks in the language that today’s generation has been reared on, through exposure to the dialogue on climate change and other environmental issues, “this whole generation knows they want to do something good and are just being turned on the idea,” adds Aujla.

But while youth have more access to information to educate themselves on the issues of today, the cooperative model isn’t all that familiar because it’s not always included in academic curriculum, said Guico, who completed a Bachelor’s Degree in International Development.

Social media can aid the cooperative movement in its efforts to connect with youth, but more education about how they can offer an alternative route for employment is needed.

“Realistically, it’s going to take a different presentation of the model and a better explanation of it,” said Gould.

It took doing her own research and meeting the right people for Guico to find her way into the cooperative movement. The same goes for others around her. “Most people stumbled upon the movement, which said something about how good the cooperative movement is doing at promoting itself and communicating its identity.”

Part of the issue Guico finds is that cooperatives operate in a more discreet manner than corporations. “We would have to impose ourselves before there’s a perception of our importance,” she said.

Another reason cooperatives are not on the minds of many youth is that schools do not delve deeply, if at all into what the model offers, Guico notes. “Most educational institutions are geared towards the capitalist model, anything that it is too complex, they tend to simplify or minimise it.”

Without the decision to explore cooperatives on her own, Guico might have continued to presume that cooperatives are only in the trade of making crafts and operating as small-scale agricultural enterprises, as she was led to believe.

In Canada, St. Mary’s University in Halifax offers a Master’s programme designed around the cooperative enterprise. The university is sponsoring Imagine 2012, a joint event of the summit, on cooperative economics that precedes it.

But the online programme, which gathers people from around the world, is targeted at cooperators entrenched in the movement. Most students have been working in the industry for 15 to 20 years and are seeking to learn new management tools and connect with other industry leaders.

“If people were only learning about it in the ways that are more typical to how (we’re) learning, I think our sector would be much further ahead,” said Karen Miner, the managing director of the Cooperative and Credit Union Management programme at St. Mary’s.

“We would be much better educated about the sector and even on ourselves. We have a large number of managers of co-ops that come from the traditional business background, myself included,” Miner told IPS.

Laure Waridel, an ecosociologist who will also be speaking to youth at the summit, also finds that not enough value is given to the social economy in university courses, particularly in management.

Waridel, who taught a course at McGill University in Montreal, sought to incorporate some lessons on social entrepreneurship in her lectures by inviting guest speakers working in the social economy to her lectures.

The cooperative model, which prides itself in embracing democratic and participatory values, where youth can help influence and shape the future of cooperatives, has a lot of room for growth and new members, Waridel said.

“The message to future leaders is that we need to prepare a transition for another economy,” she told IPS. “It’s very clear that the dominant model in which we are now is unsustainable.”

All rights reserved, IPS – Inter Press Service, 2012.

This article may not be republished, broadcast, framed, or redistributed without the written permission of IPS – Inter Press Service. Republication of this material without permission from IPS, the copyright holder, constitutes a violation of United States and international copyright laws and may result in legal action.


Hour Grows Late to Act on Climate Change, Caribbean Warns

Global Analyst Online / IPS

Peter Richards

UNITED NATIONS, Oct 04 (IPS) – Their speeches did not grab international headlines like that delivered by U.S. President Barack Obama, nor did other delegates walk out as they spoke, as was the case for Iran’s Mahmoud Ahmadinejad.But Caribbean Community (CARICOM) leaders are nonetheless hoping that their united front on the environment at the just concluded United Nations General Assembly (UNGA) will spur the international community to take them and other Small Island Developing States (SIDS) much more seriously.

“The islands of our planet are at war against climate change, warming temperatures and rising seas," St. Vincent and the Grenadines Prime Minister Dr. Ralph Gonsalves told delegates. "This war is not a future event, it is a present-day and ongoing battle… the survival of our islands is at stake."

Caribbean countries are hoping that by the time the international community gathers in the Pacific in 2014 for the Third International Conference for the Sustainable Development of SIDS, there will be progress on a number of recommendations that, for instance, emerged from the Rio+20 conference held in Brazil earlier this year.

"The failure to date to reach a legally binding outcome on climate change is cause of grave concern," said Dominica’s U.N. Ambassador Vince Henderson. "While the debate continues, the challenges to our islands are becoming greater."

Figures released by the Belize-based Caribbean Community Climate Change Centre (CCCCC) show that over the last decade, damage from intense climatic conditions has cost the region in excess of half a trillion dollars.

"In real terms, the threats posed to the Caribbean region’s development prospects are severe and it is now accepted that adaptation will require a sizeable and sustained investment of resources," Jamaica’s Environment and Climate Change Minister Roberts Pickersgill told a community-based climate change workshop in Kingston on Tuesday.

Barbados-based environmental resource management specialist Sandra Prescod Dalrymple agrees that while the international community should feel an obligation to support the Caribbean, it also a fact that the developed countries “are growing less willing to do so".

“The region needs to draw on its own resourcefulness and pursue innovative financing in climate change efforts. It is clear that we are being impacted by climate change and that our economic earning sectors are suffering as a result this would only worsen,” she told IPS.

Antigua and Barbuda recently joined other small island states at the Summit of the Alliance of Small Island States (AOSIS), to send the message that they cannot wait “for our lands to disappear before we act".

“We must act now to respond to the climate crisis, and ensure that not a single country is sacrificed, no matter how small,” said the island’s Prime Minister Baldwin Spencer.

“There is coral bleaching beyond the depths of our shores, and hurricanes are becoming more recurrent and severe,” he said, adding “it is my government’s hope that the selfish act of inaction will dissipate in Doha (Round of Negotiations) and that a positive outcome in climate change negotiations will usher in new hopes for humanity and compassion for our planet.”

St. Kitts and Nevis Prime Minister Dr. Denzil Douglas said he was troubled that the main contributors of greenhouse gases were still not taking responsibility for the coastal degradation, coral reef bleaching and decimation, infrastructure damage and loss of lives that their actions have wrought.

“The physical, mental and financial burden that other countries’ energy usage has inflicted on countries like mine has been enormous – plunging us deeper into debt, and severely frustrating our efforts to meet our Millennium Development Goals," he told the UNGA.

“While a shift to renewable energy will not instantly solve the myriad problems caused by a significantly fossil-fuel based global economy, the embrace of green energy will, indeed, help to halt the intense downward spiral into which our fossil-fuel based economies have thrust our planet,” Douglas said.

Guyana, which has entered into a multi-million-dollar agreement with Norway to implement an "avoided deforestation" plan, said that despite “strong scientific and economic case for action, the global response to the climate crisis falls far short of what is required both in terms of scale and in urgency”.

President Donald Ramotar said that the projected level of reduction of greenhouse gas emissions is much too low and that scientists have warned of catastrophic consequences if the rise in greenhouse emissions is not halted.

“Already some states are facing imminent extinction. To add insult to injury, the promise of fast-start financing made at Copenhagen (Denmark), a few years ago, has not materialised," he noted. “The result is that those most at risk are effectively deprived of the means to adapt to this existential threat."

But Prescod Dalrymple believes the Caribbean should continue to focus on building resilience and find novel ways of accessing the resources to do so.

“The onus should not only be on governments but the private sector needs to step up and be fully engaged. We need to engage technology, train and re-train our workforce and make use of our large population of youth that are looking for career opportunities and decent work," she told IPS.

“I support public private partnerships and would wish that the region would move towards mandating standards and operating procedures to build climate resilience in new and existing ventures,” she added.

Caribbean countries have also stressed the importance of extending and amending the Kyoto Protocol before it lapses at the end of this year.

The Kyoto Protocol is an international agreement linked to the United Nations Framework Convention on Climate Change. The major feature of the accord is that it sets binding targets for 37 industrialised countries and the European community for reducing greenhouse gas (GHG) emissions .These amount to an average of five percent against 1990 levels over the five-year period 2008-2012.

Barbadian Foreign Affairs and Foreign Trade Minister Maxine McClean said her island welcomes the decision taken in Durban to launch negotiations on a new legally-binding agreement that would take effect after 2020.

But, she said, a post-2020 agreement is meaningless “if ambitious actions are not taken now to reduce global emissions and provide finance and technology to vulnerable developing countries.

“This is essential if we are to adapt to the ever worsening impacts of climate change. The upcoming Climate Change Conference in Doha must, therefore, prioritise the pre-2020 actions necessary to ensure that the world is on track in 2020 to meet the below two degree or 1.5 degree globally agreed goals."

All rights reserved, IPS – Inter Press Service, 2012.

This article may not be republished, broadcast, framed, or redistributed without the written permission of IPS – Inter Press Service. Republication of this material without permission from IPS, the copyright holder, constitutes a violation of United States and international copyright laws and may result in legal action.


Media Pluralism at Risk of Extinction in Chile

Global Analyst Online / IPS

Marianela Jarroud

SANTIAGO, Oct 04 (IPS) – The announcement that the La Nación newspaper of Chile is closing down has drawn the attention of journalists, analysts and opposition lawmakers to the heavy concentration of press ownership, now in the hands of only two business groups, and to the lack of regulations to ensure media pluralism."The state must create public media in areas (press, radio or television) where there is a high concentration of ownership," said Marcelo Castillo, head of the Chilean Association of Journalists.

Furthermore, "public communication policies are needed that go beyond the mere existence of media," he said.

At present, the only state electronic media outlet is National Television of Chile, an autonomous company with a seven-member board nominated by the president and ratified by the Senate.

Castillo told IPS that "the creation of media outlets linked to civil society must be encouraged, or the example of Argentina should be followed, where an agency to manage state advertising ensures that it is widely distributed among a large number of outlets."

The closure of the century-old La Nación, in which the state owned a 69 percent share, was decided by board members representing the right-wing government of President Sebastián Piñera, who had announced he would make this decision if he were elected president.

Late last year, La Nación’s print version was cancelled, and on Sept. 24 it was agreed that the online version, which receives one million hits, will be terminated. In addition to its impact on communications, the decision means 600 workers will left without a job.

"For 20 years, since the return to democracy, La Nación has always been subordinated to the government of the day, and we believe this is not advisable and that the authorities do not need their own media," said government spokesman Andrés Chadwick.

Carlos Larraín, president of the National Renewal party, a member of the governing coalition, called the closure "very good news" and said that for the sake of journalism, it was good to end state competition against the free press.

"A subsidised press is worthless," he said.

In Castillo’s view, however, "the state must guarantee the citizens’ right to information, and ensure media pluralism, and if this does not exist, create it and find a formula for making it effective."

Figures from the National Press Association, the print media owners’ group, indicate that two companies concentrate 90 percent of Chilean readers. They are El Mercurio and the Consorcio Periodístico de Chile SA, which controls the newspapers La Tercera and La Cuarta and the magazine Qué Pasa, among other print and online media.

Both firms are in the hands of the richest and most influential families in the country, who keep the right-wing ideology alive in the press.

But Castillo pointed out that although Piñera had decreed the closing of La Nación, the previous governments of the centre-left Coalition for Democracy had failed to promote a public policy for the media.

"During the last three years of the dictatorship of Augusto Pinochet (1973-1990) there was more pluralism in the press than there is now," he said.

"For instance, there is not a single opposition daily newspaper in Chile at present. Having a public policy for communications is not only the responsibility of the Piñera government, but of administrations from the end of the dictatorship onwards," he said.

Examples of newspapers that have fallen by the wayside include Fortín Mapocho, a daily that played a key role in the fight against the dictatorship, which went under in 1991, and the progressive newspaper La Época, which was published from 1987 to 1998.

And weeklies like Análisis and Apsi, which closed in 1994 and 1995 respectively, were emblematic opponents of the dictatorship, but did not survive the return to democracy.

In the view of sociologist Manuel Antonio Garretón, winner of the National Prize for Humanities and Social Sciences in 2007, the closure of La Nación shows "an ideological intent to dismantle public spaces like education, social security and now communication.

"In the case of La Nación, the state has given up a potential public space which, since the market is not plural, it should guarantee," he told IPS.

"My understanding is that when the market cannot offer, as in this case, press pluralism, the state itself ought to offer it, to offset the ideologically right-wing private media," he said.

"The state should promote and permit the creation of media outlets with views different to those of the predominant media," he said.

In Garretón’s view, the dismantling began when the Chilean National Radio station was privatised in 1993, representing the loss of a major public awareness-raising instrument.

"All forms of state provision that are participative in character, as they should be, are being eliminated," he said.

"The clearest example is education, but there are other fields like public television,” he said.

Meanwhile, socialist Senator Juan Pablo Letelier told IPS that "economic groups in Chile, in contrast to Brazil and other countries, are too closely allied to the political right, resulting in the media being in too few hands and having a strong ideological bias."

He said the concentration of ownership "generates ideas and visions of a nation derived from a lack of real press freedom.

"The problem is that the structure of advertising in our country has not been democratised. It is not that legislation has not been tried, but that the right does not want to democratise advertising in the media," said the lawmaker.

The state’s role is "not to subsidise, but to ensure a regulatory framework so that companies must place their advertising in a diversity of media outlets," he said.

"Democracy is not only about voting and electing, but also about economic democracy and circulating a diversity of opinions," he argued.

All rights reserved, IPS – Inter Press Service, 2012.

This article may not be republished, broadcast, framed, or redistributed without the written permission of IPS – Inter Press Service. Republication of this material without permission from IPS, the copyright holder, constitutes a violation of United States and international copyright laws and may result in legal action.


Venezuela Votes…and Latin America Catches a Cold

Global Analyst Online / IPS

Estrella Gutiérrez

CARACAS, Oct 04 (IPS) – Sunday’s elections in Venezuela will determine whether the era of President Hugo Chávez’s Bolivarian revolution will continue or come to an end. The result will have an impact not only on this country but on the rest of Latin America.In the first decade of this century, Latin America saw "a nontraumatic epochal change, sometimes manifested as constituent assemblies (to rewrite a constitution), which sought to respond to the demands of the majority and bring about political change. Chávez is its most radical expression," said Manuel Felipe Sierra, an analyst from the traditional left and a critic of the Venezuelan president.

"This trend, which Chávez claims to have authored although it has roots and leadership in each country, has already passed, and most governments have taken a more conventional democratic route with left-wing overtones," he told IPS.

Bolivia and Ecuador are other examples of this current, which has as its political integration mechanism the Bolivarian Alliance for the Peoples of Our America (ALBA), led by Venezuela and made up of eight Latin American and Caribbean countries, including Cuba and Nicaragua.

But the regional reform movement has another major reference point, less ideological and radical: the process led by former Brazilian president Luiz Inácio Lula da Silva (2003-2011), whose programme was based on economic growth with social inclusion and a strengthening of democracy.

Both self-described left-wing and right-wing governments have expressed their support for the Brazilian model, including Venezuela’s opposition candidate Henrique Capriles, who declares himself an "admirer and imitator" of Lula.

Capriles, supported by a variegated mix of 29 groups ranging from right to left, points as proof to the Zero Hunger plan he implemented as governor of the northwestern state of Miranda, modelled on Brazil’s anti-hunger strategy.

Most of the latest polls tip Chávez as the favourite to be re-elected for a third time. But growing support for his rival has made the election result uncertain.

Chávez’s style of diplomacy in Latin America has been one of confrontation with right-wing presidents, which polarised countries, governments and summits ever since he took power in February 1999, said experts consulted by IPS, including several close to the president.

"The export of the Bolivarian model, supported by the abusive use of Venezuela’s oil wealth, as well as Chávez´s style, are in decline, whatever happens on Sunday," said Sierra.

"Furthermore, there is ‘Chávez fatigue’ in the region because of the behaviours and manners that stress even his allies, and that ceased to be useful for the collective interest," he said.

But Roy Chaderton, Venezuela’s ambassador to the Organisation of American States (OAS), said that if Chávez exits the stage, "it would threaten Latin American independence," especially from the United States, which Chávez refers to as "the empire."

Chaderton said Venezuela had created in the region "a diversity of dependences, that make us more independent of others and more interdependent among ourselves."

"In Latin America we created oxygen valves that help us breathe more freely, and that would close off" if Chávez loses, he said.

"These are not just any elections, for Venezuela or for the continent, because of the ideological primacy and polarisation promoted by Chávez, and because if he loses the elections it would confirm the demise of the left-wing neo-populist experiment he was trying to export," said Teresa Romero, an expert in international relations.

In Romero’s view, even if Chávez is re-elected, "the regional climate has shifted towards the centre," and within it "Brazil has won the leadership role, with progressive positions that are less strident and more efficient."

Michael Shifter, the head of the Inter-American Dialogue, a U.S. think tank, said if Chávez left the government it would have "an enormous effect on the regional political scenario, because he has been the most aggressive and polarising voice in the hemisphere over the last decade."

If change comes to Venezuela, "ideological conflicts will not disappear, but they will be less acute and better channeled," he told IPS. In his view, Capriles would maintain normal relations with left-wing governments like those of Argentina, Bolivia, Cuba, Ecuador and Nicaragua, "but not, as the phrase went in the 1990s, such carnal relationships."

In addition to ALBA, the Chávez government promoted the foundation of the Union of South American Nations (UNASUR), made up of the region’s 12 countries, and the oil aid organisation Petrocaribe. It also helped create the Community of Latin American and Caribbean States (CELAC) as an alternative to the OAS, which it considers to be dominated by Washington.

In August the government began a process of withdrawal from the Inter-American Court of Human Rights, which hands down binding rulings on human rights violations committed by states. The only precedent for withdrawal from the OAS human rights court was that of Peru, 20 years ago, during the regime of Alberto Fujimori (1990-2000).

Capriles announced that, if he were elected, one of his first steps would be to reverse the process of withdrawal from the Inter-American Court. He also said Venezuela would rejoin the Andean Community, the regional bloc that this country belonged to since the 1960s, which the Chávez administration pulled out of in 2011. It is currently made up of Bolivia, Colombia, Ecuador and Peru.

Chávez’s efforts in the past six years were directed towards Venezuela becoming a full member of the Southern Common Market (Mercosur) trade bloc, which he finally achieved in June, after Paraguay’s temporary suspension from the group, made up also of Argentina, Brazil and Uruguay.

"These are changes of alliances based on political and ideological foundations, not on economic reasoning or geographical location," Sierra said.

All rights reserved, IPS – Inter Press Service, 2012.

This article may not be republished, broadcast, framed, or redistributed without the written permission of IPS – Inter Press Service. Republication of this material without permission from IPS, the copyright holder, constitutes a violation of United States and international copyright laws and may result in legal action.


U.S.: Consumer Protection Agency Takes on "Financial Tricks and Traps"

Global Analyst Online / IPS

Matthew Cardinale

ATLANTA, Georgia, Sep 27 (IPS) – In the wake of the epidemic of home foreclosures, banking scandals and resulting massive financial regulation overhaul two years ago known as the Dodd-Frank legislation, the U.S. government created a new federal agency to protect consumers from being taken advantage of by banks and other institutions.

Known as the Consumer Financial Protection Bureau (CFPB), it’s operated for a year now, with mixed results, according to civil society groups that follow the issue.

“Obviously, the agency’s been stifled somewhat by Congress," Jamie Court, president of the non-profit California-based group Consumer Watchdog, told IPS. "Given the scrutiny they face, and the budget limitations, they’ve done a good job of starting to break new ground on mortgage regulations and financial services regulations, disclosure for consumers."

Republicans, particularly in the U.S. House of Representatives, have been vehemently opposed to the CFPB.

“It’s a very tough job in this political and budgetary climate. They’ve done a good job of letting the public know their doors are open. The question is, how responsive they are to petitions from the public, and how much can they do as quickly as possible?” Court said.

“They have a good staff that understands consumer protection. The real fate of the agency will be determined by the (November U.S. presidential) election. The election is really a mandate for this agency to go forward or not,” he said.

Republican nominee Mitt Romney opposes the CFPB, while President Barack Obama, the Democratic nominee, supports it.

The CFPB is “pretty much what Obama got for the consumer out of financial reform, which was too little. It’s the first time we have a federal agency that’s there to protect consumer, not the bank, not the investor,” Court said.

Over the past weekend, the agency announced its second enforcement action in conjunction with the Federal Deposit Insurance Corporation (FDIC), ordering Discover Bank to refund approximately 200 million dollars to more than 3.5 million consumers and pay a 14-million-dollar civil penalty.

At issue were “deceptive telemarketing and sales tactics used by Discover to mislead consumers into paying for various credit card ‘add-on products’ – payment protection, credit score tracking, identity theft protection, and wallet protection,” according to an agency press release.

According to the CFPB, Discover Bank, one of the largest credit card issuers in the U.S., misled customers about whether there was a cost for the products, enrolled customers without their consent, and failed to tell customers about some of the eligibility requirements associated with payment protection benefits.

In a similar case of "deceptive marketing tactics", on Jul. 18, the agency announced its first enforcement action, requiring Capital One Bank to refund approximately 140 million dollars to two million customers and pay an additional 25-million-dollar civil penalty.

On Aug. 10, the agency proposed two new rules that will protect families who take out mortgages for their homes. These proposed rules are currently subject to a public comment period before final action will be taken.

The agency has also been collecting hundreds of comments from U.S. consumers regarding various complaints each week, and is encouraging consumers to submit complaints to the agency, including on its website.

“They’re being judicious in what they’re setting out to do. They’re not being a lightening rod for controversy – they’re doing sensible things on a sensible timeline. We’re very pleased by their agenda,” Linda Sherry, director of national priorities for Consumer Action, a San Francisco-based national consumer education and advocacy group, told IPS.

One of the benefits of the CFPB is that it gives U.S. consumers a single place to seek help with complaints regarding banking products and other financial products, Sherry said.

Previously, there were “too many cooks in the kitchen", she said.

“This brings everything under the same roof. It’s easier for consumers to know who to go to for help. Beforehand, there were seven different agencies engaged in regulating the banking system,” she said.

Those agencies included the Board of Governors of the Federal Reserve, U.S. Department of Housing and Urban Development, FDIC, Federal Trade Commission (FTC), National Credit Union Administration, Office of the Comptroller of the Currency (OCC), and Office of Thrift Supervision.

The FTC, for example, would look for trends in the credit industry and credit reporting industry, sometimes bringing legal actions in conjunction with the U.S. Department of Justice. However, they would not respond to individual complaints.

“As far as banking complaints, any banks that were national banks were (previously only) regulated by the OCC. They had robust consumer complaint unit. However, what would come back to us many times, they (a consumer) would submit a complaint, it would be sent for review and it would come back,” Sherry said.

“The OCC would write a letter saying, ‘The bank doesn’t see there’s a problem. We can’t do anything,’” she said.

“Financial services are key to a person’s well-being, livelihood, and prosperity. We want to keep people from being ripped off. That’s why we’re very pleased to have a new national consumer watchdog on the beat,” she said.

Court believes that the CFPB should be acting more aggressively.

“It also has to start banning certain types of products because they’re dangerous. There are some obscene interest rates on credit cards being charged, also payday lending, a lot of toxic financial products. They’re going to be asked to deal with these by petition,” Court said.

“The real test of the agency will be what it does when presented with toxic products,” Court said.

Court applauded the recent enforcement actions against Citibank and Discover Bank. “It’s a great example. An agency can step in and get 200 million dollars back to consumers’ pockets. Before that you had to file a class action lawsuit,” he said.

Meanwhile, Elizabeth Warren, a Harvard Law School professor who came up with the idea for the agency, and who worked with interest groups and the U.S. Congress to bring the agency into fruition, also praised the Discover Bank action.

“I’m proud the Consumer Financial Protection Bureau is standing up for working families by holding major credit card companies accountable for deceptive practices,” Warren, who is currently the Democratic nominee for a U.S. Senate seat in Massachusetts, said in a statement sent to IPS.

“The new consumer agency is a strong advocate for hardworking men and women here in Massachusetts and across the country. The CFPB has been hard at work reducing the fine print in credit card agreements and assisting with consumer complaints… These actions will help protect families from financial tricks and traps and create a level playing field,” Warren said.

All rights reserved, IPS – Inter Press Service, 2012.

This article may not be republished, broadcast, framed, or redistributed without the written permission of IPS – Inter Press Service. Republication of this material without permission from IPS, the copyright holder, constitutes a violation of United States and international copyright laws and may result in legal action.


Breast Milk Banks, From Brazil to the World

Global Analyst Online / IPS

Fabiola Ortiz

Sep 27 (IPS) – Cíntia Rose Regis, 23, not only breastfeeds her 16-month-old daughter Zelda but has also been donating 600 ml a week of breast milk to a mothers’ milk bank in Brazil over the last year.It was her paediatrician who suggested she donate her milk. "As long as my daughter is nursing and stimulating my milk flow, I will carry on donating," she said.

"I have never personally seen the premature babies who receive my milk, but just knowing that I may have saved some of them is my reward," she told IPS. "It’s a question of awareness. If I have extra milk that I would throw away, why not donate it?"

And she added that if she has another baby, she will continue to donate part of her milk.

Any woman who produces more milk than her baby needs can donate the excess to Brazil’s national network of breast milk banks.

Brazil is becoming an international reference on the matter, and exports low cost technology to set up breast milk banks to 23 countries, as an effective tool to combat infant mortality.

There are 210 mothers’ milk banks distributed throughout Brazil, in every state. And the initiative has led to the creation of 28, in Spain, Portugal and several countries in Latin America and Africa.

So far in 2012, 97,000 litres of breast milk have been collected from 86,000 donors in Brazil and have been used to feed 108,000 babies.

Last year, 165,000 litres were donated by 166,000 mothers, helping nearly 170,000 babies.

The only requirements under Brazilian law are that donors are healthy and are not taking any medication.

The guidelines recommend that the nursing mother

The guidelines include simple recommendations for personal hygiene: clean, dry hands and forearms; a quiet, clean place away from animals; a sterilised container; and storage of the milk in a freezer.

Breast milk donated to a bank goes through a selection, classification and pasteurisation process and is then distributed as "quality certified" to babies hospitalised in neonatal units.

This country of 192 million people "has built the largest and most complex network of breast milk banks in the world," expert João Aprígio Guerra de Almeida told IPS.

"We don’t just carry out collection and distribution. We have breastfeeding support centres, quality control methods, nutritional indicators, monitoring and advisers," said Almeida, the coordinator of the Brazilian and Ibero-American Network of Human Milk Banks.

The Brazilian government has supported this effort for nearly 30 years, through research at the state Oswaldo Cruz Foundation (Fiocruz).

In 1985 Fiocruz established the first Latin American centre for breast milk research with the goal of understanding the biological, physical, chemical and immunological characteristics of mother’s milk.

"We saw that this work could become a major health strategy to promote conditions that would lead to the reduction of the absurdly high infant mortality rates we had in Brazil," said Almeida, a Fiocruz researcher. "The statistics were alarming, much higher than the world average."

Since the 1990s, the country has achieved a 73 percent reduction in infant mortality, and this year it met one of the Millennium Development Goals, agreed by the countries of the United Nations in 2000: a two-thirds reduction in the mortality rate of children under five, between 1990 and 2015.

"Because of our work, the World Health Organisation has recognised Brazil’s impressive gains in reducing infant mortality,” Almeida said.

Before the research effort, "we were completely dependent on the northern hemisphere. To process the milk we had to import equipment from Europe and the United States, which cost some 35,000 dollars at that time," he said.

International cooperation began in 2007, and now countries like Argentina, Bolivia, Ecuador, Paraguay, Venezuela and Uruguay have the infrastructure to collect and distribute donations of breast milk.

"We support the establishment of these banks and provide advice and train professionals," said Almeida.

When the initiative was extended to the Ibero-American region, Portugal and Spain joined the network and benefited from an unusual South-North technology transfer.

The creation of milk banks "spread internationally, and in 2007 the leaders of the Ibero-American countries decided to adopt the strategy as an inter-governmental action," Almeida said.

At the summit held that year in Santiago, the Ibero-American mothers’ milk bank programme was established.

The first Spanish bank was set up in Madrid, and in Portugal the Dr. Alfredo da Costa maternity hospital in Lisbon was similarly equipped in 2008.

Cape Verde became the first African country to join the network, with a milk bank that began to operate in August last year. Fiocruz delegations visited Mozambique and Angola in 2010 and 2011, respectively, and projects are under way there.

Much depends on the willingness to donate. Brazil is promoting May 19 as World Human Milk Donation Day.

"On that day in 2005, the first agreement to create an international network of milk banks was signed by 13 countries and international organisations," said Almeida.

In Rio de Janeiro, the Fernandes Figueira National Institute for Women, Children and Adolescent Health (IFF) is the Fiocruz unit specialising in neonatal care and milk reception.

Rosane Xavier, a 35-year-old nurse who works in the IFF prenatal laboratory, encourages mothers to breastfeed and, if possible, to donate milk.

Xavier nurses her first son, aged two years and two months, and she is a donor. "When milk is plentiful, I invite mothers to donate. One must be aware of the importance of breast milk for children, and especially for premature babies," she told IPS.

She says donating breast milk, an intensely personal act, benefits both parties. The advantage to the nursing mother is the removal of excess milk, which can cause problems if it accumulates. And the baby receiving the milk is likely to have fewer illnesses and improved growth.

"A baby that is not breast fed does not develop as well as one that is," said Xavier. "Breastfeeding brings about better mental development, language development, dentition and immunity."

All rights reserved, IPS – Inter Press Service, 2012.

This article may not be republished, broadcast, framed, or redistributed without the written permission of IPS – Inter Press Service. Republication of this material without permission from IPS, the copyright holder, constitutes a violation of United States and international copyright laws and may result in legal action.


New Roadmap for NGOs in Haiti Aims to “Weed Out Bad Apples”

Global Analyst Online / IPS

Becky Bergdahl

UNITED NATIONS, Sep 26 (IPS) – Haitian Prime Minister Laurent Lamothe and representatives from more than 50 non-governmental organisations, including actor-activist Sean Penn, met in New York on Monday to present a new roadmap for humanitarian aid in the country.“It is gonna help the NGOs, the serious NGOs, and it is gonna weed out the bad apples," Lamothe told IPS after the meeting.

“We have a new coordination unit for NGOs that will have guidelines and standards to abide by. So there is a continous effort and push to monitor what the NGOs are doing,” he said.

The event, organised by the U.N. Development Programme, took place during the 67th session of the U.N. General Assembly. The roadmap presented at the meeting is intended to help the Haitian government to supervise the 560 NGOs registered as working in the Caribbean state.

In brief, the roadmap outlines the government’s next steps in coordinating humanitarian, development and charity-based organisations in the country. Two important steps will be the establishment of a national NGO Forum, and the establishment of a consultation process on a new NGO legislation.

The roadmap points out that the responsibility of all prioritisation of efforts shall rest in the hands of national authorities, in order to avoid fragmentation of efforts.

Poverty-stricken Haiti already received international humanitarian aid before the 7.0-magnitude earthquake that hit the country on Jan. 12, 2010. But after the disaster, which left approximately 300,000 dead and 1.5 million people homeless, Haiti has received so much funding aid through foreign NGOs that the country has been nicknamed “a republic of NGOs”.

The aid has not always been helpful. John Chaloner, representing CCO Haiti, a consortium of international NGOs operating in the country, lamented that cooperation problems between NGOs were “common and all too frequent” after the earthquake.

About two-thirds of Haiti’s budget currently comes from foreign assistance.

Rebecca Grynspan, U.N. under-secretary general and associate administrator of the United Nations Development Programme, said that the international community has to focus more on “backing national institutions” in Haiti. Grynspan called for a “transitioning from humanitarian aid”.

But Grynspan also stressed that NGOs have offered, and are still offering, vital help to Haitians, including health services, shelter, education and food aid.

These groups will continue to play a crucial role as more than two-thirds of the population lives on less than two dollars a day, and the state offers little social security.

Prime Minister Lamothe agreed with her, emphasising that according to the new roadmap, the government will have greater authority to oversee aid projects in Haiti. “It is all a question of organisation,” Lamothe said. “There was a lack of leadership before.”

Lamothe acknowledged that this will not be an easy task for the government, in office since last year. The unemployment rate in Haiti is currently over 70 percent, and over 80 percent of the economy remains informal. “We are not getting enough tax revenue,” Lamothe said, lamenting how the financial difficulties limit the government’s ambitions.

In the long run, Haiti needs to boost its own agricultural production and industry, according to Lamothe. “We do not want to continue to be known as an NGO nation,” he said. “Haiti needs to start producing and stop importing.”

Film star Sean Penn, founder of J/P HRO, an NGO operating in Haiti, said that “NGOs’ primary job is to put themselves out of business.” This is yet not possible in Haiti, he conceded, adding that, “Instead, we must create sustainability."

Out of the 1.5 million Haitians left homeless by the earthquake, 1.1 million have been relocated. But the remaining 400,000 are still living in tents. Penn expressed special concerns about security in the camps, after numerous incidents of assault and rape.

Penn also said that “serious security issues” throughout the country are discouraging international companies from investing there and slowing down economic progress.

Still, Penn believes the outlook is positive. “Haiti is on the verge of letting us all see the fruit of our work there,” he concluded.

All rights reserved, IPS – Inter Press Service, 2012.

This article may not be republished, broadcast, framed, or redistributed without the written permission of IPS – Inter Press Service. Republication of this material without permission from IPS, the copyright holder, constitutes a violation of United States and international copyright laws and may result in legal action.


Changing Demographics Likely to Tip Scales for Obama Re-election

Global Analyst Online / IPS

Carey L. Biron

WASHINGTON, Sep 25 (IPS) – With just six weeks left before the U.S. presidential polls, analysts on Tuesday suggested that recent demographic changes in the United States, particularly through immigration, have made it more difficult than ever for a Republican candidate to vie for president.The current challenger, Mitt Romney, does not appear to be making up nearly enough lost ground to take the election.

According to some scholars and poll-watchers, the trend is not only complicating Republican hopes for the 2012 polls, but could continue to do so in coming years unless the party undertakes a significant reappraisal of its social and economic policy approaches.

Romney now needs “outlandishly large margins to be competitive – and he’s not anywhere close", Ruy Teixeira, a senior fellow at the left-leaning Center for American Progress, said Tuesday, unveiling a new report.

Today, most polls show Obama leading Romney by three or four percentage points, including in almost all of the critical “swing” states where neither candidate’s lead is decisive. For Republicans, the difficulty stems from two subsections of the U.S. voting public, both of which have been turning against the party in recent years: minority voters and white college-educated voters, particularly women.

When he was elected in 2008, Barack Obama won 80 percent of the minority vote and 52 percent of college-educated white women. According to recent polls, Obama’s current lead in these demographics remains almost identical.

Over the past three decades, the minority voting share has doubled, to 26 percent; the number of college-educated whites has also gone up, while the number of non-college-educated whites has come down – all factors in the Democrats’ favour. Indeed, just since 2008 the number of eligible minority voters has grown by three percent, while white voters have dropped by three percent.

Because of these changes, if Obama again gets 80 percent of the minority vote – which now looks likely – Romney would have to double the share of the white vote that John McCain, the Republican challenger in 2008, received.

Certain state polls today even have Romney winning by 20 points or more, but Teixeira’s research suggests that this still wouldn’t be enough. “Nowhere do you see these outsized margins that he really needs to win the election, given how Obama appears to be holding his support among minority voters and even then some among white college-graduate voters.”

In fact, if Obama is able to match the 80 percent non-white vote again this year, he would need just 40 percent of the white vote to win the election.

“The math that gives you at this point is that Romney would have to win two-thirds of all other votes to get a national majority,” Ronald Brownstein, political director at Atlantic Media, said Tuesday. “Now, he can do that – Republicans were in that neighbourhood in 2010. But two-thirds of all other voters were what (President Ronald) Reagan won in 1984 during the most decisive landslide in modern American history. So that’s a steep hill.”

Despite the mounting criticisms of the Romney campaign, Romney is not doing poorly among his primary demographic, but this may not be helpful enough. Indeed, Brownstein suggests that Romney could do as well among whites as any Republican challenger ever – in the 56-to-61 percent range – but still lose, due to demographic changes that only look set to continue.

Existential paralysis

“The existing (Republican) coalition is so dependent on a part of the country that is incredibly uncomfortable with demographic change,” Brownstein says. “They’re paralysed, for instance, between an intellectual understanding that they have to reach out to Hispanics and the difficulty that they’re finding (in trying to doing so).”

Immigration is seen as a “gateway” issue for many immigrants, meaning that even if Romney’s platform were to appeal to some, he is not being heard by those voters. This is due to his adoption, spurred by some of the most conservative wings of the Republican Party, of what some have described as a “radical” immigration-related agenda.

“What the Republican Party has done is lurch to the right,” says Frank Sherry, executive director of America’s Voice and a longtime expert on the Hispanic community. “This has hurt badly with Hispanics.”

And while Hispanic voters get much of the attention in today’s U.S. political analysis, the broader immigration story looks equally problematic for the Republicans.

Asian Americans, for instance, recently surpassed Hispanics as the country’s fastest-growing minority population, expanding at a rate of 46 percent over the past decade. Ahead of the 2008 elections, some 600,000 Asian Americans registered to vote for the first time, while similar figures are expected this time around.

“Perhaps the most important sociological and political development in the past two decades has been the massive shift in the voting allegiances of the Asian American population,” Karthick Ramakrishnan, director of the National Asian American Survey, said Tuesday elsewhere in Washington, launching a uniquely detailed report on the Asian American community.

“Asian Americans went from voting less than a third for the Democratic presidential candidate in 1992 to almost two-thirds in 2008.”

Further, the report finds abnormally high support among Asian Americans, compared to the rest of the population, for issues that are generally seen as Democratic strongholds, including on the environment, affirmative action, undocumented immigration and health-care reform.

The question, then, is when the Republican Party will respond to what could quickly be becoming an existential problem.

The situation “should precipitate a conversation in the party", Brownstein says. “One Romney advisor said to me, ‘This is the last time anyone will try to do this,’ meaning assemble a national majority almost entirely on the back of white votes.”

All rights reserved, IPS – Inter Press Service, 2012.

This article may not be republished, broadcast, framed, or redistributed without the written permission of IPS – Inter Press Service. Republication of this material without permission from IPS, the copyright holder, constitutes a violation of United States and international copyright laws and may result in legal action.


Rural Mexican Communities Rich in Resources, Poor in Capital

Global Analyst Online / IPS

Emilio Godoy

MEXICO CITY, Sep 24 (IPS) – The La Ventanilla community in the southern Mexican state of Oaxaca has not given up in the face of devastating hurricanes, but has organised to protect mangroves and animal species like the Olive Ridley sea turtle.“We have sufficient natural resources, but the hurricanes destroy everything,” said Atanasio Martínez, a member of the La Ventanilla Ecotourism Services cooperative.

“We are seeking to preserve the species, develop ecotourism, support research and capitalise on the local fauna,” Martínez told IPS.

The cooperative in La Ventanilla, a village of some 100 people who live as subsistence farmers, growing crops like corn, sesame seeds and pumpkins, emerged in 1997, after Hurricanes Paulina and Rick tore through the area that year. The village was once again struck last June, by Hurricane Carlotta.

La Ventanilla is an illustration of the fragility of the livelihoods of rural communities in Mexico, which stands in the way of their sustainability.

“The rural sector is precarious and has little access to capital,” Sophie Ávila, an academic at the Institute of Economic Research of the National Autonomous University of Mexico, told IPS.

Ávila is carrying out a study on the “means of life” – social, human, natural, physical and financial capital – in the San Pedro Pochutla district of Oaxaca, which covers 18 municipalities with a total population of around 200,000 people.

“Natural capital includes agricultural inputs, physical capital is based on infrastructure and tools, financial capital on income and credit, social capital on local networks, and human capital on formal education,” Ávila explained about her initial findings.

Studies on means of life are just starting in Mexico, a country of 112 million people in 19 million households, 39 percent of which are in rural areas.

Oaxaca, one of the poorest states in the country, with 570 municipalities home to 3.8 million inhabitants, has become the scenario of such studies due to its natural riches and the vigour of its social organisations.

On the other side of Mexico, on the Caribbean coast, the situation is not much different, Denise Soares, a researcher at the Mexican Institute of Water Technology (IMTA), has found in the southeastern state of Yucatán.

“People are not given training on how to protect themselves from hurricanes and floods,” she told IPS. “There are no support networks, and the economy is fragile, because it is based on fishing and growing fresh produce, which are very vulnerable to hurricanes.”

Soares began to carry out her study last year in the towns of San Felipe, Celestún, Ixil and Sisal on the Yucatán coast, which have a total combined population of just over 14,000 people.

Of these towns, the one that has made the progress in the management of natural resources and disaster management is San Felipe, which has an early warning system and recycles its waste.

Soares carried out 400 surveys among the local residents and 33 interviews with key actors, such as municipal authorities.

The preliminary findings included deforestation of the mangroves, which are endangered along Mexico’s Caribbean coast; the growing use of land to graze livestock; and the development of salt production.

“There is some degree of decay of livelihoods due to growth of natural disasters and insecurity. I don’t think there are appropriate policies for those resources,” Hilary Warburton with the UK-based Practical Action told IPS.

PracticalAction is an international sustainable development organisation whose mission is to reduce the vulnerability of poor people in developing countries and increase their access to markets, infrastructure and new technologies.

In La Ventanilla, the members of the cooperative are working to rebuild the damage caused by Carlotta, with little financial assistance from the government.

“There is a shortage of economic resources for taking care of the animals that the authorities confiscate and turn over to us. The tourists only show up in high season, from March to August,” Martínez said.

The cooperative has raised 1,383 crocodiles in the community’s lagoon and has released between 18,000 and 25,000 Olive Ridley sea turtles (Lepidochelys olivacea) every year. They also raise tame white-tailed deer (Odocoileus virginianus), another endangered species.

In Pochutla, the factors that have the greatest influence on the local population “are land, pollution, non-timber forest resources and water,” Ávila said.

“It is necessary to strengthen social capital through networks, improve the products, work at the local level to assess unmet needs, and change the municipal focus on disasters from reactive to preventive,” Soares said.

This year, the researcher will divulge the information gathered, and in 2013 she will work with the local communities on designing actions, based on the available data.

“Local communities can make a difference. For that, what’s needed is a policy that goes beyond economic growth and a focus on employment,” Practical Action’s Warburton said.

All rights reserved, IPS – Inter Press Service, 2012.

This article may not be republished, broadcast, framed, or redistributed without the written permission of IPS – Inter Press Service. Republication of this material without permission from IPS, the copyright holder, constitutes a violation of United States and international copyright laws and may result in legal action.