This analysis was prepared by Council on Hemispheric Affiars Research Associate Katie Soltis, July 27, 2011
The U.S. tried to undermine Haiti’s oil deal with Venezuela in order to protect the vested interests of U.S. oil corporations. Under the Obama administration, the U.S. embassy worked with major textile companies to cap the minimum wage in Haiti at 31 cents per hour. Election monitors from the U.S. and the international community knowingly supported elections that did not remotely follow accepted democratic standards of procedure. When WikiLeaks announced its plan to release tens of thousands of classified U.S. diplomatic cables to the public, the U.S. government feared a massive international backlash and threat to national security. Although WikiLeaks’ impact on Latin America does not severely jeopardize U.S. security, the diplomatic cables could nevertheless cause irreparable harm to U.S. relations with several Latin American nations. Information released by WikiLeaks points to a continuation of U.S. dominance and the application of “neo-imperialist” diplomacy in Latin America, and the cables regarding Haiti, the poorest country in the Western hemisphere, exemplify the persistence of U.S. interference.
Haiti’s history is one of brutal colonial exploitation followed by systematic neocolonial intervention, and today the country faces extreme poverty and political turmoil. According to the UN Development Program, 78 percent of Haitians live on less than USD 2 per day and 54 percent of the population, or around four and a half million people, currently live on less than USD 1 per day. In light of the problems facing this troubled nation, the new information revealed by WikiLeaks concerning U.S. involvement in Haiti is particularly disconcerting. Janet Sanderson, the previous U.S. Ambassador to Haiti, once dubbed the U.S. “Haiti’s most important and reliable bi-lateral partner,” but the cables released by WikiLeaks show a much more one-sided relationship. Instead of helping Haiti develop economically and politically, Washington’s foreign policy seems completely dominated by influential and well-connected U.S. economic interests.
Petrocaribe: Haiti and Venezuela
René Préval became president of Haiti in 2006 and immediately attempted to improve U.S.-Haiti relations. U.S. Ambassador Sanderson reported in a cable that Préval “wants to bury once and for all the suspicion in Haiti that the United States is wary of him. He is seeking to enhance his status domestically and internationally with a successful visit to the United States.” Yet despite his desire to improve relations, newly elected President Préval unintentionally began alienating the United States on the very day of his inauguration. On this day, Préval signed a deal with Venezuela to join the Caribbean oil alliance, Petrocaribe, which allowed Haiti to buy subsidized oil from Venezuela. The government of Haiti would pay only 60 percent up front and then pay the rest at 1 percent interest over the next 25 years. This payment schedule would save the Haitian government USD 100 million per year, with which the government planned to supply basic needs and services to 10 million Haitians and increase investment in social projects like hospitals and schools. Additionally, the Petrocaribe deal would help lower and stabilize the cost of oil in Haiti after several years of high prices.
However, the new Haiti-Venezuela alliance unnerved Washington, and Ambassador Sanderson abetted U.S. interests in Haiti. Apparently determined to hold a tough stance against the oil deal, she wrote in a cable on April 19, 2006, that “Post [the Embassy] will continue to pressure Préval against joining Petrocaribe.” For two years, the U.S. government worked with ExxonMobil and Chevron, the two U.S. oil companies operating in Haiti, to undermine the new deal between Petrocaribe and Venezuela. The U.S. oil companies feared that they would have to buy their oil directly from the government of Haiti and would lose their profit margins as a result. As Thomas C. Tighe, a U.S. official in Haiti, wrote in a cable, “Chevron country manager Patryck Peru Dumesnil confirmed his company’s anti-Petrocaribe position and said that ExxonMobil, the only other U.S. oil company operating in Haiti, has told the Government of Haiti that it will not import Petrocaribe products.” Because Chevron and ExxonMobil controlled shipping and distribution channels, these two companies were able to prevent the Petrocaribe deal for two years simply by refusing to transport Petrocaribe oil and blocking their shipments. Throughout this time, Tighe said the Haitian government was “enraged that ‘an oil company which controls only 30% of Haiti’s petroleum products’ would have the audacity to try and elude an agreement that would benefit the Haitian population.” Chevron eventually signed the agreement in 2008, but the two-year fight against the deal exemplifies Washington’s willingness to disregard Haiti’s interests for its own economic and political agenda.
The real problem for the United States in this arrangement appears to be not just the challenge to U.S. economic interests but also the development of a lasting Haiti-Venezuela relationship. The U.S. is inevitably skeptical of Haiti’s ties with Venezuela, a nation whose leader fiercely opposes the United States. Préval continued to develop Haiti’s relationship with Venezuela, first with the proposed Petrocaribe deal in 2006 and, subsequently, with Préval’s attendance of the ALBA (Bolivarian Alternative for the Americas) summit in Venezuela in 2007. At the summit, Préval received a deal for an energy aid package from Cuba and Venezuela. Yet despite the proposed benefits for the Haitian people with both the Petrocaribe agreement and the later energy package, U.S. officials fought against the deals because they did not trust Haiti’s possible close relationship with these two demonstrably anti-American governments.
However, the United States’ determination to undercut these agreements seems unwarranted. Although Venezuela and Cuba are outspoken in their opposition to the United States, Haiti does not participate in their leftist, anti-American rhetoric. In fact, Washington was cognizant of the fact that Haiti’s participation in these agreements did not reflect an alliance against the United States. Sanderson reported in one cable that “at no time has Préval given any indication that he is interested in associating Haiti with Chávez’s broader ‘revolutionary agenda.’” Instead, Préval’s relations with these other governments stemmed from his desire for socioeconomic improvement. The U.S. government acknowledged this, as seen by Sanderson’s report that Préval “will manage relations with Cuba and Venezuela solely for the benefit of the Haitian people, and not based on any ideological affinity toward those governments.” Despite this recognition, the U.S. government fought strongly against these agreements, evidencing the true priorities of U.S. policies towards Haiti. The U.S. earlier stated that it is “Haiti’s most important and reliable bi-lateral partner,” but these cables show the limits of Washington’s commitment to aid Haiti. Rather than supporting Haitian attempts at development, the U.S. was willing to undermine beneficial agreements in order to continue its anti-Chávez policies and to protect the interests of big oil companies.
Textiles: U.S. Interference in Wage Laws
In another instance of U.S. interference documented by WikiLeaks, the Obama administration tried to prevent minimum wages in Haiti from rising above 31 cents an hour. In 2009, Port-au-Prince passed a law that raised the minimum wage from an astonishingly low 24 cents to 61 cents an hour. This law would have increased the minimum wage by 150 percent to about USD 5 a day, but, even with this large increase, the new measure would still have fallen short of the estimated USD 12.50 a day needed to provide for a family of four in Haiti.
The proposed wage increase was of course enormously popular with Haitians, who argued that the increase was necessary because of the rising cost of living. However, U.S. textile companies with factories in Haiti, including Fruit of the Loom, Hanes, and Levi Strauss, fought the measure, while the U.S. State Department also exerted pressure on the government of Haiti. David E. Lindwall, a deputy chief of mission, said the minimum wage increase “did not take economic reality into account” and was a populist measure for “the unemployed and underpaid masses.” U.S. plant owners argued that, should the cost of labor rise substantially, these U.S. companies would have to close their factories in Haiti and relocate. Based on the insistence of these U.S. textile companies and the U.S. embassy, the Haitian government agreed to limit the increase to only 7 cents, at 31 cents an hour.
The recent fight over the proposed wage increase is merely the most recent instance where U.S. foreign companies have tried to keep wages low by threatening to close production facilities in the country. The Haitian Platform to Advocate Alternative Development (PAPDA) argues that every time the government of Haiti has proposed a minimum wage increase, lead industries “cried wolf” and threatened to halt production in all major factories in the nation, further jeopardizing economic stability in the country. However, according to PAPDA, “in every case, it was a lie.”
PAPDA implies that closing factories is an empty threat made by U.S. businesses to extort low wages. Based on the actual cost of the minimum wage increase relative to overall profits, this is likely the case. According to a U.S. embassy cable, it would cost Hanes USD 1.6 million a year to pay its workers an extra USD 2 a day. This cost is very low compared to the company’s registered profits of USD 211 million with sales of USD 4.3 billion. Furthermore, Haiti already has some of the lowest paid workers in the world, so finding cheaper labor would be unlikely. Yet whether or not U.S. factories would actually pull out of Haiti, the cables are significant in pointing to the weight of U.S. influence in Haiti. The degree of power U.S. businesses exert over the government of Haiti is particularly alarming as it prioritizes U.S. financial gains over fundamental economic improvements for 25,000 poverty-stricken textile workers.
Elections: International Support for Non-Democratic Process
Leaked cables also provide further information about the international community’s support for Haiti’s 2009 elections. International election donors, including ambassadors, members of NGOs, and leaders from the UN, were charged with monitoring the election procedures and reporting instances of electoral fraud. Yet these donors ignored their responsibility to uphold democratic standards, as they supported these elections despite unfair electoral procedures.
Haiti’s Provisional Electoral Council (CEP), which was appointed by then-President Préval, decided to exclude the political party Fanmi Lavalas (FL) under the guise of not having proper documentation. FL, the party of exiled former President Jean-Bertrand Aristide, is a leftist political party that is also very popular among the poor. However, its influence has waned since Aristide was overthrown in 2004 and exiled in a U.S.-supported coup. Since Aristide’s removal from office, Préval’s party has worked to curtail the FL’s influence and popularity, and the party has been excluded in several elections.
The FL’s exclusion caused concern among international donors charged with overseeing the electoral process. Canadian Ambassador Gilles Rivard questioned the impact that this exclusion would have on the elections: “If this is the kind of partnership we have with the CEP going into the elections, what kind of transparency can we expect from them as the process unfolds?” Furthermore, leaked U.S. cables said the decision of the electoral council was “almost certainly in conjunction with President Préval,” as an attempt to rig the outcome of the election. International donors recognized the dangers of supporting the elections: they would not only be undermining democratic procedures but also would be seen as supporting Préval.
Despite these initial concerns, the international community decided to support the elections. A cable sent by U.S. Ambassador Kenneth Merten recorded the views of a European Union representative, who said, “the international community has too much invested in Haiti’s democracy to walk away from the upcoming elections, despite its imperfections.” Furthermore, Merten argued that the elections should proceed because “without donor support, the electoral timetable risks slipping dangerously, threatening a timely presidential succession.” In total, international donors gave an estimated USD 12.5 million to finance the election—about 72 percent of the total cost—even though they knew that the election was not free or fair.
The Organization of American States adjudicated the disputed first round results and decided that the run-off candidates would be Michel Martelly and Mirlande Manigat. Martelly proceeded to win the election, but, notably, only 23 percent of Haitians participated. This marks the lowest participation rate in the entire hemisphere since 1945. The lack of voter participation has been attributed to disappointment about the exclusion of the FL and dislike of the two candidates.
The circumstances of the election reflect a difficult situation for the international community’s involvement in Haiti. Its disregard for standard democratic procedures, with open and fair elections, undermines a commitment to democratic ideals. On the other hand, if they had refused to support the elections, Haiti could once again fall into political turmoil. Such chaos would plague other international investments in the nation, while potentially further stalling the realization of stability and development in Haiti.
The repercussions of the WikiLeaks Haiti cables are a far cry from the massive national security breaches that the U.S. government originally feared. The cables detailing U.S. relations with Haiti do not contain the same devastating potential as other cables might have, and the information leaked here will not jeopardize national security. Whether or not WikiLeaks was justified in releasing this classified information, these cables shed valuable light on the hypocritical nature of U.S. foreign policy in one of the world’s most troubled nations. Based on these cables, we see a disturbing image where U.S. foreign policy is shaped by the interests of the rich and is geared toward underhanded interference in the affairs of other nations.