The Alianza: A Matter of Climate

The basic principle of the Alianza is that government aid and free enterprise should work together as neatly as a pair of greased pistons. In practice, it is becoming increasingly evident that the pistons tend to get stuck. The Alianza actually works to the detriment of free enterprise, argues Guillermo Moscoso, a United California Bank executive and cousin of Teodoro Moscoso, U.S. representative in the Alianza's inter-American committee. After a three-month study of Latin American economies, Moscoso concluded that government-to-government programs operate "to the exclusion of the knowledge, power and wealth that free enterprise could bring to the effort."

This week in Chile, New York's Republican Senator Jacob K. Javits went even further. Javits warned against the "erosion of investor confidence" in Lat in America, predicted a "great outward tide" of private investment, both in U.S. and local money, unless a major effort is made to reverse the trend. It is up to Latin American governments, said Javits, to do more to improve the climate for business. The private sector actually accounts for 70% of all economic activity in Latin America. And, contrary to popular belief, said Javits, "90% of that private sector is owned by Latin American investors themselves."