As Laura Rozen reports today on The Cable, the State Department has announced it will cut aid to Honduras, contingent upon the return to office of ousted President Manuel Zelaya, with whom Secretary of State Hillary Clinton met today.
This might seem like a pretty standard move: military ousts government in coup -- U.S. cuts off funding. Far from it. Today's announcement comes after a long debate within Washington over exactly where to fall down on the issue -- one which I reported on early last month. On the one side are the majority of Latin American countries who have condemned Zelaya's ousting and called on the United States to do the same. But on the other side are the countless analysts and officials who point out that Zelaya was hardly a democrat. They claim that his ousting was not a coup but was in fact a product of Zelaya's own political mis-actions. The latter camp also argues that to side with Zelaya would be to hand a big victory to one of the Honduran leader's biggest allies in the region: Hugo Chávez of Venezuela.
In short, the Zelaya question has come down to one of where Obama falls on the ideological debate in Latin America. If the administration backs Zelaya, as it looks to be doing, it will undoubtedly face criticism from Republican congressmen and senators who think defending U.S. interests in Latin America means standing firm against leftist leaders (like Zelaya) in Venezuela, Ecuador, and Nicaragua. But if Obama backed the now de facto government in place in Honduras, he would lose points from nearly all U.S. allies in Latin America -- not just Venezuela but others such as Argentina and Brazil as well.
The administration seems to be siding with the Latin American majority -- perhaps a nod to the idea that engagement with the region trumps ideological constraints.
But all this is to say nothing of the impact that the State Department's decision will have in Honduras, a country that stands to lose $22 million in U.S. aid and $200 million in funding from the Millennium Challenge Corporation. Honduras is also heavily dependent on the United States for trade, so Washington's words ring loud and forebodingly in Tegucigalpa. To say that the United States holds sway in Honduras would be a massive understatement. So revoking aid will put serious pressure on the de facto government, who was planning to hold elections later this fall to replace Zelaya.
This story is not over yet. And Washington will surely be a key player.
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