State Department Recommends Aid Cutoff to Honduras

After two months, the State Department is poised to formally declare what was obvious to most of the world: on June 28, Honduras experienced a military coup.

State Department staff have recommended to Secretary of State Clinton that the ouster of Honduran President Zelaya be formally declared a "military coup," which could cut off as much as $150 million in U.S. funding, Reuters reports.

The semi-official story has been that State Department lawyers were studying the events in Honduras to see if they met the "technical definition" of a "military coup." But all along the State Department made clear that it was purposely delaying its formal determination to give "diplomacy" - the talks in Costa Rica between representatives of President Zelaya and representatives of the coup regime - a chance to work.

It was never explained why making this determination - which, under U.S. law, requires a cutoff of aid to the coup government - would have interfered with "diplomacy." On the contrary: it was immediately obvious that the obstacle to a negotiated solution was the intransigence of the coup regime, which refused to accept a compromise proposal that would allow President Zelaya to return. So, as many Latin American governments argued - including the Costa Rican government - if the U.S. wanted a negotiated solution, it needed to ramp up pressure on the coup regime.

But the State Department is now, at last, conceding that its previous efforts were insufficient. Better late than never - much better.

No doubt Republicans in Congress who have supported the coup regime in Honduras will now complain loudly when Secretary Clinton makes her formal determination - assuming that she follows the recommendation of her staff.

In anticipation of right-wing Republican complaints, it is important to note two key facts.

First, in making this determination, the State Department is simply following the law. The Foreign Assistance Act requires a cutoff of U.S. aid "to the government of any country whose duly elected head of government is deposed by military coup or decree." That's what happened on June 28 - about that central fact there has been no serious dispute. Even the top legal advisor of the Honduran military conceded that the Honduran military broke Honduran law when it removed President Zelaya from office - and from Honduras.

Second, in making this determination - and cutting off aid - the State Department is simply following past practice. As the Center for Economic and Policy Research documented in a recent report, when there were coups in Mauritania and Madagascar, Millennium Challenge Corporation money was cut off within days.

So complain away, right-wing coup-lovers. If we want Latin America to take seriously the claim of a new U.S. approach to Latin America in the Obama Administration - or maintain a credible commitment to the rule of law in the region - this is the minimum.

Great!!!!more debt for Hondruas. or let me state that another way .. more debt for the Honduran pploee!!!!our world is drowning in debt!!!! we as a country and the whole world MUST learn to live within our means, meaning NO MORE DEBT.I for one took this stand two years ago for our family, and have been paying down our debt substantually every month. In less than a year we will be debt free.In our families we have to learn to live within our means, why should our Governments be allowed to spead beyond what their income is??The correct answer is; they should NOT be allowed to do so!!!Every Government should and MUST adopt a balanced budget approach to running their countries, just as we have to within our families!!!

Wages and poverty: As the CEPR Report (basis for most stats used in this U.K. alcitre) clearly points out, the low Honduran maquila wage still isn't low enough to maintain fullest employment levels as they are undercut by Asain competitors. Additionally, the maquilas are immune from standard minimum wage adjustments that apply to non-maquila workers (such as Zelaya's adjustment which was upheld by the alleged pro-business, pro-coup Supreme Court, in a very well-stated opinion). It is not possible to separate in any meaningful way wages, employment and poverty though this is what opften happens in statistical measures. You cannot reduce poverty by increasing wages, unless of course there is little or no unemployment due to that adjustment (unemployment is what happened in Honduras though not due solely to the wage hike). Also, you cannot decrease poverty by a wage hike unless of course employers actually pay the hiked wage (most employers do not pay the minimum wage, as CEPR notes; those that do are most often large outfits, usually owned by the Golpistas themselves). What the alcitre avoids are many things that matter, namely what provides jobs and which jobs are tied to which wages, and if poor people ever receive the alleged wage hike. Direct Foreign Investment had plummeted pre-Coup (a drop of nearly 45% in just the first half of the year 2009, as compared to 2008 per CEPR). One primary cause is the creation of a climate that does not encourage investment such as Zelaya & Rodas often bizarre statements on the country's future. Another factor that crushes investment, which reduces jobs and furthers poverty, is crime and violence. While my country is insanely violent right now, this is merely a progression of what happened under Zelaya as he did not deal with criminals or drugs (the Honduran murder rate per 100,000, by year: 2003 (34); 2004 (32); 2005 (35); 2006 (46); 2007 (50), 2008 (58); 2009 (67). When a place is violent, businesses reduce hours (compare San Pedro operations 1987, 1997, and 2007). What is the solution? If you raise the maquila wage then added countless jobs will be lost to Asia. If you hike the current wage, Golpista companies will eventually reduce the employment rolls. If you try to force everyone to pay the minimm wage, there will be mindboggling unemployment. If the wage was what really matters, then analogies to Nicaragua should stop as their wages are even lower. Many of the so-called accomplishments exist only on paper. The free school cherade is something many Hondurans know quite well. While journalists outside Honduras often tout this accomplishment (and the school lunch one), many Hondurans know it is usually a lie (I have family in San Marcos, Comali, outside Choluteca and Santa Rosa and Tocoa and none of them had their school fees removed at any time during the Zelaya administration and it is a story well known to countless Hondurans who cannot afford private schools).

the evidence unlcuivoqaley supports the view that increases in the minimum wage, by increasing the earnings of low-income workers without diminishing their employment opportunities, have historically helped to lower poverty rates.Bernstein directly takes on the conservative claim:opponents of increases in the minimum continue to raise the same objection: the increase will lead to job loss. This claim is based on the simple textbook notion that is the price of a good is competitively set by the free market, any diversion from that price will lead to lead to an inefficient outcome. In this case, the prediction from the simple model is that the increase will price low-wage workers out of a job....There are a priori reasons to be skeptical of this simplistic view. Low-wage workers are not "goods," and the low-wage labor market is far from the competitive laboratory that exists in Econ 101 textbooks....The theory that "small" increases in the minimum wage lead to job losses has been repeatedly tested and repeatedly found lacking ... The state of economists' understanding of the issue was recently summarized by Nobel laureate Robert Solow, who noted that "the main thing about this research is that the evidence of job loss is weak. And the fact that the evidence is weak suggests that the impact on jobs is small."That is: the arguments against raising the minimum wage are abstract and based on theory; real world studies of what happens when minimum wages are increased show that it does help combat poverty.Now, you may say, that is true in the US but Honduras is different. Yes, Honduras is different-- wide noncompliance with minimum wage laws, for example, and corruption on local levels that means policies are not enforced are effects that make it difficult for government to affect the overall economy. But that does not mean governments should give up on trying to change things. http://dqgyynx.com [url=http://snjxjz.com]snjxjz[/url] [link=http://fbaoorqm.com]fbaoorqm[/link]

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