Policy Podcast: Western Hemisphere

ASSISTANT SECRETARY SHANNON: Happy to be here.

QUESTION: Let me ask you first a question I always get asked about when I go out. Fidel Castro, what is the situation? What's his state of health? How much longer is he going to be in power in Cuba?

ASSISTANT SECRETARY SHANNON: Well, the reality is the Cuban regime is like a black box. It's hard to see what's going on inside of it. So we know that Fidel Castro at 80 is an old man who's going through a very difficult health crisis and he's someone who has effectively transferred the day-to-day management of the Cuban Government to his brother Raul and those around Raul. But he's still present. He still creates a political context with the regime and it's one of the reasons the regime really has not been able to make any kinds of significant changes since his illness last August.

QUESTION: Let me ask you another question more general about the perceptions of the U.S. in the region. We always hear about this sort of antipathy towards the United States in the region. What do you find when you travel throughout the region? I know you spent a lot of time on the road down there.

ASSISTANT SECRETARY SHANNON: What I find is a lot of interest in the United States and a real interest in having the United States as a partner. Most countries in the region recognize that in order to be successful politically and in terms of meeting a social agenda, they need a good partnership with the United States. They need access to U.S. markets, they need political support from the United States in international and financial institutions. And some countries need U.S. financial and technical assistance. And we found that for the most part, countries are serious about the relationship of the United States and want to have a dialogue with us about how to improve partnership.

QUESTION: And how about among the people of the region? I mean, is this one of those cases where political figures can make an issue out of the United States and count on getting votes in election?

ASSISTANT SECRETARY SHANNON: Some can and some will do that.

QUESTION: Right.

ASSISTANT SECRETARY SHANNON: Now, the reality is, is that historically for a variety of reasons, there has been a small reservoir of anti-Americanism in the region in relationship to our perception and what -- how people have seen our past activities in the region. But I think the President's most recent trip and especially his articulation of a message that focuses on democracy delivering the goods and on providing social justice has really underscored how committed we are to the region and that has resonated and that's resonated in a positive way. And so what we find when we go into the region, again, just as in government, people want to connect with us; people want to have a relationship with us.

QUESTION: Let me get back to that term "social justice." Are we talking -- when President Bush talks about social justice and when President Lula talk about social justice, two politicians from different ends of the political spectrum, are they talking about the same thing? Is this just some sort of rhetorical way to paper over political differences or are they really talking about the same kinds of objectives?

ASSISTANT SECRETARY SHANNON: I think there's been a real convergence in terms of our agenda and the agendas of other countries in the region. It started really back in Quebec City in 2001 at the Summit of the Americas, but over time we've slowly been able to close the gap in terms of perfection and understanding. And I think what's striking is that the United States and the other countries in the region really have a common understanding of what the problems are and it's about democracy, delivering the goods, it's about fighting poverty, fighting inequality and fighting social exclusion, with jobs, education and health care. That was the focus of the President's trip in the region. That's the message he delivered and it was a message that leaders could connect with immediately because that's the same kind of understanding of the social agenda and social justice that they have.

QUESTION: I understand that there's going to be a White House conference coming up on just this issue, talking about democracy and social justice in the hemisphere. What sort of things do you want to accomplish out of that?

ASSISTANT SECRETARY SHANNON: The conference will take place on July 9th. It's a White House conference. It's sponsored by the President and the First Lady. It will involve a series of cabinet officials, including Secretary Rice. And again, the focus is on social justice in the Americas. But it has a couple of purposes; first, following up the President's trip which was a real focus on what the U.S. Government's message was in the region and how the U.S. Government is working with their partners in the region to promote jobs, education and health care. This is also about how our society -- our private sector, our universities, our faith-based institutions -- are connecting with their counterparts in the region and doing really innovative, interesting things on the social side: creating jobs, improving education and increasing access to public health care.

And so we're going to bring in a lot of people from the region, a lot of people from NGOs in the private sector and universities and faith-based institutions to meet with U.S. counterparts, to have U.S. cabinet officials kind of engaged with them and talk about best practices. And our hope is that by the end of this conference, we'll have a very clear idea that there's this enormous connectedness in the Americas and that, in fact, integration is taking place at a much faster pace than governments are anticipating and that we really are seeing what Secretary Rice called an "alliance of people."

QUESTION: So you think that despite differences between political leaders or between governments that you really are starting to see more and more integration just at the individual level, at the sub-national level. Is that going to be a more important force, say, in the next 10 years than say, government-to-government relations? How do those two things --

ASSISTANT SECRETARY SHANNON: It's going to be incredibly important for us. But the role government can play is either to facilitate this integration and to create positive parameters for it and to use it, to address the larger social agenda of the region or it can attempt to interrupt it, to create certain standards that (inaudible) deals or really rerouting of it, which would actually kind of lessen its impact and really impede the ability of people to connect. And what we're seeing is integration, not only north and south, not only between the United States and the rest of the region, but inside the region itself, between Brazil and Bolivia, between Argentina and Chile, within Central America. This is an incredibly dynamic and rich period and it is incumbent upon governments to facilitate this project, put it in the proper kind of legal parameters and then make sure it has the impact it can have.

QUESTION: So in that sense, have the government get out of the way.

ASSISTANT SECRETARY SHANNON: Get out of the way, but establish clear boundaries, make sure that the rule of law guides this process and that when people connect, they do so within a secure environment.

QUESTION: Right. Let me ask you about one example of that, one practical example of that: biofuels with Brazil. Now, this is an agreement that is designed to encourage cooperation between Brazil and the United States in the area of biofuels. Is this more of a government-to-government program or is this going to be a private sector-to-private sector kind of program?

ASSISTANT SECRETARY SHANNON: A couple points. First, the biofuels industry will be driven by private capital and the private sector. However, it needs government now to get it moving. The President in his State of the Union address said the United States is going to reduce its consumption of hydrocarbons by 20 percent over 10 years. That creates an enormous market for alternative fuel and renewable energy sources. And biofuels will play an important part of that.

When the U.S. did its biofuel Memorandum of Understanding with Brazil, it had three components. First was sharing technology between Brazil and the United States and also scientific research. That has already begun. There are Brazilian scientists in the United States, there are U.S. experts in Brazil. Second, start identifying third countries that want to create their own biofuels industry and share our experiences and our technology with these countries to allow them to see that.

QUESTION: These other countries in the hemisphere?

ASSISTANT SECRETARY SHANNON: In the hemisphere. And we've already identified the first tranche of countries we're going to be dealing with: El Salvador, the Dominican Republic, Haiti and St. Kitts and Nevis. But Brazil and the U.S. are talking to other Central American countries and to other Caribbean countries to see what other countries would be interested in creating their own national biofuels industry and there are also conversations going on in South America about this.

The third part of the agreement was to create an International Biofuels Forum that will begin to establish the standards and the regulations necessary to make biofuel an international commodity that can be traded easily and with confidence. And again, this forum has already been created and is already up and running. But what's interesting about this is that the purpose is not to create a new cartel, the purpose is not to create an OPEC. It's to allow countries to develop their own biofuels industry, turn parts of their agricultural sectors into energy sectors, build new strategic relationships with the United States and other countries that want to use biofuels. But ultimately this will be driven not by governments, but by private investors.

QUESTION: Let me ask you a couple of questions on this. I want to go into it a little bit more. Now -- so the -- will the net effect of this agreement be that we will start to see Brazilian biofuels showing up in U.S. markets, biofuels produced in Brazil shift into the United States? Or is it that there will be partnering agreements where by we -- U.S. terms (inaudible) license Brazilian technology and produce biofuels here? How is that going to work, do you think?

ASSISTANT SECRETARY SHANNON: Well, the reality of the biofuels market right now is that the U.S. is producing biofuels and Brazil is producing biofuels. Neither country can produce enough biofuels to meet its own internal demand. The President has set out a challenge to the United States to reduce our hydrocarbon consumption by 20 percent. And at this point, we're not going to be able to meet that through our own national production. Brazil, which has been enormously successful in creating energy self-sufficiency and enormously successful over the last 30 years in building a biofuels industry, has also been very successful in its flex-fuel motor program. And therefore it has not been able to have the kind of mix in its fuel that it wants to because it doesn't produce enough ethanol.

This is one of the reasons why it's so important to work with third countries because neither the United States nor Brazil can produce enough biofuels at this moment. So it's vitally important to have other countries out there producing biofuels, to help us meet our demand while meeting -- while creating energy independence in the countries that we're working with.

QUESTION: One last one on biofuels. One criticism that you hear all the time through bumper stickers, you know, in producing these fuels, you're taking mouths -- food out of the mouths of people in the region. What do you have to say to that?

ASSISTANT SECRETARY SHANNON: I think the best answer to that is to look at the Brazil experience. Brazil has gone through a real revolution in its energy sector. It's producing a lot of ethanol right now, largely cane-based ethanol. But at the same time, it's reducing deforestation in the Amazon and it's increasing its agricultural output. So with the right kind of agricultural policy, with the right kind of management, you can meet your energy needs, while increasing your food (inaudible) -- increasing your ability to produce food.

QUESTION: Let me shift now to our two closest geographic neighbors, Mexico and Canada. I know that the President and Secretary Rice recently within the past couple years, talked about a follow-on, if you will, to the agreement signed in 1990's NAFTA agreements, designed to break down some of those non-tariff barriers. Where do we stand with that -- those discussions?

ASSISTANT SECRETARY SHANNON: Well, the Security and Prosperity Partnership was established between Canada, the United States and Mexico in Waco, Texas in 2005. Since then we've had several leaders meeting, first in Waco, then in Cancun. And in August, North American leaders will be meeting in -- across the river from Ottawa in Montebello, Quebec, to continue the discussions on how we can not only kind of break down the remaining regulatory barriers between the United States, Canada and Mexico, in terms of trade, in terms of kind of enhancing the flow of goods and services under NAFTA, but also to look for ways to armor our economy. In other words, to protect our economy from not only terrorist attacks, but also other kinds of national security issues, whether they be environmental disasters or ecological disasters.

And what we're doing in the process is recognizing that we are three sovereign countries with our own forms of government and our own way of dealing with things, but countries that share a common economic space and a common geographic space that we have to protect. And I think the three leaders have done a lot of work in establishing a well defined agenda for the three countries and processes that allow us to do this in a way that's open and transparent and addresses the concerns of our industry and our people while, at the same time, making sure that we're creating resilient societies where our economies, our democratic institutions and our liberties are going to be protected against attack from the outside.

QUESTION: One final question, on a domestic development that might have -- could have ramifications for the (inaudible) -- at least how the U.S. has viewed (inaudible). The immigration reform bill went down to the (inaudible) in the Senate recently. How is that going to effect views of the United States among the peoples of the region? Is this going to -- are they going to view this as just another attempt by the United States to distance itself from the region?

ASSISTANT SECRETARY SHANNON: Well, I think there's a lot of disappointment over the decision taken in the Senate. Many of our closest neighbors, both in Mexico and Central America, were really hoping for legislation that would create a pathway that would allow us not only to regularize the status of illegal aliens in the United States now, but also to find ways to a temporary worker program to create legal channels for people to move from Mexico, Central America and other countries into the United States. This obviously isn't going to happen now, at least not in the near future, so that was a disappointment. But at the same time, there's a lot of respect for our Congress out there and there's a lot of respect for the kind of debate that we had here in the United States, and the recognition that this was a debate not only about immigration, but also about border security.

And so one of the things we're going to be doing and that we look forward, as we talk to our Mexican colleagues, as we talk to our colleagues in Central America, is understand how we can work together better to improve border security not only for ourselves, but for all the countries in the region that face the phenomenon of immigration. So it's important to understand migration is not only about us, it's a phenomenon that has hit large parts of the region -- Central America, Mexico, the Caribbean, and also Canada. And the degree to which we can begin to understand the phenomenon of migration regionally and have a conversation among ourselves we'll be able to improve our security cooperation. And I think at that point, kind of regain a sense of confidence, at least within our own Congress, to allow us to move forward on comprehensive immigration reform.

QUESTION: Great. There's a lot more that we could cover, but we're out of time. Maybe we can have you back. Thanks so much for joining us.

ASSISTANT SECRETARY SHANNON: Thank you. Appreciate it.