SEPTEMBER 11 ANNIVERSARY; IRAN; US ECONOMY; US-URUGUAYAN

UNCLAS BUENOS AIRES 001994 SIPDIS STATE FOR INR/R/MR, I/GWHA, WHA, WHA/PDA, WHA/BSC, WHA/EPSC CDR USSOCOM FOR J-2 IAD/LAMA SIPDIS E.O. 12958: N/A TAGS: KPAO OPRC KMDR PREL MEDIA REACTION SUBJECT: SEPTEMBER 11 ANNIVERSARY; IRAN; US ECONOMY; US-URUGUAYAN FTA; ARGENTINE FOREIGN POLICY; BOLIVIAN CONSTITUTION; GSP REVIEW; CHINA AND THE DOHA ROUND NEGOTIATIONS; CUBA; 09/05/06; BUENOS AIRES ¶1. SUMMARY STATEMENT Weekend stories cover the fifth anniversary of the September 11 attacks; the USG's alleged use of the war in Iraq for upcoming US legislative elections; the positions of the US, EU and Russia vis-`-vis the imminent sanctions on Iran; the US-Uruguayan FTA; the condition of the US economy; the Argentine Government's foreign policy; the debate on the Bolivian constitution; the GSP review; China making conditions to help restart the Doha Round negotiations; and Argentina's alleged return to the Non-Aligned Countries' Movement. ¶2. OPINION PIECES AND KEY STORIES - "If 9/11 had not happened" Gwynne Dyer, contributor to liberal, English-language "Buenos Aires Herald," writes (09/04) "Five years since 9/11, and we are still being told that the world has changed forever. But the terrorist attack on the US on September 11, 2001 was a low-probability event that could just as easily not have happened. "... Would the world really be all that different now if there had been no 9/11? "There would have been no invasion of Afghanistan, and probably no second term or President George W. Bush, whose main political asset for the past five years has been his claim to be leading the US in a Global War on Terror. Deprived of the opportunity to pose as a heroic war leader in the image of Winston Churchill or Franklin D. Roosevelt, Bush would have had great difficulty in persuading the US public that his first-term achievements merited a second kick at the can. "... The main risk at this point in history is that the great powers will drift back into some kind of alliance confrontation... "Avoiding that disaster at the expense of the world's much abused Muslims is not an acceptable option, but it appears to be the preferred solution of the moment. And that, five years on, is the principal legacy of 9/11." - "US: use of war in campaign time" Leading "Clarin" carries an op-ed piece by international analyst Oscar Raul Cardoso, who writes (09/02) "... Finally, it was US President George W. Bush who joined the quire of official voices trying to rescue the Iraqi fiasco in front of the eyes of a majority that believes that the disaster is unavoidable and that it would be proper to put an end to it. Everyone has said that the task in Iraq is unfinished, and suggesting to leave it as it is would be the same as renouncing the victory of 'democracy and freedom.' "Why is this so precisely now? Welcome to the second half of 2006 election year, which will define whether Republicans can retain control of both Congress chambers so that the last part of Bush's second presidency will not turn into a political desert. "However, it is not only the disaster in the Persian Gulf that we are talking about. What is really at stake is proving that the political magic of collective fear still works in US politics. "And for this purpose, it is necessary to recreate the broken ties between the September 11 attacks and the invasion and occupation of Iraq almost two years after it. If ties between the two events are not reestablished, then the likelihood of Bush's men in upcoming elections will be low." - "The US seeks to punish Iran, but Europe and Russia are against it" Leading "Clarin" reports (09/02) "While the US said yesterday that eventual sanctions on Iran for not putting an end to its nuclear program should not damage 'the Iranian people,' the EU and Russia disagreed with Washington... "... The US position was established by Ambassador to the UN John Bolton, who spoke of the possibility of retaliation against the Ahmadinejad administration. Bolton said 'We have no conflict whatsoever with the Iranian people. We do have it with the government, which wants to manufacture nuclear weapons.' "According to Bolton, there are two kinds of sanctions - the relatively soft sanctions, which can be increased with time, as proposed by the EU, and the toughest sanctions.' However, the EU refused to talk about possible retaliation." - "Iran divides Europe from powers" Gustavo Sierra, international columnist of leading "Clarin," writes (09/03) "Powers are divided once again. This time, this is due to the Iranian nuclear program. On Thursday, representatives of the UN Security Council plus Germany and Italy will meet to decide what sanctions will be imposed on Tehran for not complying with the UN mandate to put an end to its enriched uranium program. Only some minor sanctions are likely to be imposed on companies involved in the Iranian missile industry. "The US, the UK and France believe that tough sanctions should immediately be imposed... Russia and China are against any kind of sanction whatsoever. "... Europeans have started to see the confrontation with Iran as a waste of time and effort. They know that the Iranian nuclear program is irreversible and that the only thing they can do is attempting to limit it to civilian uses." - "Uruguay negotiates an FTA with the US, China and India" Eleonora Gosman, on special assignment in Rio de Janeiro for leading "Clarin," writes (09/02) "Yesterday, Uruguay again asked for a 'waiver' from its Mercosur partners to negotiate separate bilateral trade deals with the US, India, and now also China. Its Argentine and Brazilian counterparts let the door open for this demand, but they said that every FTA signed by Montevideo should prove that it will not damage Mercosur. "According to (Uruguayan) Minister Danilo Astori, the Argentine-Brazilian accounts for 80 percent of total regional trade. According to Montevideo envoys, 'Uruguay understands that this situation can only be solved with a flexible attitude from major partners - we have to make progress on bilateral negotiations with third countries to help balance a Mercosur where asymmetries prevail...'" - "US consumption empire slumps" Leading "Clarin" carries an opinion piece by Felipe A. M. de la Balze, economist and international negotiator, who writes (09/03) "US citizens have lived well beyond their economic possibilities during the last ten years. Their personal saving declined from 7% on GDP in 1996, to 0% during the last two years. For its part, the USG has a deficit of about 3% on GDP. Only does the business sector save significant amounts, but not enough to fund productive investment (17.5% on GDP). "... Foreign capitals are funding a substantial amount of production investment and governmental deficit. However, those funds have become potentially more volatile. "... In order to cut down its dependence on foreign capitals, the US will have to cut down its trade deficit (which accounts for more than 90% of its foreign deficit). For this purpose, it will have to increase its exports of goods and services and replace imports - both choices will take time and call for new productive investment. "... In the best scenario, its growth rate will be lower. In the worst scenario, it will suffer the effect of recession, which will reduce production and employment. "Unluckily, this will not only affect the US consumer but also the world economy. US massive imports have contributed to the growth of the employment and GDP of many countries. The main exporters to the US (among others, Germany, Canada, China, Japan and Mexico) will suffer the consequences." - "Carlos Perez Llana - 'This (Argentine) Government has no foreign policy'" Daily-of-record "La Nacion's" columnist Carmen Maria Ramos, interviews Carlos Perez Llana, expert in international relations (09/02) "Carlos Perez Llana said 'There is a huge ignorance (in the Argentine Government) about the world. The Argentine Government does not correctly assess the international agenda and it has no foreign policy. It does not know which countries are its partners, its allies, and it has not decided whether it wants to be aligned with populist or social-Democratic models.' "... Asked about (President) Kirchner's alignment, Perez Llana, said 'Unluckily, the feeling is that we are closer to the populist or Chavist model, which, in my opinion, is a mistake. "... I think the main mistake, not only from Argentina but also from Brazil, is Venezuela's entry into Mercosur... I believe Brazil will end up negotiating with the US. At this point, one should wonder what Argentina's position is. I believe Argentina has no answer to this because it has no foreign policy. "About the (Argentine) affinity with the Bolivia-Venezuela-Cuba axis, Perez Llana says 'If I say that I am a strategic ally of Venezuela, and Venezuela is a strategic ally of Iran or Belarus, I am being wrong in my affinities. These kinds of allies are useless because they do not help us in being reliable and in generating conditions for a better standard of life of our people... Therefore, foreign policy should be defined by interests and not ideology'... 'Following Chavez is not the proper thing to do, firstly due to Chavez's characteristics and secondly because Venezuela is making a series of international bets... that are aimed at hindering the US' exercise of power." - "The return" Marcelo Cantelmi, international editor of leading "Clarin," writes (09/03) "It may seem an extravagance in the West's eyes, and it can also be underestimated. However, the inclusion of indigenous rules, uses and customs in the new Bolivian constitution is one of the roads of return of most inhabitants of the country to the public light. "Clearly enough, if the Bolivian history had taken into account their huge presence not only in terms of their customs but also their economic, legal and human rights, modernity would have limited the profound protest entailed by this debate. "The search for these roots goes hand in hand with the demand for equality in life standards and justice, which can no longer be overlooked." - "(Argentina) asks the US not to remove GSP benefits" Hugo Alconada Mon, Washington-based correspondent for daily-of-record "La Nacion," comments (09/03) "According to Argentine FM sources, after three weeks of negotiations in Buenos Aires and Washington, the (Argentine) Government has asked the Bush administration to extend preferential rates benefiting Argentine products for 616.5 million dollars. "Argentine Ambassador Jose Octavio Bordon signed the request for the USTR to maintain the GSP benefits for the country. "According to the USTR's spokesperson, Stephen Norton, the USTR will take 'weeks or even months' to analyze the requests from every country. Argentina belongs to a group of 12 main countries (with exports for over 26.7 billion dollars in 2005) that benefit from the system. "The diplomatic request could be combined with presentations that Argentine exporters and importers could make at international fora to plead for the maintenance of the preferential access to US markets." - "Crucial - the US confirms obstacles to Argentine exports" Business-financial "Ambito Financiero" carries an opinion piece by columnist Carlos Burgheo, who writes (09/04) "This week will be crucial for the Argentine trade. The Bush administration will have to confirm whether it will effectively remove the country from the GSP, which could cause a loss of about 600 million dollars/year in exports... "Officially, the (Argentine) Government knows that the benefit will be lost, and the Foreign Ministry is preparing a new strategy to re-direct exports to some other markets... "... The Government is also preparing a formal protest that will be made effective in October to the new US Ambassador to Argentina, Earl Anthony Wayne, whose first steps in the country will not be easy. FM sources asserted that the outcome of said meeting will mark the nature of the commercial and political ties between the two countries. "Regardless of what may happen, the Argentine Government will make two decisions vis-`-vis the removal of the country of the GSP... On the one hand, there will be no formal request for the USG to keep Argentina within the GSP... On the other hand, Argentina will reportedly deepen its public criticism of the USG's possible decision to increase farm subsidies, which the Bush administration is about to implement in mid-2007 (from 16 to 22 million dollars per year)." - "China makes conditions to help restart Doha Round" Liberal, English-language "Buenos Aires Herald's" "World Trade" Supplement (09/04) reports "China is willing to help restart WTO talks but wants to see developed countries make 'substantial contributions' first, a state news agency on Tuesday quoted China's commerce minister as telling a top US envoy. "Commerce Minister Bo Xilai told US Trade Representative Susan Schwab on Monday that negotiators 'should give top priority to the issue of development.' The WTO's Doha Round talks aim to forge a global trade treaty that would boost economic growth in poor countries by lowering barriers to their exports." ¶3. EDITORIALS - "Another Argentine present for Fidel Castro?" An editorial in daily-of-record "La Nacion" reads (09/05) "The so-called Movement of Non Aligned Countries will meet September 11-16... The news for us will be Argentina's return to said forum... "... Starting next meeting, the Cuba of Fidel and Raul Castro will lead the forum for three years. "... The Cuban idea is that documents will contain some specific actions that the member countries should take. This implies a likely and obvious dangerous threat to the countries' independent handling of their foreign policy issues. "... Argentina should have a mature relationship with every free country of the world. The need for getting closer to the most important countries certainly does not mean that we should renounce to our right to broaden our international relations. However, the Movement of Non Aligned Countries is far from being a proper forum to broaden our ties with the rest of the world, particularly if one bear in mind that the movement will be led by the dictatorial Castro regime..." To see more Buenos Aires reporting, visit our classified website at: http://www.state.sqov.gov/p/wha/buenosaires MATERA