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[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]

    YEAR IN REVIEW: U.S. POLICY TOWARD A CHANGING WESTERN HEMISPHERE

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                         THE WESTERN HEMISPHERE

                                 OF THE

                      COMMITTEE ON FOREIGN AFFAIRS
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            DECEMBER 9, 2015

                               __________

                           Serial No. 114-129

                               __________

        Printed for the use of the Committee on Foreign Affairs

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                      COMMITTEE ON FOREIGN AFFAIRS

                 EDWARD R. ROYCE, California, Chairman
CHRISTOPHER H. SMITH, New Jersey     ELIOT L. ENGEL, New York
ILEANA ROS-LEHTINEN, Florida         BRAD SHERMAN, California
DANA ROHRABACHER, California         GREGORY W. MEEKS, New York
STEVE CHABOT, Ohio                   ALBIO SIRES, New Jersey
JOE WILSON, South Carolina           GERALD E. CONNOLLY, Virginia
MICHAEL T. McCAUL, Texas             THEODORE E. DEUTCH, Florida
TED POE, Texas                       BRIAN HIGGINS, New York
MATT SALMON, Arizona                 KAREN BASS, California
DARRELL E. ISSA, California          WILLIAM KEATING, Massachusetts
TOM MARINO, Pennsylvania             DAVID CICILLINE, Rhode Island
JEFF DUNCAN, South Carolina          ALAN GRAYSON, Florida
MO BROOKS, Alabama                   AMI BERA, California
PAUL COOK, California                ALAN S. LOWENTHAL, California
RANDY K. WEBER SR., Texas            GRACE MENG, New York
SCOTT PERRY, Pennsylvania            LOIS FRANKEL, Florida
RON DeSANTIS, Florida                TULSI GABBARD, Hawaii
MARK MEADOWS, North Carolina         JOAQUIN CASTRO, Texas
TED S. YOHO, Florida                 ROBIN L. KELLY, Illinois
CURT CLAWSON, Florida                BRENDAN F. BOYLE, Pennsylvania
SCOTT DesJARLAIS, Tennessee
REID J. RIBBLE, Wisconsin
DAVID A. TROTT, Michigan
LEE M. ZELDIN, New York
DANIEL DONOVAN, New York

     Amy Porter, Chief of Staff      Thomas Sheehy, Staff Director

               Jason Steinbaum, Democratic Staff Director
                                 ------                                

                 Subcommittee on the Western Hemisphere

                 JEFF DUNCAN, South Carolina, Chairman
CHRISTOPHER H. SMITH, New Jersey     ALBIO SIRES, New Jersey
ILEANA ROS-LEHTINEN, Florida         JOAQUIN CASTRO, Texas
MICHAEL T. McCAUL, Texas             ROBIN L. KELLY, Illinois
MATT SALMON, Arizona                 GREGORY W. MEEKS, New York
RON DeSANTIS, Florida                ALAN GRAYSON, Florida
TED S. YOHO, Florida                 ALAN LOWENTHAL, California 
DANIEL DONOVAN, New York

                            C O N T E N T S

                              ----------                              
                                                                   Page

                               WITNESSES

The Honorable Roger Noriega, visiting fellow, American Enterprise 
  Institute (former Assistant Secretary for Western Hemisphere 
  Affairs, U.S. Department of State).............................     6
The Honorable Mary Beth Long, founder and chief executive 
  officer, Metis Solutions (former Assistant Secretary for 
  International Security Affairs, U.S. Department of Defense)....    23
Cynthia J. Arnson, Ph.D., director, Latin American Program, 
  Woodrow Wilson International Center for Scholars...............    30

          LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

The Honorable Roger Noriega: Prepared statement..................     9
The Honorable Mary Beth Long: Prepared statement.................    26
Cynthia J. Arnson, Ph.D.: Prepared statement.....................    32

                                APPENDIX

Hearing notice...................................................    52
Hearing minutes..................................................    53

 
    YEAR IN REVIEW: U.S. POLICY TOWARD A CHANGING WESTERN HEMISPHERE

                              ----------                              

                      WEDNESDAY, DECEMBER 9, 2015

                       House of Representatives,

                Subcommittee on the Western Hemisphere,

                     Committee on Foreign Affairs,

                            Washington, DC.

    The subcommittee met, pursuant to notice, at 2:04 p.m., in 
room 2200, Rayburn House Office Building, Hon. Jeff Duncan 
(chairman of the subcommittee) presiding.
    Mr. Duncan. We will go ahead and call the meeting to order. 
Take your time, Dr. Arnson. That is fine. We are going to have 
votes shortly. So I want to try to get as far along as we can. 
And a quorum being present, the subcommittee will come to 
order.
    And I would like to recognize myself for an opening 
statement. This year, we have seen many changes in the Western 
Hemisphere, economic and security factors, migration, natural 
disasters, and deepening ties with Iran, China, and Russia have 
greatly impacted the region. Elections in multiple countries 
have shifted governments and political power. The Organization 
of American States has a new Secretary General who has affirmed 
a commitment to revitalizing the organization, and his public 
statements related to Venezuela have underscored that 
commitment. Panama hosted the Seventh Summit of the Americas. 
And it had the inclusion of Cuba for the first time. And the 
United States began its 2-year chairmanship of the Arctic 
Council. Furthermore, Colombia has made progress in its peace 
talks with the FARC. And both houses of its legislature voted 
this month to approve a proposal for a referendum on an 
eventual peace deal. In Brazil, economic woes continue. And 
impeachment proceedings against a sitting President have begun. 
Moreover, crime and violence in the region have also risen with 
an ever-proliferating network of transnational criminal 
organizations. This year, Latin America has also experienced 
its worst economic performance since 2009.
    The purpose of today's hearing is to examine the Obama 
administration's policies and programs in the Western 
Hemisphere, to assess their impact, and to consider the 
progress of the countries in the region in furthering 
democracy, freedom of religion, and of the press; strengthening 
the rule of law and judicial institutions; growing economic 
prosperity; and providing a safer and more secure region.
    As a side note, I would like to congratulate the ranking 
member on passage, in the Foreign Affairs Committee, of a bill 
dealing with freedom of the press. Hopefully that bill will 
make it to the floor, and we will get to vote on it. I was a 
proud cosponsor, no doubt.
    This subcommittee has held 16 hearings this year to provide 
oversight of the Obama administration's efforts in the 
hemisphere and bring public awareness to key developments in 
the region. Of the hearings this subcommittee has held this 
year, two have focused on the budgetary issues and the $1 
billion request for Central America. Two have examined the 
energy opportunities in the Western Hemisphere, focusing on 
Canada and Mexico in particular. Three highlighted the 
challenges to press freedoms, religious liberties, and human 
rights abuses in Cuba and Venezuela. Two focused on the U.S.-
Cuba policy shift, the impact on U.S. citizens and national 
security, and the unresolved property claims issue. And one 
hearing explored the opportunities the United States has on 
arctic issues in the region.
    In January, the death of special prosecutor Alberto Nisman 
in Argentina raised questions about Iran's networks in the 
region and the Kirchner government's relationship with Iran and 
Venezuela. This subcommittee has maintained a focus on Iran and 
Hezbollah's activities in the region and expanded our oversight 
to include hearings on China and Russia's growing presence, as 
well. Whereas these countries have shown great attention to the 
Western Hemisphere, the Obama administration's own response has 
been minimal. With the exception of altering the U.S. 
relationship with Cuba without requiring any substantive 
changes from the Castro regime in return, a tactical response 
to the migration crisis in Central America, and an emphasis on 
LGBTI and climate change initiatives, the Obama administration 
has shown little strategic vision for United States leadership 
and has failed to make an effective case for why countries in 
the region should make the United States their partner of 
choice. That has got to change.
    In my view, the United States should be prioritizing 
relations with the democratic free countries in the region 
instead of capitulating to leftist governments in Cuba, 
Venezuela, Ecuador, Nicaragua, and Brazil. Rather than 
rejecting the Keystone pipeline with Canada, limiting U.S. 
economic potential, and ignoring important security dimensions 
in the U.S. relationship with Mexico, the United States should 
recognize that North America's greatest potential lies within 
even stronger relations with Canada and Mexico.
    In Central America, we have seen no changes in the root 
causes of migration to the United States. And I remain 
concerned with the high levels of migrant flows we have seen 
within the last few months into Mexico from Central America and 
at the U.S. southern border. In addition, we are seeing, from 
my understanding of a meeting with the Panamanians today, a 
large number of Cubans also transiting. The $1 billion request 
from the Obama administration will not solve these problems 
without active U.S. leadership and tight oversight of U.S. 
taxpayer dollars; real and measurable political will from the 
countries themselves to address the rampant corruption; and 
strong and independent national institutions that are 
transparent and accountable to the people.
    In addition, I believe we are missing opportunities to 
create stronger partnerships on trade and energy issues in the 
hemisphere. In particular, we ought to consider ways to more 
highly prioritize U.S. relations with the Pacific Alliance 
countries of Chile, Colombia, Mexico, and Peru, which 
reportedly represent 36 percent of Latin America's economy, 50 
percent of its international trade, and 41 percent of all 
incoming foreign direct investment. In addition, energy 
cooperation in North America, Central America, the Caribbean, 
and South America should be more foundational for U.S. policy 
and underscore our efforts in the region. With the Western 
Hemisphere home to nearly a third of the world's oil, U.S. 
reserves of oil and natural gas and shale gas resources, and 
the growing investment opportunities for U.S. businesses in 
multiple countries in the region, energy is a positive area for 
cooperation that we simply have not explored enough.
    Indeed, with this year's elections in the hemisphere, I am 
hopeful that we will see greater economic and security 
partnerships between the United States and many more countries. 
Longtime ruling parties were kicked out in Trinidad and Tobago, 
Guyana, Saint Kitts and Nevis. Mexico saw several surprise 
victories from independent, nonparty candidates in its June 
legislative and local elections. And Guatemala saw a rare 
victory against corruption with the unseating of a sitting 
President, the resignation of a Vice President, and the 
election of a political outsider as the President in October, 
one who promised to clean up corruption. After years of delay 
and extended political crisis, Haiti has had two rounds of 
elections this year, with a final round scheduled for later 
this month. Even our best partner on trade and energy issues, 
Canada, saw the turning out of the incumbent government, after 
several years of consecutive leadership. With the results of 
center-right Mauricio Macri's victory in Argentina last month 
and the first-ever runoff election in Argentina's history, I am 
excited about the possibilities of improved bilateral relations 
and greater Argentine leadership in the hemisphere. In 
addition, this past weekend's election in Venezuela marked an 
important turning point for that country with the opposition's 
landslide victory over Chavismo or the Maduro government.
    So we are going to see--and I look forward to you guys 
talking, Ambassador, about that a little bit more, by the way.
    Our subcommittee began this year by engaging with regional 
Caribbean leaders over the issue of finding better ways to 
partner on energy issues and looking at how the energy boom in 
the United States could benefit our friends who have 
historically depended on Venezuela to meet their energy needs. 
Next year, I look forward to deepening U.S. engagement in the 
region and maintaining our attention on Iran, China, and 
Russia's actions in the hemisphere and particularly focusing on 
energy, business, and trade opportunities, terrorism, border 
security threats, and counterdrug efforts in the region.
    As we take time today to assess the Obama administration's 
approach to the Western Hemisphere and the status of specific 
countries in the region, I look forward to using the 
perspective shared here today by our panel of witnesses in 
order to help shape and sharpen U.S. engagement in the region 
next year.
    So, with that, I look forward to the hearing.
    And I will turn to the ranking member from New Jersey, Mr. 
Sires, for any opening statement he may have.
    Mr. Sires. Good afternoon.
    Thank you, Chairman, for holding this timely hearing. And 
thank you to the witnesses for joining us today.
    The Western Hemisphere has seen a significant change over 
the past year. The region has undergone multiple elections at 
both the head of states and legislative level. Elections are 
bringing about change in Argentina, Guatemala, Haiti, and 
Venezuela, just to name a few. In Argentina, voters went to the 
polls on November 22 and voted for change by electing Mauricio 
Macri of the opposition. Macri's election ends the rule of the 
so-called ``Kirchnerismo,'' which has been the ruling ideology 
for 12 years. In Guatemala, massive corruption schemes 
uncovered by the United Nations' International Commission 
Against Impunity in Guatemala led to the resignation and 
indictment of both the President and Vice President.
    Most recently, Venezuela's opposition coalition, known as 
Democratic Unity Roundtable, MUD, triumphed in the country's 
December 6, 2015 legislative elections, despite Maduro's 
efforts to imprison and eliminate the opposition and intimidate 
voters. The MUD Party won a decisive victory by capturing a 
supermajority over Maduro's ruling party. The elections 
represent a major defeat for Chavismo and signal a potential 
shift away from the failed and oppressive socialist policies to 
a more progressive society. Despite these agents for change, 
there are still troubling changes facing the region. Cuba still 
remains as oppressive and dictatorial as ever, imprisoning 
innocent civilians at an alarming rate and making no effort to 
shift its attitude to more equitable policies. The 
administration's misguided effort to reengage with the island 
has prompted record numbers of Cubans to flee the island, 
spurring a migrant crisis in Central America as thousands await 
passage.
    Additionally, Central America is continuing to deal with 
its own crisis as children and women continue to flee to the 
northern triangle to escape violence engulfing their home 
states. Mexico has greatly increased its enforcement efforts on 
the southern border. And we must help build that capacity so 
they can adequately screen and process these people, who are 
overwhelmingly eligible for asylum. We must stay committed to 
addressing the root causes of this crisis and ensure Central 
America is making strident efforts to reform its institutions 
and absorb a potential increase in U.S. funding through the 
Alliance for Prosperity proposal.
    These are just a few examples of changes undergoing in the 
hemisphere over the past year. I have always said that the U.S. 
must prioritize engagement with our neighbors. And I look 
forward to hearing from our witnesses on this year's activities 
and how we can improve relations in the coming year.
    Thank you.
    Mr. Duncan. I will allow a brief opening statement if any 
other members would like to.
    Mr. DeSantis from Florida is recognized for a brief 
statement.
    Mr. DeSantis. Thank you, Mr. Chairman.
    The title of the hearing is the ``Changing Western 
Hemisphere,'' but the one place still stuck in its totalitarian 
past is Cuba. It was almost a year ago when the President 
announced major, major changes in our policy toward the Castro 
regime. I think we can see now that these were essentially a 
list of unilateral concessions that really represent an 
unprecedented surrender to an anti-American regime that 
continues to oppress its own people.
    Think about it. Cuba got a massive influx of cash that 
really props up the intelligence services and the regime. It 
provided legitimacy to the Castro regime by opening the 
Embassy, as if they are just one of a community of nations. We 
released the last members of the Cuban Five terrorists and, of 
course, removed Cuba from the list of state sponsors of 
terrorism. Those were major concessions.
    And, yet, a year later, what have we gotten in return? Cuba 
released 53 political prisoners. Most of them have been re-
arrested now. There has been no extradition for terrorists like 
Joanne Chesimard, who remains on the FBI's Most Wanted 
Terrorists list. No political reforms. In fact, the crackdown 
is probably worse today than it was prior to this deal.
    So there are a lot of changes in the Western Hemisphere. I 
appreciate all the subjects you brought, Mr. Chairman, before 
us. But freedom in Cuba is not a change that we have seen. And 
this is not a policy that has succeeded.
    And I yield back.
    Mr. Duncan. Absolutely. Thanks for recognizing that. I will 
now recognize the gentleman from New York, Mr. Meeks, for an 
opening statement.
    Mr. Meeks. Thank you, Mr. Chairman.
    You know, a few decades ago, Latin America and the 
Caribbean was a region known more for political turmoil and 
dictatorship than for political and economic advancements. 
Times have changed in my estimation. There have been sustained 
democratic advancements in the region for years now. And I 
think that we should acknowledge that and applaud that shift. 
It is also important that we adjust our policies to reflect 
these advancements. I commend the Obama administration for 
demonstrating to the region that our Nation is interested in a 
real partnership, a partnership with mutual interests and 
benefits on security, trade, immigration, human rights, and so 
much more.
    While Cuba is the one exception to the democratic trend, 
the Obama administration's decision to formally engage Cuba, in 
my estimation, is promising. And it puts America in sync with 
our allies in the region that have long urged more mature U.S. 
policy in the Western Hemisphere. I also appreciate the 
administration's commitment to diplomatic engagement, even 
where there have been challenges in our relationship. For 
example, as I was just talking with my good friend, the ranking 
member, here, and recent elections in Venezuela confirm that 
the democratic process in that nation remains very much alive. 
And it is good to see that there is change happening there. And 
I think that is important. And it reinforces the need for the 
United States to stay engaged. That is the key. We must be 
engaged. There are many elections ahead in the coming months. 
And there are notable challenges remaining.
    Haiti held elections in October rather peacefully. But 
subsequent violence and protest over the election results is 
deeply concerning. But we have got to stay focused on it.
    Democracy is not just about elections. Citizens of any 
nation don't just want to vote; they want to feel that their 
representatives are making a difference in their lives and 
livelihoods. For that reason, focus on poverty reduction and 
now on the equality gap is similarly an important regional 
trend. I have seen for myself the success that dedicated 
governments in Brazil, Peru, Mexico, Chile, Jamaica, and others 
have had on this front. It has been remarkable. Economic 
reforms, trade liberalization, and innovative and cost-cutting 
approaches are making positive change for vulnerable 
populations. The most affected communities for too many 
generations have suffered benign and deliberate neglect and 
discrimination.
    The progress I have seen can and has been instructive to 
our struggle to eliminate poverty and achieve a more equal and 
just society here in the United States. Our hemisphere is more 
consequently connected than ever before in both our struggles 
and successes.
    And I look forward to hearing the perspectives of our 
witnesses.
    And I want to thank the chair and the ranking member for 
holding this timely and critical review.
    Mr. Duncan. I want to thank the gentleman from New York for 
his participation in the hearings this year. A lot of times in 
Congress, we have subcommittee hearings that members just don't 
show up for. So I appreciate your participation, and as well as 
Ron and some of the others.
    So we are going to go ahead and get started. They are going 
to call votes at some point in time. We will get as far as we 
can. And I want to thank the witnesses for being here today. We 
don't have a lighting system. I am going to ask you to try to 
stay within 5 minutes. I will be timing here. If I start 
tapping the gavel, that is just to try to wrap up as soon as 
possible. And we will try to stick to that 5-minute rule. Then 
members will be able to ask questions.
    The witnesses are the Honorable Roger Noriega, visiting 
fellow with the American Enterprise Institute and former 
Assistant Secretary for Western Hemisphere at the U.S. 
Department of State; the Honorable Mary Beth Long, founder and 
chief executive officer of Metis Solutions, a former Assistant 
Secretary for International Security Affairs at the U.S. 
Department of Defense; and Dr. Cynthia J. Arnson, director of 
Latin America Program at the Woodrow Wilson International 
Center for Scholars.
    So, Ambassador, I will recognize you for 5 minutes.

  STATEMENT OF THE HONORABLE ROGER NORIEGA, VISITING FELLOW, 
 AMERICAN ENTERPRISE INSTITUTE (FORMER ASSISTANT SECRETARY FOR 
     WESTERN HEMISPHERE AFFAIRS, U.S. DEPARTMENT OF STATE)

    Ambassador Noriega. Thank you very much, Mr. Chairman, and 
members of the committee. I thank you for this opportunity to 
review an eventful year in the Americas and to discuss the 
future of our policy. I believe we have a significant 
opportunity to recapture the initiative where our priorities 
are at stake: Democracy, security, and prosperity.
    In the last 15 years, representative democracy has been 
undermined by authoritarian populism, statist economic 
policies, and unsustainable government spending. In some very 
dramatic cases in the last year, some of our neighbors have 
decided to change course. Sunday's parliamentary elections in 
Venezuela gave the democratic opposition a landslide victory 
and a supermajority in the national assembly beginning in 
January. President Maduro had no choice but to accept the 
results of those elections. But his history suggests that his 
regime will resort to any means necessary to deny the 
opposition its rightful authority. That is why friends of 
democracy must do what we can to help.
    And to get straight to the point, for example, some of the 
same men who menace Venezuela's democratic opposition today 
also shovel tons of cocaine into the United States. And I 
believe we should move quickly to identify and punish these 
thugs to put them on the defensive. In Argentina, a majority of 
the voters rejected the statist, authoritarian, and 
economically ruinous policies of the Kirchners. As a result, 
the pro-free-market candidate, Mauricio Macri, was elected to a 
4-year term. He has pledged to lift currency and price 
controls, to lower taxes, to restore Argentina's credit 
worthiness, and to pursue a positive relationship with the 
United States. And I note that just today, his Foreign Minister 
said that she would be open to the renewal of a regional trade 
agreement, like was pushed 10 years ago. Argentina's new 
President has an opportunity to show that free market remedies 
can right size government and jump start stagnant economies.
    In Brazil, the decision last week to impeach Dilma 
Rousseff, impeach the President reflects the anxiety about the 
future that permeates South America's most populous country and 
largest economy. Several parallel investigations are continuing 
as well, which are being led by independent prosecutors and 
judges. This political crisis is, obviously, not good for 
Brazilians. However, the fact that they are confronting their 
challenges by relying on the rule of law and checks and 
balances shows that when it comes to answering to popular will, 
constitutions are more reliable than caudillos.
    A second major point, one of the greatest threats to U.S. 
security in the Americas today is the breakdown of regional 
consensus to confront illegal drugs and transnational organized 
crime. In the last 15 years, key drug-producing and transit 
countries, among them, Bolivia, Ecuador, and Venezuela, have 
effectively ended their cooperation with U.S. antidrug efforts. 
Now, Colombia intends to make peace with the guerilla group 
that is the world's largest producer of cocaine. It has 
already, at the peace process, gutted the government's coca 
eradication program and ended extraditions to the United 
States. For the first time in memory, if not ever in history, 
Colombia refused to extradite someone sought by the United 
States. In the face of this crumbling regional alliance, U.S. 
foreign policy has failed to respond effectively, leaving us 
more vulnerable to the onslaught of illegal drugs than we have 
been in decades.
    On a related front, the deadly terrorist attacks in San 
Bernardino and Paris underscore the vital contribution of 
neighboring governments to our own security. In the last 
several weeks, including in the last day or so, border 
officials in the region have interdicted at least a dozen 
Syrian nationals with false or stolen documents bound for the 
United States. These particular people are not suspected of 
being terrorists, but they relied on a criminal network that 
terrorists can use to enter the United States.
    One of our biggest vulnerabilities in this regard in this 
hemisphere emanates from Venezuela, which supports Syria's 
Assad regime and provides resources, recruits, and safe haven 
to Hezbollah and Iranian operatives, groups that have vowed 
publically to carry their asymmetrical war to our homeland. 
Venezuela also has provided thousands of phony IDs, passports, 
and visas to persons of Middle Eastern origin.
    Mr. Chairman, U.S. security demands much more vigorous 
efforts to confront that criminal regime as well as, in 
general, transnational organized crime that is destabilizing 
our neighborhood. The President must use all of his tools in 
his toolkit, including investigative cooperation, intelligence 
sharing, and sanctions to identify, isolate, and prosecute 
traffickers, money launderers, complicit officials, and corrupt 
businesses. To help put the region back on the road to 
prosperity, we should invigorate the positive, proactive 
partnerships that encourage countries to adopt policies that 
bring spending under control, incentivize private sector led 
development, root out corruption, and put capital in the hands 
of innovative entrepreneurs.
    One final point, Mr. Chairman. None of our pressing 
priorities in this region--democracy, security, and free market 
prosperity--are advanced, in my opinion, by the ongoing U.S. 
capitulation to the Castro dictatorship. Arguably, things have 
gotten worse for the Cuban people on the island since President 
Obama moved to normalize diplomatic ties with Castro. 
Reasonable terms for restoring normal economic relations with a 
post-Castro Cuba were approved by a three-fourths majority of 
this House and our Senate and signed by President Clinton. The 
awful reality is that Cuba is the only country in the Western 
Hemisphere that cannot meet any of those standards in terms of 
the defense of democracy, human rights, and labor rights. The 
benefits of normal economic ties with the United States should 
be used to encourage a post-Castro government to treat its 
people decently, not to reward a government that refuses to do 
so.
    Thank you.
    [The prepared statement of Ambassador Noriega follows:]
    
    
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                              ----------                              

    Mr. Duncan. Thank you.
    And we will get to the questions and be able to elaborate a 
little bit more.
    Ms. Long, you are recognized for 5 minutes.

 STATEMENT OF THE HONORABLE MARY BETH LONG, FOUNDER AND CHIEF 
EXECUTIVE OFFICER, METIS SOLUTIONS (FORMER ASSISTANT SECRETARY 
FOR INTERNATIONAL SECURITY AFFAIRS, U.S. DEPARTMENT OF DEFENSE)

    Ms. Long. Thank you, Mr. Chairman, Ranking Member, members 
of the committee. I appreciate being invited to be here today.
    A stable if not more peaceful, democratic, and prosperous 
Western Hemisphere is in the interest of all the citizens of 
the Americas and is in our interest. Unfortunately, in the last 
year, by having failed to consistently and meaningfully engage 
our hemispheric neighbors, we have managed to make the United 
States and our neighbors neither more secure, nor more 
prosperous.
    This has been a challenging year for our near and far 
hemispheric neighbors. Just in November, an unanticipated surge 
in immigration of Cubans through Guatemala, Honduras, and El 
Salvador has nearly overwhelmed our Customs and Border 
officials and made the United States and its neighbors even 
more vulnerable to the problems that these individuals 
represent and bring with them. The economic ills and lack of 
stability suffered by many of our southern neighbors are, and 
will continue to be, transmitted to the United States in the 
form of child immigrants and refugees, violence, the spread of 
criminal activities, and opportunities for terrorists and state 
rivals from undergoverned or ungoverned spaces, who could 
operate there in order to do us harm.
    It is not much of a stretch, and certainly not as much of a 
long possibility, as it used to be. Just in 2010, Abdul Kadir, 
a Guyanese convert to Islam, under the guidance of the Iranian 
cultural attache in Argentina, Mr. Rabbani, was sentenced to 
life for planning to detonate bombs in pipes lines leading to 
the JFK network. Rabbani was the leader of the recruiters for 
the Iranian Islamic radicals and was one of those people that 
was responsible for the 1994 bombing of the cultural center in 
Argentina. The sudden death of Argentine special prosecutor Mr. 
Nisman the day before he was scheduled to testify on this 
matter remains unsolved and certainly hints to continued 
Iranian involvement in Argentina.
    Mexico's Zetas employ drug traffickers and launderers Mr. 
Harb and Ayman Joumaa, both of whom have channeled some of the 
proceeds to Hezbollah. And don't forget that the Zetas were 
involved in a nexus with terrorist planning and threatened the 
life, in the United States, of the Ambassador from Saudi 
Arabia.
    More recently, Muamad Armadar, a Guyanese arrested in Lima 
just in October of last year, was identified as a likely 
Hezbollah operative, who was stockpiling explosives in his 
apartment. This year, Argentina arrested six Syrians who 
arrived on a flight bearing false Greek passports. And before 
that, five Syrian men were also carrying passports and were 
detained in Honduras on the way to the U.S. having already 
passed through Brazil, Argentina, and Costa Rica on their way 
north.
    In October, Brazil detained eight Iraqi nationals also 
bearing Greek passports. And while there is no open information 
indicating that these individuals were either involved in 
terrorism or had violent thoughts, the fact is the networks 
that have long been used by drugs and illicit activities are 
now open and smuggling people, weapons, and drugs, and are 
available to terrorists.
    In the last decades, Latin America and the Caribbean have 
experienced generally positive trajectories in internal 
reconciliation, interstate peace, and growing democratic 
processes and institutions. Regrettably, this progress is 
counterbalanced--and perhaps even threatened--by worsening 
problems. Most notably, in the last months alone, Cuban 
migration that represents approximately three times the Cuban 
migration of 1994 and perhaps the largest since the Mariel 
boatlift has come across the borders and have overwhelmingly 
threatened Panama, Ecuador, and other Central American states. 
Relations with key allies, such as Mexico and Canada in 
particular, have been strained. At one point, in fact, one 
observer describing the upcoming meeting between the 
administration and Mexico said, ``There is really not much to 
talk about,'' in relation to U.S. policy. The escape of Mexican 
drug cartel leader Joaquin ``El Chapo'' Guzman exasperated the 
existing chill. In extraditions, President Pena Nieto's 
government is proceeding at a rate that will be substantially 
less than half of the extraditions of his predecessors.
    In Canada, our largest trading partner is increasingly 
looking to Asian markets. And although Canada no doubt remains 
a steadfast military ally, its newly elected Prime Minister, 
Mr. Justin Trudeau, recently followed through with early 
indications that he would end Canada's participation in 
airstrikes against ISIS targets and restrict its military 
efforts to training alone.
    Sadly, what stands out in many observers' minds as symbols 
of American engagement in the hemisphere in the last few years 
are our executive order on immigration; outreach to anti-
American governments, such as Cuba, with very little to show 
for it, and Venezuela; the Department of Justice welcomed 
investigation of FIFA; and, with few exceptions, not much else. 
The region simply has not been a priority for U.S. efforts or 
U.S. engagement.
    Meanwhile, from a security perspective, China and Russia 
have joined Iran in reaching out to countries in the 
hemisphere, seeking its allies and its markets. These 
interactions go well beyond the interactions of those countries 
with the Cuba regime. They are, in fact, actively engaged in 
anti-U.S. activities and rhetoric. While China has been busy 
undercutting the region's multilateral organizations, they have 
moved to take a naval flotilla across the Pacific, where for 
the first time, it conducted combat exercises with bilateral 
nations.
    Moving forward to security cooperation, while Colombia has 
long been the recipient of rigorous U.S. security assistance 
and related support, SOUTHCOM is limited in its ability to 
engage. Furthermore, as to resettlement, disarmament, and 
reintegration of the FARC, many of whom, even if they reconcile 
from a political perspective, are criminals and will continue 
to engage in criminal activity.
    Meaningful engagement from the United States is necessary 
to mitigate the impact of these and other threats. Security 
cooperation should be enhanced. It promotes cooperation in the 
hemisphere, encourages transparency, and even interoperability. 
And we need to do more along these lines, particularly through 
the Combating Terrorist Fellowship Program, the drug 
interdiction and other programs, the Ranger School training, 
and the training of additional Colombian and Mexican military 
to engage in more U.S. support. Looking ahead, the biggest 
issue is to immediately reinvigorate our national engagement 
and signal unwavering support and attention to our continental 
partnerships.
    Thank you. I look forward to your questions.
    [The prepared statement of Ms. Long follows:]
   
   
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    Mr. Duncan. Thank you.
    They have called votes. We will go ahead and try to get Dr. 
Arnson--welcome back--and probably one question per side.
    And then we will go--Ron, if you want to stay, I am going 
to defer to you first because I am coming back. So if you want 
to hang and ask a question after Dr. Arnson, whatever you want 
to do.
    Okay.
    Dr. Arnson.

STATEMENT OF CYNTHIA J. ARNSON, PH.D., DIRECTOR, LATIN AMERICAN 
   PROGRAM, WOODROW WILSON INTERNATIONAL CENTER FOR SCHOLARS

    Ms. Arnson. Thank you, Chairman Duncan, Ranking Member 
Sires, other members of the subcommittee, for this opportunity 
to testify about the challenges in the Western Hemisphere over 
this past year and per U.S. policy.
    I share and identify myself with the comments of others 
that have spoken before me that the recent elections in 
Argentina and Venezuela are historic and represent a 
fundamental change in the region. They have a common 
denominator of the failure of populist economics, which 
sustained generous but inefficient social programs, that were 
based on high commodity prices. Now that those prices have 
plummeted, along with other macroeconomic imbalances, the 
economic distress has had a major impact on the pocketbooks of 
average households, leading to the vote to punish existing 
leaders.
    The fall in commodity prices has had different effects 
across the hemisphere. But it has contributed to an overall 
economic slowdown in most parts of the region. Regional growth 
projections have dropped, now for the fifth consecutive year, 
to under 1 percent this year and next. There is, therefore, the 
deep concern over the ability of people who left poverty over 
the last decades to remain out of poverty; little chance that 
those who are still impoverished, the tens of millions of 
people who are still in poverty, to leave poverty; and there 
will be a reversal of the modestly improving patterns of social 
mobility. And I think these trends will have important 
political consequences.
    It should not be surprising that the countries that have 
fared best over the last 2 years, Mexico, Colombia, Chile, and 
Peru, precisely the countries that are part of the Pacific 
Alliance, are those that have pursued economic opening and 
liberal international trade among themselves and with other 
partners in North America, in Europe, and especially in Asia.
    Economic and social change in the region has contributed to 
higher living standards. But it has also contributed to civil 
societies that increasingly demand more of their political 
leaders and institutions. From Chile to Guatemala, Brazil, 
Peru, we have seen millions taking to the streets in recent 
years to demand better quality education, improvements in 
public services, from transportation to garbage collection. 
What would appear as a negative--the seeming epidemic of 
corruption scandals in numerous countries in the region--I 
think can also be viewed positively as a reflection of 
citizens' demands for higher ethical standards and more 
accountable and transparent government.
    The free press has played a critical role in bringing these 
scandals to light. In looking at the challenges ahead, I would 
note that U.S. relations with the hemisphere--and here I think 
I differ with those who have spoken before me--have improved 
significantly over the last year. Part of that has to do with 
the normalization of U.S.-Cuban relations, which removed what 
many countries in the hemisphere saw as an outdated relic of 
the Cold War. I think this was seen most dramatically at the 
Summit of the Americas in Panama in April, a meeting that many 
heads of state had actually threatened to boycott if Cuba was 
excluded one more time.
    The Obama administration's commitment to working 
multilaterally on a range of issues, from protecting the 
environment to promoting Venezuelan democracy, has also been 
viewed favorably. There is a recent poll by the Public Opinion 
Project, LAPOP, based at Vanderbilt University, which 
demonstrates that 51 percent of citizens in the region believe 
that the United States is the most influential country in Latin 
America. The comparable figure for China is 12 percent.
    I want to briefly highlight three areas where I think U.S. 
policy and engagement are critical. One has to do with 
relations with Colombia. If there is a peace accord that is 
signed early next year, whether or not it coincides with the 
deadline that has been announced, there will be a need for 
continued U.S. assistance and engagement. This is something 
that did not happen after the end of the Central American wars. 
And I believe that once the FARC has demobilized and has 
transformed itself as a political actor subject and under 
Colombian law, it would be appropriate for the U.S. Government, 
the Congress, and the executive branch to review the FARC's 
designation as a terrorist organization.
    Several of you have mentioned the Central American policy. 
I agree that more border enforcement is necessary. But there 
must also be a concerted effort to improve the conditions on 
the ground, the insecurity, and lack of opportunity that 
continue to impel Central American youth, in particular, to 
take this perilous journey.
    I see that people are looking to head out. I would say that 
it would be critical to maintain high-level but very discreet 
U.S. engagement on Venezuela. There are important new allies in 
the effort in the hemisphere, including OAS Secretary General 
Luis Almagro, President-elect Macri, who will be inaugurated 
tomorrow. They have demonstrated that they will take a leading 
role in pushing for respect for human rights and democratic 
freedoms.
    The U.S. administration and Congress, and here I conclude, 
should speak out publicly and frequently on important matters 
of principle but also be mindful that the Venezuelan Government 
currently thrives on confrontation and has used accusations of 
foreign interference to its own political advantage.
    Thank you very much. I look forward to your questions.
    [The prepared statement of Ms. Arnson follows:]
    
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    Mr. Duncan. Thank you.
    And the committee looks forward to asking some questions 
and digging into this a little bit more. But, unfortunately, we 
are going to recess and go vote and come back. It is a two-vote 
series. It shouldn't take long. They are already into the time 
for the first one.
    So we are going to stand in recess pending call of the 
chair. And we will be back shortly.
    [Recess.]
    Mr. Duncan. All right.
    The subcommittee will come back to order.
    I thank the witnesses for your patience.
    And we will enter into the questioning phase. Each member 
will be given 5 minutes to ask questions. Since there are only 
two of us right now, we may exceed that a little bit.
    I have to figure out what I want to ask you here a little 
bit. There has been a series of recent large-scale and high-
profile corruption scandals in Latin America, whether it is 
Petrobras in Brazil or whether it is Guatemala and the deposing 
of the President and Vice President and regime change there. So 
the question I have is this: Is corruption getting worse in the 
region? And is it spiraling out of control? Let's talk about 
corruption. And I will start with Ambassador Noriega.
    Ambassador Noriega. Well, Mr. Chairman, when governments 
settle in for a long spell, when they are undemocratic, for 
example, as in the case of Venezuela or in Brazil, where the PT 
managed to stay in power for a considerable period of time and 
then in Argentina where the Kirchners handed the Presidency 
between them, the culture becomes about satisfying the 
President and the President's inner circle or the President's 
political party. So, yes, I think corruption, when there isn't 
this alternating of power, alternancia, corruption tends to 
build up and become a bigger problem. Certainly the oil 
revenues--I mean $1.3 trillion in oil revenue since Chavez took 
power in Venezuela. Where did all that money go? When you look 
at the disintegrating infrastructure and about $250 million in 
the central bank reserves looted. Astronomical levels of 
corruption in Venezuela. And then the involvement also in 
narcotrafficking precisely because there are no checks and 
balances. There is no Congress that can hold officials 
accountable.
    Mr. Duncan. Ms. Long, do you think just changing the guy at 
the top or the female at the top, the President in Guatemala or 
President in Argentina, possibly in Brazil, you think that is 
enough to change corruption in these countries?
    Ms. Long. No, I don't. And I think one of the things that 
we do as Americans is we tend to look at corruption at the top 
of a government. And one of the changes probably in the last 
decade, I believe, is that because of a lack of U.S. 
involvement and lack of emphasis on the traditional drug or 
counternarcotics or counternarcoterrorism activities, that the 
corruption at the top, for all the reasons the Ambassador 
explained, has gotten worse. But the types of corruption have 
gotten worse. It is not just drugs any more. It is all kinds of 
movements of transnational crimes. It is involvement of Russian 
mafia. It is involvement of Hezbollah. It is involvement of 
Chinese triads in addition to Chinese markets. And then they 
have spread, as well. I think there is a study, actually from 
the Mexicans, that some 75 percent of Mexican municipalities 
are either totally corrupt or unreliable to the central 
government. So because of the frustrations of the economic--
lack of economic opportunities, the constant flow across 
borders, the sieve that has become at least Central America, 
you have worse corruption at the top; you have the spread of 
corruption throughout the bureaucracy; you have got the types 
of corruption that has gotten worse. And all of that bears very 
ill.
    Mr. Duncan. Let me ask you this just as a quick followup. 
Do you think the economic situation exacerbates that or doesn't 
change it any?
    Ms. Long. It certainly exacerbates it. And one of the good 
things about some of the changes that we have been talking to 
at the top is there are opportunities. But those opportunities 
have got to be pushed all the way down. And they are going to 
have to have U.S. support. But as the doctor mentioned, even 
with the economic opportunities, the expectations have really 
risen where there has been change. I think there is going to be 
tremendous expectations of advancements in Argentina with Macri 
and in Venezuela. And being able to deliver that is going to be 
a challenge.
    Mr. Duncan. Dr. Arnson, with what you have heard, knowing 
that changing the person at the top isn't dramatically going to 
affect anything, what are some of the solutions as you answer 
this question?
    Ms. Arnson. Sure. Thank you, Mr. Duncan.
    With respect to your question about whether corruption is 
getting worse, I think the answer is yes and no. I don't think 
the world has seen anything on the scale of the Petrobras 
scandal, the billions of dollars that have been--that were not 
accounted for or used for purposes other than the correct ones. 
So that is--I think my colleague in the Brazil Institute has 
described that as a corruption scandal of biblical proportions. 
And I think that is an accurate statement. I also think that it 
is true for all the good reasons that I pointed out in my 
testimony, that we are finding out more about corruption now 
than almost ever before because of the demands from civil 
society, because people are fed up, especially at a time when 
they feel that the quality of the services or the amount of 
benefits that they are receiving is extremely poor.
    The check, or the improvement in combating inequality, has 
to do with what I think political scientists call mechanisms of 
horizontal accountability. Vertical accountability is from the 
voters to the people that they elect. Horizontal accountability 
is within a government and refers to having checks and balances 
and institutions within a state that can serve to monitor and 
control and investigate. The bodies, such as the Congress, 
asking the executive branch for information, whether 
voluntarily or by subpoena, the Congress has that power. The 
GAO also can investigate and is an investigative arm of the 
Congress. So reinforcing those kinds of institutional 
mechanisms--and I think people have referred to them earlier 
today--to the sort of pervasive weakness of institutions of 
democracy, that has to be a fundamental focus of our efforts in 
the region.
    Mr. Duncan. Thank you all for that. The new President of 
Argentina, who gets sworn in and takes office tomorrow at 
night, won 51.4 percent of the vote. His party doesn't have a 
majority in the Argentine Congress. So he is going to have some 
challenges. How long do you think the Argentine people will 
give him to turn things around?
    Ambassador Noriega. I think there will be a honeymoon of 
some duration because the dissatisfaction comes, as well, from 
others in Peronism. He could not have won unless there was a 
good part of Peronism that was disgusted by the levels of 
corruption and the authoritarian ways of the Kirchners. So he 
will have some who are within Peronism who are willing to 
cooperate with him. He will have to cobble together sort of ad 
hoc coalitions in order to have initiatives move through the 
Congress. But it was a closer than expected result. And so the 
Peronists bounce back pretty quickly. They already took steps 
to sort of pass some Kirchner-supported measures through the 
lower house in defiance of what the President-elect had asked. 
So the Peronists have the bit in their teeth, and they are 
going to put up a fierce level of opposition, that is to say, 
those that are particularly loyal to Kirchner and the outgoing 
government. But there are some, for example, Mr. Massa, who 
competed in the first round, was a rebel within the--or a 
dissident within Peronism. So I think people from his bloc will 
be looking for opportunities to cooperate with Macri and get 
the economy moving again.
    Mr. Duncan. Ms. Long, do you want to chime in on that?
    Ms. Long. I don't really have much to add except for I 
think a little bit of time may have been bought to the extent 
that the population that voted for Macri are disgusted by the 
latest 2 days of machinations of money transfers and other 
measures that have at least attempted to tie his hands from a 
fiscal and other sense. Perhaps there will be some sympathy 
there.
    Mr. Duncan. Before Dr. Arnson answers, so I traveled for 
the first time to Argentina in 2002, March, early April. The 
day before I got there, they devalued their currency, went from 
1 to 1, to 3 to 1 with the dollar. I know they have done it at 
least one other time since 2002. Inflation is extremely high in 
Argentina. Anyone that has traveled there prior to 2002 and 
traveled there now has experienced that. Plus, there are a lot 
of dead issues out there with bondholders and what not. So how 
do you think--and maybe this was a campaign issue during the 
Presidential campaign. I don't know. I didn't follow it that 
closely. So we have got this bond issue that Argentina needs to 
really pay, and we have got rampant inflation. So how do you 
think, from an economic standpoint, does President-elect Macri 
address that?
    Dr. Arnson.
    Ms. Arnson. Sir, you have added a difficult question on top 
of a difficult question, but I will try my best. You were right 
in pointing out that President-elect Macri does not control the 
Congress. In point of fact, the Argentine Senate is dominated 
by the FPV, the ruling party of President Fernandez de 
Kirchner. But there are large areas of economic policymaking 
that are in the purview of the executive branch.
    And I think that is where, in conjunction with his advisers 
and his cabinet and his senior ministers, he will have to take 
some very prudent steps to control inflation, to unify the two 
exchange rates. The official exchange rate right now, if it was 
3 to 1 back in 2002, the official rate now is about 9.5 to 1. 
But can you walk to any street corner and exchange dollars for 
15 to 1? So that contributes to inflation. And one of his goals 
is to have a unified exchange rate and prevent that parallel 
black market. In bringing those together, he has also 
announced, as a way of restoring the confidence of the private 
sector and of the international investor community, that he 
would lift controls on repatriation of capital. He has to do 
that very carefully because to simply allow a mass exodus of 
dollars would create even more deflationary pressures on the 
currency. And if Argentines go through another massive 
devaluation as a product of the kind of adjustment that he 
trusts to put into place, he is very rapidly going to lose 
political support. And people like Scioli, the principal 
opposition candidate, will be pointing their fingers and 
saying: See, I told you so. We told you this was going back to 
the days when the IMF and neoliberalism ruled the day. So I 
think he has to be very careful.
    Mr. Duncan. Let me ask you this. You mentioned repatriation 
of capital. What is attractive about Argentina giving high 
inflation for Argentine investors to bring money back--maybe 
from U.S. investments, maybe from other investments--to Buenos 
Aires or to anywhere in Argentina? What is attractive?
    Ms. Arnson. Well, there is a very extensive middle class. 
There is a consumer base in the country that is extremely 
broad. The levels of education in Argentina are really, I 
think, at the top of the list of the hemisphere. It is an 
extremely wealthy country in terms of natural resources, both 
land, oil and gas, which has been exploited only in the last 
few years. So there are enormous opportunities. Buenos Aires, 
for all of the things you could say, happens to be one of the 
most active tech and innovation hubs in Latin America, 
something that it shares with Santiago, Chile, Montevideo in 
Uruguay, and Guadalajara in Mexico. But there is enormous 
capacity and enormous human talent and human capital. So it is 
a very attractive country for investment. There is an internal 
market. There is also the ability to export within Mercosur, 
although Brazil's ability to absorb exports from other 
countries is very limited.
    But the real question is that there is not only a pent-up 
demand for dollars but also a pent-up demand to get pesos out 
of the country because the current regime has made that very 
difficult. And so all of those capital controls and adjustments 
in the exchange rate are going to need to be done slowly so 
that you don't see just a massive----
    Mr. Duncan. My time has expired, but I agree with you that 
it is a very attractive country. If the government can get it 
right, I absolutely believe there will be investment coming 
back. I don't believe you are going to see, at $40 a barrel, I 
don't think you are going to see a whole lot of oil and gas. We 
can't even get oil and gas investment at $40 a barrel in this 
country right now. So, as oil prices creep back up, assuming 
that they do over time, absolutely. There was oil and gas 
prospecting going on in Argentina in 2002, and I know it has 
probably continued. But it is hard for that at $40 a barrel.
    So I am going to yield to the gentleman from New Jersey for 
as much time as he needs.
    Mr. Sires. Thank you, Mr. Chairman.
    You know, to continue this conversation, I just find it 
very difficult for people to invest in Argentina if they don't 
pay their debt. Why would I, as a businessman, even consider 
going into some sort of a partnership when they have the issue 
that they don't pay what they owe now? So I think it is almost 
a catch-22. You know, you want the investment, but you don't 
want to pay.
    But my question really is toward Venezuela more because I 
was very excited about the elections. I am very concerned where 
we go from here. Actually, I was talking to my colleague, and I 
told him, I said: You know, I was very surprised how far away 
the army stood from this election. And I was wondering if you 
have any ideas? Because you know, as we know, usually the army 
controls a lot of the elections or the process. So why do you 
think it was an advantage to them to stay far away from this 
election? Although I had heard rumors that Maduro was trying to 
create problems there.
    Ambassador Noriega. Yes, Mr. Chairman, and Mr. Sires, if I 
could jump in there, I believe that first off, a 2-to-1 margin, 
67 percent of the vote going one way, even the most clever or 
sophisticated corruption couldn't have overcome that deficit. 
But, having said that, the last several seats were settled by 
less than 100 votes. So the electoral apparatus was allowed to 
proceed in a normal fashion. But it didn't just happen. The 
information I have from sources on the ground in Venezuela, all 
that day, the ruling party was expecting a massive defeat. And 
as it became more and more clear, there were some people--and 
one of them whose name I already mentioned, Diosdado Cabello, 
who is President of the National Assembly, who has perhaps the 
most to lose for various different reasons because he can't 
withstand the kind of accountability that will come from an 
opposition Congress--was urging that the party put people on 
the street to stress the vote using these colectivos, these 
armed people that go around on motorcycles and shooting into 
crowds to disrupt the day and to sort of provoke some sort of a 
crisis. And the information I got was that the military 
establishment, particularly the Minister of Defense, Padrino 
Lopez, said if that happens, the military will deal with those 
people who are trying to incite violence. And so there was sort 
of a tense standoff up until just after midnight, when they 
announced these devastating results. But Padrino Lopez is no 
longer the Minister of Defense, from what I have been told, in 
the last 24 hours. He--along with the other Cabinet Ministers--
he is being replaced in that case by someone--Reverol, General 
Reverol, who used to head the National Guard as Minister of 
Defense now. You know, in 2013 he did put National Guardsmen on 
the streets to attack these student demonstrators. So you 
already see this tug of war going on. The military did play a 
decisive role apparently by preventing the ruling party from 
putting sort of this thuggish apparatus on the street to 
suppress the vote. We will see now where that balance will be 
as the opposition begins to assert itself and make moves as a 
supermajority in the National Assembly can hold the executive 
more accountable, to call for the amnesty of these political 
prisoners and other moves.
    Mr. Sires. Ms. Long, do you have anything to add to that?
    Ms. Long. No. In fact, the one thing I would add is it 
really is a double-edged sword. And I think it is one of those 
places where U.S. active engagement, although in a subtle and 
productive way, is really needed. I agree with the Ambassador. 
I think the military is in very much a wait-and-see mode. I 
don't think they wanted to go against the population where the 
politics were trending. I do think that with the recent 
changes, they will come out if there is violence in order to 
maintain the social order in their minds. But I think most 
people who actually know the individuals within the Venezuelan 
military will actually tell you that they are very interested 
in closer relationships with the United States. They have had 
them in the past. They have some U.S. equipment. They don't 
believe they have been well supported over the years. They see 
themselves as having been deteriorating. And this could be 
under a new regime, if it gets legs underneath it, a real 
opportunity for us to engage them in a productive manner.
    Ms. Arnson. If I could first address your question, your 
statement about Argentina and the holdouts, I think Mr. Macri 
has made it clear that he wants to move quickly early in the 
new year to begin to negotiate with the holdouts. Ninety-three 
percent of bond holders that held Argentine debt did settle 
with the Argentine Government. And it was 7 percent that have 
resisted that or refused to do it. And I think to come to an 
agreement is going to take some real compromise on both sides. 
It is just, I think, unrealistic to think that 100 percent of 
the face value of the bonds that were bought at very, you know, 
favorable rates and were seen as high risk, you know, which is 
part of the risk is that they are going to lose value, I think 
it is unrealistic to think that the holdouts, the so-called 
holdouts will get 100 cents on the dollar.
    Mr. Sires. You don't think they sell because they thought 
she was going to win?
    Ms. Arnson. No, I think they decided that it was a deal 
they could accept, that there was some number--I haven't spoken 
directly with people who took that buyout, but there was a 
sense that this was a government that went into default, that 
was destroyed economically back in 2001 and 2002, that it was 
unable to pay the face value of the debt. And so as you do with 
bad debts everywhere, you renegotiate and you come up with some 
terms that you can live with. And there was a certain number of 
people--again, a very small minority, 7 percent--who refused to 
do that. And it is a priority of the new government to come to 
some agreement precisely to be able to re-access international 
capital markets because they have been frozen out of financial 
markets over the holdout issue.
    If I could address the Venezuela issue just briefly, I 
think that it is important to understand that Chavismo has 
always depended for part of its legitimacy on the sense that it 
is an elected government. Elections have been a feature, in 
fact an all-too-frequent feature, referendums on this, that, 
and the other thing, something like 12 elections between the 
time that Chavez was first elected and the time that he died, 
where people are called, and the elections serve as a way for 
the regime to almost hold a plebiscite on its own rule. So 
there is a sense that elections are ways that political change 
happens, but also the way things are legitimized. So I was, 
frankly, quite surprised to see the very prudent and moderate 
language that President Maduro used in accepting the electoral 
defeat. This was a man who only 10 days before had said, you 
know, we will see you at the ballot box or we will see you in 
the streets, raising this fear that there would be post-
electoral violence and that an opposition victory would not be 
respected.
    I also think that the actions of the electoral council, the 
CNE, were in my view very surprising. I would have never 
imagined that the two-thirds majority would have been ratified 
so quickly. I expected that there would be prolonged protests, 
accusations of fraud between the opposition and the CNE. So I 
am not saying that Venezuelan institutions function, but I just 
would say the results and the way that they happened were, to 
me, a pleasant surprise.
    Mr. Sires. Do you think that this populist ideology is 
dead?
    Ambassador Noriega. Absolutely not. But as a columnist--I 
will give him credit for this, although I should steal the line 
myself--Andres Oppenheimer said, ``Populism runs out of steam 
when the politicians run out of money.'' And that is precisely 
what has happened in a couple of these countries. The tide has 
gone out, and now there are the repercussions as some of these 
institutions step up and point out corruption, as what has 
happened in Brazil, or the fact you have had an economic 
meltdown----
    Mr. Sires. It is always interesting to me because the 
President, the speaker--I don't know what they call the 
speaker--he calls for the President to be----
    Ambassador Noriega. Impeached.
    Mr. Sires [continuing]. Impeached. Yet he is under 
investigation himself. He may wind up being kicked out.
    Ambassador Noriega. Right. There was some horse trading 
going on. That is why the decision took so long because the 
word was that he was trying to get people to sort of get off 
his back if he sort of didn't go along with the impeachment of 
the President. So it is a political process. But as I mentioned 
in my statement, there are parallel investigations and various 
levels of corruption by the courts that will have ramifications 
no matter what happens with this impeachment.
    Mr. Duncan. I want to follow up on that. Brazil is going to 
be in the world's spotlight--is in the world's spotlight--due 
to the Olympics. We have got a terrorist attack in Paris, 
threatened to blow up--terrorists threatened to blow themselves 
up in a stadium. It has got to be a huge issue of concern for 
Brazil, as it is for all the countries attending the Olympics, 
sending their star athletes there in the wake of a corruption 
scandal that is going to possibly bring down the President and 
the speaker of the house. We see impeachments just hanging out 
there. Not been impeached yet, but--and little things like the 
inability to clean up areas where swimmers and kayakers are 
going to be, the inability to provide water to a major city in 
Sao Paulo last year.
    So what does the Petrobras government corruption scandal 
and the impeachment mean for security? Let's just focus on 
security. What does it mean? Because if I was the head of an 
Olympic committee in the United States--or maybe even Spain or 
somewhere else--thinking about sending my athletes down to swim 
in the waters of Brazil, I would be concerned about their 
health. And I would be concerned about my soccer players and 
the fans that are going to attend the games in the stadiums. So 
we saw the World Cup. Did they learn anything from that? And 
how has that applied? Let's delve into that for just a second.
    Ms. Long, I am going to start with you.
    Ms. Long. Absolutely. I don't think it bodes well. And I 
think, as a practical matter, the political maneuverings 
regarding the Petrobras and other scandals are on a much larger 
scale status quo. But it really doesn't have any favorable 
outcome for security. There are two things, and you hit upon 
them both. While the U.S. is distracted a lot with ISIS and 
other Middle East events, the populations on the tri-border 
area, that have long been suspected as Hezbollah enclaves, have 
increased significantly. And, in fact, neither Argentina, 
Paraguay, nor Brazil can speak to exactly what is going on in 
those areas. We know that they have long served perhaps as 
resting areas for Hezbollah. They certainly have served as 
places where moneys and funds are laundered, if not 
transportation hubs. But there has been very little attention 
and almost no sincere ability on the part of Brazil to actually 
understand what is happening in that border area and to gauge 
what implications it will have for the Brazil games.
    As to the games, if you speak to any of the U.S. entities 
that are normally engaged at this period in time for internal 
security for helping with the favelas, with taking a look at 
immigration, the fact that these events will be taking in 12 or 
16 different fora and require trains and significant airplane 
and other movement of athletes and spectators is a nightmare. 
And there is very little planning that has been done just on 
the transportational issues alone, not to mention the fact that 
there are health and other concerns.
    Mr. Duncan. Stadiums and that sort of thing.
    Ms. Long. Yeah. At this point, I think they are housing or 
planning to house a number of the athletes offshore, with very 
little significant plans, upgrade in activity and coordination 
on the maritime security that will be required just to guard 
these--I think they are going to use former cruise ships in 
order to put the athletes on them. It is going to be a 
disaster, and it is going to go to the last minute, and then 
everyone is going to rush.
    Mr. Duncan. Anyone else like to--Ambassador?
    Ambassador Noriega. For example, the FIFA that they hosted, 
it was a bit of a carrier landing; that is to say a controlled 
crash: I mean, the Brazilians waiting to the very last minute 
until they took measures and involved some foreign advisers to 
get things up to snuff. But as you mentioned, the Petrobras 
corruption scandal, part of the problem is the fiscal crisis. 
The country is now in a 4-percent contraction. A recession 
started a couple years ago. So the resources may not be there 
for this to--well, they are going to have to take extraordinary 
moves to find the resources to get the sort of advice, do the 
sort of physical improvements at some of these sites. But I 
think, again, it is going to be a bit of a carrier landing.
    Mr. Duncan. I think the Brazilians generally get security 
right. A little heavier hand than maybe the U.S., but 
generally, I think they do so. Everyone is holding out hope 
that we do.
    We could talk about Chile and their economy and the 
downturn in mining. We could talk about Peru and private 
property rights, civil society all over Latin America. You 
know, the GTMO six, attempted terrorist attack in Montevideo.
    I mean, there is so much we could delve into. I think our 
committee has done a good job this year talking about the FARC; 
and talking about energy; and talking about Venezuela and Cuba 
and changes there; and Mexico and energy opportunities there; 
but also the children that were killed. We have delved into so 
much. But there is so much left uncovered.
    We could talk about your trip to Colombia recently, Ms. 
Long, and the FARC, and what you think--let me ask you that. 
Just briefly, tell us your experience and what the U.S. can do 
with regard to the FARC negotiations just quickly because I 
know you were just there, right?
    Ms. Long. I think there is a lot of optimism in the 
government about the FARC negotiations, and expectations are 
high. And I think that certainly the will on the government's 
side to get there will be--will get them there. I think that 
expectations are going to be very difficult to meet. And there 
will be resource strain on the government that will sort of 
pull from traditional security and other expenditures that may 
be significant. I worry, more importantly, about--the FARC has 
long since, I believe, been a theological bulwark for political 
organizations, and they are significantly criminal 
organizations. And those people are not going to lay down their 
arms, and they are not going to integrate, and they are not 
going to be willing to accept jobs. And what they are going to 
do is become a different kind of threat, a domestic threat that 
is basically either stealing the gold, or engaging in 
narcotrafficking, or basically running ungoverned areas.
    Mr. Duncan. But now they want to be part of the government. 
They want to have the opportunity to run for elections and be a 
viable political party. Is that being cut out of this deal? I 
don't think the Colombian people will go along with that, 
personally.
    Ms. Long. I don't think the Colombian people will go along. 
And, frankly, why would they take that harder path to actually 
be elected and hold office when the path that they have right 
now, frankly, is working very well for them?
    Mr. Duncan. Is there going to be jail time for any of the 
FARC leaders?
    Ms. Long. I don't think that has been determined. I doubt 
it.
    Mr. Duncan. Well, we are looking forward to hearing more 
about that. The last question I have, and that is for each of 
you, going forward, you have heard all of the things we have 
done this year in this committee and things we have delved 
into, but we have got a whole nother year in this session of 
Congress. So give me just a brief, real brief, your ideas on 
what we should delve into going forward. I have got a year to 
plan here.
    Ambassador Noriega. Great. Two things. Focusing on the 
threat of transnational organized crime, the crosscutting 
impact that criminality has in the hemisphere and transit 
zones, weak states in Central America, even a strong state in 
Mexico, sorely tested to meet that international threat. And it 
is an asymmetrical threat that has asymmetrical responses; that 
is to say, rifle shots, executive sanctions, OFAC sanctions 
against individuals who are laundering money. You could have a 
dramatic impact with that sort of move.
    And then an emphasis on the economic revitalization. Start 
talking about how do you get--encourage countries to retool 
their economies? You know, we are not going to be talking about 
grand international trade agreements, but we have to get back 
to basics. All prosperity is local. These countries need to 
retool their economies so they can invite investment; they can 
incentivize sustainable private sector growth, create jobs, and 
start to meet the basic needs of their people. That happens, 
you know, with free market policies. And I think we should be 
unabashed advocates for that kind of program.
    Mr. Duncan. Ms. Long, your top one or two.
    Ms. Long. I will adopt the Ambassador's number one.
    Number two is we are quickly losing our role as the 
security cooperation partner of choice, in part because we 
haven't engaged, and one would argue we can't engage. But there 
is going to be real implications, not to what China is doing in 
the Pacific and not to what Russia is doing in Ukraine, but 
those two actors are moving in significant ways into the 
region. It is still nascent, and we haven't seen the results of 
it yet, but when you have 140 or 170-plus Russian advisers in 
Nicaragua, which we can all count on that being at least 10 
times that amount--and it is not the numbers; it is the roles. 
One recent person just told me there are Spetsnaz. Whatever 
they are doing, we have got artillery delivered. We certainly 
know there are artillery advisers. Just having that in our 
backyard--with all of the problems that we have got with porous 
borders, corruption, money, and other flows--is really 
dangerous. And that chicken will come home to roost when it is 
too late. And we have an opportunity now to reengage and 
reengage effectively, and we need to do so.
    Mr. Duncan. Doctor?
    Ms. Arnson. I would say that a key priority is to support 
the peace process in Colombia and the post-accord era. I think 
it is unrealistic to expect that a peace accord is going to 
mean the end of violence; it is going to mean that all FARC 
members are going to lay down his or her weapons. That did not 
happen with the AUC paramilitary demobilization, many of whom 
have recycled into the so-called bacrim, the criminal bands. 
And I think some portion of the FARC will do that. I also think 
that there is an ongoing threat from the ELN and that there 
will be an important role in trying to end the insurgency by 
the ELN. In a bipartisan way, the United States has provided 
approximately $9 billion to Colombia. A big mistake would be to 
reduce our assistance in the post-accord era to the current 
levels of maintaining a couple of hundred million a year. 
Colombia is going to face enormous challenges. The resources 
available to the state at a time of low oil prices are much 
diminished. And I think it will be incumbent on the 
international community, including the United States, to 
support, financially and politically, the peace process.
    I think another important issue for the committee will be 
to pay attention to what is happening to those who became 
middle class during the boom decade of the 2000s, those who 
remained as vulnerable, and what is happening to them both 
economically and, more importantly, politically in the coming 
year or two, in the foreseeable future.
    And then a third, if I might permit myself, is to continue 
to help with institutional strengthening, to bolster the 
ability of governments and civil societies to combat corruption 
through strengthening of institutions and independent 
mechanisms for control and oversight.
    Mr. Duncan. Well, I want to thank each of you for that. I 
mean how many committee chairmen ask for your input on what we 
should look at going forward? But I think it is important 
because of your expertise in the region.
    I look at Latin America this way. We spend a lot as a 
Nation, we spend a lot of time and money and effort in parts of 
the world where people don't like us very much; where they 
don't speak the language; we have different cultural 
backgrounds. I look at Latin America and I see a shared 
culture; I see a shared religion than I see in most countries; 
and I just see a lot of commonality and a lot of opportunity 
for America, not only American businesses, but for American 
Government to get reengaged in this region with our friends and 
our neighbors here. And that is really what I hope we will 
continue to push forward in this subcommittee.
    And so I appreciate your excellent testimony here today. I 
apologize more members weren't here to ask questions because I 
think they missed a very prime opportunity to delve into some 
of the key issues in the region.
    But I will say the ranking member and I are focused. We 
work very well together, and I look forward to working with him 
going forward and each of you.
    And with there being no further business, we will stand 
adjourned.
    The ranking member.
    Mr. Sires. Before we end, I just want to thank you, 
Chairman, for the work that we have done throughout the year. 
It has been a very bipartisan, very good relationship. I was 
very fortunate; I had Matt Salmon also as chairman. And it is 
the best times that I have had here in Congress, regardless of 
being in the minority, working with these two chairmen.
    And South America, Central America, and, obviously, being 
from Cuba, I am very concerned about what is happening in Cuba. 
You know, since all this--over 7,000 people put in jail, and 
everything that is going on on the island--it is becoming more 
oppressive than before. And it is funny, we mentioned Brazil, 
because I was in Brazil a month--we were in Brazil with the 
previous chairman and almost a month to the day when all the 
riots started. And they took us through Maracana Stadium, where 
they spent $500 million, to see the construction. And it was 
chaotic, but they got it done. But I think one of the things 
that ignited a lot of the people in the area was that they took 
away the ability of the common people to go to this Maracana 
Stadium and watch the football games because it became more 
expensive. Whereas, before, you had the common people--I 
shouldn't say ``common people''--but you had people able to 
afford to go into the football games. And, you know, they 
showed us everything. They showed us all the railroads and 
everything else. Then, when we came back, we were very excited. 
But a month later, all hell broke loose. People started 
demonstrating. I think it hasn't stopped, quite frankly.
    But, again, Chairman, thank you very much. It has been a 
great year.
    And I look forward to having you in the future as panelists 
with us.
    Mr. Duncan. I assure the ranking member we aren't going to 
take our eye off Cuba, and look forward to continuing to look 
into that.
    You know, you are talking about cutting the common man out 
of being able to go a sports game, a soccer or football game in 
Brazil; I would say the NCAA here is about to price the common 
person out of going to a college football game. It is crazy.
    With that, there being no further business, we will stand 
adjourned. And Merry Christmas to everyone.
    [Whereupon, at 3:55 p.m., the subcommittee was adjourned.]

                                     

                                     

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