A specter is haunting Latin America — the specter of socialism. From the Rio Grande to Tierra del Fuego, alternatives to the Washington Consensus are being developed and leftist governments are being elected. A 200-year legacy of U.S. intervention in the form of the Monroe Doctrine, “dollar diplomacy,” CIA-backed dictatorships, and the International Monetary Fund appears to be coming to an end. Neoliberal capitalism has failed so spectacularly that philosophical and political independence from the United States are finally not only possible, they are also an absolute necessity. The socialist governments of Latin America can be divided into two different but not antagonistic camps: the populist, pro-Castro governments of Venezuela’s Hugo Chávez and Bolivia’s Evo Morales; and the more market-friendly, reformist administrations in Brazil, Argentina, Uruguay, and Chile. It appears likely that 2006 will see Mexico replace the pro-Bush Vicente Fox with moderate leftist Andrés Manuel López Obrador, and Nicaragua could re-elect Reagan’s old nemesis Daniel Ortega. Next month, Peru could turn markedly to the left if retired Gen. Ollanta Humala, a Chávezlike populist, is elected. Perhaps the key event in recent Latin American history has been the economic collapse of Argentina in 2001 and that country’s subsequent rejection of the IMF’s mandates. IMF free-market policies allowed speculators to drain capital from Argentina, and it has been President Nestor Kirchner’s interventionist practices that have stabilized the economy. Over the last three years the Argentine economy has averaged 9 percent growth. With help from loans by Venezuela, Argentina has been able to pay off its debt to the IMF and undo some of the damage done by that institution. As Kirchner said, after paying off the debt, “The IMF acted towards our country as a promoter and vehicle of policies that caused poverty and pain among the Argentine people.” The same could be said for many countries of the world. The most entertaining and probably most important politician in Latin America today is Venezuela’s Chávez. As the world’s fifth-largest producer of oil, Venezuela and its politics are vitally important to the rest of the continent and to the United States. In 2002 Washington supported a coup against Chávez. The coup failed; the underdog Chávez became an international hero and our administration once again sullied America’s reputation abroad. While not necessarily supporting Chávez’s brand of personality-based populism, other nations in South America are delighted to work with Chávez and his oil wealth. Venezuela’s purchase of Argentine treasury notes helped make that country independent of the IMF and American financial institutions. Many believe that Chávez will support Bolivia in a similar fashion. Plans are now being made for a 7,000-kilometer oil pipeline to Argentina, and Venezuela has helped Brazil by purchasing 36 fighter jets there. Venezuela and its oil money are essential in Latin America’s move toward economic independence. Brazil is emerging as the leader of an economic bloc that has demonstrated it has the ability to thwart the United States and Europe, particularly in the area of agricultural policy and pharmaceutical patents. Meetings of the World Trade Organization, which used to be a romp for the wealthy nations of the north, are grinding to a standstill because of the spirited resistance of the “G-20,” a bloc of developing nations that includes Brazil, India, and South Africa. Brazil, like Argentina, has announced that it will no longer borrow money from the International Monetary Fund. It is too early to predict how successful Latin America’s socialist governments will be. The United States and its version of capitalism, particularly under our current administration, have little credibility. The system has failed to deliver. Unregulated capitalism has achieved the only two things it is capable of doing: driven down wages for workers and maximized profits for the wealthy. This economic model is proving an empty promise, a dead end for most of the planet. In their effort to create a future they control, the people of Latin America are developing an alternative to the neoliberal feudalism emanating from Washington and Wall Street. The rest of the world is watching closely.