Easy for Washington to Say

For some time now U.S. Treasury Secretary James A. Baker III has been preaching Reaganomics to Latin America. His message: The best way for the region’s heavily indebted nations to get out of a severe depression is to work their way out, mainly by cutting government spending and opening their economies to private investors who can generate economic growth.

Austerity is easy to prescribe from an office in Washington, but it creates immense political problems for the officials who must practice austerity in Mexico City or Buenos Aires. Still, many Latin debtors have acceded to elements of the so-called Baker Plan, although not without complaint and criticism.

One way in which Latin Americans express their discomfort is to seek out public forums where the debt crisis can be discussed in political terms rather than pure economic terms. The latest forum is a scheduled special meeting of the economic council of the Organization of American States. That meeting, in June, would mark the first time that the OAS has taken up the debt crisis, despite the fact that most specialists on Latin America agree that the region’s $380-billion debt is the hemisphere’s most profound long-range challenge.

No sooner had the OAS meeting been announced, however, than the United States tried to put a damper on it by proclaiming publicly that no such meeting is needed. And while there is not much that the United States can do to prevent the meeting from being held, a spokesman for Baker also said that it is uncertain whether the Treasury secretary will even attend. Baker’s absence would, of course, diminish the importance of the session.

It is bad enough that the Reagan Administration refuses to take decisive steps to reduce the United States’ contribution to the Third World’s economic problems, like cutting into its own massive federal deficit that helps drive up interest rates for other nations. Now it appears that Baker is unwilling even to sit down with the finance ministers of the OAS nations to discuss the regional economic crisis. Surely it would not be a very pleasant experience for the Treasury secretary to sit in meetings where he is outnumbered by critics, but it would help relieve the political pressure that officials in countries like Mexico, Brazil and Argentina are under if they could get some things off their chests in public. Baker would make it easier for Latin Americans to take his medicine by taking a few unpleasant doses himself.