Contemporary U.S. foreign policy toward Haiti and the Caribbean Basin has emerged from the political and economic interests of international institutions, U.S. policymakers and competing business interests with investment stakes in the region.  The policy positions of various national and international actors were shaped by the international environment of the early 1980s, especially the collapse of commodity prices and the debt crisis that narrowed the options of the less developed governments. (Ould­Mey, 1994).  U.S.­based multinational corporations in finance, agribusiness, and electronics attempted to take advantage of the structural circumstances of the period to advance a "neoliberal agenda" for Haiti and the Caribbean Basin.  This agenda is defined as a reduced role for the nation­state in development policy, privatization of industry, reduction of trade barriers and promotion of low wages to attract foreign investment.  An examination of the interplay between private investors, the U.S. state and the Haitian state and class structure will shed new light on the politics of intervention in the post­cold war period.

 The economic objectives of U.S. foreign investors were largely compatible with the political objectives of the U.S. state in creating a stable climate for foreign investment in Haiti.  For example, the U.S. State Department and intelligence agencies worked with the Haitian military in an effort to strengthen the institutional base of the regime against its domestic opponents.  In 1985 and 1986, the U.S. intervened politically in Haiti in an effort to bolster the Haitian military and security forces against the mobilization of student, labor, the urban poor, and religious groups in Haitian society who demanded an end to military rule.

 The U.S. State Department and CIA used their ties with Haitian elites to promote a shift toward elections that featured U.S.­backed Marc Bazin, former World Bank official, against Rev. Jean­Bertrand Aristide.  During the Presidential campaign, USAID, the National Endowment for Democracy and the CIA worked to undermine the Aristide candidacy through the dissemination of political propaganda against him and in favor of Bazin, who had ties to US banking, agribusiness and electronics firms in the Caribbean Basin (Cox, 1994).  The victory of Aristide was seen by labor­intensive U.S. electronics industries as a threat to their investments in Haiti.  These interests worked with the US embassy, USAID and the National Endowment for Democracy to mobilize middle class opposition to Aristide's rule.

 The intervention of the Haitian military to oust Aristide satisfied U.S. electronics firms, who applauded the ouster in private meetings held in Miami.   However, other US agribusiness and banking firms with less ties to the Haitian military feared that the military coup would result in instability in Haiti and throughout the Caribbean Basin.    That concern also permeated the Bush and Clinton White House, where political officials were convinced that the Haitian military had not cooperated sufficiently in implementing the neoliberal agenda sought by the World Bank and AID in the 1980s.  After a decade of political pressure to curb its role in the Haitian economy, the Haitian military had failed to reduce its control over key economic sectors.  Furthermore, Haitian military officials had become more independent of U.S. policymakers and more inclined to follow their own political judgment (Wilson, 1989).

 In Haiti, two factions had emerged among the Haitian elite, one of which was committed to the program of industrialization, the modernization of agriculture, and the gradual opening of Haiti toward free trade; another of which was resentful of U.S. efforts to further industrialization and favored maintaining preferential treatment for Haitian agricultural producers (Barry, Wood, and Preusch, 1983).  The coup represented a triumph for the second group of Haitian elites who were hostile to some aspects of the U.S. neoliberal agenda of the 1980s.  In addition, the military coup created domestic political problems for the Clinton Administration, which was now faced with a potential refugee crisis during a time when policy was directed toward limiting immigration to the United States.  The Clinton Administration, as a result, moved to implement a naval blockade coupled with a sanctions policy designed to pressure the military to reform.  At the same time pressure was placed on Aristide by administration officials who urged him toward reconciliation with the military officials who had ousted him from power.    Finally, the administration authorized the U.S. occupation of Haiti in the midst of a negotiated deal with Haitian military and police officials who agreed to cooperate with the U.S. during the occupation.

 This account focuses on the economic and political interest blocs who developed a stake in Haitian and Caribbean politics in the 1980s and early 1990s.  Contrary to realist accounts that focus on U.S. efforts to counter Soviet influence in the Caribbean Basin during the 1980s, this account directs attention to private interest groups and their influence on U.S. policy, beginning with the structural adjustment agenda of the 1980s.

Private Actors and Structural Adjustment

 The U.S. government and multilateral lending agencies promoted structural adjustment programs during the 1980s in response to the changing needs of U.S. foreign investors in the less developed world.  The U.S. State Department, the Agency for International Development, the World Bank, the International Monetary Fund and various regional banks began tying loans to less developed countries to the following conditionalities: reductions in state spending, privatization, market­oriented reforms such as devaluation of currency and exchange rate adjustment, and favorable conditions for foreign capital investment.  In the case of the Caribbean Basin, private U.S. banks and foreign investors worked with the State Department and AID to promote structural adjustment in response to the emerging "crises of the 1980s."  The precise nature of these "crises" will be the subject of this section of the chapter, with a case study of U.S. AID's development program toward Haiti.

 Banks and electronics firms were part of a broad coalition of industries advocating structural adjustment lending to the Caribbean Basin during the 1980s.  For banks, such lending was seen as an appropriate means to facilitate two primary goals:  1) The collection of debts owed by less developed countries to private banks.  2) The resumption of private investment funds for export projects in agribusiness and light industry.    The debt crisis of the early 1980s threatened to forestall the collection of money owed by less developed countries to the private banks.  Most Central American and Caribbean countries faced mounting obligations to private lenders which were exacerbated by a sudden jump in the real interest rate on the external debt and a collapse in commodity prices that led to significant trade losses in the region (Cypher, 1989).  In addition, advanced capitalist nations made matters worse by increasing various nontariff barriers to trade that further impeded exports from the less developed world.

 For U.S. banks engaged in private lending to Caribbean Basin governments and investment lending to agribusiness and assembly operations in the region, a structural adjustment program which forced reductions in state spending, adjustment of currencies, and privatization was the preferred solution to the economic crises of the early 1980s.  In addition, leading U.S. banks urged the U.S. government to loosen trade restrictions on a category of manufactured goods entering the U.S. from the Caribbean Basin.  Bankers, along with U.S.­based electronics, pharmaceutical, and sporting goods firms, were among the leading advocates of the Caribbean Basin Initiative (CBI).  The CBI promoted an elimination of duties on goods exported to the United States by U.S. firms, subsidiaries and subcontractors, especially in the area of electronics and pharmaceuticals (Pantojas­Garcia, 1985).

 Electronic firms, engaged in partial production in a select few Caribbean Basin countries, including Haiti, the Dominican Republic and El Salvador, also advocated structural adjustment lending and greater regional trade with the U.S. in order to ease a declining rate of profit relative to their Japanese and West European rivals (Cox, 1994: 110­132)  These firms had steadily lost market share in the U.S. during the 1970s and early 1980s to foreign competitors.  Some firms saw partial production in the Caribbean Basin as providing a low­cost sourcing strategy for regaining a competitive edge in the U.S. market.  However, the debt crisis of the early 1980s threatened to reduce the investment potential of the Caribbean Basin.  In response, leading U.S. investors pushed for CBI in order to stabilize investment trends in the region by providing greater export opportunities to the U.S. market.

 The lobbying efforts of U.S. firms on behalf of the CBI occurred well before the Reagan administration announced its support for the initiative in 1983.  The U.S. business group Caribbean/Central American Action (CCAA) was created in 1979 for the explicit purpose of reducing trade barriers for U.S. firms and their related affiliates or subcontractors in the region.  The organization, led by U.S. banks and electronics firms, worked with the State Department and AID to draft CBI legislation which would aid foreign investors engaged in partial production in the Caribbean.  The primary beneficiaries of the CBI were electronics and pharmaceutical firms, which were overwhelmingly U.S. owned or controlled (Pantojas­Garcia, 1985).

 In addition to the promotion of CBI legislation, passed in 1984, electronics firms worked with the State Deparment and AID to promote increased investment opportunities in the Caribbean Basin.  Electronic firms cited Haiti as one of the most important countries for expanding sourcing operations in the Caribbean Basin.  The CBI helped facilitate this strategy by allowing U.S. firms tax­free exports from Haiti to the United States.  Some firms began to diversify their operations in various Caribbean Basin countries, with capital­intensive production and skilled labor concentrated in Puerto Rico and labor­intensive production and unskilled labor concentrated in El Salvador, Haiti and the Dominican Republic.

 A good example of diversification is the TII Industries of Capiague, New York, which produced telephone, power and electronic protection devices for General Electric, NYNEX, Southern Bell and Ameritech.  In 1985, TII Industries began to take advantage of investment opportunities promised by CBI.  The company divided production of overvoltage protection, network interface and station electronic equipment throughout the Caribbean to take advantage of low­cost labor and duty­free export to the United States.  Labor­intensive operations were concentrated in Haiti and the Dominican Republic, while capital­ intensive production was confined to the United States and Puerto Rico.  The result was that TII electronics became one of the lowest cost producers of electronics for the telecommunication market.  In 1986, the President of the firm reported to stockholders that the company had taken advantage of the CBI to regain a competitive advantage in world markets by shifting additional labor­intensive assembly work to our facility in Haiti and to new plants in the Dominican Republic. The sharply lower, world competitive wage rates in these countries, coupled with the incentives of the Caribbean Basin Initiative, have opened two important avenues toward long­term corporate growth (TII Industries, Annual Report, 1986).

 In a short period of time, TII was able to realize substantial profits from its foreign direct investments in the Caribbean Basin.  In 1986, the firm established a wholly owned subsidiary, Caribbean American Manufacturing, to "subcontract TII's low­cost labor force and its technically advanced manufacturing facilities in Puerto Rico to American companies for use in labor­intensive manufacturing" (National Labor Committee Report, 1993: 50).  In 1986, TII Industries' sales jumped 22 percent to $38 million, while its income more than tripled.  Under 936 of the Internal Revenue Code and CBI, "TII pays no federal corporate tax on its Caribbean operations, can pay wages six percent of New York state's, and can import into the U.S. market without paying duty" (National Labor Committee Report, 1993: 51).

 Well before the expansion and diversification of TII Industries, U.S. AID and the World Bank were promoting a development strategy for Haiti that centered around incentives for assembly plant production and agricultural exports.  Throughout the 1980s, AID established joint committees consisting of agency personnel, U.S., and Haitian business elites in order to channel funds toward the growth of assembly plants and the promotion of exports to the U.S.  As part of this effort, AID and the World Bank recommended in 1982 that the Haitian state undertake reforms such as reduced social spending and privatization that would give the foreign investor more confidence in establishing export plants in Haiti.  AID also recommended tax incentives and subsidies to export industries as part of this development strategy.

 By 1986, AID had established an organization known as Prominex in a promotional effort "to recruit assembly contracts and attract overseas investors" by mounting "a marketing effort that identifies the country as a serious contender for overseas investment" (USAID, 1986).  This strategy would emphasize the advantages of Haiti's low­cost labor force and suggest possbile joint ventures between foreign entrepreneurs and Hatian businessmen.  AID initially allocated over $7 million towards developing a working coalition of U.S. business firms and contacts necessary to promote the further development of assembly industries in Haiti.

 The agency chose Andre Apaid, a wealthy Haitian businessman, as the first president of Prominex.  Apaid was the owner of Industries Nationales Reunies S.A. (INR), a contract assembly firm employing over 1,700 workers in 1990.  The most successful division of INR is Alpha Electronics, "which assembles electronic products for Sperry/Unisys, IBM, Remington and Honeywell" (National Labor Committee Report, 1993: 28).  Alpha­supplied components are used in U.S. government computers and U.S. Defense Department radar and sonar equipment.  In addition, Apaid has close connections to sections of the Haitian military and is a known sympathizer of the coup which overthrew the democratically elected government of Jean Bertrand Aristide.

 The U.S. business organization Caribbean/Latin American Action (previously CCAA) has close ties to Apaid and U.S. AID.  A consistent theme in AID's development strategy was the cultivation of a "continuing, long­term" relationship between the U.S. private sector and the tiny Haitian private sector, which U.S. AID has described as "privileged elites of the Duvalier era" and "rapacious new ones...that have a 19th century approach to making money" (National Labor Committee Report, 1993: 35).  Joint meetings between Caribbean/Latin American Action and Haitian investors close to the Duvalier­ and post­ Duvalier military regimes were facilitated by AID.  At a Miami Conference established for U.S. direct foreign investors in the Caribbean Basin, Apaid was a featured speaker at a "Haiti Strategy Breakfast" in which he vehemently stated his opposition to the "socialist" policies of Aristide, who temporarily succeeded in raising the legal minimum wage for Haitian workers­­prior to his overthrow in the military­backed coup of September 1991.  AID used its relationship with Haitian and U.S. business elites to oppose the policies of Aristide and undermine his presidency.  The Aristide economic program was not in keeping with the AID approach to development.

 The Commerce Department articulated the implications of the development strategy undertaken by AID in an April, 1992 report:

...the best long­term prospect for U.S. business will continue to be investment in export assembly operations. Haiti's proximity to the United States, its access to Generalized System of Preferences, Caribbean Basin Initiative and Section 807 U.S. Customs benefits, as well as its abundance of low­wage, productive labor should make it a good location for assembly operations when the country achieves some level of political stability. Best prospects for U.S. exporters include imports for the assembly sector: textiles, electronic components, and raw materials used in the manufacture of sporting goods and toys (U.S. Department of Commerce, 1992).

 U.S. AID's development program toward Haiti is characteristic of the overall aims of structural adjustment: privatization, reduced state spending, increased opportunities for foreign direct investors and reduced wages.  The result for Haiti has been steady increases in nontraditional exports of electronics, clothing, toys and sporting goods to the United States.  From 1980 to 1989, these exports increased from $216 million to $370 million of assembly goods to the U.S. (National Labor Committee Report, 1993, 33).  Such exports promise few avenues of growth for the Haitian economy, since assembly plants do not rely on domestic Haitian firms for the bulk of their machinery and equipment.  Instead, assembly components are shipped from the United States to Haiti and then assembled by Haitian workers.  As a result, few backward or forward linkages to the Haitian economy are created by nontraditional exports.  On the other hand, Haitian wages have continued to plummet during the past decade, from an average of approximately 50 cents an hour in 1980 to 22 cents an hour without benefits in 1991 (Ridgeway, 1994: 143).

 In addition, AID and the National Endowment for Democracy have used "electoral intervention strategies" to weaken opponents of U.S. structural adjustment policies in the Caribbean Basin.  The two best examples are Haiti under Jean­Bertrand Aristide and Nicaragua under the Sandinistas.  On both occasions, despite the absence of a "Soviet threat," U.S. public and private agencies channeled money to private organizations intended to undermine the electoral success of these governments.  In the case of Aristide, U.S. AID launched a campaign to back his opponent in the 1990 Presidential elections, former World Bank official Marc Bazin.  When Aristide won the election, AID undertook a campaign to weaken his presidency by aiding Duvalier­sympathizers opposed to Aristide.

  This form of "electoral interventionism" is characteristic of U.S. policies during and after the cold war period.  Thus, such policies can hardly be explained by the Soviet threat.  Instead, private interest groups and government bureuacracies have developed an interest in such interventionist strategies in order to weaken opponents of U.S. economic and strategic goals in the region.

Electoral Interventionism and U.S. Interests

 Borrowing from William Robinson's recent work on Nicaragua, the term "electoral interventionism" provides an apt label for U.S. strategies to counter governments and popular movements opposed to U.S. political and economic goals in the Caribbean Basin (Robinson, 1992).  Since 1979, private sector organizations, including the U.S. Chamber of Commerce and the AFL­CIO, have worked to devise long­term strategies for promoting U.S. intervention in the less­developed world.  The formation of the National Endowment for Democracy (NED) in 1983 was part of a joint effort by the Republican and Democratic parties, the Reagan administration and private sector groups to promote "electoral intervention" to advance U.S. interests.  Erroneously dubbed a private or quasi­public organization, the NED owed its existence and its funding to State Department initiatives and Congressional authorizations.

 The organization relies on working relationships with the White House, the CIA, the State Department, the Pentagon, the USIA, the AID, Congress, the Democratic and Republican parties, the AFL­CIO and the U.S. Chamber of Commerce and dozens of other private groups to promote its agenda.  The Reagan administration created the NED as part of National Security Directive No. 77, "which laid out a comprehensive framework for employing political operations and psychological warfare in foreign policy" (Robinson, 1992: 16).  The creation of the NED was part of a concerted effort by political and private sector elites to overcome the "Vietnam Syndrome" by recasting the rationale for U.S. intervention away from anti­communism and toward the promotion of democracy.  Specifically, the NED has used its funding to promote and intervene in elections in the Philippines, Chile, Panama, Nicaragua and Haiti.

 The NED devotes its resources to building political coalitions capable of advancing candidates which support U.S. interests in pursuing structural adjustment programs.  Similarly, the organization targets for defeat those parties or governments opposed to U.S. goals.  In the case of Haiti, the NED worked with AID and private U.S. investors to undermine the presidency of Jean­Bertrand Aristide after his election on December 1990.

 The NED and the AID had channeled assistance to Aristide's opponent, Marc Bazin, a former World Bank official and supporter of structural adjustment in Haiti, during the 1990 elections.  After Bazin was defeated in the first popular election in Haitian history, the NED began directing its "democracy­building" grants to private sector opponents of Aristide, which included groups such as the Haitian International Institute for Research and Development and two conservative unions (Canham­Clyne, 1994).   Depsite the fact that these groups had little connection to any popular movements in Haiti, the NED portrayed them as representing the "democratic movement."  In addition, the AID began to establish working groups of Haitian and U.S. industrialists to voice concern and opposition to the economic reforms of Aristide, especially his plan to raise the minimum wage for Haitian workers.  The agency was responding to pressure from Haitian and U.S. business elites, who both claimed that Aristide's policies, including his decision to raise the minimum wage, could have disastrous effects on investment trends.  As part of this effort, AID cut off aid to Aristide shortly after he took office.

 In addition, for the first time in its history, the State Department became concerned with human rights violations in Haiti after the election of Aristide.  The Department reportedly established a notebook of human rights violations committed by the Aristide government, something it had not done during the Duvalier regimes.  In fact, State Department officials had supported the Duvaliers consistently by arguing that the human rights abuses of those regimes were unsubstantiated and that those regimes deserved support for their anti­communism.  As Amy Wilentz has noted:

During the four regimes that preceded Aristide, international human rights advocates and democratic observers had begged the State Department to  consider helping the democratic opposition in Haiti. But no steps were taken by the United  States to strengthen anything but the executive and the military until Aristide won the presidency. Then, all of a sudden, the United States began to think about how it could help those Haitians eager to limit the powers of the executive or to replace the government constitutionally (Chomsky, 1992: 211).

 Similar to NED's efforts, AID's "Democracy Enhancement" program was designed to aid conservative opponents of the Aristide government.  After Aristide's election, AID assembled a network of U.S. and Haitian business groups to undertake an assessment of the Aristide government and the prospects for deepening the export promotion drive.  The AID team included Charles Beaulieu, the former governer of the Haitian Central Bank, and the Stanford Research Institute, which was given $1,227,000 in AID contracts to assist the agency in "Economic Policy Analysis and Assesment of Science and Technology Policies."  The emphasis of AID study groups and research teams was to listen to the concerns of the Haitian private sector regarding the options and obstacles to strenghtening the assembly export program.  The Research Team reported to AID that the government's proposed increase in the minimum wage:

....is generally not being very well received by the business community in Haiti. Many business leaders fear that the large minimum wage increase will lead to higher wage demands from semi­skilled and skilled workers, which will be beyond the  companies' capacity to pay, given the high cost structure in Haiti for non­labor cost factors such as port charges, electricity and telecommunications (National Labor Committee, 1993: 26).

  Based on the report of the Stanford Research Team, AID issued position papers arguing that Haiti's economic future was being jeopardized by Aristide's wage bill.  The agency responded to the "Aristide threat" by allocating $26 million to the "ad hoc committee of business organizations" under AID's control in order to help keep "Haitian production competitive in world markets" (National Labor Committee Report, 1993: 26).  AID produced an internal working paper which recommended that Haitian business organizations be organized and placed "under the umbrella of USAID's export and investment promotion project (Prominex)" (National Labor Committee Report, 1993: 26).  In addition, AID increased its funding of Prominex by approximately $5 million, which gave the organization $12.7 million in assistance.  One of the main goals of the project was to build sectoral support among Haitian business elites for a set of policies required for sustained economic growth.  This included the:

establishment of an advisory committee with approval of USAID, to broadly represent the Haitian business and commercial sectors; convening regular and special meetings of the committee; advising this committee of its mandate to make Haitian production competitive in world markets...(USAID, June 1991).

 According to the agency, the "project will work with local business organizations to develop internationally competitive local production, build constituencies for open market policies, and move Haiti toward becoming a full partner in the hemisperic free trade bloc" (USAID, June, 1991).  AID emphasized that it was primarily Haiti's low­wage advantage that would attract investments and provide the impetus for integrating Haiti into the free trade bloc.

 This electoral intervention in Haiti reflected long­term U.S. economic and political interests which had little to do with either anti­communism or the promotion of democracy.  However, these rationales have been used in the cold war and post­cold war periods, respectively, to justify U.S. policy toward the country.  The attempt by the U.S. government to pressure the Haitian military to restore Aristide to power should be seen in the context of the electoral intervention strategies of the recent past.  The confrontation between the U.S. administration and intransigent sectors of the Haitian military is best described as a battle between sectors of the international elite and local Haitian nationalists.  The Bush and Clinton administrations have both supported a continuation of structural adjustment policies in Haiti.  Both have worked to mediate a compromise between Aristide and the Haitian military which will leave military institutions intact and allow for the continuation of U.S.­backed austerity measures in Haiti.

 During the initial embargo against Haiti by the Bush administration, U.S. assembly companies were able to win an exemption to the prohibition of trade with the island.  U.S. business groups mounted a successful lobbying campaign which allowed them to continue to import partially assembled components to U.S.­owned assembly plants in Haiti.  In addition, as many as 66 U.S. companies received a special license from the Bush administration to import into the U.S. from Haiti (National Labor Committee Report, 1993: 16).   The Clinton administration continued the Bush strategy until very recently, when the administration authorized the military occupation of Haiti after a negotiated agreement with the Haitian military.  The terms of the occupation are consistent with U.S. foreign policy objectives throughout the 1980s and 1990s.

 First, the Clinton administration worked with the World Bank to devise a structural adjustment plan for Haiti to be implemented after Aristide's return to the presidency.  Second, Aristide was instructed by Clinton officials that he must accept a general amnesty for Haitian military leaders involved in the 1991 coup.  Third, Haitian military personnel are being used to restructure the police force in a manner consistent with U.S. objectives of preserving the Haitian state apparatus while allowing for a change of regimes.  Thirty U.S. military advisers will remain in Haiti after the occupation to supervise the work of leading ministries, while the U.S. has retained a veto power over the ministerial appointments of Aristide, enforced by threats to withhold aid if they wrong personnel and policies are adopted.

The Military Occupation Strategy

 As of this writing, the Clinton Administration had authorized the military occupation of Haiti.  Such an intervention is portrayed as having the goal of the restoration of democracy to Haiti via the return of Jean­Bertrand Aristide.  A more accurate interpretation involves an assesment of the political and economic interests of U.S. investors and policymakers in Haiti, and the role of sectors of the Haitian elite in obstructing those interests.  The long­term trends involve a political conflict between sectors of international capital backed by the United States and the traditionalists within the Haitian military who have rebelled against some of the neoliberal reforms of the 1980s.  In order to understand this conflict, it is necessary to outline a class map of Haitian society and the relationship between the Haitian state and the international and domestic bourgeoisie.

 As many observers have noted, the Haitian state has a contradictory relationship to the Haitian private sector and the international bourgeoisie.   On the one hand, the state has provided the Haitian rural bourgeoisie, dominated by coffee exporters and speculators, with monopoly privileges in the buying and selling of coffee and the fixing of prices, as well as the authority to coerce peasant producers into accepting low prices paid for their products.  The state also has channeled international aid money into the development of a light industrial sector geared around the needs of a dominant U.S. bourgeoisie and their Haitian subordinates.  On the other hand, the state maintains an elaborate network of monopolies and taxation policies which simultaneously undercuts the Haitian and international bourgeoisie (Trouillot, 1990).  This section first details the cooperative side of the relationship between the Haitian state and the private sector.  It then documents the conflicts between the state and private capital, both foreign and domestic, which have surfaced in the confrontation between the United States and Haiti.

  The dominant agricultural classes in Haiti include coffee exporters and speculators who constitute a rural rentier class dependent on monopoly privileges extended by the Haitian state.  The coffee exporters have monopoly control over the buying and selling of coffee, fix prices paid to the peasants and pass government taxes on to peasant producers (Pierre, 1989).   The speculators serve as middlemen between the coffee exporters and the peasants.  They collude among themselves to restrict competition and force down prices for peasant producers.  In addition, they have relied on their ties to the military, police and tontons macoutes to coerce peasants to deliver food at low prices.

 This rentier class overlaps considerably with the service sector and industrial entrepreneurs in Haiti.  For example, the coffee exporters are also involved in insurance, real estate, commercial representation and distribution of imported products, industries that produce for the Haitian market and export manufacturing industries.  Those Haitian elites most dependent on the coffee sector are opposed to any changes in the pattern of landownership and distribution in Haiti for fear of losing profits to competitive enterprises, especially foreign agribusiness firms engaged in the marketing and distribution of agricultural products in the Caribbean Basin (Fauntroy, 1994).  Whereas US AID and the World Bank has proposed ending the monopoly privileges of the Haitian coffee sector, the Haitian coffee exporters have relied on their connections with the Haitian state to preclude the introduction of such policies (DeWind, 1989).

 At the same time, the Haitian state has played a pivotal role in facilitating conditions for the development of light industry in Haiti with government subsidies and guarantees for foreign capital accumulation and repatriation of profits.  U.S. firms, including Motorola, Bendix, Univac, GTE and TRW have dominated the electronics industry.  Other U.S. firms in the garment, toy, shoe and leather goods sectors either own assembly plants or subcontract to Haitian owners.  U.S. AID money, as documented in the previous section, has consistently gone toward attracting and promoting foreign­owned or controlled light industry in Haiti.

 In return for foreign firms locating in Haiti, the state has guaranteed tax and tariff exemptions, and an abundant supply of cheap labor.  Starting in 1972, foreign assembly firms paid no income tax for the first five years and a graduated income tax for the next ten years.  In addition, these firms paid no taxes on raw materials, equipment, or technology imported for their operation, with no restrictions on the reparation of profits.

 The Haitian military and police forces, backed by the repression of the tontons macoutes, kept labor costs low and suppressed the efforts of Haitian trade unionists to organize within the assembly sector.  The result was the growth of an assembly sector dominated by foreign capital and constituted as an enclave sector within the Haitian economy.  Assembly firms imported most of their raw materials and technology and used minimal inputs from Haitian agriculture or industry, such as leather goods, wood products and fiber.  As with traditional enclaves, the primary contribution of the host country was a cheap labor supply.  In subcontracting relationships, the role of the Haitian bourgeoisie was subordinate to U.S. investors.  While foreign contractors supplied the raw materials, the technology, established the standards for production and set the price of the products, Haitian businessman "supplied the capital, the buildings, hired the workforce, paid the operating costs, and supervised the production process" (Dupuy, 1989: 19).  Haitian investors thus assumed virtually all the risks with "no control over what was produced, the volume of production or the price of the goods produced" (Dupuy, 1989: 19).

 U.S. foreign economic policy has been based on support for the enclave sector of the Haitian economy, thereby exacerbating tensions between Haitian traditionalists and modernizers over the future role of the Haitian state.  The U.S. State Department, through the AID and the NED, have cultivated relationships with U.S. business executives and the Haitian bourgeoisie affiliated with the enclave sector, to promote a development package centered around further support for light industry and modernization of agriculture.  AID has pushed for privatization and modernization of the agricultural sector and the diversion of 30 percent of agricultural land for export crops (USAID, November 1989).

 Unlike the AID program in the light assembly sector, the agricultural program met considerable oppostion from Haitian traditionalists tied to the agricultual sector.  In fact, Haitian traditionalists became convinced that state promotion of the light assembly industry was undercutting the agricultural sector of the economy.  Since the mid­1970s, the agricultural sector has experienced a steadily deepening crisis, resulting in an intensification of the exploitation of peasant producers by the landed bourgeoisie.  After stagnating in the 1970s, the agricultural sector declined in the 1980s, as indicated by negative rates of growth for most of the decade.  At the same time, state expenditures were concentrated in Port­au­Prince and away from rural areas, with only 54 percent of public expenditures going to rural areas where 74 percent of the population live, while 28 percent of public expenditures went to Port­au­Prince, where 14 percent of the population are located (Dupuy, 1989: 19).

 In this context, the Haitian state was unwilling to implement an AID strategy of abolishing agricultural monopolies and diverting 30 percent of agricultural land to export crops, because both measures were vigorously opposed by coffee exporters and speculators.  However, U.S.­based agribusiness firms supported such a move as part of a regional strategy of increasing access to marketing and distribution opportunities throughout the Caribbean Basin.  U.S. agribusiness and banking firms with the Caribbean/Central American Action organization supported eliminating agricultural monopolies as a first step to opening the Haitian rural sector to foreign investors at low cost.    These business groups also backed World Bank and AID reforms aimed at reducing the role of the Haitian state in the economy by eliminating state monopolies which interfered with and blocked competition from the domestic and foreign private sector.

  While labor­intensive U.S. electronic firms supported the status quo in Haiti and benefited from AID's aggressive promotion of light industry alongside state repression of labor, agribusiness and banking firms sought to use AID to move into the marketing and distribution of coffee, just as had been done in other countries in the Caribbean Basin.
  The overall program of AID and the World Bank mirrored the objectives of a broad coalition of U.S. investors who sought to expand investment opportunities in Haiti.  Throughout the 1980s, these international agencies pressured the Haitian military to eliminate monopolies in industry and agriculture and to privatize state­owned firms while reducing taxation rates that interfered with private capital accumulation.

 This AID and World Bank strategy appealed to some Haitian state elites, here dubbed "modernizers," while being opposed by "traditionalists" within the agriculture and state sectors of the economy.  The traditionalists were especially strong within the Haitian state, which had long benefited from monopolies and taxation policies which has enabled state employees of various class backgrounds to enrich themselves.  The Haitian state is not tied to one sector of capital, although it negotiates with the urban bourgeoisie and rural rentier class for favorable terms of trade and investment.  Instead, the state is best described as a prebendary government which accumulates income from all segments of the population (Dupuy, 1989a).
 Contrary to World Bank and AID advice, the Haitian government had extended its monopoly of state enterprises and created new ones which aggressively compete with private capital.  For example, the Regie du Tabac monopolized the manufacture and sale of tobacco products and matches, and controlled the taxes on such products as herring, codfish, milk, soap and detergents.  The Minoterie d'Haiti and the CIment d'Haiti, two other state enterprises, monopolized the importation and sale of flour, wheat and cement.  The regime also owns a sugar mill, the Usine Sucriere Nationale de Darbonne, and an oil seed company, the Societe d'Exploration des Gleagineuz, that produces cooking and industrial oil products and other substitutes for meat and milk.  These enterprises were heavily subsidized and undercut enterprises in the private sector while increasing prices charged to consumers (Dupuy, 1989: 17).

 At the same time, the Haitian state has relied on regressive taxes for its primary source of wealth.  Throughout the 1980s, the Duvalier government continued to increase income taxes, taxes on luxury goods, alcoholic beverages, cars, sales taxes, and coffee export taxes.  The wealth was not used to promote industrialization or to modernize and improve agricultural production.  Instead the taxes enrich high civilian and military officials, support the Tontons Macoute forces and serve as discretionary funds for the use of the regime.  Thus the state relied primarily on AID money and low wages to attract U.S. assembly firms, while remaining opposed to international efforts to reduce the role of the state in the domestic economy.

 The conflict between U.S. foreign economic objectives and Haitian traditionalists within the state sector is the long­term factor that has led to the U.S. military occupation of Haiti. To summarize, the Haitian state sector refused to cooperate with various aspects of the AID/World Bank program, including reducing the role of the state in the economy, privatizing state monopolies, and implementing an agricultural modernization program.  At the same time, the U.S. moved to strengthen the position of modernizers in the Haitian state who were supportive of U.S. foreign economic goals and to weaken traditionalists who remained opposed.    All the while, the U.S. remained fully committed to preserving the basic institutions of the Haitian state, including the military and police forces, in an effort to implement its preferred agenda (Nairn, 1994).

 The U.S. strategy has involved weakening radical opponents of the regime by increasing military assistance to Haiti during times of social unrest, especially during the period of 1985 and 1986 when worker and student movements threatened to unseat Jean­ Claude Duvalier, and again during the current occupation.  After the military had repressed and contained the 1985­86 uprising, the U.S. moved to drive a wedge between the modernizers and traditionalists within the Haitian regime by withholding aid until the regime undertook steps toward changing its economic policies.  The U.S. also urged a shift toward elections in order to weaken the traditionalists within the regime and to strengthen the proponents of a modernization strategy.  Thus the U.S. moved toward its electoral intervention strategy as a preferred method of promoting its foreign economic agenda.

 The electoral intervention strategy backfired from the U.S. point of view.  The U.S. candidate, Marc Bazin, a leading modernizer with close ties to U.S. and Haitian business interests, lost the election to Jean­Bertrand Aristide, a priest with close ties to segments of the Haitian progressive bourgeoisie, as well as the popular student and worker movement which had developed in the mid­1980s.  Immediately, U.S. intelligence agencies, led by the CIA and supported by AID and NED, worked to undermine the Aristide government by disseminating negative propaganda regarding his psychological state and his anti­democratic (read populist) tendencies.  Ironically, it was these U.S. tactics which helped to strenghthen the resolve of the traditionalists within the Haitian state, who had been skeptical of U.S. intentions all along and now felt confident of their ability to overthrow Aristide.

 The failure of the electoral intervention strategy, followed by the military coup which overthrew Aristide, eventually led to the U.S. occupation as political instability in Haiti threatened to create a refugee crisis for Clinton.  An exhaustive interview of U.S. military intelligence officers engaged in developing long­term plans for the occupation of Haiti reveal that one aim of the U.S. occupation is to prevent popular demonstrations from getting out of hand (Nairn, 1994).  A related objective is to restructure the Haitian state apparatus which the U.S. has long relied upon to police Haiti.  Thus the Haitian armed forces have worked with U.S. military personnel in planning deployment of troops and in restructuring the Haitian police forces, primarily with neo­Duvalierist army functionaries who are loyal to U.S. objectives.  Most recently, the U.S. has relied on Haitian military personnel to staff the new Haitian police force.

 On April 1, 1996, the United Nations began its first day of formal peacekeeping operations in Haiti with 6,900 soldiers and police officers from more than 30 countries. Despite the diversity of the U.N. contingent, there is continuity between the goals of the U.S. occupation and the U.N. deployment that are evident in the continued pursuit of U.S. strategic and economic objectives. First, an American general officer, Major General Joseph W. Kinzer, was named the commander of the military component of the U.N. mission. Second, the U.S. continued to direct the training of the new Haitian police forces, using the U.N. and Haitian personnel to oversee the formation of a 6,000 member police unit. Third, the U.S., according to interviews and documents obtained by journalists on the scene in Haiti, has relied on former Haitian military personnel and Duvalierists to train and staff the Haitian police force (Nairn, 1995).

 At the same time, U.S. special forces have maintained a close relationship with the Haitian death squad "Front for Advancement and Progress in Haiti" (FRAPH). Starting in mid-1993 and continuing through the U.S. occupation, the Defense Intelligence Agency, implementing high-level orders from the Defense Department, authorized the shipment of arms to FRAPH from Miami and New York. U.S. military commanders ordered special forces units to "go easy" on FRAPH members during the occupation, with a common practice of allowing FRAPH attaches to go free after brief arrests. Meanwhile, the CIA kept FRAPH informants on its payroll at least from mid-1993 through 1995. The purpose of the U.S.-FRAPH connection has been to put pressure on Aristide, first to make concessions to the Haitian military and economic elite as a precondition for his return to Haiti, and second to keep his government on track to implement the neoliberal reforms pursued by the State Department since the 1980s (Nairn, 1996; New York Times, Feb. 6, 1996).

 One of the primary economic objectives of U.S. policymakers has been the liberalization of trade, which has greatly accelerated with the return of Aristide. As argued in the previous section of this chapter, U.S. agribusiness and the State Department have long supported trade liberalization as a foreign policy objective for Haiti. Since the return of Aristide, and at the demand of the U.S., the World Bank and the International Monetary Fund, Haiti has dropped import tariffs from 57 percent to between 0 and 15 percent on a range of agricultural products.

 The slashing of agricultural tariffs has meant that Haiti, previously self-sufficient in cereals production, is now becoming dependent on imports of foreign rice, a policy pursued by the U.S. State Department and agribusiness giant Erly Industries. While rice tariffs have been slashed to 3 percent, the U.S. Agency for International Development has provided $89 million in contracts for a leading Erly subsidiary, Chemonics.  The latter firm, along with other Erly subsidiaries, including Comet Rice, the Rice Corporation of Haiti, and American Rice, has benefited from a U.S. trade liberalization policy that accelerated after Aristideís return to Haiti (Washington Office on Haiti, 1995). Meanwhile, peasant groups such as the Association of Agricultural Groups of the Artibonite, told independent election observers that imported cheap rice has been flooding the Haitian market, driving rice farmers off the land and destroying Haitiís ability to feed itself (Grassroots International and New England Observersí Delegation to Haiti, 1995).

Conclusion

 This chapter has attempted to document the continuity of U.S. policy toward Haiti in the Cold War and post-Cold war periods. Contrary to realist accounts which focus on anti-communism as an overriding objective of U.S. policy, this perspective argues that the U.S. has long attempted, and is continuing to pursue, an integration of the Haitian political economy into the neoliberal framework of trade liberalization, privatization, and electoral reforms which favor Haitian modernizers and foreign investors over Haitian traditionalists dependent on monopoly privileges extended by the Haitian state.

 At the same time, the U.S. before and during the occupation, has opposed efforts by Haitian popular sector organizations (peasant movements, student groups and trade unionists) to pressure Aristide to abandon the liberalization and privatization efforts encouraged by U.S. officials (Petras and Morley, 1986; Haitian Information Bureau, 1994). Toward that end, the U.S. has tied future U.S. and international aid to the conditionality that Aristide and his successor, Rene Praval, remain committed to neoliberal reforms and the appointment of ministers who will be committed to the implementation of those reforms. At the same time, the U.S. has maintained linkages with the Haitian far right by working closely with Duvalierists to restructure the Haitian police force and, through the Defense Department and the CIA, with FRAPH attaches to pressure Aristide and Haitian popular movements to back away from challenging the neoliberal economic and political agenda.

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