I’m not sure which attracted them first: my water or my watch.

I’d been warned, but safely traveling from Manaus to Rio de Janeiro by boat and bus dimmed my suspicions.

The desperation of Rio’s slums and the starkness of the contrast between wealth and poverty should have instilled vigilance. A mugging was inevitable – but by a group of 11-year-olds?

Increasing industrialization has flooded Brazil’s cities with poor and landless peasants. In fact, only 19 percent of Brazilians remain in rural areas. Not surprisingly, Brazil has added a new word to the world’s vocabulary: favelas. Tumbling upward toward the Corcovado, the country leads the hemisphere in crowded and ramshackle tin huts. When the rest of Rio grew at 6.9 percent in 2000, according to the World Bank, the favelas grew at 23.9 percent. The nearly 550 favelas are homes to 20 percent of Rio’s population and, most recently, the breeding ground for a politically empowered class-consciousness.

Unlike most Americans, Brazilians increasingly see the cause of poverty as a result of social injustice, not personal vice. The success of leftist Lula da Silva and the Workers’ Party in Brazil’s recent election proved just that. According to the Financial Times, the incoming working-class president won 52.5 million votes (more votes that any other candidate in democratic history besides former U.S. President Ronald Reagan.)

Now, more than ever, Brazilians need, want and expect an increased role of their government in directly improving their lives. Healthcare is under-financed. Public housing is rare, and wages are unsatisfactory. The most recent statistics collected by the United Nations shows more new cases of AIDS/HIV in Brazil than anywhere in the world.

However, the demand for subsidized healthcare, affordable housing and living wages has scared international investors. With higher wages and stagnant productivity, their profits will decline. With increased government expenditures on healthcare and housing, public debt will grow.

Clearly, what Brazilians need and what international bankers want are incompatible. Because the International Monetary Fund lends billions of dollars to countries in need of financing, their bankers make their borrowers’ budgets subject to the approval of the existing president. Because the outgoing president, Fernando Henrique Cardose, has approved the budget, the incoming president, Lula, is bound by it.

Despite the overwhelming mandate for increased governmental spending to directly improve the standard of living, the already signed budget and requisite austerity programs profoundly restrict Lula from meeting his country’s needs.

Unfortunately, as international trade increases, so have two disturbing and equally inflammatory trends: the business of militarization and the militarization of business.

Brazil’s efforts to export their biggest commodities (coffee, oranges, and steel) are stymied by U.S. tariffs. “The very items that Brazil needs to export in order to earn the hard currency to pay off their debt are the items that the U.S. government is restricting. And then on top of this, there is the national humiliation and remarks from U.S. officials. U.S. Secretary of the Treasury Paul O’Neill said any aid to Brazil will just be funneled to Swiss Banks,” explained Adhip Chadhuri, a professor in Georgetown’s Economics Department.

U.S.-backed free market reforms and privatization have left millions of Brazilians subject to capricious price fluctuations. “The federal government’s industrial privatization project has sent propane gas prices soaring, leaving many urban families cooking with wood,” wrote Time Magazine.

Before O’Neill approved the IMF loan, Brazil’s head air force general, Carlos Baptista, disregarded the consensus of his fellow military elites and the findings of a two-year study regarding the replacement of 12 supersonic jets. That is, in spite of less expensive and better Brazilian and European technology, he entered into a $700 million contract that guaranteed profit for American companies. Two days later, O’Neill, who made his opinion on the contract clear to a Brazilian audience before it was completed, approved the IMF loan.

Brazil is not the only country in the region where businesses work closely with the government. George W. Bush announced that next January Special Forces will be deployed to Colombia in order to augment the protection of a Los-Angeles-based petroleum company, Occidental, whose pipeline is being threatened by anti-American rebels. According to The New York Times, “Occidental, well-versed in Colombia’s troubles by virtue of its two decades here, is close to the Bush administration and has long lobbied for the United States to be more involved in the conflict. According to the Center for Public Integrity in Washington, the company contributed $1.5 million to presidential and Congressional campaigns between 1995 and 2000. Occidental also spent nearly $ 8.7 million lobbying American officials on Latin American policy . from 1996 to 2000, according to disclosure forms filed with Congress.”

In this setting, anti-Americanism has visibly surfaced. According to the World Bank, 66 percent of the favelas’ inhabitants are opposed to globalization. An increasing number of Brazilians see a hero in Osama bin Laden, not President George W. Bush. In August, a freshly painted mural of bin Laden was emblazoned along the wall of Rio’s biggest ghetto, while a picture of a cloaked and fanged Bush filled the covers of a national magazine.

Contrary to Bush’s logic, neither Islam nor “anti-Western” ideology is the correlative of anti-Americanism. It is poverty and globalization.

Of course, the solution to anti-Americanism and the terrorism that it spawns will not come from bombing our “enemies,” but rather through extending the economic prosperity of a few to everyone.

Beyond the IMF/U.S. budget restraint and international investors’ fear of a Lula presidency, the existing Brazilian government is presently working to restrict the power of the next president. That is, the Brazilian congress is preparing to give the Central Bank full autonomy and to raise the compulsory retirement age from 70 to 75 for civil servants – meaning that supreme court justices are unlikely to be replaced. Yes, Lula has won, but few outside Brazil have much hope in dramatic change.

On a well-lit street at a bus stop somewhere under a statue of Jesus, a towering favela and a Copacabana hotel, a group of homeless, orphaned children pleaded for my bottle of water and lunged for my watch of silver.

I still wear the watch that Rio’s children tried to take away from me, but now I wonder why.

Max Taves is a sophomore in the School of Foreign Service.

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