Leadership: Cold War Dollar Diplomacy Returns

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September 16, 2006: One of the ways by which Iran, Venezuela, China, and other outlaw nations, garner international support is by spreading their money around. This was a tactic widely used by wealthy and powerful countries, especially during the Cold War. Outcast nations have also learned that money talks. Iran and Venezuela are benefiting from the booming price of oil, while China is riding a booming economy, which generate lots and lots of cash. Iran spreads huge sums around to sympathetic Islamic charities, movements like Hizbollah, and small countries desperate for cash, such as Djibouti. Venezuela's president. Hugo Chaves similarly has been giving huge amounts to help like-minded political leaders all across Latin America, and also provided development money and subsidized fuel to impoverished countries in the region. China has also been investing heavily in overseas enterprises, and while some of its money goes into the developed world, a lot goes to poor countries.
The goal of all three countries is in enhance their influence by spending their money, and they have had some success at it. This effort has also revived the Cold War situation, where recipient countries would play the superpowers off against each other, in order to get larger gifts from one, or both, of them.
But as Americans know, spending on "foreign aid" is not popular with the folks back home. One of the reasons the Soviet Union collapsed was public unhappiness with the large sums being given to foreigners. Of course, in the U.S., the public gets a say in how much money is going to used to help other countries, and that usually translates into "as little as possible." The public in Iran, Venezuela, and China doesn't get any say, and so these countries actually spread around proportionately more cash than the U.S. does. But sooner or later the cash cow is going to dry up. There's already widespread resentment in Iran over foreign aid (Hezbollah was getting hundreds of millions even before the recent war in Lebanon, and will be getting billions now to rebuild) while a majority of the folks back home live in poverty. Venezuela's poor are beginning to notice that despite nearly a decade of rule by Chavez and his "Bolivarian Revolution" they ain't getting any richer, and there are reports of numerous incidents of "disorder" in rural China, which has hardly felt the effects of the economic boom.

 


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