Latin America is as varied as its peoples. What they appear to share in common is adaptation to the substantial changes in the forms, cultures, and cognitive cages within which the United States seeks to deal with its Hispano-Lusitanian-Indigenous neighbors.
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| Senator Henry Clay |
That very American cognitive cage, sometimes referenced as America(s) First, posits a normative triumph of the transactional. That is, it returns the United States to a political-cultural position closer to that of the middle of the 19th century--markets driven, trading focused, and grounded on the notion that the State served the nation best as a large and multi-purpose Import-Export Bank and insurance enterprise, one that included a military wing for the protection of a trading environment centered in the nation but extending outward through investment transactions and transactions in goods and services, that serves the nation by creating wealth. Americans (at least the current crop of leadership) are now merchants again. One recalls Henry Clay and the tripartite economic organization of the nation built around tariffs and the win-win of a functionally differentiated economic Republic --Southern planters for export and supply of raw materials to domestic manufacturers, Northern industrialists and merchants for trading in goods and services and participating in domestic supply chains, and western farmers to feed the nation, and perhaps the rest of the world (Henry Clay,
The American System, Speech Delivered in the Senate of the United States 2-3 and 6 February 1832). It is no longer 1832, the union has become a more unified State, tariffs are no longer the critical source of revenue for the general government, and functional differentiation within the Republic has become exceedingly multi-layered and partitioned, as well as deeply embedded in the foreign adventures of the Republic's economic actors. Nonetheless the ghosts of the antebellum Republic continue to haunt--spectres that remind us that cultural types--merchant, official, warrior, and farmer--may transcend the peculiarities of a stage of historical development to appear and reappear as the dominant vision for an age (
The
"Merchant" (商), the "Bureaucrat" (士) and the "Tariff War"--The
Cognitive Cages of the New Apex Post-Global and the Condition of the
U.S. and China in their Folie à Deux).
The response to these changes in national leadership socio-political cultural "personality" by its neighbors has been one of the great sports of regional history. It also serves to unmask the cognitive cages, trip wires and rationalizing predilections of those sovereign enterprises that must deal both with foreign merchants, adventurers, investors and traders, while sending out their own to their own ends.
On the one hand, Mexican leaders, through their President Claudia Sheinbaum, have adapted to these personality changes through a well developed process of flexibility that both mimics the ruling American archetype of a time and then reflecting it back in ways that serve the Mexican national interest. ("Vamos
a llegar a un acuerdo con el gobierno de EUA; no se negocia nunca la
soberanía de nuestro país: Presidenta Claudia Sheinbaum" [We will reach
an agreement with the US government; our country's sovereignty is never
negotiable: President Claudia Sheinbaum]; also here and here). The power imbalances between Mexico and the U.S. of course shape the nature of that interaction, but they do not make it either impossible or of some value to the Mexican Republic, itself a powerful regional actor within its own sphere of primary operation. And of course, Mexican elites have the capacity of transactional merchant cultures that in some ways equal or sometimes exceed that of the merchant types of their northern neighbor. The point, though is that Mexican political elites tend to be in the flow of their neighbor, and have learned to exploit it to the extent possible from time to time. In the age of the merchant, in the time of the triumph of the transaction, Mexico might become a saavy merchant and its transactions can be both defensive and offensive. In the latter respect one need only consider the way Mexico leverages both regional power and serves as a counterbalancing conduit for principal tiers competitors of its North American neighbor--for the moment particularly in its relations with China (here).
On the other hand, Brazil, that other Latin American power, has tended to adopt a quite different approach. That difference, grounded in wariness and built on a need to preserve its cognitive borders (physically manifested, of course, through the State and its legal-administrative apparatus) against what it views as interference by foreigners, especially disfavored or ideologically threatening foreigners. If Mexico can flexibly move between the cognitive sensibilities of the merchant and the official, Brazil appears less able or willing to do so. Probably less willing given its won development of a political culture around which the State apparatus has been built. In the current era, wariness of the United States--whether in its apparent in the cultures of the official or the merchant--runs deep, and to some extent is both ideological and personal in a way the dogmatics of which are more powerful than in either the United States or Mexico. One might start the current history of those dogmatics from the time that Brazil helped spearhead the demise of the U.S. based Free Trade Area of the Americas in 2008 (an irony, really, considering the enthusiasm, less than half a generation later, for the arrangements of the Chinese Belt & Toad Initiative). But that speaks to ideology as well as economic interest--and to an attachment of Brazil (though not necessarily its masses beyond the intellectuals and officials) for European and "South" sensibilities over that of the North Americans. Fair enough, of course, and one, at least among segments of its intelligentsia long cultivated by deep connections with Cuban political ideology and European intellectual currents.
The differences between Mexico and Brazil then tend to be quite showy, especially in moments of transition or crisis (both in the United States an in Brazil or Mexico). The showiest element, and the core triggering element of transactional discourse in both states touches on sovereignty. Like every other Latin American State, the issue of sovereignty, its discourse, and the way in which it is made meaningful in culture, politics, and economics, is central to the way in which States approach their relations with others. Sovereignty, in this sense acquires a profoundly semiotic and cognitive character. It is an object that incarnates the ideal of the State, but at the same time it is a way in which the State's ideal acquires significance, and through this signification (what does sovereignty mean in context and with respect to specific relations) it may be applied or interpreted expressed in the actions and policies of the State, as well as in the form of a conceptual framework within which it is possible to understand and abide by the "rules" and limits of actions that trigger taboo negative impacts on sovereignty. But the practice of sovereignty, that is, the way that sovereignty is articulated, and thus articulated manifested as a form of that articulation, is also a function of the history and national context in which it may be applied--even where the national feeling (the patriotic solidarity) among states may be viewed as equivalent. Mexican sovereignty, in this sense, is largely internalized. It is expressed within the self conception, and thus the action drivers, of its collective organs. Might it be possible to suggest that Brazilian sovereignty is more visible an an externalized force--projected outward through the expressions of an ideology of sovereign prerogative in law and discretionary actions leveraged outward bit applied to those invited in. Mexican sovereignty can thus be expressed in and as transactions in a way that would be difficult for their Brazilian counterparts, for which a more formal legal-administrative language of the culture of the official (rather than the merchant) predominates. No judgment here--either works--but it makes sense to acquire some sort of understanding of the language and cognitive frameworks within which relationships might be approached with either or both.
It is no surprise, then, that as President Sheinbaum negotiates, President Lula da Silva--ironically taking a page from the Executive playbook of President Trump, though within the cultural spaces of Brazilian approaches to these things--exercises administrative discretion within an apparatus of state. The result is inevitable--for Mexico the challenge of bargaining for a good deal; for Brazil, the start of a chess game of opposition and regulatory (as well as discursive) stances.
Brazilian President Luiz Inácio Lula da Silva on Monday signed the decree regulating the Trade Reciprocity Law, Chief of Staff Rui Costa confirmed in a statement from the Planalto Palace. The measure is to be published in a regular edition of the Federal Diário Oficial da União (Official Gazette - DOU). The new rule authorizes the Brazilian government to adopt trade measures against countries that impose unilateral barriers on Brazilian products in the global market. It could be used to respond to the 50% tariff on all Brazilian exports to the United States (US) as of August 1, as announced last week by US President Donald Trump. (HERE)
More specifically, the "Economic Reciprocity Law, approved by the Brazilian Congress in April and now formally implemented, allows the government to suspend trade concessions, investments and even intellectual property rights of countries that impose unilateral measures against Brazilian interests." (Here). To that end, President Lula da Silva promulgated DECRETO Nº 12.551, DE 14 DE JULHO DE 2025. The Decree establishes an Interministerial Committee for Negotiation and Economic and Trade Countermeasures, of a deliberative and executive nature, under the Ministry of Development, Industry, Commerce, and Services. The Committee is authorized to consider adoption of provisional countermeasures referred to in Art. 6 of Law No. 15,122, of April 11, 2025; and to monitor negotiations to overcome unilaterally imposed measures detrimental to Brazil's international competitiveness. Chapter IV sets out the procedures for the adoption of provisional countermeasures and is worth a read.
Neither the Apil 2025 Law nor its implementaiton within the structures of a State organ vested with substantial (though interlinked) discretionary authority is unexpected, nor aberrational within the cultural cultures and approaches of Brazil's elites. It is just interesting to see how, in context, it may play out for the moment. Again, there is a measure of the personal, the cultural and the political that spices things up. President Trump favors the mortal enemy of President Lula da Silva, who suffered personally (as well as politically including his protege) at the hands of former President Jair Bolsonaro. And internet content oozing into (or from) Brazil on matters related to that feuding--including in its judicial forms--has irritated an influential sector of Brazilian leadership and raised old sensibilities anew. President Trump has also been a bit aggressive in response to the provocative (though not unexpected) discourse emerging from the BRICS summit of a few weeks ago.
Although the decree does not mention the U.S., its publication on Tuesday is widely seen as a response to the tariff escalation pushed by Trump, who framed the sanctions as a response to a Supreme Court case against former President Jair Bolsonaro, calling it a "witch hunt." On Monday, Brazil’s Office of the Prosecutor General recommended Bolsonaro’s conviction, along with seven others, for attempting a coup d’état. The new law applies in three scenarios: when a foreign country interferes in Brazil’s sovereign decisions, violates existing trade agreements or imposes environmental restrictions stricter than Brazil’s legislation. That includes, for instance, unilateral barriers on Brazilian commodity imports based on non-negotiated environmental standards. (Here).
One does not negotiate--one responds, formally and through the instrumentalities of State and law. ""Now the country has a legitimate and autonomous legal tool to respond more effectively to unfair trade practices,” he said. “Responses can be faster, more coordinated and based on objective criteria. That strengthens both the legal and political legitimacy of any retaliation, even before international bodies.”" .(Here quoting Igor Machado, a tax attorney at São Paulo-based firm Meirelles Costa Advogados). Early in the return of President Trump to Office, Welber Barral, a partner at the consultancy BMJ and Brazil’s foreign trade secretary from 2007 to 2011,explained the fundamental approach: "For trade policymakers in capitals everywhere, the issue is no longer whether to retaliate, but how to do so wisely. A poorly calibrated countermeasure risks harming domestic industries more than its intended target, while a well-crafted response can tilt the scales back toward negotiation." (here)
None of this is good or bad; it just is in the sense that it both reveals the nature and imperatives of cognitive cages and also the way that those cages make responses both inevitable and predictable. In the process it also serves as a reminder that cognition helps shape the way that people and collectives view, understand and respond to each other, that discourse sometimes provides a glimpse into the mindset that propels those relations, and that this knowledge can either be exploited or produces sometimes unfortunate though not unforeseen consequences. In this case, it is likely that the personal and the ideological shape U.S. Brazil relations in ways that are not transposable to the U.S. Mexican relationship. It is likely to endure until President Lula da Silva and Trump's time in office (and that of the leaders in their factions) disappear from the scene. But that is years in the future. And there is much to be learned from the Brazilian legal architecture in a world that is increasingly redefined by layered hub and spoke platforms of economic-political relations with the two apex powers at the top. All states eventually will have to make a space for themselves somewhere in this layered universe of functionally and politically differentiated global platforms. Brazil provides one approach; Mexico another, and both in the shadow of the structural frameworks developed by China and the United States.
And, of course, this is a U.S. Administration that is always eager to engage in leader play in the style of merchants negotiating transactions; President Lula da Silva, of course, will return the fvor, but in the style of the ideologiocally committed official thinking in terms of institutions and jurisdictional prerogatives seeking a positive stable state. The two styles are unlikely to align--and that may be the preference of both actors. And thus the American move:
Today, the Office of the United States Trade Representative initiated an investigation of Brazil under Section 301 of the Trade Act of 1974. The investigation will seek to determine whether acts, policies, and practices of the Government of Brazil related to digital trade and electronic payment services; unfair, preferential tariffs; anti-corruption interference; intellectual property protection; ethanol market access; and illegal deforestation are unreasonable or discriminatory and burden or restrict U.S. commerce.
“At President Trump’s direction, I am launching a Section 301 investigation into Brazil’s attacks on American social media companies as well as other unfair trading practices that harm American companies, workers, farmers, and technology innovators,” said Ambassador Greer. “USTR has detailed Brazil’s unfair trade practices that restrict the ability of U.S. exporters to access its market for decades in the annual National Trade Estimate (NTE) Report. After consulting with other government agencies, cleared advisers, and Congress, I have determined that Brazil’s tariff and non-tariff barriers merit a thorough investigation, and potentially, responsive action." (Office of the US TRade Representative)
The language is one of disadvantageous tariffs on the U.S. side. "Greer accused Brazil of disadvantaging American exports by offering lower tariffs to other trade partners. Investigators
will look into alleged attempts by Brazil to penalise US companies
involved in digital trade and services for not censoring political
speech." (BBC)
The text of Lei nº 15.122 de 11 de abril de 2025 and of DECRETO Nº 12.551, DE 14 DE JULHO DE 2025 follow below in the original Portuguese and in a crude English translation. The Statement of the U.S. Trade Representative of 15 July, Brazil’s Unfair Trading Practices, also follows below.