In opulent Europe (at least in Spain, where I live), nothing special will happen as a result of the price increases. Today, Europeans set aside a much smaller percentage of their wages for food than they did 10 or 20 years ago. The problem in Europe, as in the United States or Canada, is not the price of food but obesity.

It is even possible that, by increasing the price of food, the portions consumed by people will be reduced, and that may contribute to improve society's health in general. Aside from that, the high prices of food at an international level are a good argument to ask for the elimination of farm subsidies, a real cancer that corrodes Europe's finances and barely benefits 6 percent of the population.

The bad news is that the crisis will severely impact Latin America for four reasons:

1) A substantial decrease in the price of raw materials
(oil, gas, copper, soy.)

2) A reduction in foreign investment in the
region.

3) An increase in protectionism in the U.S. and Europe.

4) A
diminution in remittances by emigrants.

The good news is that Hugo Chávez will lose a great deal of his ability to intervene in his
neighbors' affairs, and will be forced to apply the brakes on the mad arms race to which he seemed dedicated.

The weakest country facing the current crisis is perhaps Ecuador, a country that will enter, in the second quarter of 2009, into a sort of generalized bankruptcy. As an additional consequence of the crisis it is very likely that power will shift to the center right in the next elections in Chile, Brazil and Uruguay.

The Current Discussion: The U.S. will lift travel restrictions on Cuba, but leave the larger trade embargo in place. Is that a smart move? Does it go far enough? Too far?

President Obama has done well by eliminating the restrictions on Cuban-Americans' travel to the island and on the remittances they can send. It is an intelligent political gesture that indicates that Washington would look with interest on a response from the Cuban government that contained some measure of aperture.

Those restrictions had been imposed upon the Cuban dictatorship in 2004 after the repressive spasm of spring 2003, when 75 peaceful dissidents were imprisoned and sentenced to long terms (up to 28 years) for crimes such as lending forbidden books, writing accounts about the Cuban reality in foreign newspapers, and requesting a referendum to ascertain the political preferences of society.

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The United States' economy will regain the world's confidence when its government (first Bush, now Obama) stops behaving like a banana republic.

When it behaves responsibly in fiscal affairs. When it ceases to print currency without a parallel increase in production. When it no longer interferes in the market with arbitrary rescue operations to bail out companies, like General Motors, that are condemned to disappear because of the rejection of consumers, the pigheadedness of labor unions, and the insensitive stupidity of management.

In sum, when it follows the prescriptions of the Washington Consensus that the technicians at the World Bank and the International Monetary Fund used to recommend to Third World nations that had undergone financial crises. The worst kind of hypocrisy is to preach one thing and do something completely different.

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