From 1984 to 1988 the basis was laid for many of the dramatic changes
in the world order that would become manifest in the late 1980s and
the 1990s. Following the period of the second Cold War, a new détente
between Washington and Moscow commenced around 1985. It was
largely a result of the increasingly bankrupt Soviet empire which could
no longer assume a strong presence abroad, and which could barely
control events within its own borders. This process was assisted by the
Reagan administration's rather successful attempts to intensify and
accelerate the Soviet decline by pressuring Moscow into costly military
competition on a number of fronts.

For Latin America, the withering of Soviet superpowerdom would
prompt leftist forces, especially in Central America, to consider an
eventual presence at the bargaining table, since it was clear that any
support from the Soviet Union or Cuba would shortly evaporate. This
is not to suggest that Moscow and Havana were the guiding forces
behind revolutionary leftism in the hemisphere, since it was clearly
indigenous socio-economic inequities that propelled such movements.
But it is no doubt true that the Soviets and Cubans provided materiel
and other support which allowed socialist and communist forces to
battle the more lavishly bankrolled military proxies of the United States.
At any rate, these developments contributed to an emphasis upon
peaceful negotiation rather than military excursions in many venues
throughout Latin America. As was seen, Canada contributed signifi-
cantly to the peace process in Central America once changes in the
global environment improved prospects for success.

The world order, then, was moving away from a bipolar arrangement
to a more uncertain global distribution of power. Accompanying these
shifts in military capability was the emergence of a radically new
international economic regime. By 1985 the U.S. became the world's
largest debtor nation, with Canada and the rest of the hemisphere also
deeply in the red. While U.S. military supremacy remained unques-
tioned during this period, the U.S. and the rest of the Americas seemed
more vulnerable economically. Further, the European Community's
progression towards the establishment of a trade area in 1992 led others
in the system to contemplate a world of three major trade areas: Europe,
Asia, and the Americas. The debt crisis and the resultant restructur-
ing/austerity programs would contribute to this process in Latin Amer-
ica by creating some of the requisite conditions for globalized
production. Generally, these conditions were already in place in the

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