Latin America has passed through a difficult decade, but the light at the end of the tunnel finally seems visible. For Latin America, the triumph of capitalism has reinforced the need for substantial reductions in the size and functions of the state. At the heart of the matter is the question of whether global economic changes in the 1990s will incorporate and reinvigorate Latin America as a whole or whether new regional divisions will dominate. Latin America began the post-1950 period committed to import-substitution industrialization. For the United States, the free trade model might offer a genuine chance for Latin American nations to renew their growth and productivity. In the initial years, the US economy would continue to expand, driven by the repressed demand for its exports in the region. Capital mobility promises to assure consistency between regional integration and the goals of global liberalization.