Last Wednesday, as the debate over the economic stimulus bill was gaining steam in the Senate, the House Subcommittee on the Western Hemisphere met quietly in the Rayburn Building for a hearing called "U.S. Policy Toward Latin America in 2009 and Beyond."

The Subcommittee is not known as a particularly powerful force in the realm of foreign policy, and the hearing was not held to discuss any specific legislation, aid program or trade agreement. Still, the gallery that morning was packed with an overflow crowd that included the ambassadors from Colombia and Guatemala -- enough attention that even Chairman Eliot Engel, D-N.Y., seemed a bit surprised.

"We're honored that we have such a large crowd and overflow," he said at the outset. "I was a hero out there being greeted by all these people. It was very nice to know there is so much interest in foreign policy."

Some of that interest was no doubt due to the fact that, while the new administration has moved quickly to address global trouble spots like Afghanistan and Gaza, it's done comparatively little so far to signal its intentions toward countries closer to home.

President Obama has yet to act on a campaign pledge he made in Miami last year to reinstate the position of special envoy to the Americas, an office created by Bill Clinton but discontinued under George W. Bush. And, while Obama's domestic policy team includes prominent border staters like Janet Napolitano, Hilda Solis and Ron Kirk, his foreign policy appointees so far lack the same history of working with the U.S.'s southern neighbors.

That's too bad, because experts say the hemisphere is ripe for re-engagement after years spent languishing in the long shadows of Iraq and Afghanistan. Falling fuel prices have sapped some of the momentum behind Venezuelan President Hugo Chavez and Bolivian President Evo Morales, two populist leaders who have benefited domestically from anti-American rhetoric. Obama's order to close the Guantanamo Bay prison and his stated intention to end the war in Iraq will remove two persistent strains on relations with the region. And the upcoming Summit of the Americas in April presents a chance to reset the tone of U.S. dealings with the 33 other nations in attendance.

"At the best level, it's an opportunity missed" if the White House doesn't reach out to Latin America, said Eric Farnsworth, who worked in Office of the Special Envoy under President Clinton. "But it's more than that. Clearly the region has other options -- they're building relations with China and other Asian countries on the economic side. We're not the only game in town any longer."

Farnsworth suggested that Obama could strengthen economic ties at no cost to the U.S. by lobbying for the inclusion of Mexico and Brazil in the G8. And, while rising protectionist sentiment means new trade deals are off the agenda for the immediate future, he said the Obama administration could begin laying the diplomatic groundwork for future deals once the U.S. economy begins to recover.

In the interconnected world of global trade, closer dealings with Latin America could in turn open the door for broader trans-Pacific economic agreements. And improving ties with the Americas would be in keeping with Obama's global image as an internationalist antidote to Bush.

"It's very difficult for the United States to really command a credibility in terms of our leadership with the world if we don't have constructive relationships with our own neighbors," said Mack McLarty, who served as President Clinton's first envoy to the region.

Changing domestic priorities and the abdication of Fidel Castro have created an opening for some form of rapprochement with Cuba as well. Exit polling in Miami-Dade County this November showed a clear generational divide among Cuban-Americans, a historically Republican voting bloc that generally supports a hard line against Cuba: McCain took 84 percent of Miami Cuban-Americans over 65, but lost those under 30 to Obama.

"There is generational change here and there," said Hector Schamis, a professor at American University who studies democratization in Latin America. "Castro is gone, pretty much. There is a new administration. And let me tell you, the Latin Americans feel that there is animosity, just plain animosity toward Cuba, and that just a gesture of thawing a little bit would pay off."

But with Washington focused so exclusively on the economic crisis, there is debate over how to make room on the president's agenda for hemispheric affairs. McLarty and others who served in the Clinton White House support the proposed special envoy, saying it would get pressing issues on Obama's desk faster. The special envoy role "really focused the White House as we approached the Summit of the Americas," said McLarty, referring to the 1994 meeting of member nations of the Organization of American States. "The fact that it had a White House imprimatur gave it a standing it otherwise wouldn't have had."

But some observers are concerned that the envoy position could confuse U.S. policy toward the region and be lost amidst the administration's already bountiful ranks of czars. "You can run foreign policy from the State Department or you can run it from the NSC and the White House, but it's very hard to do both," said Bernard Aronson, who served as assistant secretary of State for inter-American affairs under President George H.W. Bush and Clinton.

The risks of getting it wrong will be more than just trade agreements scuttled and dollars lost. In Mexico, whose border with the U.S. was already a security concern, a government offensive against drug cartels has resulted in gruesome violence just across the border and over 5,000 dead last year. Obama has pledged to cut down on the flow of weapons south from Texas to the drug gangs, but controlling the border has so far proved impossible. Security in the border states of both countries will, in the long term, require more investment in the U.S.-Mexico relationship.

"It's more than a war on drugs. It's really a war for the rule of law," said Aronson. "That's a very important battle, because if the Mexican government loses, the lawlessness and violence is not just going to be contained in Mexico."

Whatever appointments Obama makes, his Latin American agenda could end up looking much like President Bush's, with a smile. In a meeting with Mexican President Felipe Calderon in January, Obama voiced support for the Merida Initiative, a program begun under Bush to fund anti-drug operations in Mexico. Obama has already spoken with Brazilian President Luiz Inacio Lula da Silva and Colombian President Alvaro Uribe by phone, expressing his commitment to maintaining close ties with the hemisphere's second-biggest economy and its largest recipient of U.S. military aid, respectively.

Just by putting a new face on U.S. policies, Obama will avoid some of the animosity that many in the region felt for his predecessor. But while observers welcome the change in tone, many are doubtful that the White House will go much further than that, at least for the time being.

"With a lot of external pressures pointing the United States in other directions, Latin America's once again going to be fighting for its share of attention," said Aronson. "Historically, it doesn't tend to win those fights until there's a crisis."