Proceso 775: 24 sept 97 Via NY Transfer News Collective * All the News that Doesn't Fit Center for Information, Documentation and Research Support (CIDAI) Central American University (UCA) San Salvador, El Salvador Apdo. Postal (01)575, San Salvador, El Salvador Tel: +503-273-4400 ext. 266 Fax: +503-273-5000 E-mail: cidaiuca@es.com.sv ******************************************************************* Proceso is published weekly in Spanish by the Center for Information, Documentation and Research Support (CIDAI) of the Central American University (UCA) of El Salvador. May be forwarded or copied to other networks and electronic mailing lists. Please make sure to mention Proceso when quoting from this publication. Subscriptions to Proceso in Spanish can be obtained by sending a check for US$50.00 (Americas) or $75.00 (Europe) made out to 'Universidad Centroamericana' and sent to the above address. Or read it on the UCA's Web Page: http://www.uca.edu.sv ******************************************************************* PROCESO 775 September 24, 1997 EDITORIAL: Premature end There were no surprises in terms of the new ARENA leadership. The names had already been announced. The recomposition of the governing party's leadership took place as envisioned. Cristiani and his gang took over the leadership of ARENA, although President Calderon Sol retains a post, as well as an ideologically extreme right-wing sector. Ministers with political ambitions were relegated to a broadened political commission in order to find them all a place. Their relevance will depend on the room afforded them by Cristiani. The changes cannot be read as renovation, because if that were the case there would have to be new people at the head of the party. But with some exceptions, of which the most significant is Roberto Murray Meza, well-known faces from the first ARENA administration prevail. In other words, ARENA has undergone no real changes, or its internal crisis is of such a magnitude that it opted to place old, seasoned politicians at the helm, trusting in them to bail out the party. What is truly novel is that Cristiani will run the country from his seat at the head of the party. His team includes the former minister of planning [Mirna Lievano de Marques], and there is emphasis on drawing up a new governing plan, including a legislative agenda. Thus, the party recognizes that it is time to plan and to lead, something the present government is not doing. In his interviews, Cristiani concedes that ARENA's electoral situation is not the best, due to the government's poor leadership and the lack of concrete results in job creation and improving the people's standard of living. The new party leadership knows that in order to win the next elections, the current government must change course, moving toward a perceptible improvement in the quality of life of the majority of Salvadorans. As the administration has already proven itself incapable of producing the expected results, ARENA will try to do so now from the position of the party leadership. In fact, the government's discredit has redounded negatively on the party. Thus, the party will now try to recover what is left of the administration from the vantage point of the party, in order to avoid losing the next elections. This signifies the premature end of the Calderon Sol government. In launching the [1999] electoral campaign so early on, the current government's room for maneuvering has already been vastly reduced. Both the President of the Republic and his ministers must first consult the party leadership and ask for directives. This orientation will probably come without asking. The party's discredit is so great, and the true chances for success of the Calderon Sol government are so negligible, that there appears to be no other alternative than to relieve the latter of its duties two years early, in a desperate attempt to recover lost ground and votes. Launching the electoral campaign and ending the Calderon Sol presidency are one and the same thing. The twilight of the regime is hastening its pace. The government is watching its sun set far too soon, and will go down in history without glory. The question is whether or not Cristiani can mobilize enough support to get ARENA out of its crisis. The Alfredo Cristiani of today does not enjoy the same indisputable acceptance he had three years ago, when he left the presidency. The last IUDOP public opinion poll shows him in an intermediate position on the spectrum of public figures according to their approval ratings; he used to shine far ahead of the others. This drop in the ratings is related to the people's greater awareness about his role in the privatization of the banking system, his presidency and ARENA's internal struggles. What has actually come to light has not favored him. In effect, Cristiani proposes to reunite a party fractured by internal disputes, by resentment about the privatization of the banking system, and by opposing visions of what the government should be. A key ARENA member recently complained that Cristiani represents the "mercantilist right," interested in conserving the privileges of a powerful minority to the detriment of the great majority. He proved his point by alleging that just as the banks were divvied up, so will the airport and electricity generation and other services; Cristiani and his gang are against opening the skies of Central America to competition and against liberalizing trade, they own the Central Reserve Bank, the laws and the institutionality of the state are at their service, and they oppose decentralization. Unity is fundamental for recovering the party's lost enthusiasm and returning some sense to party work. The reunification of ARENA under Cristiani's leadership is no easy task. His election as party president is the result of his predominance over other groups and factions, which means the defeat of -among others- Mathies Regalado. Cristiani's return to the leadership of ARENA is not the fruit of consensus, but rather the result of an internal struggle in which he prevailed. This means that there are defeated factions, people with resentments and tendencies that have been excluded. Murray Meza generates high expectations in terms of his possible candidacy for president, but Cristiani's shadow could do him more harm than good. ARENA has been forced to bring its only ex-president out of retirement to steer a government which for three and a half years has been incapable of facing the challenges posed by the nation and the world. But Cristiani is not necessarily the best solution for ARENA, whose worst enemy is not the FMLN, but rather itself. If the March 1997 elections made it clear that ARENA was incapable of continuing to hold state power, it would not be far-fetched to believe that the 1999 elections could lead it to political bankruptcy. Cristiani and his group must shoulder the task of "saving" the party from that possibility. It will unquestionably be no easy task. POLITICS: Renewal of COENA, more of the same? After several weeks of anticipation, last September 21 saw the XVI General Assembly of the ARENA party. The goal of the event was to appoint the National Executive Council (COENA), the top leadership body of that political institution. It would be redundant to mention all the adverse conditions which, for the first time in the party's history, accompanied the election of its top leaders this time. The ruling party's serious internal crisis, a product of (among other things) its poor administration, conflicting interests among the sectors which make it up, corruption scandals involving several of its members and top officials, has all been hashed through over the last several months by political analysis, opposition figures and disgruntled ARENA members. At this stage, everyone knows that ARENA is worn out politically, and that the "nation's first political force" is slipping badly into the swamp of its own blunders and miscalculations. Enough has already been said about the causes of ARENA's decomposition. Perhaps it would be worthwhile to come up with a diagnosis of how the party stands today and what can be expected of it in the immediate future. In the first place, we must rule out the possibility of ARENA disappearing easily from the Salvadoran political scene. Although it is true that it is going through a critical period, that popular discontent hangs about it like a cloud, and that the nation has undergone significant changes in the realm of politics, that is a long way from saying that ARENA is anywhere near disappearing from the political ring. W must not forget that this is the party which currently governs the country, and that despite its mistakes and the criticisms which rain down upon it, power is a privilege for those who hold it. If anything has characterized ARENA, it is its skill in utilizing power for its own benefit. Furthermore, we must remember that, despite popular discontent surrounding the current administration, some sectors of the Salvadoran people maintain a certain degree of fear of the "communist menace," which is a serious obstacle to a left which hopes to obtain a greater share of the vote than it did last March 16. And, finally, we must be realistic and admit that none of the opposition parties looks like a convincing enough alternative to bring together sufficient votes to jeopardize ARENA's position. So, ARENA is not doing well. But magnifying its illness would be a miscalculation which could get in the way of a more objective analysis of its situation, and of the national political situation. Now, assuming that ARENA will continue doing battle for a long time to come, it would be useful to examine the tactics it is employing to recover from the adverse situation it is going through. Apparently, its most explicit wager has been on the renovation of the party leadership. With the new faces which have been entering the party ever since its famous post-electoral "restructuring," ARENA has been trying to refurbish its image, showing itself off as a progressive force ready to change. And, in reality, it is quite probable that its leadership renewal itself may be interpreted by many as a wish to put an end to its stagnation. The problem is that this illusion may vanish soon, once people realize that the lines being spouted by the party's key figures are the same as in previous years. Of course, words like consensus-building have recently become part of ARENA's vocabulary, especially among those who hold public office, but it is even more possible that this had to do more with momentary imperatives than with an authentic desire to promote negotiations. The last card ARENA has played in its efforts to remain in the game is the appointment of Alfredo Cristiani as president of COENA. Besides contradicting the party's purported spirit of renewal, the move opens the door for his detractors to strike out at the old ARENA members linked to cases of corruption. One hopes that the party leadership gave careful though to that risk (a serious one, given the circumstances), but the fact that despite that risk they decided to promote the ex-president to run their party merely shows up their poverty of leadership. Of course, the lack of political leaders is a generalized problem in Latin America, and the parties cannot be blamed for that. What is questionable is that ARENA is placing such high hopes on a figure whose reputation is as tarnished as Cristiani's. It could be that some Salvadorans retain a romantic view of the ex-president, and continue to feel that the country owes him for the achievement of peace; no matter what the reason, giving Cristiani the helm of the party casts serious doubts on ARENA's willingness to "restructure" itself. Besides his involvement in corruption scandals, Cristiani, like many other members of the governing party, is one of those who still thinks in terms of "destabilization" and "political enemies." Figures like him reveal that ARENA is still far from modifying its structures, because in essence, its mentality hasn't changed, even if its members go to great lengths to prove the contrary. Legislative deputy Walter Araujo, for example, recently said, "ARENA initiated the culture of change, and the ultimate goal is the challenge of continuing to improve, not the number of votes." However, it seems evident that ARENA is the one with the hardest time assimilating change and adjusting its view to a reality which requires, precisely, considerable modifications in its political agenda. With regard to "not the number of votes," it is worth pointing out that all the party's maneuvers over the past months are in response to its interest in keeping power in 1999; thus, the ARENA leaders are constantly referring to their "24-month plan" and the loudly trumpeted renewal of the party. In conclusion, despite the ruling party's well-publicized efforts to show off a new face to the country, it is enough to carefully examine its performance to realize that ARENA is far from authentic renewal, with all that it implies: for example, renouncing many of the classic precepts of its discourse which sound so obsolete today. Renewal means changing one's way of conceiving politics and the nation, it means being truly willing to play by the rules of democracy, which is hard for ARENA to do given the vestiges of arrogance and authoritarianism it continues to display. It would probably not be inaccurate to claim that if anything keeps ARENA on its feet amidst all the obstacles it must get across, it is its conviction that it is the only party capable of running El Salvador. ARENA members retain their triumphalist spirit, and it will be a long time before they feel defeated. One can expect, then, that in the upcoming years the electorate will be the target of a ferocious campaign by ARENA, and that its key role in the political arena will not diminish significantly. It would be hasty and inaccurate to rule out the possibility that it might lose the 1999 elections; what is more certain is that, despite all its failings, ARENA will still be around for a while. AGRICULTURE: The debate around forgiving the agrarian debt The issue of forgiving the agrarian debt has occupied a key position on the priorities of the Legislative Assembly. However, certain factors have prevented a resolution of the issue to date, over two months since the debates began. Only in the last week have we heard the postures which prevail in the Subcommission on the Agrarian Debt, which still fail to reveal the nature of the final proposal. Since discussions began on this issue, the government has leaned towards not forgiving the debt, brandishing arguments around fiscal stability and the poor credit ratings that would mean for the agricultural sector. However, these postures only evade the potential positive effects of forgiving the debt, and the coherence of such a move with the "Agricultural Program" announced by the government itself. This article will present an updated assessment of the issue of agrarian debt forgiveness, based on the different postures held by the nation's political parties and that of the government; it will study the possible role of debt forgiveness as part of an integrated plan to reactivate the agricultural sector. Initially, the political opposition represented in the legislature showed a strong tendency toward total forgiveness of the debt, but this was turned down by the government, leaving an agreement still up in the air. The initial proposal to begin forgiving the agrarian debt selectively, differentiating between minor and major debtors, does not appear to have won any support, and postures currently oscillate between total forgiveness (the opposition position) and no forgiveness (the ARENA legislators and government). At this point, the opposition appears willing to concede a partial forgiveness of the debt, although one that is not necessarily based on the amount of individual debts. ARENA, however (in the legislature, not the government) has made only one concession, and that it is to offer more flexible forms of payment, but without going so far as total forgiveness. Not even the cooperatives formed under Phase I of the 1980 land reform have been considered for total forgiveness. An additional factor to be considered is that the final total of the agrarian debt is substantially lower than the figure of 3 billion colones that was bandied about initially. A more updated figure shows that the total debt is approximately 1.028 billion colones, distributed in the following fashion: Land Bank, 20.2 million; Agricultural Development Bank (BFA), 212.9 million; Land Reform Institute (ISTA), 448.9 million; and Fund to Sanitize the Financial Institutions (FOSAFFI), 346.4 million colones. The cases of the Land Bank and the BFA appear to involve more advanced discussions in the legislature, in part because the totals involved are less; this is not the case with ISTA and FOSAFFI, where there are still strong differences with the government position. In the case of ISTA, the ruling party bases its position on the fact that a large number of land reform cooperatives are actually capable of paying off their debt; meanwhile, in the case of FOSAFFI, ARENA's position is that its loan portfolio is made up of large debtors who may even have used the funds for ends other than agriculture. In this context, both the FMLN and the PCN have varied their positions considerable since their earlier support for full debt forgiveness. The former agreed not to forgive loans catalogued as "D" and "E", in other words, those that are over 90 days delinquent and which were awarded by the BFA between 1979 and 1991; the FMLN continues to support full forgiveness of the remaining agrarian debt. The PCN, in response to key changes in leadership, has begun to question its support for full forgiveness. In truth, the issue of the agrarian debt touches a sensitive chord in the productive apparatus, not only because these are debts contracted as part of the land reform, but also because it has to do with the economic sector that has been hardest-hit by economic policies. Thus, when the issue of the agrarian debt comes up, one is not only addressing the problem of the fiscal deficit or access to loans by the agriculture sector, but also how to revitalize the economic and social development of the countryside. The impact of the financial burden derived from the agrarian debt is one of the factors which explains the indisputable contraction and crisis in the agricultural sector. No one can deny that underlying the agricultural problem are other serious problems as well (instability in coffee prices, natural limitations on basic grain production, difficulties in obtaining loans, the loss in competitiveness of agricultural exports due to the overly stable exchange rate, etc.). Even so, it becomes clear that whatever decision is taken around the agrarian debt could be used for the purpose of reactivating the agricultural sector, something the government claims it is determined to achieve. The agricultural program proposed by the government earlier this year was evidence of the above; the President's second-year anniversary speech offered to "undertake an integrated plan to reactivate agriculture, whose principal points are: legal security around ownership of the land, timely and preferential credit for agricultural activities, access to technology and market information, as well as improvements in basic grain storage..." These are precisely some of the principal policy guidelines in the "1997 Agricultural Program" which, 15 months after it was first offered, shows no sign of implementation. The President's offer to award "timely and preferential credit" to the agricultural sector contradicts his government's opposition to forgiving the bulk of the agricultural debt. If we recognize that the agricultural sector is not receiving enough credit to increase its economic activities, then the most logical step would be to come up with mechanisms to alleviate the financial burden represented by the agrarian debt; however, the government has taken an entirely contrary position. The agrarian debt is a product of the implementation of the 1980 land reform, but was also seriously increased when the banking system was sanitized [starting in 1989]. At first, in order to privatize the financial system, the government heedlessly absorbed the banks' portfolio of delinquent loans, thus freeing up the banks from the financial and administrative burden it signified. That allowed the banks to be sold and then flourish during this decade. Today, when attempts are made to alleviate the financial burden weighing on the agricultural sector -which the government claims it wants to reactivate- people raise all sorts of questions like the danger of a ballooning budget deficit and the undesirable precedent such a forgiveness could cause vis-a-vis other economic sectors, who would also come running to the government for relief. In truth, both the budget deficit and the precedent of government handouts already exist, and began when the government took on the banks' delinquent loan portfolios. Brandishing this type of argument today is nothing more than a lack of political willingness to try and reactivate the nation's rural sector. At the very least, most of the political opposition has taken into account the possible positive effects of forgiving the agrarian debt -even partially- but it remains to be seen whether or not it has enough votes to push it through. IUDOP REPORT: Salvadorans' expectations of the nation's authorities Some 39% of Salvadorans feel that the most powerful branch of state today is the legislature, according to the latest public opinion survey conducted by the University Public Opinion Institute (IUDOP) of the "Jose Simeon Can~as" Central American University of El Salvador, sponsored by the Konrad Adenauer Foundation. The survey, held between July 13 and 21 of this year, with a national sampling of 1,212 adults in urban and rural areas of the nation's fourteen departments, had the goal of registering citizens' expectations of municipal and legislative authorities. It also revealed that 31.1% of Salvadorans feel that the President has the most power today, and only 11.6% feel that the greatest power resides in the judicial branch. The survey also showed that around half of those consulted (45%) feel that the control exercised by the legislative opposition is positive, while 19.6% feel it is negative and 14.3% said they did not care who controlled the legislature. The rest of those questioned abstained from offering an opinion. Respondents were asked about the principal challenges the legislature should be facing today. The results show that a little over one-third of the people feel that legislators must above all listen to the people's demands; another large percentage (19.8%) said the legislature should eradicate corruption, while 16.5% said the parliament should pass laws which benefit the people. Other challenges mentioned were the creation of laws for developing the country, producing an accord around a national program, and promoting the modernization of the state. Furthermore, and more concretely, Salvadorans also offered their opinions on aspects which, in their opinion, the legislature ought to address as soon as possible. In the first place, 33.5% of those consulted said the legislature should reduce the Value-Added Tax (VAT), 27.9% said the legislature should pass anti-corruption laws, 11.2% favored the enactment of the death penalty, 10.8% said the problem of the agrarian debt must be addressed, and 7% said the legislature ought to continue the process of privatization, among other tasks. Municipal governments According to the results of the survey, over one-third of the people feel that their interests are not being represented by their local municipal government; another 29.3% said their interests are scarcely represented; 24.2% said their interests are "somewhat" represented, and only 6.8% said their interests were being well represented. However, when those surveyed were asked whether or not the projects implemented by their municipal governments were beneficial to them, opinions were quite divided: while 49.8% said they had benefitted, another similar proportion, 46%, said the contrary was true. The UCA survey also asked people about the first thing the local government ought to do. In general, the most frequent petitions could be summed up as: waste removal and treatment (24.7%), repairing roads and public places (22.2%), improving public lighting (18.6%), improving the system and infrastructure of municipal markets (13.9%), bringing water service to outlying villages and hamlets (6.4%), and improving citizen registry services (3%), among other requests. At a more national level, Salvadorans were asked what the government as a whole ought to do in order to resolve the nation's most serious problems (crime and the economy, as reported in this same survey). The results show that over half of all citizens (51.7%) agree that the government must listen to the people in order to begin resolving the nation's problems; 18.6% said other nations must be asked for assistance; 12% feel the government must reach an agreement with the opposition, and nearly 11% mentioned that the state must come up with a national program. Confidence in national institutions As is the custom in IUDOP surveys, an effort was made to measure citizens' confidence in different national institutions (this time the media were included, given their importance in defining the national agenda). The figures show that the Catholic Church, the media and the Human Rights Ombudsman's Office enjoy the highest levels of confidence among the people, followed by municipal governments, the police and the Armed Forces. Ironically, the national institutions which received the lowest votes of confidence were those linked to national power. According to the survey, the legislature, the presidency and the Supreme Court, along with the political parties, enjoy the lowest levels of confidence among the population nationwide. Ratings of public figures Finally, the UCA survey asked citizens to rate certain public and political figures. A list of key public figures who have a great impact on national life was read out, and the respondents were asked to rate their performance on a scale of 1 to 10. Those rated the highest were: Minister of Education Cecilia Gallardo de Cano . . . . . . . 6.76 San Salvador Mayor Hector Silva . . . . . . . . . . . . . . 6.54 First Lady Elizabeth Aguirre de Calderon . . . . . . . . . . 6.53 Former president Alfredo Cristiani . . . . . . . . . . . . . 6.50 The second most popular bloc included the following: San Salvador Archbishop Fernando Saenz Lacalle . . . . . . . 6.13 Human Rights Ombudsman Victoria de Aviles . . . . . . . . . 5.99 CD Legislator Ruben Zamora . . . . . . . . . . . . . . . . . 5.73 COENA member and business leader Roberto Murray Meza . . . . 5.52 President Armando Calderon Sol . . . . . . . . . . . . . . . 5.51 The lowest ratings were received by the following: FMLN deputy Jorge Schafik Handal . . . . . . . . . . . . . . 5.43 PRSC deputy Abraham Rodriguez . . . . . . . . . . . . . . . 5.37 PLD deputy Kirio Waldo Salgado . . . . . . . . . . . . . . . 4.98 However, not all these people were known to all Salvadorans. For example, the ex-president, the current president, the first lady and deputy Zamora enjoyed the highest name recognition among all those surveyed. In sum, the results of IUDOP's July survey show that the majority of Salvadorans hope the nation's authorities listen to them as a way to resolve El Salvador's principal problems. This explains the fact that the institutions with the lowest confidence rating are those which represent national power, while those with the highest ratings are those which, in some form or another, are in closer contact with the people. Thus, if government institutions manage to get closer to the people and deal with their issues, their institutional ratings might go up. NEWS BRIEFS: RAISES: President Armando Calderon Sol and the Minister of the Economy, Eduardo Zablah Touche, during their visit to New York on September 22, announced that public employees would receive an across-the-board salary raise of 6% in January 1998, and again in December of that year. According to the statement, the decision to raise salaries in the public sector was taken by the Council of Ministers on September 19, with a pledge not to cut the budgets of the ministries of health and education. "We are taking into account people's real needs," said the President, who said he understood the nation's social problems and the needs of government workers, while at the same time stating that the salary upgrade would require a serious economic effort. The Minister of the Economy explained that no raise was possible in 1997 because the budget had nothing to spare; however, the possibility exists in 1998 because of expectations of better tax collection, and also thanks to loans by international lending organizations which consider El Salvador a good credit risk. Nevertheless, Zablah Touche warned that the announced raises could jeopardize the economy, given the risk of higher inflation and a higher cost of living. "That is why we are doing it in two parts, because that lowers the risk," explained Zablah. REACTIONS: A number of workers' organizations belonging to the National Union of Salvadoran Workers (UNTS) called the President's announcement of a public sector raise "demagogy," saying it did not correspond with the increase in the cost of living. Carlos Rodriguez, a leader of the Association of Public Works Employees (ATMOP), criticized the President's proposal because it was not consulted with workers, and announced that a series of protest activities would be launched in response. Another reaction to the announced raise came from the head of the ARENA legislative bench, Walter Araujo, who said that it was the product of a "healthy economic process of fiscal discipline, without any pre-electoral demagogy." In Araujo's view, the raise has been announced well before the 1999 presidential elections, which rules out any government intention of using it to regain public support. PDC deputy Ronal Uman~a said the executive branch announced the raise too soon, since it is the legislature which passes the budget as well as any increases in the different categories. PD leader Juan Ramon Medrano said that if the executive branch has made a commitment to the raise, it must have also thought of how to improve tax collection, reduce the 1998 budget in other areas, increase the Value-Added Tax (VAT) or resort to external financing. Centro de Informacion, Documentacion y Apoyo a la Investigacion de la Universidad Centroamericana "Jose Simeon Can~as" (CIDAI-UCA) Apdo. Postal 01-575 San Salvador, El Salvador Tel: +503-273-4400 Fax: +503-273-5000 E-mail: cidaiuca@es.com.sv ================================================================= NY Transfer News Collective * A Service of Blythe Systems Since 1985 - Information for the Rest of Us 339 Lafayette St., New York, NY 10012 http://www.blythe.org e-mail: nyt@blythe.org ================================================================= nytcamer-09.30.97-00:21:33-24828