Flores’ solution

A democratization of the preventive health system?

There are different kinds of privatization. The concept of privatization does not strictly refer to selling the assets of the state, because when the state renounces to the control of the economic flows that were under its responsibility, it is also being privatized. The case of the pension scheme is an example of the former idea. In this case, no assets were sold but they did grant important financial operations to others, which were formerly performed by the state. As for the financial system, they did sell the assets, but anyone can infer that the actual business was not that, but the possibility to work as an intermediary for the transactions.

One of the characteristics of the privatization process is that those responsible for it invariably intend to enlarge the array of projects of the businessmen, especially those of the wealthiest. That is how the privatization of the basic services in Latin America and Asia gets the attention of the international companies, and that is why these companies do not hesitate to invest in the sectors that the state considers as “little profitable”. The local businessmen who have more purchasing power or some political influences also get the benefits of the new situation, when they see that their investment and profit possibilities grow larger.

In El Salvador, the privatization process has not only enlarged the fields of accumulation of the private business companies, but it has also opened the door for a new concentration of the property and the control of the economic flow. In a recent issue of the ECA magazine (July – August 2002), it became evident that the families who have acquired the banks are the same families that have founded the AFP companies, and they have definitively watched their investments grow at the different companies with an enormous economic potential.

In a context such as this one, the doubts and the afflictions about the new privatization project of the Social Security System are completely justified. Even if the assets are not sold, to accept the participation of the private business companies guides the state towards a privatization modality, similar to the one implemented at the pension scheme. That is why it is extremely necessary to examine the recent governmental offer about the health system.

In a message aired on last July 14th , and in the context of a crisis, President Flores announced his proposal about the health system, and he offered a reform that he synthesized in four principles: a supportive contribution, an expansion of the coverage, the integral plan, and the freedom to choose. In this article we will review the characteristics and the economic implications of each item.

According to Flores, the supportive contribution implies that the health system will keep operating under the following terms: those who, because of their age and their health conditions, do not use the system can contribute with their donations for those who do use it. Nothing new here. However, the president did not mention that solidarity is not the main feature of the present system, especially when it comes to consider the income levels that go beyond $686. Those who earn more than $686, pay the same contribution than those who earn less money. This measure goes against the principle of equality, and it shows that the reform will not actually strengthen the ISSS.

To expand the coverage would be a goal that could be achieved by two actions:
1. To automatically include the children under 12 years of age, who are presently not included in the system.
2. To achieve a “democratization” of the system, which through a gradual and an organized process will allow the system to expand its coverage and open it to the “farm workers, the house keepers, the independent workers, and the Salvadorans who live abroad”. This last aspect is purely demagogical, and it reminds us about the laughable arguments that were presented to justify the privatization of the pension scheme.

To include the informal workers and farmers into the private system of pensions was one of the qualities that were ascribed to such system. Four years after its implementation, this promise has not become a reality yet, and it probably will not be fulfilled in the present conditions. The income of the informal workers and farmers is simply not enough to pay for the unfair fees that the AFP companies charge or, reconsidering the last governmental proposal, to pay the contributions of the employee and the employer to the health system.

The integral health plan, according to President Flores, is the heart of the reform, since “it includes the elements that you expect to receive”, such as consults, diagnosis, treatments, hospitalization, surgery, rehabilitation, dental surgery, medicines, orthopedics, and prosthesis. Most of these elements are already included in the present health plan; the only exception might be the provision of prosthesis.

Finally, the freedom to choose the desired medical service will allow those who are insured to choose between being assisted at the ISSS or “by a doctor they trust, in the clinic they choose to receive the medical treatment they need”. More demagogy. This became more evident because of the ISSS director, Mauricio Velasco. Only a few hours before the presidential discourse, Velasco stated that the attention provided out of the ISSS facilities will be in the hands of “administrating companies” that will count with a number of “health agents”, to whom the patients can come. Therefore, it is not true that the patients will be able to consult “the doctor that they trust”.

However, beyond this contradiction, this “dauntless” governmental effort to encourage the freedom to choose certain medical services will also be promoting the creation of new fields of action for the private business companies. This is not something wrong by itself, but it involves the possibility to generate three harmful tendencies that have been already experimented by the pension scheme:
1. A created financial crisis at the ISSS –in the health department, in this case- that will justify its liquidation later.
2. A larger economic concentration, due to the appearance of the “managing companies” created by the bankers, the insurance companies, the AFP system, and other large business societies.
3. The increase of the expenses of the contributing workers, and even for the state itself, which presently does not contribute with the health regimen of the ISSS when it should if the objective is that the workers are treated privately for the “same contribution”. No one should forget that the privatization of the pension scheme, far from improving the public finances, it has made the situation even more difficult for it, since it has placed more financial duties on the state’s shoulders.

The modification of the health system is the second step in the line of the Social Security System’s reform. The first step was the privatization (or the concession) of the administration of the pension funds. The businessmen who manage the AFP system are closely connected to ARENA. Therefore, it should not seem strange if now we are facing a similar situation. The public discourse intends people to believe that the former system will remain alive. However, the regulations are technically designed to liquidate it. The reform of the pension scheme was a farce. Nobody had the freedom to choose, since the younger workers were practically forced to become the contributors of the private system
–this measure condemned the ISSS to a slow death- to later approve a fusion of the four or five AFP companies that initially participated in the market as a single company. Presently, there is only one choice.

Nothing can guarantee that the same thing will not happen to the health system, especially because we are face to face with a government that is organically connected with the business elite. It manipulates the privatization process to favor the political and the economic elite, and it systematically refuses to regulate the privatized services. That is why the congressmen are asked to reject the governmental proposal that intends to reform the health sectors. The congressmen have the obligation to objectively analyze the options that can actually favor the workers and the society as a whole.

Beyond October the 12th

October 12th, the day in which people commemorate the arrival of the Spanish sailors, headed by Christopher Columbus, to the American shores, is a date that usually awakens a certain kind of mixed emotions. The passion exalt the rhetoric, and this day is characterized by public demonstrations that show the acceptance or an absolute rejection to the historic date that symbolizes the birthday of the American continent.

In Central America, different kinds of official discourses and popular demonstrations take place. The content of such events intends to connect the historical rejection against the Spanish Colonialism with the present vindication. This connection is not always fortunate: sometimes the protests do not go beyond symbolic acts –such as destroying the statues of Christopher Columbus-, charged with an indigenous and an anti-European rhetoric. With this, the demonstrations’ present sense turns darker.

The protests of last October 12th were indeed characterized by a real concern: the free trade agreement issue with the United States and the Puebla-Panama Plan. The social organizations from the different Central American countries took part in various demonstrations to protest against a free trade agreement model that turns its back on the majorities. According to the recent information published by the Salvadoran newspaper La Prensa Grafica, in Guatemala, 1000 indigenous people blocked the Panamericana road, while they closed four exits to Peten. In Honduras, according to the same source, 2000 union members took part in a demonstration in the capital city, while another 500 people who were part of the indigenous movement blocked one of the roads that leads to Guatemala. The already mentioned newspaper does not indicate the number of participants who took part in the protests at Costa Rica, which had to do with a hydroelectric project that belongs to the Puebla-Panama Plan. According to the newspaper, 300 people were congregated at the Inter-American Bank of Development (BID, in Spanish) in the Nicaraguan capital, while in El Salvador the demonstrations blocked different borders and important roads.

There are a considerable number of subjects over which it would be important to reflect. It is a positive fact that the social organizations intend to connect themselves with the other institutions of the isthmus, pushed, as they are, by the project of the Free Trade Area of the Americas (ALCA, in Spanish) and the implications that this could bring along. The social organizations had been suffering of a lack of coordination and they had seemed, until this date, incapable of looking for a regional horizon.

Obviously, no one has to magnify the effects of the demonstrations. Without a doubt, the social movements of the area still have plenty of things to do. The citizenry still has a very skeptical attitude when it comes to participate in the social organizations. This effect is mostly the result of the interference of the parties, which dissociated the already mentioned organisms from the sectional vindication and from the men and the women that it allegedly represented. The social movement still has to overcome the wear-and-tear produced by the vertical relation with the parties or the political movements, the electoral campaigns, and the different political strategies of the parties. They also have to win back the credibility they lost because of the corruption cases they were connected with. In summary, a considerable number of people participated in the different demonstrations during October 12th ; however, that is not a representative number of the general political mood of our society.

These events have been enough for the right-wing press to attack this incipient regional movement. The press has tried to make people believe that this is not a natural reaction, and they have made ridiculous accusations –some articles mentioned that those demonstrations could be supported by Cuba, and this indicates us that some reporters have not been able to leave the Cold War behind-. They also highlighted the participation of certain left-wing politicians in those demonstrations, as if they were representing the party and not attending to it because of personal reasons. The social movements should be more careful. The links with the political parties, which could be beneficial since they count with a share of the legislative environment and they can have a positive influence in this field, can also become a negative aspect in a relationship. The alliance with the parties must be based on the respect for the individuality of the social organizations, which cannot be subordinated to the political parties.

The meaning of the October 12th protests, in reference to the specific struggle against the Neoliberal policies, cannot be exaggerated. Those actions do not go beyond the symbolic meaning they have. In this case, the protests turned into a loss for the small business companies that use the roads to transport their products and sell them in other countries of the region. The protests were also an inconvenience for the tourists. These ideas lead us to discuss other important factors.

The movement that questions the free trade agreements cannot overlook the fact that the trade is not a negative aspect of the economy. It is only harmful when the people’s fundamental needs are overlooked. Therefore, the fight against the free trade policies should not be a fight against trade. No society can succeed without any commercial activity, and nevertheless without the international trade. The rules of that international trade are the ones that have to be transformed in a way that the access to the benefits becomes available for the majority.

Even if the anti-globalization movement knows what it is fighting against–the Central American movements that participated in the October 12th demonstrations are a part of that movement-, its members do not seem to clearly understand the movement’s objective. Their discourse seems to revolve around the word “no” (“No to the free trade agreement”; “no to the maquila”), but the objective does not seem so clear when it comes to make the proposals. Unquestionably, a slogan such as “fair trade” is a respectable initiative, but it seems that there are a lot of other actions that can help to materialize that fairness.

The social organizations should go beyond the activism –which without a doubt is an important factor- and search for specific plans to benefit the society. It is important to have a coordinated relationship between the countries of the region and among the nations of the continent. This relationship cannot be reduced to eventual claims and campaigns. The Anti-globalization movement has not come up yet with any remarkable theoretical contributions. It is necessary that the social movements feed themselves with the contributions of the academic analysis.

It is necessary that the organizations that are looking for an alternative to the Neoliberal model also look for ways to be heard by all the sectors of the society. It is a mistake to overlook the foundations. They are wrong when they are more concerned to explain their approaches to other social sectors (most of all, if those sectors have social and political power) instead of discussing them with the population. Sometimes, the demands of the social movements can be correct but the people either ignore them or do not know enough about it. That is how those demands are not clear enough for the majority. It is necessary to make their approaches public, and not to impose them. They should not be afraid to have a debate with the people.

This does not mean that they have to end with their struggle, or that with the academic analysis alone they will be able to resolve the complexity of the social and the economic problems. The present problems evidently have crucial implications for the survival of the majorities. It would be wrong to postpone the struggle for the social justice in order to “come up with more proposals” while the structural problems become more critical. This is the logical trap in which many movements and organizations have fallen into. Sometimes the “rebelliousness” tag becomes a heavy load, and some movements are incapable of examining their own proposals: sometimes they try to avoid the confrontation with the hegemonic sectors, they come up with empty ideas, and they end defending the interests of a hegemonic minority.

The economic indicators that show a considerable difference between the life standards of, for example, Costa Rica and El Salvador, are very eloquent. One single reference, the level of the minimum wage, reveals that the people who live in the Central American region have urgent needs that demand the answer of an organized society.

What we are referring to is that these answers should also contribute to search for humanistic alternatives to resolve the structural problems. The bet for the free trade and the privatization certainly seem as the answer to these problems. But those are not viable solutions because they tend to give an absolute power to the market, and are not able to face the challenge of the decreasing levels of human development in our society. Therefore, it is necessary to encourage the social organization with the objective to search for specific solutions to the problems.

These proposals should be made public in those areas where the official institutions and the business companies gather. The need to “have a more active role” has been one of the aspects that the civil organizations pointed at in the Puebla-Panama plan. That is why such organizations demanded to participate in the different stages of the Plan to “assure/ensure that the benefits of the plan are equally distributed”.

This is a valid observation: the social movement must penetrate into the spaces where the national decisions are made. However, it would be naive to think that the groups that hold the social, the economic, and the political hegemony can automatically grant the right to participate in the decision making process. The strength of the secondary sectors in the frame of the political agreements will depend on their social power and their capacity to irradiate their ideas.


Finally, it is interesting to understand how the protagonists of the October 12th demonstrations see these activities. For them, the demonstrations, the act of blocking the roads and the streets, and other activities, are not “protests” but “resistance activities”. This is a very important theoretical change. The word “protest” recalls an isolated discomfort sign. The word “resistance”, instead, suggests a consistent opposition to something, to the free trade in this case. If they present themselves as a resistance movement, these organizations would be looking to make a firm statement, and to practice consistent actions in a society that keeps excluding the majority. It has been precisely the lack of consistence
-and the lack of resistance- of the social movements what favored the strengthening of the conservative and the retrograde positions of the dominant groups. It seems that people are beginning to understand the lessons of the past.