Ex-civil patrol personnel: a social debt

Democracy and political parties

The question of economic balance in Nicaragua: "we’re having problems and they’re getting worse"

News Briefs

EX-CIVIL PATROL PERSONNEL: A SOCIAL DEBT

The demand of the ex-civil patrol personnel could place the government in check and thereby threaten social stability. The indifference with which the authorities have received these demands has provoked more and more defiant protests, which could culminate in a social conflict of considerable proportion, above all if other discontented sectors join in and make common cause with the ex-civil patrol agents. The government did not continue responding to their demands alleging that they do not have the wherewithal to comply with their demands or that to comply with them would be against the law. The determination of the ex-paramilitary people and the absence of governmental capacity to attend to their demands satisfactorily can only end in repression of which the National Civilian Police already made a brutal demonstration.

The more than 20,000 ex-civil patrol agents are demanding an indemnization of some 18,000 colones, housing, three parcels of land, fertilizer, indemnization for the widows of the war, schools, health centers and agricultural credits. At first glance, it is evident that the government does not have the money to bankroll these demands; but this is not the best —nor is it the most politic— response. Neither is it acceptable to take refuge in the inviolability of the law when the government party takes convenient and comfortable positions or simply transgresses with notorious impunity.

The problem posed by the ex-civil patrol agents has two dimensions. The first is the obligation of the government to recognize the services that these men performed during the armed conflict. The paramilitary organization of civilians was a key element in the social control of the population during the decades of the 1970’s and the 1980’s. Their members were used, sometimes against their will, as spies and guides for the Armed Forces. On no few occasions, these paramilitary personnel were used to arrest, torture and assassinate their neighbors and even their own family members. As part of the Armed Forces, they shared with that institution the commission of crimes and complicity in multiple crimes which until now have been covered by impunity, protected as they are by an amnesty contrary to law.

When the Armed Forces establishes benefits and indemnizations, the Armed Forces left this important sector, which supported its operations during the conflict, out of the picture. The generals and colonels took the lion’s share —it was they who took advantage of the war to become rich by making it good business. Therefore, the Armed Forces and the government are obliged to recognize the services performed by the civilian population, which it organized militarily in order to serve its purposes. The indemnization offered them, in an attempt to quiet their protest, is ridiculous. This apart from the fact that many ex-civil patrol agents were excluded from benefits, according to the logbooks of the Armed Forces —which do not distinguish themselves for exactitude, being highly unreliable.

The second dimension of the problem goes beyond the question of indemnizations. The demands of these ex-paramilitary personnel could very well be the same demands which the majority of the Salvadoran rural population make. If they had jobs, education, health and housing, very probably they would not be demanding indemnizations in the streets of the capital and on the highways of the country. Their demands are the cry of an unemployed rural population abandoned by public services and, in this same measure, many others in a similar situation could raise their voice in protests as well, thereby swelling social conflict. They are the other face of what official discourse is given to calling "the new El Salvador". Seen in a positive light, the ex-paramilitary personnel are part of civil society, organized in order to demand what they consider necessary for living life with dignity.

It is not, then, mere chance that the candidates for the presidency of the republic of the two principal political parties offer to create jobs. In the measure that this promise reflects a clear consciousness of this urgency on the part of the majority of the population, it is a good electoral promise. Inasmuch as none of these has yet explained how they will create jobs, there is a real danger of it remaining at the level of a simple electoral promise. The two government administrations of ARENA began their terms in office declaring their commitment to the poor of El Salvador. As the second of these government administrations draws to an end, El Salvador has more poor people than it did ten years ago. Reliable statistics on unemployment do not even exist. The ARENA government uses the number of affiliates in social security as a indicator to celebrate the increase of these as an indicator of the breadth of employment when, in reality, the only promise they can present with any certainty is that the number of persons insured is growing —perhaps as a result of the efforts of that institution to combat evasion of responsibility on the part of employers.

The government of Mr. Calderón Sol should not make such mistakes in its calculations. Repression is not a good solution for a social problem of such large proportion; neither is this convenient in an election year. Politicians who promise jobs ought to be conscious of the fact that they are confronting a huge challenge because Salvadoran capital does not appear to be disposed to invest in the country; because investment in more runaway shops [maquila] stimulate more emigration from the countryside into the city, aggravating urban problems of infrastructure, services and existing security; and because foreign investment is bowing before the world financial crisis and, although it might come, it is unstable and, therefore, not very reliable. Everything points to the fact, then, that the solution must come by means of economic and social reforms which the two ARENA administrations have avoided throughout their almost ten years in office.

DEMOCRACY AND POLITICAL PARTIES

"There were no surprises" was the favorite phrase of the principal Salvadoran dailies as they referred to the ratification, on Sunday, October 11, of the ARENA candidate for the vice presidency. That it will be Mr. Carlos Quiontanilla Shmidt whom the National Assembly of the ARENA party designated as the vice-presidential candidate to accompany Mr. Francisco Flores was already a well-known fact, so that, seen at a glance, one should not be surprised at the insistence of the newspapers on the predictable nature of the ARENA function last weekend. But has it not always been this very same procedure that that party has always used to elect its candidates? Who does not know that the successors of the principal party figures come from the leadership and not the bases?

The fact that the communications media highlights the predictable in the designation of the vice-presidential candidate of the official party would be nothing unusual if it were not for the fact that there followed close upon the affirmation "there were no surprises" the question "why should there be? And such a question finds a reasonable response in appealing to the long process of the internal election of candidates which has marked the FMLN. It is paradoxical, but what happens is that, while on the one hand the written press has broadly covered the not particularly fruitful FMLN conventions, emphasizing their repeated failures, on the other, after this, it indulges in complaints referring to the calculated nature of the internal electoral processes of the ARENA party.

Curiously enough the complaint of the morning dailies about the traditional ARENA party attitude, which is little inclined towards the democratization of the party, has sounded like a reproach of the type "you ARENA members are not like the FMLN members who, for good or ill, made an effort to hold democratic elections". The unanimous and uncontested confirmation of "Paquito" Flores’ campaign formula partner appears to have produced wonderment, as if, at bottom, what had been hoped for from the government party was an election which would truly be an election, with the surprisingly lucky element that that action brought with it. For their part, the opposition political parties united their voice in a "critical" manner against the media, noting that the official party membership is a kind of "herd without a bellwether" or sarcastically expressing the opinion that "they do not understand why they [the ARENA party] spend so much money", if it is always so obvious and predetermined what will happen during these kind of events.

It is important to highlight that the lack of a minimally democratic scheme of things in the ARENA party structures begins to cause a more and more generalized foreshortening of public opinion. This foreshortening calls attention to one of the central topics at hand at the moment of analyzing the advance of the democratic institutionalization and the evolution of political parties in El Salvador: the level of democratization of political party structures.

It is said that to democratize themselves is one of the tasks with which the parties must occupy themselves at the moment in time at which they seek a greater consolidation. So then, what kind of democratization should be sought? When can a party consider itself truly democratic? What mechanisms must be followed in order to reach a level of democratization which is representative but viable? Returning to the case of the contraposition of ARENA vis-à-vis the FMLN in a specific concatenation of events surrounding the election of candidates, it must be recognized, in the first place, that the FMLN made the effort to define its formula in a democratic way —in a scanty, rudimentary and imperfect way, but it was, all in all, an attempt.

Once the arduous process through which the FMLN had to pass was finalized in the election of the pair which will represent the party in March of 1999, the not insubstantial question arose concerning how convenient and realistic the pretensions of the FMLN were in configuring its electoral processes in such a way that direct democracy was exercised. The "ifs, ands and buts" of this modality were pointed out as well as the counterproductive effect achieved by means of this experiment in direct democracy. The ill-fated left party conventions seem to corroborate such an appreciation.

In the second place, the case of ARENA must be considered. Far from being a secret, the procedure in this party is that public figures are simply named; everyone knows this and seems to have accepted it without thinking twice until now: the official party is not characterized by its int4erest in the democratization of its internal party structures. But what happens? It is equally manifest that this is the party which enjoys the highest level of institutionality. It would be a dangerous piece of reductionism to attribute the causes of the relatively stable situation of ARENA to the scanty state of its internal democracy, nevertheless, this phenomenon has something to do with the apparent strength of ARENA’s leadership groups.

ARENA has been, from its beginning, the birthplace of diverse factions. Much has already been said about how much discomfort has been caused to "the granite-like unity" of that party by the signing of the Peace Accords, that it would be an unsustainable argument to affirm that the push and pull for power and the ideological differences are unknown inside the party. Nevertheless, it is important to point out that in the recent political history of El Salvador, ARENA is the only party which has succeeded in placing itself above the inter-group rivalry which exists in the party itself.

The FMLN, on the contrary, had to deal with a difficult breaking up into fractions within the few years of its reinsertion into democratic life and today the in-fighting between progressive and conservative factions inside the party have left the FMLN weakened. March of 1997 was the moment at which the serious crisis of the ARENA party was made manifest and the political history of the FMLN showed signs of a promising upward rise. The cracks in the "iron unity" of the ARENA party members could not be hidden, at the same time as the inoperability of those in power tried the patience of the electorate. The substantial increase in the quotas of FMLN power allowed for room to believe that finally the moment had come to step into the executive leadership of the country as ARENA left and that the FMLN would be the party to replace it.

But recent events have given a jolt of 180 degrees to such expectations. Not without difficulty has ARENA been able to put up a candidate with a certain alternative image of one who might change things. The national assemblies which had as their objective the "election" of a presidential formula had been, rather, events prepared with the goal of exulting in ideological fervor, animating party members and cultivating preferences, with the objective of avoiding massive abstentionism which was the crowning glory of the ARENA polling places in 1997. The FMLN, on the contrary, far from having handily taken advantage of the opportunity of maintaining itself as the only rival with possibilities of winning against ARENA, fell into the ditch of its own internal rivalries, involving its own rank and file in the infighting and thereby seriously frustrated its attempt at participation in the upcoming elections by means of an eminently democratic process.

It seems, then, as if the situation presents itself in which by maintaining its traditional line and not showing any sign of democratization allowed ARENA to reap good results, while for the FMLN the effort to carry out its elections by means of a democratic formula was prejudicial in the eyes of all. However, the authoritarian vestiges in ARENA are perceived clearly by the electorate. If there is something positive about what has happened on the political stage during recent months it is that public opinion is beginning to demand the internal democratization of the parties. As much for the principal political forces of the country as for all political institutions, the search for a workable strategy of internal democratization continues to be a pending task.

THE QUESTION OF ECONOMIC BALANCE IN NICARAGUA:

"WE’RE HAVING PROBLEMS AND THEY’RE GETTING WORSE"

The economic context of Nicaragua is not good. Nevertheless, Mr. Noel Ramirez, the President of the Central Bank (BCN, for its initials in Spanish), as he presented his report in September of this year concerning the principal economic indicators with which it might be hoped that the year 1998 would draw to a close, as always, with an optimistic balance. The government foresaw a 10% inflation rate and a 6% growth in production, as a result of the increases in diverse activities, especially in mining.

The darkest note in the official report is to be found in the section on the external sector where a decline in exports and an increase in imports was reported with a trade balance deficit —already high— which would increase even more. This is serious because the medium-range viability of the Nicaraguan economy depends on reducing this gap.

The slogan with which the neoliberal economic model was implanted in Nicaragua was —as it was in other countries—: "we’re having problems and they’re getting worse". In our case, the "problems" which were a result of having had to do with the end of a war between brothers which caused a slow wasting away and of a state economic model based on subsidy, was evident —not open to discussion. The structural adjustment model was presented to society as a compass with the aid of which one could walk in the correct direction. No one —or almost no one— hid the fact that the road was strewn with thorns. But we were doing "all right" and paying the hard price of the adjustment; we would soon "be doing well". So went the official propaganda during the government of Mrs. Chamorro and so the liberal government of Mr. Alemán continues to allege. None of the promises has been kept. And on the difficult road upon which we set out, there are abundant advisory warnings that we were not doing alright, that we were having serious problems and that we will continue to have them.

The structural adjustment program which the international organisms advise for countries such as Nicaragua deal with the rescue of economies that are unsustainable because of their lack of adjustment. When they are adjusted, they can begin to become sustainable. In order to achieve this, two essential deficits must be attacked: the internal and the external. The internal adjustment is the cutting of public spending. The external adjustment promotes an increase in exports.

In order to make us believe that we are doing well, the government throws its full light on the figures indicting internal adjustment. The public deficit, effectively, is being controlled. Although at a very high rate and obvious price of impoverishment of the majorities with greater unemployment, less health and less education. But the external deficit is not only being controlled, but is becoming larger and larger. It grows each year. The adjustment, such as it is being applied, is resulting in failure: it makes the Nicaraguan economy more and more unsustainable. The evidence that in the microeconomy of the family the majority of us "are having problems and they’re getting worse" does not merit analysis. What is merited is the new evidence that in the pampered macroeconomic figures "we’re having problems and they’re getting worse".

The adjustment has been successful in controlling the public deficit. In 1990 the GNP was 20% and in 1997 it is only 5%. Such a drastic reduction in the internal deficit was achieved in two ways. The first was by reducing public spending on goods and services and the category of salaries. One must be precise, nevertheless, that, although the employment rate in the public sector was reduced in 1997 by 3%, there was an increase in state salaries.

During these years, the budget category for defense was the one to suffer the most, coming to represent almost 20% of the GNP, in 1990, to less than 3% today. The social services spending has suffered a slow erosion since 1994, when it represented a little more than 12% of the GNP, up until 1997 when it dropped to 10.8%. Although the categories dedicated to health and education are greater in the budget for 1998 than they were in 1997, these increases are not compensated for by the rapid population growth which is the highest in all of Latin America. In this state of affairs of high birth rate and low public spending, the stated dedicates less and less to education and health care for its citizens. And it continues to dedicate excessive amounts to the payment of the external debt: in 1998, the government paid 240 million dollars in interest, which represents almost 40% of the total value of national exports, a quantity which is much above 20% recommended by the World Bank itself.

The second road to reduction of the public deficit was the increase in tax income. The principal change took place when the taxes on the consumption of goods and services,, duplicated between 1990 and 1997. Initially, this represented a little more than 7% of the GNP and in 1997 was the equivalent already of 14%. In contrast, income tax is almost 3% and property tax is insignificant. This is the index of those who are paying the adjustment.

If controls exist on the internal deficit, although with devastating social consequences, control is being lost in the external deficit and the macroeconomic variables are beginning to be cause for concern. Exports will be down, in 1998, while imports continue to increase. The commercial deficit not only continues to be high, but has grown with each year since 1995, when it represented 24% of the GNP. In 1997 it became 36% and, according to BCN projections, for 1998, the tendency will be the same. On this terrain, adjustment is not functioning.

There are reasons behind this. On the one hand, there is the financial reason: the price of the Cordoba is not real, the national currency continues to be overrated, which is not a stimulus to exports but does stimulate imports. Some calculate that the Cordoba is overvalued by between 13 and 20%. On the other hand, there is an institutional reason: the privatized national financial system suffers from short-range planning and is not interested in offering credits for investment in production, especially if what are being dealt with are small and medium producers. Credits give privileges to consumption, commerce and services. Anyone can obtain a credit of 25,000 dollars in order to by themselves one of the most luxurious cars of the kind that saturate the streets of Managua, but one cannot obtain this amount of money —nor even less money— for upgrading the acres of coffee on the finca. The short-range vision of sumptuous consumption is, above all, a productive consideration in the medium and long range.

The predicted reduction in exports for 1998 is owing in part to the closing of the national runaway shop industries which are benefiting from Tax Benefit Certificates. If this "subsidy" is eliminated, profits are reduced and they close. This and similar industries depended on a high percentage of imported components and value added income was increased very little. Nevertheless, their closing weighs upon the economy.

If the public sector reduces its deficit, the increase in the gap between the external sector is only owing to a private deficit, provoked by increases in consumption —particularly in that the consumption of imported luxury products creates a sector in society. The increase in private consumption is owing, in part, to the availability of long-term credit in foreign currency. Consumption credit experienced a surprising increase in recent years: as it came to represent less than 1% of the GNP in 1995, it came to represent more than 8% of the GNP in 1997.

The availability of credits for consumption reflects another key figure: the unequal increases experienced by deposits in foreign currency in recent years have gone from 5% of the GNP in 1991 to 35%. The question is, Where do such abundant deposits in dollars come from if the source of income, which are exports, does not explain the increase? Although there already exist in Nicaragua relatively voluminous entrance of remittances as a result of family remittances, although they have not achieved the important level that they have in El Salvador, one cannot imagine that the dollars of the remittances are going to massively increase the savings account in the banking system. Remittances in the amount of 200 million dollars come into Nicaragua, but the immense majority of this money, which comes into the country in small amounts, is spent in survival and not in savings.

Could it be, then, that that volume of money in dollar savings accounts is the fruit of speculative investment? Does this kind of capital flourish in that amount in the country? Have the rates of interest offered by the national financial system, perhaps, attracted so many of these volatile capital incomes? Although a portion of these accounts might come about as a result of these factors, this cannot be the only explanation given that in Nicaragua there are other alternatives for financial investment which are much more viable. Specifically, the Negotiable Certificates for Investment (CENIS), issued by the government, offer an attractive rate of interest with no risk at all.

Some international capital, such as Lehman Brothers, have taken advantage of this opportunity and acquired CENIS in the amount of 75 million dollars, a highly risky situation because the redemption of these bonds can mean that the country would have lost a third of its international reserves, which causes new shadows to fall over the fragile external sector of the economy. The increase in the external deficit, the redemption of the CENIS and whatever echo —which there will be— of the current world financial crisis might threaten the stability of the rate of exchange and it might not be strange that, by the end of the year, there may have to be a change in monetary policy and public spending might have to be reduced even more.

Perhaps the question might be answered another way. Is it possible that the increasing deposits in foreign currency might come from money laundering? There are qualified national observers who calculate that Nicaraguan "dry cleaning" could have put into circulation already some 300 million dollars or more. For a small country an amount of this great magnitude could bring with it important consequences. So important that it might "undo" the country we know and make "another" country. Perhaps in a short period of time there might be clearer answers to the many important questions which this reality poses for Nicaragua.

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The above is an article presented by "Equipo Envio" of Nicaragua.

USC. The presidential candidate for the Social Christian Union (USC, for its initials in Spanish), Mr. Abraham Rodriguez, announced, on October 7, his non-acceptance of the proposal that he be a candidate in a coalition formula with the FMLN. At the same time, the National Council of the USC supported the process of alliance and coalition with the FMLN. "I have declined and we wish to solicit the National Council of the FMLN the opening up for discussion of candidacies of consensus", stated Mr. Rodriguez. Likewise, he argued that his withdrawal is owing to his not wanting his presence to be "an obstacle to the coalition and the project, and it was handled in such a way as to make it appear that I was obstructing a candidacy, so then, so that there would be no doubt, I declined". According to the USC, the FMLN ought to include in its presidential formula a candidate which does not belong to either of the two parties. The leadership of the USC has given itself a period of 15 days in order to convince the FMLN and come to an agreement concerning candidacies. The National Council of the party is now divided between those who do not know whether or not they should accept the FMLN formula and those who openly accept it. The USC deputy, Mr. Mauricio Salazar, stated the following: "we will make the effort to see if the FMLN formula can be made more acceptable, but this does not signify that we are going to pressure them. Under no circumstances, if they do not accept, will we follow along with the FMLN and we would accept the formula" (LA PRENSA GRAFICA, October 8, p. 6).

VILANOVA. Five National Civilian Police agents, accused of the death of the young man, Adriano Vilanova Vervel, were found guilty, on October 11 in a Tribunal of Conscience. The Judge of the First Court of Instruction, Mr. Levis Italmir Orellana, in the presence of family members of the victim and of the accused, read the verdict of the Tribunal of Conscience. The police were accused of aggravated crime, the penalty for which is, according to the new regulations, a prison term of between 20 and 25 years. The sentence must be imposed by the San Marcos Court of Instruction, the place where the investigations began in 1995, the year when the murder occurred. The judge, Mr. Victor Zelaya, who is responsible for passing down the sentence, has thirty days to do so, and meanwhile the guilty must remain in prison in the Apanteos Penitentiary. For their part, the defense attorneys for the five police declared that they will call for annulling the verdict because, they declare, there were procedural irregularities. "This is a surprise. There was no proof. In the public trial the District Attorney’s Office offered nothing," argued Mr. Humberto Recinos, defense attorney in the case. Likewise, Mr. Rafael Chávez, another of the defense attorneys, said that the decision of the jury was "unjust’, while at the same time he discredited the witnesses to the charge which were presented by the Public Ministry (LA PRENSA GRAFICA, October 12, p. 4).

POLITICAL PARTIES. The FMLN, PDC, PCN and LIDER declared, on October 8, their economic plans, within which they proposed, simultaneously, to combat poverty, government corruption, tax evasion and to promote national production and investment in the country and to maintain macroeconomic stability. The representatives of each party presented their economic plans at a seminar called "Challenges to the adoption of economic policies in the current national and international context", promoted by PNUD. Those attending were Mr. Rodolfo Parker, presidential candidate for the PDC; Ms. Nidia Diaz, candidate for the vice-presidency for the FMLN; Mr. Mauricio Meyer, Secretary of LIDER; and Mr. Julio Menjivar, campaign manager for the PCN. The PDC economic plan contemplates, moreover, the creation of jobs and the encouragement of production with fewer regulations for businesses. With regard to the economic plan of the FMLN, this includes, among other things, the implementation of a fiscal policy to combat tax evasion, as well as a decision to encourage the independence of the Central Reserve Bank. The PCN, for its part, proposes to create the necessary conditions for achieving sustainable development based on a social market economy which will also facilitate judicial security for the private sector in order to encourage foreign investment (EL DIARIO DE HOY, October 9, p. 30).