El Salvador in 1998

Political Balance

Economical Balance

Social Balance

EL SALVADOR IN 1998 

Serious and pressing economic, political and social dynamics worried El Salvador during 1998 and these, in turn, have given rise to serious doubts about the direction to be taken in the current process of implanting democracy in the country. On the economic question, the deterioration in agriculture continued to be unstoppable, while state entities showed signs of taking responsibility for the problem which threatens the social and economic viability of the country. In dramatic fashion, hurricane "Mitch" laid bare, the vulnerability of the rural population whose vital living spaces had already been destroyed by practices causing deterioration of the most diverse characteristics. In 1998, nothing was done to renew and recuperate the agricultural sector; even more, governmental neglect was the norm, because of which a new opportunity for laying the foundations for a process of self-sustaining economic and social development was lost. It was not understood —or there was no desire to understand— that the viability of El Salvador is impossible without an agriculture based in solid in financial and environmental planning.

The economic impetus continued to move in the direction of conversion into service industries, specifically by means of the expansion of the financial sector. This sector’s interests have not been unaffected by the privatization of electrical energy, telecommunications and retirement pensions, categories which have become an arena where national and international financial groups confront each other and have not hesitated to utilize the most diverse kinds of intrigues to extract the maximum from the public which uses these privatized services. The Calderón Sol government administration has sought unconditional support from the strongest financial groups in the country —especially from among those making up the Banco Cuscatlán group—, and so they have obtained the greatest advantages in the competition to make those public enterprises more profitable. The Calderón Sol government’s commitment to specific economic groupings has even led to characterizing the relationship between them as a kind of "mercantilist" relationship.

As a consequence of the foregoing, the country has not been able to overcome its most acute structural imbalances, which have, instead, become more accentuated. Rural and urban poverty, unemployment, social and cultural marginalization and the lack of fulfillment of basic needs for the greater part of the population are all ills which have increased. The rapid deterioration of the agricultural and livestock sector and the impact of privatization of these processes has not only aggravated long-standing structural problems in the country, but has presented new obstacles to the resolution of these very problems.

On the political plane, the political class could not turn back the tide of its lack of credibility which has plagued it during previous years. Resistance to democratizing and renovation, incompetence, power struggles... All of this contributed to the deslegitimization of the parties and their leaders, so that they are seen with very little credibility by society. One more year and the political class has demonstrated its lack of capacity to serve as intermediary between the demands of society and the state entities responsible for responding to them. As 1998 is a pre-electoral year, power struggles occupied the energy of party leaderships, the most ambitious members of whom did not mince words and used all available means to defeat their political rivals. And so it was the case in most parties that they did not present their most capable leaders; those who were presented were only those who maneuvered with the utmost audacity. As the year closed, when almost all the candidacies had been defined, it is impossible to ignore the political poverty of El Salvador. The spectrum of candidates from among whom the President of the Republic will be chosen does not offer alternatives which might truly generate confidence concerning the future of the democracy in our country. This is true to the point that in what we have now seen of the political campaign there appeared to be nothing to differentiate it from traditional political campaigns where cheap rhetoric and empty promises are bandied about.

The political dynamic of 1998, then, gives us cause for concern. Another year has passed in which the political parties have not become more democratic or institutionalized in better ways. The decisions and interests of the "good old boys" who consider these parties to be exclusively their property have continued to weigh heavily. Meanwhile, the population at large has exhibited signs of diminished interest over and above the already slender levels of confidence they have in the political system. The gulf between the political class and society has widened and all seems to indicate that in 1999 this tendency will be accentuated.

On social questions, the year just ended saw an aggravation in the living conditions of the broader sectors of the population. To the difficulties of survival caused by poverty in all of its manifestations, has been added organized crime as well as common crime which, as in previous years, brought suffering and material losses for the population. Given both situations, government authorities did not show the least interest in taking seriously these problems which are so serious for the country. The Calderón Sol administration has reached its last year in office without complying with its much-touted commitment —a commitment announced in its governmental plan and in endless presidential discourses— to fight poverty. Calderón Sol leaves the "poorest of the poor" as poor as they always were. El Salvador, far from being a country of those who own property, has become a country which is the property of powerful financial corporations, and the government works assiduously in favor of their interests.

Criminal violence, on the other hand, has not been addressed with sufficient determination and efficiency. Moreover, the country is suffering from a crisis in public security motivated as much by the failure of the National Civilian Police (PNC, for its initials in Spanish) to confront criminality —which has even become embedded in police structures—, as well as by the political ties of the Ministry of Public Security, which have impeded this ministry’s ability to take on the problem of criminal violence with the necessary seriousness.

The call to take notice of the failure of the authorities to maintain public security should not be passed over lightly. This year, the serious limitations from which the institutions with direct responsibility for the security of citizens suffer have been duly noted. And it is the National Civilian Police which must be noticed and called to account for not having assumed, on many occasions, the role to which it is assigned in present day Salvadoran society. Some of the ills which have crippled its work during 1998 are: (a) the presence in its ranks of agents and mid-level commanders linked to the world of crime; (b) complicity with criminal activities of diverse kinds; (c) unresolved conflicts between the higher level echelons and the National Academy for Public Security; (d) poor coordination between the police leadership bodies; (e) the predominance of politically-motivated decisions over and above those which should be strictly police matters; (f) negligence and resistance to institutional change by an important sector of police organizations.

The composite of these factors has hampered police work, giving rise to feelings of failure in the fight against crime. The National Civilian Police have not been up to dealing with society’s need for public security. Profound logistical and strategic weaknesses have been demonstrated on countless occasions. This has discredited the police institution in the eyes of the public, which does not perceive success after the last six year’s investment in that entity. The discredit into which the police institution has fallen is only made more manifest when police agents and middle-level commanders appear to be tied to murders, kidnapping and robbery. For all of the reasons stated above, in the best of cases, the PNC has, in the end, been seen as an institution which is not worth much; in the worst of cases, it has begun to be seen as a threat. Both situations point to something serious: the crisis of an institution called upon to carry out a decisive role in the democratization of El Salvador.

In summary, 1998 has not been a very fruitful year for the inculcation of democracy in El Salvador. The resistance demonstrated by the political class to internal restoration, renewal and renovation; the social effects of the process of privatization concocted by specific power groups, environmental deterioration, the existence of criminal groups inside the PNC... All of this holds the efforts to construct a democratic society in El Salvador at bay. The greatest cause for concern, however, is that there appears to be nothing to indicate that these situations will be remedied or eradicated during 1999. The same figures and political parties as always will continue to reign in the political sphere, the same business interests will continue to fight it out over what remains of the country, and it appears that the same political party will control the executive office for five more years. There is sufficient reason not to be overly happy about the future of El Salvador. A substantive change in the way politics are done, in the way the challenges to business enterprises are taken up and the way in which state efforts are directed: none of these is to be detected on the horizon. It may be that we have to wait two or three generations for Salvadorans to deal with the vices, errors and limitations which actually control the destiny of the country to be overcome. Meanwhile, there is nothing to be done but to look for the best among what is currently the worst.

POLITICAL BALANCE

On political questions, 1998 was marked by the presidential electoral period leading up to March of 1999. Changes in the balance of powers at the legislative and municipal level, the product of the results of past elections, presaged a situation in which 1998 would be a decisive year. Decisive because the significant increase in power quotas experienced by the FMLN demonstrated the real possibility that that party might assume the executive office in 1999.

This not only worried ARENA —which at that time was dealing with a serious crisis of credibility— but the FMLN itself as well. ARENA was obliged to design a sufficiently well thought out plan which would permit it to recuperate lost sympathies. The FMLN had to carry out the complex task of responding in a satisfactory manner to the expectations raised by the complex task of responding to the expectations raised as a result of its possible election, at the same time as it drew up its electoral strategy for the presidential elections. Evidently, the challenge of the official party would be less difficult and easier to carry out than that of the primary left political party.

But not only these two extremes of the political spectrum will be put to the test during this coming year; the 1997 elections posed serious challenges to the minority political parties. One of these challenges was that of assuming the role of protagonist in the Legislative Assembly. The hegemony of ARENA having been broken and the FMLN having been converted into a strong rival for ARENA, it fell to the lot of the "small" political parties to mediate between the two poles. Moreover, such parties found themselves confronted with the challenge of consolidating themselves internally and of strengthening alliances which would permit them to deal with the polarization. It was only in this way that the possibility opened for them for becoming an alternative power in 1999, channeling the votes of potential voters who are unsatisfied with the "big" parties.

In summary, the exercise of electoral power in 1997 made it clear that the task of making cohesive the work and functions of government with a strategy to be followed in order to participate in the 1999 elections ought to be taken up by every political party wishing to achieve satisfactory results in these elections. How this process of making cohesive was carried out and to what level the parties could assume the challenge posed is what we will attempt to analyze below.

ARENA is, doubtless, the party which has most effectively prepared the most and is the best prepared to enter this year’s electoral process. The first step along this road—after a series of preliminary measures which had already been taken—was the election of a candidate which, perhaps, was more polemical than the official party would have liked, but which, up until now, has demonstrated results which the ARENA party leaders hoped to achieve with this nomination. Such a candidate, as we all know, is Francisco Flores. It was initially thought that the controversy generated around the figure of "Paquito" was a result of the fact that the proposal of his pre-candidature came from a group of young ARENA party members who wished to question the predominance of the leadership body within that party.

This interpretation gave rise to a certain optimism because, if it were true that the initiative of that party’s young people had been able to achieve its own dynamics, over and above the mandate of the ruling leadership and in harmony with the interests of the bases, the probability that ARENA might have been undergoing an internal process of democratization might have come about. But the truth was that "Paco" Flores was not the independent dark horse that he was thought to be in the beginning. His desire to represent the governing party in the up-coming electoral race had not arisen only from among the young Turks of the ARENA party. It soon became very clear that the candidate belonged to the Calderón Sol faction of ARENA.

After Mr. Flores candidacy had been made official, it was learned that it was not the image of the young, intellectual, conciliatory leader which won Mr. Flores the sympathy of the rank and file, but rather the image arising from the fact that he had been hand-picked by the current president and his allies as the most convenient personality to be named as his successor in the executive office. If ARENA aimed to be innovative, it would have to choose a candidate which was not a run-of-the-mill candidate, and this was the line of thought which led Mr. Calderón Sol and company to support "Paquito". But support was not unanimous. Inside the primary right-wing party, other important figures were not in agreement with the president’s opinion and one of these was the president of COENA, Mr. Alfredo Cristiani.

Hot and heavy polemics aroused the media as they dealt with this situation. But what turned out to be certain is that if Mr. Cristiani had preferred a candidate proposed by himself, this ended up being practically a moot point. First of all, because the expresident seems no longer to be a predominate voice among the party rank and file. Secondly, because Mr. Flores was received with popular acclaim from the very beginning. A third reason is that, in spite of all of its limitations —the wearing down produced as a result of eight years in office, the coexistence of groups with diverse and distinct economic interests, the verticalism and scarce democratic room for movement predominant in the party, among others—, ARENA continues to be the party with the highest level of institutional structure, which makes possible, even in spite of weaknesses and cracks in the facade, the existence of the kind of party unity which does not crumble when faced with a few contrary winds.

Parallel with this process of consolidating the candidature of Francisco Flores —which continued throughout "Paco’s" visits to all of the departments of the country, continued with the formulation of his government plan and culminated in the inauguration of his electoral campaign—, ARENA has been carrying out its traditional "government proselytizing". This is the condemnable practice of taking advantage of any opportunity for propaganda. It is very clear that throughout the year the government party had intensified the number of paid ads, radio spots and televised announcements promoting the "goodness in office" of the Calderón Sol government towards the Salvadoran population.

Experts in taking advantage of state control, ARENA functionaries make of any event —as minimal as it may be— the occasion to be cheerleaders. Lamentable cases of a paradigmatic nature were the publication of a propaganda campaign against the FMLN —at a point in time which the FMLN was demanding that the foreign debt be examined as a conditioning factor for approval of a loan to the educational sector— and the tawdry use of distributing international donations to the homeless as a result of "Mitch" by the president and the first lady with an eye to raising their popularity profile.

In the first of the cases mentioned above, it was from the funds of the Ministry of Education by direct order of the president, and without previous consultation with the Minister of Education —that the funds were taken in order to finance the millionaire campaign against the FMLN. This was one of the reasons which the most outstanding member of Calderón Sol’s cabinet, Mrs. Cecilia Gallardo de Cano, would decide to resign as Minister of Education. Such an unexpected resignation was followed by four more resignations, all of them high-ranking functionaries of the ARENA government. These were: Mr. Roberto Orellana Milla, President of the Central Reserve Bank (BCR); Ms. Ana Cristina Sol, Presidential Commissioner for the Modernization of the State; of Mr. Arturo Zablah, President of the Executive and Autonomous Port Authority (CEPA, for its initials in Spanish); and that of Mrs. María Teresa de Rendón, President of the Social Investment Fund for Local Development (FISDL, for its initials in Spanish).

The short lapse of time during which these resignations took place did not allow for an interpretation that these cabinet members and heads of ministries unanimously presented as their justification for resigning. All alleged "personal reasons". But it was obvious that more was at stake than "personal reasons" and the massive flight of functionaries appeared more to be related to their disagreement with the leadership which Calderón Sol was demonstrating from the vantage point of the presidential cabinet. Mishandling of state funds and the president’s lack of separation between party interests and governmental administration appear to be closer to the point as explanations for the group resignations.

From the second of these cases in point can only be added the reproachable fact that the ARENA administration had lent itself to the work of capitalizing upon for the benefit of the party and taking accredit for merits which rightly belong to the countries contributing in solidarity with the reconstruction of the areas affected by the hurricane. It is a well known fact that many of the political parties have tried to obtain benefits in any way possible from the tragic effects of this storm. But the open and shameless way in which the ARENA government has tried to take advantage of its current quota of power in order to take credit which they do not rightfully deserve is doubtless the most condemnable. So it is, then, that the government, rather than drawing up a reconstruction plan which would establish how the money would be invested and what state institution will be charged with administering it, is busily occupied with pretexts for publicizing itself.

These examples —among many others which could be presented— should suffice to illustrate the fact that, if it is true that ARENA is the political party which has planned for March 1999 with the most care and anticipation, it is also true that these preparations are of an imminently formal character. There is nothing fundamental in the work of the ARENA government that proves that the official party is really willing to subordinate party interests to the demands that a government for all Salvadorans —as it presents itself as being. Moreover, policies which have been in effect cast serious doubts on the rhetoric of ARENA discourse, which purports to work for the common good.

It is true that ARENA carries the lead over the FMLN with regard to the possibilities of winning in the upcoming elections, but it would be an error to think that this is because the voting populace is overcoming its lack of agreement on this. The fact that the official party has achieved higher levels of popularity in recent weeks is owing to the fact that in recent weeks this is owing to its ability to "sell the successes" of the administration and the marvels which its candidate promises. And so it goes: if ARENA is again elected in the upcoming elections, it will not be owing to the recognition and blessings bestowed by the voting populace for the ARENA administration —because very few things to admire in the current government administration. It will be thanks to ARENA’s impressive publicity apparatus which it has been engaged in building during recent years, instead of working to consolidate an efficient and responsible governmental apparatus.

Examined from the point of view of its overall work and in the municipal administrations, it must be said that the FMLN has not succeeded in rising to the expectations that its victory in past elections might lead one to expect. In the Legislative Assembly, the FMLN has not been able to do much more than attempt to arrest the ARENA party initiatives, on many occasions because there was little that could be done to turn back that party’s initiatives, as in the case of the AFPs. Valuable opportunities to demonstrate their commitment with the majority of the population slipped through the fingers of the FMLN deputies in unjustified ways. One of the lamentable examples of this was the election of the Ombudsman for Human Rights.

Speaking of this, however, it would be unfair to hold the FMLN entirely responsible for the way in which the legislative body arrived at such a questionable conclusion, and this after interminable debates. What it can be held accountable for is its participation in the standstill into which the election fell because the FMLN did nothing to prevent a situation in which there was no ombudsman for the Ombudsman for Human Rights office—this as a result of months of indecision by the deputies. It is not the case that ARENA and the rest of the parties were not responsible for overseeing the Ombudsman’s Office and guaranteeing that the precisely the best and most appropriate person was in office to lead this entity which arose from a provision of the Peace Accords charged with the protection of citizen rights. It is rather the case that, taking into account the mentality which has characterized the right-wing parties which have more weight in the Legislative Assembly (ARENA, PCN and PDC), it fell more properly the FMLN to guarantee the overseeing of the process as the party from whom one might expect greater concern and commitment for the Ombudsman’s Office for the Protection of Human Rights.

This is the most notable instance in which the indecisiveness and tardiness with which the FMLN acted that transformed that party into a target for critics. But, it must be said in other matters related to the social problem, that the major opposition party’s participation has left much to be desired. There is more happening, and this with the FMLN’s municipal administration. One cannot deny, of course, that the FMLN municipal governments had had to embark on correcting the ills that corruption and incompetence in previous administrations had left in the municipal offices. Nevertheless, the mayors have now been a year and a half in office and few are the successes which the FMLN can take credit for on this front. For obvious reasons, it is the San Salvador Mayor’s Office which has the most to show on this question. All of the projects that Dr. Hector Silva promised to put into motion, with the exception of the renovation and recuperation of the historic center, have begun to function. The difficulties which Dr. Silva had to deal with as he entered office can doubtless, be included is the lack of resources, to which may be added his sudden aspirations to transform himself into the presidential candidate for the FMLN.

It is possible to affirm that it would have been a benefit for the FMLN to think that Dr. Silva might possibly have become a candidate —given his moderate background and relative independence from the FMLN—, but, it would have been prejudicial for the Mayor’s Office if he had fallen into the FMLN’s pre-electoral game plan. It should not be forgotten that, in order to carry out projects which have been planned, the capital city’s mayor is obliged to negotiate with other sectors and between groups which would, with difficulty, have been in agreement with so much closeness with a party with respect to which one cannot help but feel a certain lack of confidence. If this is true, Mr. Facundo Guardado’s efforts to encourage Dr. Silva’s candidacy would have been unfavorable to the Mayor’s Office as well as for the FMLN.

But let us now focus on the FMLN’s unfortunate attempts to consolidate a presidential formula which would put it on a par with ARENA’s formula. Three national conventions, dubious adjustments in the FMLN’s party regulations and numberless changes in the figures under consideration were necessary for the FMLN’s rank and file to elect the candidates which will represent them at the polls in the 1999 elections. The FMLN had to pay a high price for its efforts to democratize the party. Loss of credibility and fatigue after the elections together with the low level of acceptance with which the formula was received are proof of that.

Had it not been for the fact that the leadership of that left party used the primary elections as the arena for working out their internal power struggles, the results of these elections would not have been so harmful. Lamentably, what in the beginning was proposed as a process for democratizing the party, in practice lost that character completely, demonstrating that none of the parties to the conflict —that is to say, the "orthodox" and "reformist" factions— were willing to accept the decision of the majority if this implied giving up terrain to its ideological adversary.

Zigzagging from one disaster to another, the FMLN was finally able to elect Mr. Facundo Guardado and Ms. Marta Valladares as its presidential formula. Once again, the "progressive" wing seems to have won out, but at quite a price. Internal polarization, loss of confidence by the voting populace in the capacity of the FMLN to govern, a considerable lessening of the possibilities that the FMLN might win the presidential office: these are the problems which the candidates inherit from the previous state of affairs and with which they will have to deal throughout the campaign. This, added to the fact that this candidacy does not enjoy the support of a significant consensus inside the party nor acceptance outside of the party, places the efforts of the FMLN to substitute ARENA in office next year in serious doubt.

This is, then, how things stand, and it is evident that the FMLN has not been up to the task of articulating the necessary requirements in order to place itself in a position of strengths as compared with the governing party in future elections; that is to say, either to carry out a good and effective government administration, on the one hand, or, alternatively, to draw up an efficient strategy which can compete with ARENA. What is most worrisome is that the FMLN was not only incapable of articulating either one of these, but was, rather, not able to make significant advances in the construction of either one of these separately.

As has already been pointed out, following the results of the 1997 elections, one might have supposed that the center parties would be called upon to counterbalance the tension which such a polarized state of affairs would bring to the Legislative Assembly. So it is that the number of seats which the PCN won (11) made of that party, the party with the most determinate possibilities. Had this positive result obtained after the incorporation of a group of ARENA dissidents into the PCN leadership body gave rise to speculations that the PCN would stand firm in its aspirations to acquire autonomy from ARENA and consolidate itself into a real alternative for power in 1999.

If, however, it is true that the legislative faction of that party supported certain FMLN initiatives and showed signs of wanting to become a real opposition force, the faint signs of leadership which have characterized the PCN during 1998 and the difficulties which old-line ARENA members have experienced as they attempt to adapt themselves into the ranks of the PCN indicate that the PCN project did not crystallize —nor will it crystallize in the immediate future. If to this we add the poor preparation of the PCN as it enters the electoral race, it will be still more difficult not to show any pessimism in this regard.

The fact that we are now well into the official campaign period, the PCN did not designate its vice-presidential campaign anticipates the low profile which will surely accompany that party throughout the electoral campaign. It is not a question of a low profile with relation to the rest of the "small" parties, but rather in relation to what would have been possible to acquire had the favorable aspects which were theirs during past elections been taken more seriously.

But more serious than the tenuous participation of the PCN in national political life, doubtless, is the critical situation in which the groupings which make up the PDC have sustained during the past year. Far from having encouraged unification, the different factions of the Christian democrats have stayed at loggerheads, blind to the evidence that their confrontation could not but break out in internecine warfare. On the one hand, the untiring detractors of Mr. Ronal Umaña rose to the extremes of establishing a parallel leadership which, within the heart of the party itself, have aimed, at all costs, to undermine the mandate of the PDC’s Secretary General. The high political cost that the PDC has had to pay for this is something that the non-conformists seem to have completely overlooked.

On the other hand, the rhetorical discourse in defense of party unity which Mr. Umaña adopted just a little after the election of the presidential candidate, did nothing more than inflate the ill feelings of those who opposed him. The fact is, that to speak in the name of consolidation after having won office as a result of a bitter controversy and, moreover, after he himself had become the object of a confrontation which was nothing less than the most obdurate display of cynicism. And if this were not enough, this was only the prelude to what later would bring the bile of Umaña detractors to a boil, the world witnessed the elimination of primary elections for Secretary of the PDC with an eye to nominate —arbitrarily— Mr. Rodolfo Parker as the presidential candidate.

Mr. Umaña’s behavior, however, surprised no one. It was only to be expected of a person who is characterized as using the PDC as he liked when it was a question of personal gain. This time the party secretary of the PDC needed to consolidate the candidacy of Mr. Parker in any way possible, given the arm-wrestling of which that nomination was the result. Rumor would have it that, in alliance with a group called "The Friends of Freedom" on one side and with Mr. Alfredo Cristiani and his allies on the other, Mr. Umaña’s objective is tow rest as many votes as possible from ARENA in order to oblige that party to cede either the vice-presidency or important power quotients for the Christian Democrats in the future government.

As things stand, it seems clear that the only thing that the PDC has won under the banner of its current leader is the perpetuation of the chronic infirmities from which the PDC has suffered in recent decades. Wrenched by the crudest sorts of internal disputes and plagued by the interests of economically dominant factions, the Christian Democrats have become the model of backwardness which has characterized the process of democratic institutionalization in El Salvador. If the life of a political party only revolves around itself it cannot achieve any true representativity; nor can its work be recognized as an exercise in democracy, properly speaking.

In the case of the rest of the minority parties, it is important to point out how much these have lent themselves to unclear definitions of their ideological platforms, as well as demonstrating a propensity for improvisation in the preparation of their 1999 electoral strategies. Of the first it must be said that, if it is true that certain political parties of the center have been trying to consolidate alliances, the stability of these parties will be long in coming. Such is the case with the Centro Democrático Unido (CDU), made up of a gathering of a series of tendencies, including the CD, the PDC, the PPL, the MUDC (Christian Democratic Unification Movement) and the party-in-formation, Fe y Esperanza [Faith and Hope] —among which no points of agreements might be observed, be it because it is not clear what concordance might exist among certain propositions which have been half-way consolidated, or be it because the scarcity or lack of presence of certain public opinion groups have made difficult the determination of their propositions.

On the second question, given that the electoral process is well underway, LIDER, PLC, PUNTO and CDU have either not finally decided if they will participate in the race or not, or that they have not chosen who their candidates in the elections will be, all of which speaks ill of their capacity to develop a presence with a critical position which, in their discourse, could stay ahead of the polarization. It may seem contradictory, in spite of their proclaiming, at ever opportunity, the need to establish a center block which would channel those voters who are not in agreement with the ARENA and the FMLN, that when the opportunity presents itself, these parties make so little effort to achieve such a center block.

The electoral campaign has been underway now for almost two months. The polarization, the ARENA advantage over the FMLN and the weak participation of the minority parties in the campaign are characteristic notes which the current electoral campaign will share with the campaign which preceded it. Here are some novelties that one might have expected to see in 1998 at the political level: that the FMLN might have discovered how to maintain its broad possibilities to unseat ARENA in the presidency; that its work in government might have been praiseworthy; that the minority parties might have achieved some leadership in the plenary and finally achieved consolidation; that ARENA might have been more concerned with the problems of the country and less concerned with losing the executive office. With hindsight, these expectations seem almost to be impossible miracles.

Clearly, none of the political parties was able to present a satisfactory response to the challenges that the 1997 elections posed for each one. Only two innovations merit being taken into account in this examination: the nomination of Mr. Francisco Flores as the presidential candidate for ARENA and the fact that the electoral campaign marked by belligerency and confrontation has not prevailed over and above serious and pertinent proposals. Both of these novelties are linked to the conviction to which the government party finally arrived that it is not by attacking the opposition that one wins the victory in the elections. This must be recognized, but as has already been pointed out, it is a question of form but not of substance.

For all the rest, it only remains to be considered that if it may be said that it is positive all of the electoral processes that the political parties are concentrating their efforts on making clearly focussed proposals is a positive tendency, when compared with actual governmental achievements, these proposals pale hopelessly. And so it is that, as we have seen, the political parties seemed not to foresee the importance of carrying out a good administration as a prerequisite for winning votes in future elections. If the slogan "we are going to do this" of the campaign propaganda had become "look, we have done it", the shadow of abstensionism, the lack of confidence and an air of lack of credibility would probably not hang over the politicians and all they do as it does today.

ECONOMICAL BALANCE

During 1998 four dynamics clearly marked economic behavior: the privatizations, the tax proposal presented by the Mayor’s Office of the Municipality of San Salvador, the obligatory increase in legal bank reserve deposits and the disaster provoked by the tropical hurricane "Mitch". As a result of "Mitch" even official projections had to be adjusted.

One of the most important successes has been a growth in the GNP of approximately 3.8%; nevertheless, growth levels of 3% and 4% obtained in recent years are not sufficient to allow us to expect considerable improvements in the population’s conditions of life. Not even high rates of growth of 6% and 7% obtained during the early years of the decade of the 1990, showed a decisive incidence in the behavior of employment and poverty.

As to the external sector, the dilemma of devaluation as a possible measure to stimulate growth in exports by means of a price reduction expressed in dollars continues to be proposed —and with this an increase in the ability to compete. This is principally owing to the fact that in 1998 the tendency towards an increase in the balance of payments deficit continues.

The affluence of family remittances explains, fundamentally, why the exchange rates have not plummeted with the elevated and rising deficits in the balance of payments reported throughout the decade of the 1990’s. This, together with the practice of control of the monetary supply has allowed inflationary levels to be maintained at single digit figures since the year 1996.

In the analysis presented below is presented the argument that, in spite of the permanence of economic stability, El Salvador still has not been able to implement a productive apparatus capable of generating the necessary exports to maintain growth and stability, nor to produce the necessary goods for consumption and investment. Additionally, the principal characteristics of the most important facts affecting the economic ambience during the year 1998 are summarized below.

As mentioned above, production did not grow by 4% —the expected rate of growth— and, in accordance with data estimates by the Central Reserve Bank, as the year closes, growth will be at 3.8%. As opposed to the situation of the preceding eight years, growth has not been concentrated in the service sectors of the economy because the manufacturing sector experienced an important comeback during 1998, while service sector activities experienced an important lowering in rates of growth. Only the agricultural and livestock sector continued in as critical a phase as it has since the decade of the 1980’s. On the other hand the commercial, service and financial sectors experienced a much more vigorous expansion, although not as much as in 1997.

According to the Index of the Volume of Economic Activity drawn up by the Central Reserve Bank, the most dynamic sector in 1998 was industry, with the sectorial growth rate of 7.4%, followed by transportation, warehousing and communications with 7.3%, electricity and water with 5.5%, financial services, construction and personal services with a 3.7% and commerce with 2.2%.

Without being pessimistic, it might be added that in reality the dynamic situation of industry is owing to the fact that in large measure the expansion of the run-away shops (maquilas), especially in garment, which is carried out in free trade zones and generates more than 40% of the total value of exports. Traditional domestic industry is not growing at these rates and is at a competitive disadvantage as it faces the lowering of customs rates, a matter which will be dealt with below. An additional point must be mentioned and that is that the general growth rate, although it would have reached the projected 4%, is currently at extremely low levels in relation to the growth rates experienced between the years of 1992 and 1995. In order to substantially improve income per capita growth rates of much higher levels than 4% will be required.

On the question of employment, sectorial tendencies of growth exhibited since 1997 provoked a lesser growth in jobs as compared with what it could have been had the growth been concentrated in the agriculture, livestock and industrial sectors and not in the financial sector, for example, because the greater number of those holding jobs is to be found in the agricultural and industrial sectors at a level of 46% in 1997, while financial establishments provide jobs at only 1.3% of those employed.

All in all, in accordance with data cited by the Salvadoran Banking Association (ABANSA, for its initials in Spanish), the open unemployment rate was reduced, moving from 8% in 1997 to 7.2% in 1998, which presupposes the creation of 375,000 jobs. This data is congruent with the supposed reactivation of the industrial sector, although reasonable doubts might be raised with regard to the possibility of the creation of jobs in this sector, and more concretely in the maquila. Throughout the decade, the number of jobs in this subsector scarcely reached 70,000.

Although inflation was only 3.8%, it rose substantially during 1998 because, in 1997 it was 1.9%. All in all, this is one of the historically lowest inflation rates, which is, in reality, not so outstanding in a context of abundance of profits and strong controls on the monetary supply, as will be explained below.

According to governmental data, the increase in inflation is owed principally to the impact of "Mitch" experienced by agricultural products after November. It is certainly true that after the disaster that immoderate increases in the prices of basic products in the affected zones were experienced even in San Salvador and this even obliged the Legislative Assembly to promulgate a decree in which market forestalling and price speculation were to be sanctioned by a term in prison.

With regard to the minimum wage, it is important to point out that during the month of May it was increased by 9%, or, from a monthly salary of 1,150 to 1,260 colones in commerce, industry and services. This increase is the first that was implemented since July of 1995 and was clearly inadequate even to recover the real salary level prevailing at the moment; moreover, in order to cover the cost of the basic food basket and even less for the amplified food basket. For December 1992 it is estimated that the cost of the basic food basket was 1,313.38 colones, that of housing at 728.30 colones, clothing at 223.05 colones and for miscellaneous items 895.66 colones; the amplified food basket cost 3,160.4 colones. For 1998 the value of the basic food basket was raised to a value of close to 2,400 colones and the market basket reached approximately 4,900 colones.

Upon close examination of this data it can be seen that neither the minimum salary for industry, commerce and services would be sufficient to cover the cost of the food basket, much less the market basket. Almost two minimum salaries would be needed in order to acquire the food basket and four minimum salaries in order to acquire the basic amplified food basket.

The situation in the external sector continued to express apparent tranquility, stability in exchange rates and balance of payment surpluses together with a sustained increase the International Reserve Rates. A more detailed examination reveals that these signs are only apparent and that the true causes of the external lack of equilibrium are still present. In reality, as one examines the behavior of exports, imports, the balance of payments and the balance of the regular account it seems clear that the economy is not really capable of maintaining international commerce without external resources. Much more is imported than is exported, but more is received from workers’ family remittances which could not be absorbed into the Salvadoran economy established mainly in the United States.

An examination of the balance of payments reveals that it has experienced sustained increases in its deficit as indicated in graphic 2. Between 1994 and 1997 the balance of payments deficit rose from 1,325 to 1,817 million colones.

The Public Non-Financial Sector reached 2.3% of the GNP during 1998 as a result of the increase in spending over and above public income. Greater pressures toward increasing spending are the result of pressures to finance the areas of public security, the social administration and the administration of justice as well as necessities arising from the process of the privatization of telecommunications. This last category generated expenses on the order of 240 million colones for the compensation of the workers of the National Administration for Telecommunications (ANTEL).

There are two causes for the fiscal deficit: difficulty in increasing tax income and increases in public spending over and above the increase in income. The tax system reform has not resolved the deficit problem because, although it succeeded in increasing tax income with the introduction of the Value Added Tax (IVA, for its initials in Spanish), it also provoked reductions in the elimination of the taxes on exports and inheritance, the lowering of customs and tariffs and the reduction by half of the taxes which businesses pay.

After the second semester of 1998, new reductions in taxes on imports or customs tariffs, which dropped from 20% to 17% for finished goods, and from 15% to 12% for some intermediate goods and 10% to 7% for all others. This has caused a situation in which taxes on imports were reduced by 3.1% and fell from 1,278 to 1,240 colones. The effect has not been so noticeable for two reasons: it was only in effect during the second semester and the increase in imports was compensated for the reduction of customs tariffs.

On the other hand, the deficit was also increased as a result of pressures to increase public spending in the administration of justice, public security and, more recently, the financing of local governments. In the General National Budget for 1998, this last item acquired special importance while, for 1999, the line item in the budget for public security will increase by 13.9% (180 million colones) while the line item for the administration of justice will increase to 27.2% (313.2 million colones). Taken together, public security and the administration of justice all of its components will rise to 24.6% of the budget earmarked for institutional financing and comprise 16.8% of the total budget.

Additional pressures on public financing will be felt as a result of conjunctural elements alone, such as the compensation of ex-employees of ANTEL and, more recently, as a result of the additional needs required for attention to the disaster provoked by the tropical hurricane "Mitch". According to President Calderón Sol, at first 150 million colones were assigned to emergency relief; however, it remains to be seen what will be the end result once donations are taken into account.

The most outstanding aspect in this category has been the initiation of a process of adjustment of obligatory legal reserve deposits which rose to 24% for the month of March, 1999. The increase in mergers took place last June when banking rates began to rise in units of 0.3 each month.

Interest rates, on the other hand, still show considerably higher levels in relation to inflation, but the most questionable of all is the wide margin of financial intermediation prevailing. A figure for the margin of intermediation accepted by the President of Salvadoran Banking, himself, Mr. Archie Baldocci, and calculated by the BCR is that of 5.1%. This figure does not contemplate the effect of high commissions, which the banking system charges and is, on the whole, a median rate because extreme cases exist.

A banking client with a savings account in one of the major banks in the country which, at the same time, is a borrower in consumer loans, receives 4% on his savings deposits and would be paying close to 23% for his or her loan. This implies that the intermediation margin at the banks in these cases would be close to 19% as a margin for intermediation, without considering commissions. A businessman, for his part would be paying up to 6% for the same thing owing to the fact that he receives higher rates for his deposits and pays less for his loans.

Expectations for 1999 with regard to look towards an increase in the already high interest rates. In fact, this tendency was felt during the second semester of 1998 in some financial institutions. An important piece of data in the financial ambience of El Salvador was the closing of the savings and loans association, Credito Inmobiliario, S.A. (CREDISA) for lack of capital. However, in this case, the depositors were not subject to fraud as they were absorbed by three banks of the system, as well as CREDISA shares.

Although it should be recognized that this case is not comparable with the case of Financiera de Inversiones Seguras y Productivas (FINSEPRO), it does show that inside the financial institutions there is too much discretion in the use of what ought to be funds belonging to the public. This is clearly reflected in the current interest rates and the marginalization of the agricultural, livestock and industrial sectors from credits which favor construction, commerce and services.

The San Salvador Mayor’s Office proposal on municipal taxes has been a polemical topic from the political as well as from the economic point of view. The implications of the tax proposal as well as for the Mayor’s Office of San Salvador are important in the measure that they completely contradict the spirit of the tax reform implemented by the last two governments of ARENA during the 1990´s.

As was pointed out above, one of the effects of this reform has been the elimination of taxes that were paid by the businessmen: exports, rent on corporations, inheritance, legal stamps; and the adoption of the value added tax as the principal tax which, at the same time, lent itself easily to the possibility for tax payers to avoid paying IVA even on personal consumption, something not permitted by the law which created it.

The tax table proposed by the San Salvador Mayor’s Office is designed to be progressive, that is to say, it is a measure which advances in levels of shares in businesses, and in this measure it also increases the tax rates for each sector and vice versa. This contradicts the proposal which underlies the ARENA tax reform on unification and generalization of tax rates.

As a result of the concentration of banking activity in the municipality of San Salvador, one of the sectors most affected will be the financial sector, which will be subject to considerable increases in tax rates. Some contributors will confront an astronomical increase in municipal taxes, especially owing to the fact that, in the current structure, the sectors with greater taxable capital are those which pay less taxes, while the municipal proposal would be the opposite. So it is that, for example, a contributor with capital in the amount of 175 million colones will see his or her taxes increased by 1700%, or, from a tax bracket of only 35,000 colones to one of 630,000 colones. On the other hand, contributors with less capital will have their contributions decreased.

Logically, the proposal has generated adverse reactions from those affected who are grouped in the National Association of Private Enterprise (ANEP, for its initials in Spanish) and the process of municipal tax reform will be bogged down in a Legislative Assembly commission, but something which is clear about the foregoing is that, in the current state of affairs, no one denies the need to increase municipal taxes in order to implement social and environmental projects. The fundamental difference between the sectors involved is rooted in the amount and the provenance of the additional taxes.

In practice, the dilemma of the source of the new taxes is posed as much by the central government as by the local governments, but it becomes clearer that the salaried sectors are already paying their quota of taxes, including the excessive quotas while the business sector has had its fiscal burden reduced and aims to have the situation continue as it is.

The viability of the country depends not only on its being able to depend on a dynamic private sector with a positive ability to create jobs, but also on its being able to depend on having sufficient fiscal income to finance social development, supportive infrastructure and the cleaning up of the environment in order to obtain the necessary support of the business sector. Aside from being seen as a loss, taxes should be seen as an investment in security, training of the work force, increase in environmental quality and improvement in communications media.

During 1998, the three most important processes of privatization of the decade were reported: the sale of the four electrical energy distributors, the privatization of the pension system and the sale of the National Administration for Telecommunications (ANTEL, for its initials in Spanish).

The privatization of the electrical energy distributors was begun in 1992 when studies of the privatization of the energy sector were begun; it continued with the creation of the four corporations which together make up the shareholders of the distributing companies to be privatized and finally includes approval of the Law for the Privatization of the Electricity Distributors. According to this law, the sale of shares would take place with respect to the following proportions: 75% to foreign investors, 20% to employees of the four distributing corporations and to the Executive Hydroelectric Commission of the Lempa River and the remaining 5% to national investors.

Between the months of September and November of 1997, 20% of the shares to be sold to the workers were sold, on January 20, 1998 75% were auctioned off to foreign investors and, then, the sale of the remaining 5% to national investors on the stock market. According to the versions printed in the newspapers, as a result of the auction of the distributing company, offers of a little more than 586 million dollars were obtained from businesses in Venezuela, Chile and the United States.

The implications of the privatizations in terms of quotas, according to spokespersons in favor of it, were very positive: they would be reduced. However, reality is quite contrary to this assertion, as the legal context of the privatization of the distributors showed. According to Article 122 of the General Law governing Electricity, there exists a trimestral program of increases in prices to residential consumers with a monthly consumption of less than 500-kilowatt hours. So it is that a gradual lessening of subsidies is planned until November of 1999 when the subsidies would be eliminated altogether. Currently, the state assigns a subsidy of 262 million colones to small consumers of electricity. But by the end of 1998 it is estimated that the price of kilowatt-hours would rise from 0.39 colones to 0.86 colones, which implies an increase of 120% in the first year alone.

On the other hand, the General Superintendence of Electricity itself accepts that the price of the kilowatt-hour would be reduced for the sectors which consume more electricity, although without specifying what the amount of the reduction would be. This would basically benefit big and medium-sized businesses, and especially industry.

Fortunately for small consumers, the social movement generated around the project and the intervention of the Legislative Assembly, President Calderón Sol opted to continue the policy of subsidies for the consumption of electrical energy and put off the increases in quotas. Paradoxically, the foregoing would imply that, at least for the moment, privatization would have failed to comply with the objective of reducing public expense. It might be mentioned that in the near future, the Hydroelectric Executive Commission for the Lempa River is contemplating the privatization of the generation of electricity in spite of the fact that this body has denied the fact during the entire last decade.

The privatization of the pension system took place beginning on April 16 when the Administrators of the Pension Funds (AFPs, for its initials in Spanish) began formally to commence operations. By the end of the year, this system had demonstrated success at levels of affiliation higher than 50% of the population affiliated with the Salvadoran Institute for Social Security (ISSS, for its initials in Spanish). Although this is not surprising, because the law governing the pension system raised the quota payments to ISSS to levels such as would indicate that it would be more convenient to move pension funds to the AFPs.

The system is being questioned from all sides, but the most serious is the negative effect on the income available to the worker. The increase in pensions will mean an increase of 300% for the workers as their quotas to the pension system rise from 1.5% to 4.5% with an aggravating factor that the lion’s share of the quota, or 78%, will be lost in the payment of commissions for the AFPs. For the year 2002, the quota payments of the workers will come to represent more than 410% of the current quotas. For 1999, the law contemplates increases in the quota rates which vary between 0.75 and 1% additional. So the total quota payment will increase by 37%.

Another important privatization measure has been that of ANTEL, which was put into effect between last July 17 and 24 after having to confront delaying measures coming, at first, from labor opposition and, afterwards, from changes in the correlation of forces in the Legislative Assembly after June, 1997. And so on July 17 51$ of the state wireless telephone company (INTEL) was sold to the Telephone Company of Spain for U.S. $ 41,009,900, while on July 24, 51% of the regular telephone company was sold to France Telecom for a total of US. $275,lll,000, which yielded a total combined amount of U.S. $ 316,120,900.

Problems with the quotas is also a latent threat here because the very telecommunications law contemplates increases. In fact, the President of CTE/ANTEL, Juan José Daboub stated that for 1998 the quotas will not be increased, but the telecommunications law permits the adjustment of quotas in accordance with inflation rates. The CTE/ANTEL functionary does not rule out the possibility that in 1999 increases may be brought to bear. For his part, Mr. Eric Casamiquela, the Superintendent of the Electricity and Telecommunications Superintendence stated that, beginning with the year 2003, the aforementioned law includes provisions for quotas to be adjusted in accordance with the rate of inflation and the fluctuation in the rates of exchange.

Up until now the funds obtained from the privatizations have not been assigned to any social are as had been offered when the process took place, and it is still not known with any clarity what these funds will be used for. On another point, however, the creation of a national investment and permanent employment creation plan is to be imposed.

At the end of October, hurricane "Mitch" provoked heavy human and material losses along the whole coastal area of the country, leaving more than 200 dead and 50,000 homeless. A preliminary evaluation after the disaster quickly demonstrated that the dimensions of the economic losses could seriously affect production and other macroeconomic equilibrium. This turned out, in fact, to be the case because production fell, prices went up, the importation of foodstuffs increased and public spending grew.

According to data gathered by the National Committee for Emergencies (COEN, for its initials in Spanish), total damage as a result of the disaster is close to 1,159 million colones and the major areas of loss are crops, highways and school infrastructure, in that order. This estimate is in strong contrast with the estimates of the agricultural and livestock associations which fix the level of losses at 1,400 million colones for export crops alone, while the Ministry of Agriculture and Livestock fixes the loss at 800 million colones for the agricultural and livestock sector. This would imply that the direct total losses would easily be greater than 2,000 million colones, close to 2% of the GNP for 1998.

It should be noted that even greater and continued effects of this disaster must be expected during 1999 given that only two months have passed and, in practice, the impact of the disasters on production will have a medium-range as well as long-term effect.

With respect to production, 1998 has been a hopeful year. For the first time in several years, industry appears to be an important dynamic force for growth, although we are speaking here of the maquila industry. Nevertheless, the structural crisis in agriculture must be lamented once again and this includes not only political and economic aspects, but also the impact of disasters. Internal price controls by means of control of the monetary supply has become the principal anti-inflationary policy of the government, presenting apparently positive results, but which have as a side effect the reduction of financial resources available for investment. Likewise, the same situation of dependence on family remittances in order to maintain macroeconomic stability remain in place and, for this very reason, exporting sectors in the country continue to flounder.

Privatization moved ahead in leaps and bounds during 1998, but doubts about the effects of quotas and the well-being of the national population are still in doubt. The only thing that is clear is that new areas have been opened for economic accumulation for national enterprises as well as for transnational enterprises.

Apart from "Mitch", 1998 was not a year different from other years because moderate growth with economic stability and dependence on family remittances continued. Nevertheless, this situation cannot be sustained indefinitely as it does not represent a solution to the problem of underdevelopment. What it does offer is the opportunity to develop sectors which generate exportation of jobs by means of an investment policy in the agricultural, livestock and industrial sectors, which could be developed in a context of relative social and economic stability.

SOCIAL BALANCE 

Although disheartening events have occurred during 1998, such as continuous and persistent errors in the struggle against delinquency or the presentation of important projects for the city by purely "interested" politicians, there are some optimistic indicators: these are especially related to the awakening of citizen participation and the collaboration among previously opposing, if not irreconcilable, forces. For this reason, it is important to highlight the events and the way in which such events have permitted these new situations to arise. Moreover, taking into account the every greater possibility that ARENA might occupy the presidential office for the third consecutive time, it is perhaps relevant to evaluate the social dynamics which could act as a counterweight to a government administration which it may not be possible to distinguish in any significant degree from preceding administrations.

This article, then, will evaluate what characterized the year 1998 as a first point, with respect to the struggle against crime; then, the most important events related to the process of re-ordering and improving downtown San Salvador will be detailed; and, finally, the dynamics which point to a resurgence of citizen participation in social matters will be presented.

After more than two years have passed since the number one item on the public agenda of points for discussion has been the fight against crime. Much has been said about crime —perhaps too much— without there having been an overall vision outlined which would satisfactorily and coherently explain the causes, manifestations and consequences of crime —be it common crime or organized crime. The topic has been dealt with in a biased way in which are to be seen admixtures of with intentions and motives alien to what the problem requires in order to be understood and dealt with in such a way as to find a solution. What is plain as day has been overlooked: no plan or measure which could be applied to the situation will present the necessary solutions for stopping crime as long as there is no coherent overall vision of the phenomenon.

 But in El Salvador the problem goes even beyond the absence of this very essential element: the government, in its eagerness to commercialize the country abroad and make its administration shine, against all logic and reason, has been reluctant to recognize the real magnitude and dimensions of delinquency; it has also minimized its responsibility as a government in the struggle against crime.

Given the lack of vision and the clear direction which would link up the his work, the National Civilian Police (PNC, for its initials in Spanish) as well as the Supreme Court or the judges knew only how to set in motion a mass of entangling legalese, contradictions and mutual accusations. When the news media pointed out that it was the incompetence of the judges that created the situation in which the PNC could not comply with its mission, the first attacked the scarce and limited preparation of the police agents and the ignorance of these agents concerning procedural norms coherent with the law in order to apprehend a criminal. On the other side of the coin, when the news media or the President of the Republic pointed their accusing fingers at the PNC or the Ministry of Public Security, both argue against the penal codes and the judges defended the rights of criminals more than the rights of the population, thereby tying the hands of the PNC in their efforts to pursue criminals.

A factor that complicated the problem even more was the pressure applied by the new media in its pretended role as the agent with the mission of channeling the urgencies and necessities of the citizenry; the attitude assumed by the government agencies responsible as they dealt with this news media phenomenon.. Given this state of affairs, acritical attitudes and political manipulation of public opinion were pushed dangerously in the preponderance and forefront. On the one hand, governmental agencies, in the confusion and lack of knowledge of the problem of crime which characterized them, were especially vulnerable to the signals emanating from the press and public opinion. Perspective was lost regarding the fact that public or citizen opinion as well as the opinion of the media are not always the most qualified to discuss and evaluate the validity of conceivable measures which might be applied in the fight against crime. Certainly, the voice of the citizens ought to be taken into account at the moment when these matters are to be discussed, whatever the matter under discussion might be —especially among those whose forms of daily living are affected—, but this voice ought not to be substitute for technical analysis and serene and lucid reflection.

Another, and complementary, evaluation is that this vulnerability was fed in good measure by the politicizing of the national questions. The "wishing to be well received" won ought over the "need to act well" in the political parties as well as in governmental agencies, be it with the aim in mind of winning votes or ingratiating oneself into the favor of public opinion, many of the social actors involved in the struggle against crime did not hesitate to become the champions of citizen demonstrations and demands, even when these have been found to be, on no few occasions, irrational and unfounded.

One of the most notable examples of this tendency was the deployment of the army onto the streets. Although it is true that, from the beginning of the year —even since 1997— President Armando Calderón Sol, echoing the requests of the populations, had been contemplating the idea of deploying the army in rural patrols to the cities of the country, with a National Emergency decreed as a result of hurricane "Mitch", the measure was finally put into effect: the Armed Forces deployed troops on the principal streets of the urban areas. As might have been foreseen, the effect of the deployment of the Armed Forces in the cities was minimal and irrelevant, especially given the fact that crime is growing on the level of sophistication of their modus operandi.

Eventually, the deployment of the army on the streets was more a result of a desire to be well-received by the population than of calm analysis of its relevance in an effective strategy of the struggle against crime. Had this analysis been made, the analysis itself might have anticipated the fact that the army would not impact crime in such a way as to reduce it in the least, principally because it lacks the minimal training on the question and because its legal condition does not enable it to make arrests unless it is in the same way that any citizen may make a citizen arrest. At bottom, the mistaken idea persists that one of the reasons why the fight against crime is the lack of personnel to cover the whole of Salvadoran territory and so prevent crime wherever it may take place. This being the case, the army was not deployed on the streets of the cities because of its ideal capability for fighting crime —a fact that surely was never analyzed —what appears to have been taken into account was only the number of soldiers which made up the army.

This last consideration withstood the burden of proof when it was observed that, throughout the year, the PNC had been submitted to heavy pressure to broaden its coverage of the national territory. At mid-1998 (see, PROCESO, 812) when this pressure reached its limits, high police authorities were asked to cut their vacation periods short in order to assure a presence of the greatest number of police agents in the streets and in the PNC barracks. In the adopting of this measure two fallacies were committed: the first fallacy was that what is needed is to strengthen the powers of the PNC to pursue criminals and not their investigative and intelligence abilities; and, the second is that the struggle against crime can be resolved by a simple quantitative problem in the PNC (work hours, number of police on the streets, area covered by PNC) and not a qualitative one (their need for high-tech equipment and training in criminal and penal areas).

Perhaps the greatest fault pas committed during the whole year on the question which concerns us was the offensive, in which the Ministry of Security, the executive branch and the private enterprise associations took up the banner and which was fed by alarmist and unrealistic news reporting, against the new Penal and Procedural Codes. For their detractors these codes not only did not respond to Salvadoran reality, but even obstructed the work of the PNC and favored the criminals. This situation provoked a tiresome and fruitless confrontation between the Justice Ministry, the Legislative Assembly and the rest of society —a confrontation in which the effects of the codes would have in the slow and inefficient judicial system of the country and the correlation between arrest-sentencing-incarceration of criminals were completely lost from sight.

The heated polemic which was unleashed on the question of the codes obliges us carefully to review what is to be understood when one speaks of providing arms with which to fight against crime. In the blind closed and isolated way in which this question was handled, the application, from April of 1998 on, of the Penal and Procedural Penal Codes were perceived as obstacles to police being able to act well as a demonstration of the lack of solidarity which exists among the agencies responsible for applying justice with regard to the police agents who arrest the criminals. This is a grave and serious error, although the position expressed is entirely coherent with the deformed and simplistic vision which government and agencies have taken with regard to the problem of delinquency.

Only in a context in which there are no existing visions or global and integrated plans for combating the crime wave is it possible for legislation which aims to make justice prevail to be seen as an element contradictory and harmful to citizen interests. For the way in which the discussion concerning the new codes has been focussed, justice will be dead as an idea from the moment in which the police capture someone who is suspected of having committed a crime, given that the eagerness to exclude him or her from society will weigh more heavily than proofs and procedures which might validate his arrest and jailing. It may not be such a wild or irrational idea to expect that, parallel with the reign of violence which delinquency has installed in our country, a judicial system might be developed which will lack the mechanisms to detect and remedy arbitrary acts and procedural equivocations.

It would be difficult to draw up a balance sheet of the social dynamics in effect during 1998 without first evaluating the administration of the Mayor’s Office of San Salvador, presided over by Dr. Héctor Silva. This for various reasons. In the first place because the destiny of San Salvador, at least in the short and medium range vision of things is intimately linked with the progress (at the level of works and projects carried out) that were implemented by the mayor in the course of his work. In second place, because Dr. Silva’s municipal term of office in taking up this style of administration (which has aimed, basically, at consensus-building and openness to dialogue with the social forces of the city) presents itself as an important element for unleashing some of the dynamics which San Salvador needs. This is to say, it is not only a question of the projects which Hector Silva carries out which are important, but also the success obtained in his goal to include in them the whole conjunct of capital city social forces, something which is really new in the recent history of the country.

As has been pointed out on previous occasions (see PROCESO, 805), the two first and primary obstacles with which Silva has had to deal in order to place his administration in motion have been: on the one hand, those related to the lack of the necessary economic resources to finance the works and projects which the city needs; and, on the other hand, the frontal opposition of big business and private enterprise as well as the government to his projects —opposition which finds its explanation in a political reading which can be made of this left municipal administration. In this sense, when hard-line business impresarios or the government vetoed one after another of Silva’s projects they did not do so after evaluating the degree of appropriateness of these projects for resolving the pressing problems of the city. They opposed these projects, rather, because of the political capital which the left would marshal for having brought these projects to successful fruition.

So it is, then, that the dispute, at least from the point of view of those who oppose Héctor Silva, did not spring from the desire to find the most adequate solutions to the ills from which the capital city suffers; it sprung, rather, from a zeal to boycott the administration which, for all of its successes, could be used by the left in the presidential elections of the upcoming year (political capital which, paradoxically, was thrown away by the FMLN itself as it cut short the pre-candidacy of Héctor Silva in the presidential formula which it would present to compete in those elections).

During 1998 the mayor and his team, demonstrating praiseworthy patience and perseverance, succeeded in good measure in overcoming both obstacles. Those of a financial nature were resolved, principally by means of an administrative restructuring of the mayor’s office, an increase in municipal taxes charged for services rendered, the modernization of the tax collection system, a policy of building sister-city projects with other capitals cities of the world (which translated into treaties for cooperation and exchange of technical know-how) and the assignment, although not without its problems, of 6% of the national budget for the mayors of the country.

One of the projects which produced the bitterest controversies and confrontations must be mentioned together with the confrontations they caused for Silva during 1998: the bill to present the Law governing Municipal Taxes for San Salvador (See PROCESO, 791, 793 and 800). In brief, the project aimed to substitute a regressive tax collection modality (in which those who have more pay less and those who have less pay more) for a progressive tax scheme (the reverse of the tax structure just mentioned.) Changes in the tax structure which the Mayor’s Office attempted to implement could have implied, among other things, that: the total collection would rise from 57 million colones —the current level— to close to 237 million colones; the mean level of municipal tax rates would be 0.36% on the value of business profits, against 0.18%, 0.16% and 0.04% which was the mean level of taxes paid by commercial and industrial enterprises and financial agencies, respectively; and that, in the context of the new municipal tax rates, 5697 businesses would pay less and 814 would pay more. Of these last, 314 would confront increases of between 500% and 1700%.

The project failed on two occasions. The first, at mid-year, after the negotiations between the Mayor’s Office of San Salvador and the businessmen broke down and, the second, at the end of 1998 when there was attempt to carry it to the Legislative Assembly for its approval but this failed because the project failed to obtain the number of votes necessary to carry it. In both cases, ARENA, the government and the printed press owing to the fierce opposition shown by the private enterprise associations, openly supported the failure. The business groupings argued against the project that this would imply a loss of capital to the businesses and a fall in employment, increase in the costs of production and inflation and finally it would be counterproductive for the economy and for the Salvadoran pocketbook.

Similar to the destiny of other mayor’s office projects, what broke the luck of this one was the decision of a sector of the country not to back down a single step against the political force of the opposition, even when it implied throwing out what could have been converted into an efficient source for financing the necessary measures for renovating a city which was falling under its own weight of the ills and apathy of its inhabitants. Moreover, the business sector made clear that its supposed commitment to build a new El Salvador did not imply —nor could it imply— that the greater part of the economic cost of the project would be at its own expense.

Without doubt, the great success of Héctor Silva in 1998 which opened the doors of the sympathies of the population and brought him general recognition, even from his bitterest opposition, was the Plan to Renew the Historic Center of San Salvador (See PROCESO, 822). This is the expression of a municipal initiative to make of the capital city a clean and safe place to live together. The Plan, supported by the Plan for Citizen Tranquillity of the Metropolitan Police Agents (CAM) which aimed at reordering the downtown area of the capital city and rehabilitating its historic arquitecture, translated, in the last six months of the year, into the relocation of a large number of street vendors who occupied some of the principal streets of the Capital city.

Included in the Plan, was the relocation of the street vendors in the Plaza Morazán and the recuperation and remodeling of this plaza, a result, which marked the turning point in the Silva administration from that moment on. This happened in such a way that, thanks to a good part of this initiative, private enterprise was obliged to reconsider its previous attitude and give its support to the mayor’s plans. Silva, then, in this way, achieved a double objective: it set in march, beginning with the right foot, his project to make of San Salvador a city which was more inhabitable and, at the same time, succeeded in injecting into the project some of the social forces with the greatest dynamism and influence.

As the fruit of this truly new situation, Mayor Héctor Silva and the leaders of the most important business guilds of the country (ANEP, ASI, the Chamber of Commerce) signed, in October, the minutes describing the formation of the Corporation for the Development of San Salvador (SEM, for its initials in Spanish), a private body of mixed economy the objectives of which were: to organize, promote, plan, coordinate and implement projects for the urban development and rehabilitation of the down town area, among other things (see ALPRESS, "Silva and Business grouping sign acts of incorporation", October 28).

It would not be very objective to assign as the cause of this promising step in the (re)construction of San Salvador to the good will of the business community alone —which to date had shown no sign of rationality than to defend its own profits— and the success of the eviction of the traditionally virulent and short-sighted street vendors. The state to which the mayor’s office’s relations with other sectors of the population had come was owing more to the fact that this was perceived as the just result of a disinterested, open and transparent labor, in which the enthusiasm for dialogue and concertation was ever present.

Mayor Silva is not an agile politician, a fact that he has demonstrated on sufficient occasions throughout the year (his eagerness to insist on the reform of the municipal tax rates when he did not enjoy the legislative votes necessary to approve it and his rush to announce the sister-city project of San Salvador with Havana without taking into account the foreseeable opposition which this would generate from the right-win elements of government are examples of this). He is, however, a Mayor of a new kind, really interested in the city and its problems. It was this which finally ended in tipping the balance in his favor and so permitted 1998 to be a good year for the mayor as well as in such a way that it laid the foundation so that his work could be carried out with more support than blockages against him, so that it was a good year for the city as well.

Aside for the mayor’s office, one of the projects of the greatest magnitude. That of putting San Salvador in order came from the central government by way of the Ministry of Public Works (MOP, for its initials in Spanish). So, in the first six months of 1998 what should have been a project initiated in stages and in a reasonable manner some years ago was set off in a hurried and simultaneous way: this was and is the construction of several overpasses, one of the principal parts of the plan to reorder vehicular traffic in San Salvador. The results were astonishing: chaos and traffic jams of huge proportions on the principal streets of the capital city.

The use of detour routes and other efforts by the PNC to regulate traffic through those streets which had been partially or totally closed because of construction were measures insufficient to remedy the congestion that the construction of the overpasses caused —and in those sectors where it is still not finished, continues to cause. Certainly the problems of vehicular movement were to be expected, given that in the city the streets are narrow, one-way (in some cases alternate routes exist); through these circulate a greater and greater number of cars. But the way in which MOP planned the construction of the overpasses demonstrated, in many ways, a lack of judgement. So much so that the Vice-Minister for Transportation requested the delay in some of the constructions given the imminent collapse of vehicular traffic in San Salvador.

The reasons which MOP presented for justifying this were not convincing (one argument being that the loans for financing the projects had recently been obtained and these should be carried out simultaneously in order not to wait four or more years to finish the project). This was especially true when it came to light (and was presented in a report by the news daily La Prensa Gráfica) that MOP underestimated the recommendations of the Master Transport Plan for the Metropolitan Area of San Salvador (PLAMATRASS, for its initials in Spanish), designed by Tahal, an Israeli consulting firm. Originally PLAMATRASS proposed the construction of the overpasses within the compass of four years, or between 1998 and 2002. More serious still, the Master Urban Development Plan (PLAMADUR, for its initials in Spanish) which laid out the plans for the capital city (PLAMATRASS) recommended the overpasses only as a second level measure which should be preceded by orientation on the growth of the city towards the north (towards Apopa and Nejapa) together with the construction of a peripheral metropolitan circle.

Given this evidence, one can only affirm that in the construction of the overpasses, the goals to be completed have been more related to political questions than to criteria related to urban engineering. On the contrary, it would be difficult to explain the reasons which motivated MOP and the central government to propose short-term goals for the construction of such a large number of works, the reason for not taking the recommendations of experts into account before launching into hurried construction projects which comes into contradiction with what ought to be done to arrive at an integrated solution to the traffic problems of San Salvador.

It is obvious that the path to straightening out the vehicular chaos of San Salvador must pass momentarily through periods during which this problem is exacerbated. So it is then, that an increase in bottlenecks and gridlock and extreme difficulty in transportation is the price to be paid for getting rid of both problems. Nevertheless, that this, in some degree, ought to be so does not serve as an excuse for not carrying out a well-thought-out strategy for vehicular reordering which responds more to the urban needs of the capital city than to interests alien to this vision. In this country, politics and rationality are mutually exclusive spheres; the project which MOP is carrying out is only one more manifestation of this.

In last year’s evaluation we finished by saying that 1997 had been a poor year for citizen participation and that apathy and skepticism had become endemic ills among the population. On the one hand, the unions had lowered their profile almost to the level ceasing to exist as a result of the privatizations and the lack of power to group together credible platforms of demands; moreover they showed themselves to be incapable of freeing themselves from the sectarianism and polarization which characterized them during the period of the civil war. On the other hand, the population was unable to find a motive for making public pronouncements or for participating actively in socially relevant tasks.

During 1998, the presentation of the document BASES FOR A NATIONAL PLAN, drawn up by the National Commission for Development and the beginning of actions by the Doctors Union of the Salvadoran Institute for Social Security (SIMETRISSS, for its initials in Spanish) when faced with the stagnation of negotiations with the leadership of ISSS, marked a highpoint for citizen participation. There is no doubt that the launching of the document BASES was one of the most important events in the year. In the first place, because it aimed to constitute a binding factor in the process which, through consultation with the citizenry and their participation, culminated in the designing of the PLAN FOR THE NATION. In second place, because in this document a diagnostic of the country’s reality was carried out on the basis of which thematic points for solution were proposed, with an eye to changing the direction of El Salvador and constructing an integral, just and egalitarian nation. Finally, because the document succeeded in attracting the attention of sectors of the population, the majority of whom did not hesitate to support it.

Nevertheless, on the question of social participation, BASES is not interesting in its diagnosis —in which there is much to be discussed and some deception— nor for the results which follow from it —after a year, it is impossible to affirm that the good intentions and recommendations of the document have taken on reality in the political and economic actors f the country— rather, it is in the interesting because of the process which it generated. The document BASES, during the phase in which the population was consulted about it, has brought the discussion of the problems of our society closer to the population, and has permitted common people to express their concerns and their suggestions on what is necessary to be done in order to achieve a better state of affairs for living together.

Although on the question of citizen consultation some of its initial proposals have been betrayed and some of the central points of the document have been left without being discussed, although the Administrative Group has not had any public presence, the process initiated by BASES has sown the seed for a change in attitude on the part of citizens by making them participants in the design of policies which could govern their lives in a not too distant future. So then, the success of the enterprise initiated this year will depend on how much and in what manner the concerns of the citizens might be gathered and reflected, in the elaboration of the final NATIONAL ACCORD ON THE NATIONAL PLAN.

With regard to SIMETRISSS, the union complied with the expectations awakened at the end of 1997 when the demands presented to the authorities of the Social Security Institute had been made known publicly and a series of broad and wide-reaching and important demands been published. SIMETRISSS became a new phenomenon for various reasons: (a) made up of a group of professionals, it demanded of the government a maximum platform of demands and interests belonging to the medical union, a platform which called for structural reforms to a health system in crisis and which, therefore, translated into deeply-felt improvements for all Salvadorans who use the service; (b) throughout the whole thorny process which ended without the signing of an agreement between the doctors and the government, the union knew how to maintain itself, even in the hardest moments of its actions, separate from political interests alien to its objectives; (c) for the way in which it proceeded and the strength of its demands, SIMETRISSS succeeded in attraction solidarity from a great number of social organizers of diverse persuasions, something which had not been seen in this country since the period of the war; and (d) the medical union led with success one of the longest and most difficult trade union struggles in the recent history of the country, setting, with this struggle, a precedent for civil participation in matters concerning the country because since the signing of the Peace Accords, no social organization had succeeded in making the government cede to each and every one of its demands.

It is not that SIMETRISSS is the only union to give new life to citizen participation because ANEP generated and participated actively in citizen action against delinquency. What differentiates the first from the second is, basically, its apolitical character and the dimension of its demands. While ANEP maintained little independence from the central government and in the campaign it carried out were to be seen its particular interests over and above those of the population in general, SIMETRISSS carried out a struggle which, while confronting the government agencies in charge of health, was not linked with the political opposition and always argued for a substantial transformation of a service vital for the population.

Even more important, in a context in which union struggles virtually supine because of its lack of credibility and because of the opportunism which generally characterized it, the case of SIMETRISSS became an example of what a citizen initiative could achieve when its objectives are clear and just and its action decisive. Although there are indicators that the government may not comply with some of the points agreed to with SIMETRISSS and the Social Security Institute, a state of affairs which has already provoked a situation in which the union might declare the possibility of returning to the streets and initiate a series of escalating labor stoppages, the lessons which SIMETRISSS has left for social mobilization and citizen participation are priceless.

On the social level, the most important advances during 1998 have been the setting into practice of the necessary measures for re-ordering and making San Salvador a more inhabitable city and the insertion of this effort into the most determinant sectors of the society. Although they were obliged to pass through innumerable obstacles to achieve it, the pact between the Mayor’s Office and the Private Enterprise associations opens the way for collaboration which very probably will present concrete and satisfactory results during the year recently begun. On a complementary level, the National Commissioner Development has laid the foundation for the population to participate in national affairs, for it to abandon its skepticism and apathy and collaborate actively in the construction of its own future. Up until this year, words such as consensus-building and dialogue were only dead letters finding little or no reflection in daily reality. But this situation is beginning to be modified, although not with sufficient speed for the changes which the country needs.

It is also to be considered a relevant event that the Mayor’s Office of San Salvador succeeded in becoming not only an administrator of a city which complained of serious problems but has become a linking element among the social forces which live in the capital city. As seen in 1998, the social development of the city necessarily passed through a policy that attacked, with an adequate technical focus, its ills, implicating in this policy the social actors directly involved in these policies. Evidently, the tasks which have been pending are many. In order to resolve them it is necessary for private enterprise and the sectors representing economic power to broaden their cooperation to include the financing of projects, ideas to which they have been complete opposed up until the present time. In this sense, it is the responsibility of the business associations to collaborate in the loosening up of the discussion on the Law governing Municipal Taxes in San Salvador, which, should it be approved, would constitute the material basis for the projects which the capital city needs.

On another point, the experiences of 1998 demonstrate that on the question of fighting crime not a thing has been learned. Not only does El Salvador continue to lack an integral policy to deal with he problem, but it has, moreover, maintained the dangerous tendency of holding the laws responsible for diminishing criminality. Added to this, the pressure that private enterprise has exercised on judges in the resolution of some of the most difficult cases and in the discussion of the Penal and Procedural Penal Code have complicated the situation even more. The campaign mounted by private enterprise, although for noble ends, is offering nothing in terms of rationality and clarity with regard to resolving the problem; it is, rather, strengthening the idea that faced with crime it is necessary to implement Draconian measures. A dangerous road has been chosen.

Pending during the upcoming year is the culmination of the process begun with the document BASES and the compliance with the accords reached between the government and SIMETRISSS. Upon the way in which the first is implemented will depend the possible incentive of the population either to continue participating actively in order to influence its surroundings or return to its previous attitude, having now a clearer and closer reason for doing so. Upon the second will depend a good part of the social stability during the coming year. If the government does not comply with what it promised, it is reasonable to expect that SIMETRISSS will again have recourse to strikes and street demonstrations which will place in danger the population which must use the health services.