Center for Information, Documentation and Research Support (CIDAI)
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Central American University (UCA)
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     Proceso is published weekly in Spanish by the Center for Information, Documentation and Research Support (CIDAI) of the Central American University (UCA) of El Salvador. Portions are sent in English to the *reg.elsalvador* conference of PeaceNet in the USA and may be forwarded or copied to other networks and electronic mailing lists. Please make sure to mention Proceso when quoting from this publication.

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Proceso 970
October 3, 2001
ISSN 0259-9864
 
 
 
 
 

INDEX

Editorial:  Hypocritical disapproval and condolences
Politics:  Businessmen take control of ARENA
Economy:   The budget proposal for 2002
Comments:  Ignorance and bad intentions
 
 
 
 
 
 

EDITORIAL

    The two most important political parties keep making the same mistakes since the terrorist attacks against the United States. However, an emphasis is made on the idea that the FMLN is the one that is constantly making the wrong moves, and that ARENA is the one that behaves correctly. None of them has been to the level of the circumstances and, contrary to what it might appear like, maybe ARENA is the most disrespectful one about the pain of the United States. The FMLN, besides condemning the attack and presenting its condolences, has expressed its ideas about the United States imperialism, however it has done that in a bad time and inadequately. There is nothing new here, and it is an advantage that everyone already knows what this party thinks. Now everyone already knows about its lack of human, political and diplomatic sensibility. Instead, ARENA, appearing as if it deeply cares about the victims and that it remains faithful to the United States policies, it takes advantage of the situation to accomplish its local political interests.

    The FMLN has made a series of mistakes because it ignores how to face, from a human, political, and ethical perspective, the September 11th events. That is what the FMLN displayed in the streets of San Salvador side by side with the ones who approve of terrorism, it addressed itself to the American Embassy with inappropriate terms, at a very inopportune time, and it still has not been able to express its ideas about this event in a consistent way. To make things even worse than they already are, instead of correcting its error, these have become excuses to go deeply into the internal division of its members, which are magnified by others from outside the party. Its own divisions do not allow the FMLN to see and seriously analyze what is going on around them. In the best of the cases, it looks outside its ranks. This explains its false steps and its internal paralysis, which do not allow it to act with determination about the national problems, specifically about the militarization of several public areas, next year's budget, and particularly the dangerous debt of the state.

    ARENA has not behaved too well either. It has constantly repeated the official speech of the United States, as well as the one of the most important media enterprise, which is at its service; however, that is only an excuse to attack its traditional political adversary. It is a manipulation of both the victim's pain and the United States' external policies. That is the explanation of why it connects the FMLN with terrorism. This was a relation that was very much used in the past. Then again, how is it that now, it ignores the terrorism acts committed by the state and the death squads, which are linked to the army, to the party itself, just as it is demonstrated in the report of the Truth Commission, among others.

    ARENA is so blinded by its ideology that it cannot act without attacking its most important adversary. This might be an advantage from the electoral perspective; however, it is not an advantage if it is considered from a point of view of the country as a whole.  There are issues that cannot be and that should not be treated from the political parties' or the electoral perspectives. Terrorism is one of them. The national budget and its deficit is another. Probably now that people with a considerable amount of money have taken over the ARENA leadership, replacing the politicians that had a very little sense of reality and that were prone to more emotional reactions, which respond to outdated ideologies and to a good doses of ignorance, things might change at the right-wing's main party.

    Both political parties are very opportunistic. They have that in common, although one is worse than the other. However, none of them will gain significant advantages with such an absurd attitude.  Once they were gathered at the Legislative Assembly, both of them dedicated many hours and energy to insult themselves, calling each other, irresponsibly, "taliban" and "death squad hit-man". They can do that because the truth about what happened in El Salvador has not been totally revealed. When they insulted each other in   this way, they showed their lack of political maturity to confront the national and the international reality. In the middle of the insults, they proposed to integrate a commission to investigate the possible terrorist relations of the Salvadoran political organizations. This proposal is as familiar with the work of the deputies as it is useless. They always want to investigate.

    They are not convinced yet that their investigations have been useless. It is a waste of time at the expense of the taxpayers. Instead, they should find out why the Attorney General's Office and the National Civilian Police do not investigate. Both of these institutions that are legally in charge of investigating, up to this day, have been as incompetent as the Legislative Assembly itself, however, with an important difference, this duty does not concern this last institution, its obligation is specifically to legislate; for the latter, investigation is one of its most important duties.

    The right-wing's press releases, which have been immediate, condemn both the terrorist acts against the United States and the FMLN. All those press releases follow an identical pattern, and they are nothing but excuses to condemn the FMLN under the shadow of the international terrorism and the condolences to the American Embassy. In other words, this is nothing but hypocrisy. If only the business elite, who have taken over the direction of ARENA understood that their main threat does not come from the FMLN, but from the governmental policies that they blindly support, things could change. Its local investments would be safer and they would be more profitable at a long term period, if the country substantially improves its economic, social, and political performance. The main threat for their assets established in El Salvador comes from poverty, the economic vulnerability and the environment, from the social instability and from a lack of a more human and ethic reason.

    The media has contributed in an active and conscious way to this double campaign of excluding the FMLN for being a terrorist, and presenting ARENA as the only democratic option. In such "quest",  El Diario de Hoy  "corrected" the FMLN's declarations, adding a word so that instead of "states" —the plural of the name state— it would say "United States". This way, the FMLN would end up saying what the newspaper wanted them to say. And so that there would be no room for doubt, it repeated the same operation in another part of the text. On the other hand, these media display the names of the Salvadorans who are being mentioned in the investigations that the United States authorities are carrying out. It is an hypocrisy to be shocked because in a school parade a child was disguised as a terrorist —who was also executed by the good forces, represented by the United States— when that is the idea that the media spreads out.

    Very few people have doubts whether if ARENA is a political party whose main objective is to conquer more power, in order to guarantee the interests of its most important members: the national business elite. Beyond the objective of arriving to the political power, the debate turns itself into a shallow affair. If it is accomplished through free, transparent, democratic and competitive elections, nobody contradicts the actions of the political parties. Instead, once the power is conquered there is not so much unanimity left when it comes to answer questions such as who will receive the benefits and whose interests will prevail. From that moment on, the debate about the government's ethics starts.

    During the last weekend, a group of businessmen, which was leaded by Roberto Murray Meza, a beer industry businessman, took control of the COENA, the most important decision branch at the official party. The arrival process of the first person designated to take over the Republic's Presidency, in order to direct the destiny of ARENA, is a long and complicated issue; however its most important moment would have to be Walter Araujo's resignation, in July, to keep the presidency of the party. Ever since then, the speculations and the and the division that threatened the structure of ARENA finally ended. He surrendered himself to the businessman persona. The founders, such as Mario Acosta Oertel, accepted the leadership of "the one recently arrived", to enhance their will to collaborate with the official party.

    However, two months later, Murray Meza surprises more than one individual. Instead of attracting the different sensibilities, just like the sectors in conflict of his party expected, he decides to surround himself of other important businessmen, brushing aside, for instance,  Mario Acosta Oertel and other leaders of the founders' movement. It is about —says one of the members of the new COENA— "organizing the greatest business company of the country, the ARENA party". The confidence on accomplishing such task is based on the fact that they are "capable of administrating and they are successful people".

    It is evident that Murray Meza’s move and the new leadership that he intends to consolidate inside ARENA are not a bet for the solution of the main problem that developed inside this party after the last electoral results. By questioning their numbers during last March’s elections, some ARENA members started to criticize their party’s lack of democracy and the dreadful way the country was being managed. They even put on the spot the economic management model, which gives privileges to the bankers and the groups that belong to the financial system. Today, however, about the question for the internal democracy and the legitimacy of the economic policies, Murray Meza responds with the political promotion of a group whose only credential is their economic success.

    It yet remains to be seen if this is the way to calm the wind of division that blew inside ARENA. People will have to wait to prove if the argument about the economic success also convinces the other business groups, who until this day are still unhappy with the economic policies of the ARENA governments. For the moment, what can be said is that Murray Meza and his team are using, to convince the nonconformists, an elitist language   that makes the economic success the only criteria to measure the qualification or the disqualification of people. A popular proverb says that “for the wedge to hold tight, it has to come from the same tree”: the near future will show if this saying can be applied in the case of the unhappy ARENA members.

    This will be the only way to know if both expressions “renovation” and “the new way to deal with politics”, that have been mentioned many times after last year’s electoral disaster, are opening new pathways inside ARENA, or if they just refer to the new make-up that the La Constancia beer company’s president (who also holds shares of who knows how many more other companies) is applying on it.

    In the mean time, the creation of the new COENA, exclusive group of bankers and the elite businessmen, sets a whole line of questions that are related to the political-ethic issue. One of the doubts that casts upon the public administration for the rest of President Flores’ administration is the possibility to establish some distance between the exclusive interest of the business elite that are part of his party’s dome, and the constitutional obligation to examine from a nation’s perspective the problems that afflict the country.

    It is no secret for the Salvadorans that the ARENA businessmen usually see themselves as the people who hold the most important values of patriotism, love to the nation and human fraternity. In this way, the three governmental periods of the official party, among other things, have contributed to strengthen the myth that the businessmen’s interests are very similar to the ones of the rest of the Salvadorans. Over this belief, the governmental economic policies have been legitimated, independently from the damage that they have caused in the economy of the Salvadoran families. In this wide variety of private business and national interests, when it comes to discuss problems such as poverty and social exclusion, they turn to the patience speech as the ideal way to let the country slip into an abysm. In the meantime, the businessmen, through their political party, try to get more involved with the national political life, in order to obtain better profits for their companies.

    Knowing the identification between the political and economic decisions that the ARENA governments make and the orders of the national businessmen —together with the variety of both the national and the private companies’ interests—, the scenery that is being offered to the society is considerably somber. There are no signs of how a certain balance of the power will be achieved —mostly because of the situation in which the left-wing is. It is not evident either how the situation can change during the rest of the Flores administration.

    Therefore, it can be said that the arrival of the financial economic sector to the ARENA direction obeys to a business ambition of having more pressure capability and more presence in the political decision circles, in order to accomplish the application of their economic assumptions.

    On the other hand, it is also known what that asphyxiating presence of the businessmen in the political decision circles has produced, as far as the corruption of the public apparatus is concerned. In fact, not without a certain grief it has been observed how, in the last years, institutions such as the judicial system, the Attorney General’s Office or even the Comptroller’s General Office keep languishing because of problems such as corruption, crime prosecution and the administration of justice. In all that, the influence of the business elite at the circles of power has played an important role. That is the reason why, for instance, the Attorney General’s Office has not been able to investigate the cases of the stolen fertilizer and the telephonic espionage, among others.

    In summary, the weight of the businessmen’s intervention in the country’s politics has contributed, mostly, to increase the levels of poverty, social exclusion, corruption and the institutional weakness. The fact that they keep getting more involved in the direction of the official party does not predict a brighter future for the Salvadoran society.

    During the last few months, two important situations have emerged in the public finances’ field: first, how the Minister of the Internal Revenue Service, Juan Jose Daboub, brought to the attention of the public institutions the issue of reducing their regular expenses in a 15%; and the impasse in which the approval of the new loans and the bonds emission to finance the fiscal deficit is. Although it could still seem questionable, the observation that El Salvador in involved in a fiscal crisis —since the deficit level can still be financed as it is—, the truth is that the recent tendencies and the future sceneries show that the country is closer to that situation.

    Daboub’s designation as the Internal Revenue Service Minister was made in a moment in which the fiscal deficit had already accumulated serious increases, and in which —as a result of the disasters caused by the earthquakes— an even higher increase was expected by the end of 2001. In fact, the regular expenses’ reduction objective, and the transformation of the short term debt into a long term debt, which the government operates, is an evidence that the public finances are not doing well.

    The presentation of the nation’s general budget for 2002 was marked by this context, and that was why it is important that —despite the austerity advise— the budget contemplates a 7.4% increase in the regular expenses, and a 32% for investments. The total budget (including the regular expenses and the capital ones) would suffer a 13% increase during that year. If this proposal is approved, the increase would reach higher rates than the ones reached on the last three years: in 1999 it was increased in a 3%; in 2000, 6.7%; and in 2001, 6.4%.

    On the other hand, at the time that the government’s budget proposal was divulged, it was also revealed that this one needs the Legislative Assembly’s approval to issue bonds for $470 million to finance the deficit. Because the government still does not count with the necessary votes to issue the bonds, Daboub has told the deputies who oppose —specially the FMLN— that “they have a responsibility with the country: to take advantage of the present situation of the international market to place the bonds that the Salvadoran need”. By saying this, he seems to suggest that the fiscal problem is in the bonds emission.

    Without going into the details about the distribution of the budget by administrative units, it is worthwhile to examine in very general terms which will be the behavior of the regular expense and the investment, and finally, the evolution of the payment of “general obligations and debt”.

    In general terms, the government would have not accomplished its goal of reducing the common expenses in a 15%. However, it is important to mention that it did achieve a 4.6% reduction for the present year. Fortunately, this reduction would not affect the education and the health sectors, which would increase their budget in a 29.8% and 15%, respectively. The most significant reduction has been at the rest of the state’s institutions, where, in total, the regular expenses would be reduced in a 17% ($52 million). The Public Works’ 79.3% reduction deserves a special mention (over $100 million), a result of the massive indemnity of most of its employees, and the transference of all the machinery to the defense sector. As it can be inferred, it is the Public Works’ budget reduction the one that fundamentally explains the reduction of the regular expenses.

    On the other hand, the investment of the Executive would experiment a respectable 57.8% increase between 2001 and 2002, being specially noticeable the social sector investment’s increase. However, contrary to the ordinary beliefs, the truth is that the public investment planned for the year 2002 is not a very important part inside the total budget. The public investment will reach a total of $354.3 million, while the allowances to the municipalities for investment projects will reach $99.7 million; that is that in total they would reach $454 million, which is only equivalent to a 18.1% of the 2002 total budget.

    If we consider that —according to the CEPAL— the destruction caused by the earthquakes reached a little more than $1,600 million in damages, as a result we have that in 2002 an amount of funds equivalent to a 28% from the estimated total loss will be disbursed. An amount that reveals an important advance in the recuperation process, but which is also far away from being adequate to even return to the public infrastructure that we had before both the January and February earthquakes and disasters (which, by the way, was very negative already).

    In regard to the “general obligations and debt” sector, it can be said that its behavior reveals a relaxed attitude of the Internal Revenue Service authorities, which makes a strong contrast with the first reaction of Minister Daboub when he asked for a 15% reduction in the state’s dependencies regular expenses. The regular expenses in the formerly mentioned sector were increased in a 39.2% ($169.4 million), while the investment was only increased in a 13% ($37.2 million). Between 2001 and 2002, the payment of obligations and the debt service will have a relatively high growth: it will go from $718 to $924.6 million, which means  $206.6 million  (28.8%), very much above the increase destined to the social sector, which was only $70.3 million (8.1%). The budget of the already mentioned sector would be very close to the one destined to the social sector, which is $941.3 million. In addition, it would represent close to a 36.9% from the 2002 budget’s total, and a 203% of the public investment and the municipalities’ allowances.

    This way of distributing the increases in the budget reveals that the priority is the payment of the government’s financial obligations. The fact that there are intentions to increase even more the amount of the debt and its service through a new emission of bonds for $470 million is something to really worry about.
 
    The worst problem for the public finances is not —for the moment- the fiscal deficit itself, but the unsustainable expense policy, the indebtedness and the service of the debt. The need to strongly increase the public expense, the debt contract that it requires and providing of more resources for its service are the elements that close a vicious circle which will make even more difficult any well intentioned initiative to redistribute the revenue trough the public expense.

    At the moment, the government has no other option but to continue going into debt, even if that means to count with less resources to spend. It must not be ignored that it is a result of the tax reform implemented by its predecessors —who belong to the same party, ARENA—, which has not managed to sufficiently increase the revenue.

    Even if the present problem is to obtain the legislative approval for the emission of bonds, the bottom line is still the need to increase the revenue. For the moment, Daboub’s proposal is to tax the lowest income sectors, without considering at all any increase to the taxes paid by the business companies. It seems as if this situation will continue to be the main error of the governmental tax policy, and the most significant gap to achieve economic stability, economic growth and a sustained improvement of the social well-being.

    The UCA has been unfairly involved by both the Salvadoran authorities and the International Police in a shameful case of pornographic material displaying. Everything starts with a letter made by the latter and addressed to the former, in which they inform them that they have received complaints from people from Germany and Spain because, they received pornographic texts and pictures. They also indicate them that the address from which the material was sent belongs to SV Net, located in El Salvador and at the UCA.
 
    Since the Salvadoran authorities did not give any importance to this matter, the International Police turned to the Legislative Assembly and it pointed out that a Salvadoran University has a web site from which it displays child pornography to obtain profits from it, and that, in addition, the authorities of that institution have not allowed them to investigate the problem.

    SV Net is a non-profit organization that has been around for a long time. Its purpose is to provide the addresses that allow people to connect with the Internet. The founders of this organization were besides the UCA, the Salvadoran University, the Don Bosco University, FUSADES and the Science and Technology Council. SV Net has assigned 60,000 addresses available for the people who request it. Without them, it is impossible to go into the Internet. Out of those 60,000 addresses, 20,000 have been provided to the Presidential House, several ministries and autonomous organizations, small and large business companies, telephone companies and people in general, among others. The only duty of the SV Net is to designate those records and keep web pages with information of El Salvador.

    The computer from which this activity is administrated is located at the UCA, however it does not belong to that university. Actually, the SV Net Secretariat is at the Technology and Science National Council. The service of assigning addresses to those who navigate through the Internet is free.

    The two addresses from which the pornographic material was sent were, in fact, assigned by the SV Net. Presently, those addresses are found in a block that was assigned to Telecom. Therefore, the UCA does not have a relation with such records, nor with the way these were used. No computer from the UCA has been used to send these messages. The work that the SV Net can be compared with the activity of assigning the car plates for the vehicles to circulate.

    There is an institution that registers and distributes them; however, after that the user is the one responsible for the way he drives the authorized vehicle. In the same way, to navigate through the Internet it is necessary to have an address, and SV Net is the one who registers and distributes them. The way in which the users administrate the address is their responsibility. All of this is public, therefore, if the authorities had asked before making serious accusations, they would have been properly informed. It would have made no sense to deny public information.

    Then again, why did the Attorney General, The National Civilian Police Director and the International Police connected the UCA with the complaints received from Germany and Spain? The answer is simple, because of ignorance and malice. In their declarations, the police as well as the Attorney General show that they ignore the basic technical aspects of the problem. Apparently, they do not know the difference between a web page and an e-mail, how internet works and its techniques.

    However, ignorance should not be a problem, any person who understands these topics could have explained it to them. It is inexcusable, since the authorities cannot allow themselves to throw groundless public accusations. And this is where malice enters the picture: the connection between the UCA with the SV Net was too much of a good opportunity as to let it slip away without relating the university with a display of child pornography. Despite that these authorities are already informed of the facts, they insist on relating the UCA and making false statements, that only show their ignorance about the new technologies and their bad intentions.

    The UCA considers that, in addition, it has been a victim of the flippancy and the irresponsibility of the authorities to proceed in the penal field. It is a rule for these authorities to make groundless statements, to accuse with no evidence and to turn their prejudgments into the truth. The press, at the same time, becomes the echo of such issues without making an analysis of the situation. The UCA is one more item in the list of their irresponsibility. The fiscal authorities and the police cannot allow themselves, under any circumstance, to make groundless accusations. The International Police has not given any signs of being different from their colleagues at the National Civilian Police. Supposedly, it was invited to the country for its professionalism and to strengthen the local police, however, according to the facts the International Police is not better than the PNC. As they have treated the UCA, with the inadequate investigation procedures that they treat most of the cases that fall into their hands. Therefore, their little efficiency to pursuit crime is not unusual.