Envío Digital
Central American University - UCA  
  Number 198 | Enero 1998



Uncertainty at Year's End

With the new property law now passed, what pending problems will it resolve? And what new businesses will it facilitate? Will the Liberals split in 1998? And will the FSLN revitalize itself or continue to self-destruct? Will civil society remain dispersed, perplexed and passive? We should start getting some clues to these questions early in the new year.

Nitlápan-Envío team

By the Nitlapán-envío team.

As 1997 ends, so virtually ends Arnoldo Alemán's first year of government. Almost all of the national problems that were awaiting consensus, solutions or creative proposals are still with us. Uncertainty still predominates, not only about the nation's future but even about life itself for many Nicaraguans.

The rules of representative democracy aren't being accepted and those of participatory democracy haven't yet been practiced enough. The state has been weakened by those who represent it and civil society is still not as strong as it needs to be. Those in power violate laws and undermine institutions on a daily basis. And those who are not in power have not yet found any other road than that of mere individual survival. What will next year, the next to the last of the century and the millennium, offer us?

Property: Bipartisan Consensus

The controversial legislation to put an end to the property problems, which had been hammered out exclusively by legal teams of the government and FSLN leadership, was released to the public in early September. It was then discussed for two weeks by the National Dialogue and finally submitted to a National Assembly findings commission for study in October. The commission listened to the demands and suggestions of various social sectors for over a month before incorporating its revisions into the bill. In mid-November, amid well-concealed tensions between Liberal and Sandinista leaders, the commission turned the bill over to the Assembly for floor debate and voting. That debate took place on November 26, and lasted barely four hours before 73 of the 93 Assembly members passed what is now called the Law of Urban and Rural Reformed Property. The 36-member Sandinista bench voted as a bloc, but only 33 of the 43 Liberals voted in favor.

The modifications that the commission made to 14 articles of the bill largely respond to the complaints presented by various sectors linked to Sandinismo. One change favors the worker-owners of the 248 companies privatized to them in the early 1990s, since the more than $60 million owed on these companies may now be paid with bonds and over a longer time period. Another favors the bulk of rural property owners, in that only 80 of the tens of thousands of land adjudications made by the agrarian reform will be reviewed; another the agrarian cooperatives, because they will finally be recognized; and yet another the inhabitants of settlements created up to 1995, since the original bill only protected settlements created by 1994 from eviction.

The Confiscated Are Furious

The legislative commission did not incorporate the proposal submitted by the Association of Confiscated—to be compensated in cash, not bonds, and at their properties' current market value rather than either their value at the time they were confiscated or the current assessed value by the land registry. In fact, none of the recommendations of the National Dialogue participants, which included representatives of this hardline group, were taken into account.

Leaders of the Association angrily branded President Alemán a traitor. "We helped him win the presidency," said Blanca Buitrago, one of its most active members. "We helped him demonstrate that we were more than the Sandinistas, and now he has betrayed us."
Vice President Enrique Bolaños, who expressed his disagreement with important elements of the bill when it was first released, quickly distanced himself from the reformed one after it was approved. He thinks that the majority of the "President's men" put too much emphasis on the agreement's urgency and not enough on its content. And Rosendo Díaz, who heads what remains of CORNAP, the state holding company responsible for privatizing the state enterprises, resigned in open rejection of the law. The big question for next year is what concrete application the significant Alemán-FSLN consensus expressed in this law will have.

Adjustment and Growth

After 11 months of administration without publishing any economic plan, the government released the Economic Adjustment and Growth Program it had submitted earlier to the international financing agencies as a condition for getting the second Enhanced Structural Adjustment Facility (ESAF) signed at the start of next year. True to the arrogance that characterizes the Alemán governing style, Central Bank president Noel Ramírez said that the program "will resolve all the poverty problems in Nicaragua once and for all."
How could anyone be expected to believe that? Nicaragua is the only country in the world with the same production and life expectancy levels that it had 50 years ago. Anyone understands that, even with several consecutive governments that were totally efficient and free of the current corruption epidemic, this generation would still not see the povertyless "promised land."
The presentation of the program was accompanied by another chapter in the campaign to disqualify the past, understanding by "past" only what happened between 1979 and 1990. According to this simplistic Liberal propaganda, Nicaragua's only economic problem is that the country was "impoverished" by what happened in those years, and the Liberals' only problem is thus having received a country that had been "destroyed" then. Their "past" goes no further back and comes no further forward than that. There was no Somocismo and nothing at all happened between 1990 and 1997, during the Chamorro government. A vision like that, which has all kinds of consequences, will never be able to clean up the country and make it grow economically.

The proposals in the program are no surprise: privatization of the water, electricity and telecommunications services; huge cuts in the number of public employees; continued frozen salaries of those who remain; more efficient tax collection, etc. The government repeatedly comments that "the "details" cannot be made public yet.

The program proposes official austerity. Will that perhaps come to top officials next year? Throughout 1997, the accumulated images and realities illustrating anything but austerity—outrageously high salaries for ministers and the President's advisers and cronies, constant presidential junkets, fleets of top-dollar vehicles, sumptuous presidential spending, ostentation, perks—have made the population not just suspicious of but cynical toward all those who say they represent it in the political spheres.

One of the most worrisome areas of ESAF is the privatization of public services, in which there could be an "agreed to" lack of transparency. After helping finance Alemán's presidential campaign, Cuban-US millionaire and anti-Castro leader Jorge Mas Canosa declared during his visit to Nicaragua a month after Alemán took office that he had come to buy the state telecommunications company. Then, only a few days before Mas Canosa's death on November 23, his son visited President Alemán to explore investments. According to Alemán, he "reiterated his intention to invest in the telephone company and where it would be needed." President Alemán flew to Miami to attend the funeral services on November 25.

At the ESAF Threshold

Nicaragua is suffering a serious scarcity of funds since the government went the whole year without signing the ESAF agreement with the International Monetary Fund, which is the precondition to new financing. Once it is signed, a new Consultative Group can be organized with the international donor and cooperant countries, from which Nicaragua will request $800 million for investment in various productive and social programs over the next five years. Many analysts agree with the United Nations Development Program representative in Nicaragua, who publicly recommended in October that social investment be integrated into the structural adjustment program, but it was not.

In November, driven by the shortage of funds and the urgency of maintaining strict control over inflation to assure that the IMF will sign the ESAF, the government increased the legal reserves that private banks must maintain in the Central Bank from 15% to 17% of the deposits they receive in national currency. The objective is to withdraw tens of millions of córdobas from circulation, particularly in anticipation of year-end bonuses and Christmas spending, which always add inflationary pressure.

There are forecasts that next year will be extremely difficult, with more unemployment, less purchasing power and more inflation. And with of all this, there will be surely new turns in the spiral of social decomposition. The government will have to pay a high political cost for the long list of unpopular measures in exchange for the much-needed and overdue external financing.

But money will be going out as well as coming into the country in the next few months. In the first four months of 1998, the government must pay the debts it contracted in 1997 through emergency operations to avoid depleting its international reserves given the lack of external funds. A rise in the banks' reserve rate for dollar savings is another emergency measure to help deal with these pending commitments.
One such commitment is Jorge Mas Canosa's famous $100 million investment in Nicaraguan bonds to balance those reserves for his "buddy" Arnoldo Alemán. That investment carries an interest rate of over 20%, which must be paid soon. The economic group running the multimillion dollar empire of which Mas Canosa was the "godfather" is determined to put that fortune "in order" after his death, which will have economic and political consequences.

The '98 Budget: More "Ghost" Spending Lines

When the executive branch sent the National Assembly its 1998 budget bill, President Alemán characterized it as having "an exceptional level of transparency." He was referring to the fact that it details the salaries of the President, the ministers and other high officials and also includes, for the first time, the destination of millions of córdobas in extra-budget income (fines, commissions and charges for passports, visa applications and other official transactions).

Nonetheless, state income increased by over a billion córdobas in this new budget, without any clarity about where the amount came from or where it will go. As with the 1997 budget, this line, equivalent to about US$100 million, will be transferred as an "internal debt" from the government to the Central Bank. The President again justified the operation as necessary to accumulate the international reserves that the country needs. And various political sectors again demanded a more convincing explanation for this "ghost purse" of resources.

Remittances and Maquilas Provide Stability

If the country has maintained some semblance of stability in 1997 despite all these problems, it is thanks to the effort of the poorest. Even though crime and social decomposition are growing, those who daily do anything legal they can find just to survive are still the majority. Some $250 million in family remittances come into the country annually from the 400,000 Nicaraguans who cross the border into Costa Rica to work, defenseless, at hellish jobs in hellish conditions and under relentless pursuit by the authorities. Another 250,000 Nicaraguans work in the United States, increasing Nicaragua's stability by $200 million more from what they earn and manage to save and send home. No export product earns more hard currency than this labor force.

The prestigious Nicaraguan Institute for the Promotion of Human Resources (INPRHU), a veteran national NGO, has begun a consciousness-raising campaign about the reality of Nicaraguan workers in Costa Rica. According to its data, 2 million of the 2.9 million in annual exports from Costa Rica come directly from production of coffee, sugar, bananas, fruits, fish and livestock, categories in which the cheap labor force of illegal Nicaraguans plays an important economic role, which translates into greater earnings for the businesses of the neighboring country.

There is no work in Nicaragua. The year is ending and unemployment is still the most serious, most heartfelt problem, to which the Liberal government has given scant response in its first year. The investments that have come into the country to provide jobs—Taiwanese and Korean textile plants in partnership with huge US companies—have headed straight to the Free Zone installations, to assemble garments for re-export from cloth they bring in, tax-free both ways. The investment comes part and parcel with a labor system based on low wages, stringent piece-work demands and repression. Institutions and unions constantly demand "employment, but with dignity" of these investments, and charges about the exploitative Free Zone system are frequently heard. But in these times of crisis, the majority of workers in these assembly plants, most of whom are women, prefer not to denounce anything; they just hunker down and silently endure the reality as long as they can on the grounds that being exploited is better than being unemployed. That's also pretty much the government's posture, but doesn't it have other options?
In mid-November, the US TV program "Hard Copy" included footage and interviews from various textile plants in Managua's Free Zone in several of its broadcasts, denouncing the terrible working conditions in them. The programs caused a disturbance inside Nicaragua. Tempers rose even higher when, in the same period, a young worker was electrocuted two days after filing a complaint with management that his machine was faulty and should be immediately repaired. While Sandinista unions again spoke out against the labor exploitation in the Free Zone, government ministers and spokespeople defended the kind of employment that this assembly plant system—known in Spanish as maquila—contributes. Radio businessman and representative to the Central American parliament Fabio Gadea Mantilla, who is also newly the father-in-law of President Alemán's daughter, went so far as to claim that "many countries of the world have achieved development by establishing free zones."
This opening to foreign investment in maquila operations is a centerpiece of the economic growth strategy not only of Nicaragua but of all Central American and Caribbean countries. The economic justification appears unarguable. With high unemployment rates and no access to either the capital or technology necessary to industrialize, our countries have few options. The industrialized countries, on the other hand, have both capital and technology, but wage costs are relatively high, particularly for the production of consumer goods such as textiles and footwear, which requires abundant labor. Albeit very unequally, both the investors from industrialized countries and the governments of countries with so much unemployment come out ahead with installation of assembly plants, or maquiladoras.

That's why the multilateral lending agencies include opening to foreign investment as a condition for providing financing to our countries. It is also why all governments in Central America offer every possible incentive to the maquila investors: generous fiscal exemptions, low-cost infrastructure and services and minimum labor regulations. Each new plant is inaugurated with fancy celebrations by the Central American Presidents themselves.

The New Division of Labor

The recent industrialization of some underdeveloped countries, particularly in Southeast Asia, has progressively attracted labor-intensive industries from countries of the Group of Seven (United States, Japan, Germany, Great Britain, France, Canada and Italy). All of this has created a new division of labor in the production of manufactured goods: the most sophisticated goods, such as computers, machinery and equipment, etc., are made by the advanced countries, while the recently industrialized ones produce manufactured goods with less technological complexity. And it works out to be more profitable for them to produce them in parts, a la the maquila model, which partially explains why Asian investment has been coming to Central America, gradually displacing the United States as the main foreign investor here.

But the reality of the Central American assembly plants is not as simple as the economic argument that justifies them, i.e. to give a significant response—250,000 direct jobs—in countries with very high unemployment rates. There are other, more complicated elements to this reality.

What Options for Central America?

The arrival of foreign investors, mainly from Southeast Asia, to the region has not been motivated so much by the extremely favorable conditions the Central American governments offer them or by the low wages they pay our workers. The underlying motive is the textile quota in the US market to which Central American countries have a right.

The United States preaches free trade but doesn't always practice it. The importation of textile products is an example. In the United States textile imports are governed not by free trade but by quotas that the government establishes. The Asian countries have already more than filled their quotas, and have trade friction with the United States. The Central American countries, on the other hand, Nicaragua in particular, are far from saturating their quota. In addition, they are very close to US territory, which substantially lowers transport costs. All this makes Central America a "paradise" for Taiwanese and Korean investors looking to install assembly plants.

The "sin" of Central America's governments has been their inability to turn this privileged position to their advantage in negotiations with the Asian investors. Instead of negotiating from strength, they compete among themselves to see who can offer the Asians more at less cost.

There is also another element. A broad and growing movement of consumer organizations and unions in the United States and Europe is denouncing imports coming from underdeveloped countries in which labor rights are not even minimally respected, focusing especially on the products manufactured by subsidiaries of transnationals. Two issues ago, envío reported on an important assembly plant in Honduras that was forced to request the collaboration of US and Honduran organizations to certify that its employees were working in adequate labor conditions. But the Central American governments have not used the backing of these civil society organizations from the industrialized countries to require from the Asians better labor conditions for their own citizens. Instead, they have taken upon themselves the task of questioning and denigrating the organizations themselves.

One last element. The Central American governments have no defined industrial policy to assure that the (assembly plants) tie in better to the national productive sector, as Brazil has been doing for several decades. The main raw material used by the textile plants in Managua's Free Zone is semi-processed cotton that the Asians bring. Why isn't national cotton used to supply these plants?
The Central American governments have clearly not fulfilled their role of governing in favor of the nation and its citizens, and have not known how to use the advantages that their situation gives them. It is also clear that the problem of vile working conditions in the Free Zones will not be solved by either the demagogy that demands nothing short of expulsion of the foreign investors or the discourse of beggars submissive to international capital that the governing elite use.

Money Laundering?

The maquilas aren't enough. There's still no work in Nicaragua. And almost all the wages of the majority who do work go for food, even then barely covering it. Supply far outstrips demand in all categories, since very, very few consume anything more than just food.

In this setting, the growing supply of superfluous goods in the new and elegant, but always virtually empty, shopping malls cropping up all over Managua is increasingly suspect. So are Central America's fictitious companies, fancy residential constructions and new million-dollar investments in luxury hotels and malls for the consumerist inclinations of a minority who, if truth be told, prefer to shop in the malls in Miami. So, for that matter, are the ostentatious town station wagons now seen in far greater numbers on Managua's streets than in the capitals of countries with healthy economies—and this without even counting the fleet of such vehicles bought by the new government.

The only explanation for the growth of such flashy fluff is that Nicaragua has been turned into an attractive space for money laundering and that the capital coming from or connected to drug trafficking is entering through the front door, luggage in hand, with plans to call the place home.

It would seem that the time has come to ask ourselves whether international drug traffic isn't a hidden but real component of the economic "plan" we are already experiencing. It is, after all, a very profitable activity through which financial "stability," economic growth and jobs can be attained. It puts money into circulation, gives the appearance of progress, and provides abundant jobs in the construction branch of the economy.

President Alemán is giving himself the credit for promoting all the new construction on the grounds—which are indeed correct—that it is a multiplier of jobs by creating more demand for cement, wood and other inputs from local industry. But can we be expected to believe that all he had to do was wave a magic wand, say "let there be construction," and suddenly shopping malls and luxury homes began cropping up everywhere in this prostrate country?
Meanwhile, Nicaragua is about to establish legislation that would allow investigation into the laundering of money from illicit activities such as drug traffic. This legislation would be at a par with international laws covering the same issue. Nicaraguan police authorities believe that many of the new investments coming into the country are money-laundering operations, but state that there are no data on the amounts or the methods. The capacity does not yet exist in the country to investigate this criminal activity nor does legislation that would permit it to be punished. The new bill would allow the investigation of all institutions that carry out financial transactions—banks, currency changing operations, the securities exchange and the like. In these investigations bank confidentiality would be invalidated.

Crisis Among the Liberals

Over the course of the year the institutions of democracy did not awaken much credibility among the population. The legislative branch functioned the whole time like a wholly-owned subsidiary of the executive branch, like a tool in the hands of President Alemán, who gave more than a little proof of his powers of conviction and cooptation over Liberal legislators and some of those from other parties. If these legislators were not unconditionally loyal to the Liberal ideology, they certainly showed that they were to the personal privileges and material perks that came their way with Liberalism in power.

The year ended with a serious crisis in the National Assembly's Liberal bench given how unsustainable this situation had become. The last straw came in October, when President Alemán decided to remove from their positions in Estelí's departmental government all relatives and friends that two Liberal bench members had recommended for those posts. And why? Because the two legislators did not vote according to the President's directive during the debate on the future privatization of the electricity company. President Alemán had ordered "his" representatives to vote in favor of leaving this process totally in executive hands, but the two "rebel" representatives from Estelí voted with the opposition, which argued that the National Assembly should also participate in this strategic process. Their indiscipline caused the failure of the President's project. Within 24 hours, Alemán himself ordered the firing of almost all Liberals who made up the administrative apparatus in Estelí. The still unsubmissive legislators publicly criticized Alemán's decision, calling it "political revenge."
Alemán's action had the ripple effect of a stone skipped across water. By year's end, the Liberal Alliance was in obvious disarray. The Grand Liberal Party, formally announced in July, was a chimera about which nothing more has been heard. After barely a year in office, Alemán's Constitutionalist Liberal Party is prey to a muffled fight among various of its leaders over who the presidential candidate will be in 2001. José Rizo, who succeeded Alemán as head of the party when the latter took office, acknowledged the fight when he commented that, among the Liberal leaders, there are now "gente que aspira, otra que suspira y otra que expira" (some who aspire, others who just sigh and still others who are expiring), adding that, in his case, él "respira"(he's still breathing).

The "Arrogance of Power"

In an address to the León Liberals who hold public posts, Rizo admonished them for not yet getting past the "binge" of the electoral victory a year ago. He warned them that Liberalism had fallen into inertia and they themselves into the "arrogance of power." There are more than a few signs of how right he is. The government has become for many a space in which the first thing one does is create one's image, make deals and flaunt one's privileges and the very last is serve the common good.

Will the Liberal bench split over the castration of the National Assembly by President Alemán's authoritarianism, or perhaps as an expression of this struggle of personal interests? To what degree might the division of Liberalism in power democratize the activities of the legislative branch and/or make it more autonomous? To what degree might the Liberal "dissidents" work more with a national perspective than a party perspective—in this case a dissident party one?

Wipe Out Even the Names

Alemán's Liberal project has demonstrated sufficiently over its first year that its priority component is ideological-cultural: erase all prints that the revolution and Sandinismo have left on the nation. More because it longs for the features of Somocismo than because it is a modernizing neoliberal option, Alemán's Liberalism has shown itself to be very exclusionary: there's only room for the faithful.

The year was rife with public Liberal offensives against media, NGOs, women's organizations, institutions and individuals with Sandinista origins. At the same time, Liberalism "came to an understanding" in the non-public sphere with a sector of the FSLN leadership.

The latest of the anti-Sandinista cultural-symbolic offensives that so needlessly damage national unity began at the end of August and fizzled out two months later. On August 29, the Ministry of Education (MED) published an "accord" ordering all public schools and other educational institutions in the country to choose a new name from among "those who, by their example, their civic, historic and cultural value. will always remain in the memory of the generations."
The MED decided that the School Councils, made up of parents, professors and students, would choose the new name of their school. According to the ministerial accord, the name could be voted in by a simple majority, but if it did not conform to what had been established, local MED representatives could overrule it.

The large majority of public schools still bear the names of heroes and martyrs of the anti-Somocista struggle or of national personalities that the ministry thinks "are not a civic example for the new generations." MED functionaries argue that the anti-Somocista struggle was a party initiative that "does not unite the Nicaraguan family" and that its result was an historic period that "recalls violence" and should be put behind us.

Together with the accord, the MED published a list of suggested names of "lofty civilizers, governors, poets, narrators, journalists, painters, sculptors, composers, educators, historians, scientists, doctors, jurists, religious and sports figures, business leaders and philanthropists." With the airs of a crusader, Minister of Education Humberto Belli claimed that the names chosen should "unite" Nicaraguans, but a good number of those on the list, many of whom are still alive, do little to unite the Nicaraguan family due to their clear political connotation. On the other hand, General Sandino, claimed by both Sandinistas and Liberals, does not appear on the list.

In many teaching centers, this measure pitted students, teachers and parents against each other and contributed not to unity but to disunity, deepening the polarization that has done and continues doing so much damage to Nicaragua. By October 30, the deadline for the change, the MED announced that only 1,157 of the 4,700 schools had changed their "Sandinista" names and that those which had not changed it would be "conscienticized" into doing so.

The Opposition's Challenges

Any project that opposes the exclusionary, wasteful and authoritarian nature of Alemán's Liberalism requires a long-term vision, honest leadership and broad consensus. Neither the FSLN that we know nor the other social and political groups have been up to this challenge, the latter because none have achieved enough social representation or credibility among the population. "There's nowhere to look, no one to see," is a phrase heard often in any conversation about national political life.

The year is ending with the campaign getting underway for the March 1, 1998, election of autonomous regional authorities on the Atlantic Coast. The ballot will be about as long as the ones last year, since 20 parties—both new and old—have signed up, some to run alone and some in new alliances. Alemán's PLC is among those going it alone, which is an indicator of the fissures the Liberal Alliance has suffered since the 1996 elections. The Nicaraguan Democratic Movement (Social Democrats), the Independent Liberal Party, the Conservative Party and the new Costeño Peoples' Party have formed the Costeño Alliance, whose objective is to "confront the bipartisanship that Alemán's Liberals and the Sandinistas want to impose." It will be quite a challenge for this and other groups of small parties to crack the bipartisan monopoly with which history, today's reality and both Sandinista and Liberal leaders have stamped national politics. After the electoral trauma of October 1996, the way the coast elections develop and the results they offer could provide interesting indicators to evaluate the vitality of the parties, the capacity of their leaders, the population's participation and the functioning of the Supreme Electoral Council. In a few months all these unknowns will be cleared up.

The FSLN has created expectations with the reorganization process it has initiated and from which "profound and integral changes of both form and essential content" have been promised. The process is supposed to culminate in May 1998 in the party's III Congress. In the Sandinista Assembly meeting in early November, which kicked off this process, FSLN Secretary General Daniel Ortega argued that the FSLN cannot content itself with just being a party that does good legislative work, since the Liberal government does not respect the laws. The current project to re-issue Somocismo, he claimed, obliges the FSLN to develop work at the base, a space in which it has been weak throughout the 1990s.

"The government is taking advantage of our weakness to advance," argued Daniel. "And it will advance as far as we let it, as far as the people let it." He recognized that the FSLN, with its current forms of organization, "has exhausted its possibilities and capacities for struggle" and that this new process plus the Congress must define "how to organize our strength, how to communicate our proposals better and how to multiply our influence." He called this "one of the greatest challenges, if not the greatest, of our entire life as revolutionaries." Will 1998 bring genuine and far-reaching changes in the FSLN? Or will it continue to self-destruct due to continued distancing from the grassroots base?

The FUAC Came...and Went?

The armed group calling itself the Andrés Castro United Front (FUAC) was headline news throughout 1997, after emerging in the Atlantic Coast's mining triangle (Siuna-Bonanza-Rosita) in the last year of the Chamorro government. The FUAC claims to have over 800 men in arms in that subregion, known as Las Minas, and even more importantly it has an extensive and very real social base there.

From the first moment of its appearance on the scene, it was clear that this was not just one more of the semi-politicized rearmed groups variously called recontras, recompas or revueltos that kept appearing in the early 1990s. It had even less in common with the bandit gangs that some of these rearmed groups evolved into due to the socioeconomic crisis, and which still operate in various rural zones.

FUAC was largely the creation of former officers, including several founding members, of the Sandinista Popular Army (EPS). Its forces were made up of veterans of the EPS, the former Ministry of the Interior (now Ministry of Government), and even the Nicaraguan Resistance (the once-enemy of the Sandinistas known as "contras"). All of these people have proven military experience and political capacity.

The FUAC agenda was a mixture of social and economic demands from Las Minas and proposals aimed at rescuing Sandinista principles forgotten by the FSLN in these years. But the most characteristic aspect of this armed group was the social base in which it was inserted and which recognized its members as their representatives. In several recent negotiation sessions with government representatives, FUAC's social base protected the group members like an effective shield of organized civil society.

Among the FUAC's activities was the disarticulation of rural cattle rustling bands and the "extra-official execution" of some of them at the population's request. The organization worked like rural police in a zone in which at least 60 criminal bands were active. "People seek them out day and night with all their problems, from the wife who complains that her husband is drinking and abusing her to those who have problems with the bank or need schools or health facilities," a nun who does pastoral work in the mining zone told envío. "There's no problem that doesn't find its way to their door. And they have behaved like an armed movement that is providing a social response."
After months of negotiations with the army, FUAC head "Camilo Turcios" and Minister of Defense Jaime Cuadra established December 19 as the deadline for the group's disarmament. During the negotiations, both the Peace Commissions made up of religious men and women working in Las Minas and members of the legal team of the Nicaraguan Human Rights Center (CENIDH), headed by CENIDH director Vilma Núñez de Escorcia, played distinguished roles.

In-depth solutions based on a genuine social development strategy never get to the most impoverished zones of Nicaragua. At best, what gets there are band-aids, always-insufficient social compensation measures. Like many other places, this has traditionally happened in the coast's remote mining region.

Before agreeing to disarm, the FUAC members got responses to some of their social and economic demands from functionaries of the agrarian reform, transport, and natural resources and environment ministries. Among other things, FUAC's armed pressure forced the government to provide facilities for the formation of a new bus cooperative that will cover the route between the Atlantic Coast and Managua. And during the negotiations, they got five ministers to visit Las Minas to listen to the population's demands. "When have we ever seen a minister face to face?" asked one resident. "That was the first time in years that someone from the government came to listen to the people and take an interest in our zone. That alone is an achievement."
The FUAC also wanted to be a spokesperson for the veterans and victims from both sides of the 1980s war, especially those from the rural population. To this end they called for the creation of an institute of retired military personnel and a foundation to respond to their many needs.

At the end of October, after months of on again-off again talks, the FUAC leaders presented the government with a document called Protocol of Social Demands, as a condition for the group's disarmament. One set of demands contained in it constitutes a kind of "development plan" for the mining zone, while another set has more general demands of a national scope.

"They know about demands and they're clear about the principles underlying them," an analyst close to the FUAC commented to envío, "but they still don't understand what a development process is. They just ask for things, just stick their hand out."

Culture of Uprisings

The features that distinguish the FUAC from former and still existing armed groups made it very hard both for the government to negotiate its disarmament and for the army to go against it militarily. Not only is this one of the most prepared groups the army has faced, but it's even harder for the army officers because some of their best subordinates and fellow officers are on the other side. Only once in two years did the two sides engage in combat.

At various points throughout the disarmament negotiations, FUAC chief "Camilo Turcios" declared that they weren't "rifle peddlers." He was referring to the Chamorro government's oft-repeated mercantalist policy to get the rearmed groups to turn in their weapons, which consisted of buying the weapons off both rearmed activists and civilians on a sliding price scale that culminated in luxury four-wheel drive vehicles, good farms and even public posts or well-financed exile in the United States for top leaders of the recontra groups.
This policy made rearmament one of the most lucrative businesses available in the rural areas and, as FUAC itself says, created a "culture of uprisings." One recontra that envío spoke to several years ago admitted that disarmament figures from what appeared to be the peak year of 1992, when the weapon-buying policy was in full swing, were inflated by those who rearmed and disarmed two and three times, collecting $100 for a rusty old AK-47 each time. Still today, many of those same people are running around various rural zones with new weapons, engaging in the latest money-maker: kidnapping producers and their family members for ransom.

In one of its documents, the FUAC recalls official data showing that the government invested $400 million in "surmounting conflicts" between 1990 and 1997. This covered the cost of demobilizing and disarming the Resistance, reducing the armed forces, initiatives to get recontras, recompas and revueltos to lay down their weapons, and projects for the social reinsertion of all these forces. Yet this extremely high cost did little to heal the many wounds and scars of war, and in fact very little of it was even designed to.

Will the FUAC Disappear?

This year is ending with the suggestion that perhaps all of FUAC's discourse and activities were "more noise than nuts." Now partially demobilized in security zones, it seems to have decided to disappear from the scene after having gotten some of its demands for both its own men and the social base that backed it.

The novelty of its line and the support it enjoyed was indisputably clear. What has never been clear is if negotiating its disarmament was a piece that the FSLN strategically included in its own negotiations with the government over the property problem. Is it simple coincidence that the announcement of the FUAC's disarmament came in tandem with the legislative agreements to make new and more progressive changes in the controversial property law and push it through the National Assembly with the speed of light? It is also still unclear whether the Andrés Castro United Front was something real, even if its trajectory was brief, or was mainly a skillful pressure tool on the stage of Nicaraguan politics, in which reality and images are superimposed one on top of the other until they become confused and both end up being ephemeral.

The Comptroller General: Credibility Against the Odds

Finally, as 1997 draws to a close, one of the most positive institutional realities is the consolidation of the Comptroller General of the Republic's office as a credible institution within a not very credible government. Alemán's Liberalism has continually tried to undermine both the institution and its titular head, Agustín Jarquín Anaya, who steadfastly goes about his business of scrutinizing government activities and individuals any time there's a hint of possible wrongdoing. And with this new government, that's a full-time job.

The latest offensive came in early October, when Eliseo Núñez, deputy chief of the Liberal bench in the National Assembly, tried to put Jarquín's office through the wringer once again. Núñez insisted on creating a commission to investigate how the Comptroller's office was using both its budget and the resources it received as international donations.

Other Liberal legislators backed Núñez's new round of pressure by accusing Jarquín of having political ambitions for the 2001 presidential elections and of "using his office as a niche for his image projection." Even if that's true, presidential hopefuls on the Liberal side could learn some lessons from Jarquín about the value of grounding image projection in solid earth.

This offensive, which undoubtedly will be followed by still others, evaporated into thin air in mid-October, when Jarquín presented the National Assembly with the report that Núñez had demanded in such a suspecting manner; it was lauded by the majority of legislators, including some Liberals. The governments of Sweden, Denmark, Finland and Norway chose the very moment Jarquín was about to turn in his report to express their support for both the man and the office by donating $5.2 million to bolster the institutional emphasis he wants to put on the auditing work. "We have been pleased by the enthusiasm and professionalism shown by you personally and by your personnel," the Norwegian ambassador told him on that occasion, "and want to see an even better and more solid institution."

No Trace of the Past

The tasks of Jarquín's office are very complex. None of the new crimes that are the order of the day now are typified in Nicaragua's obsolete legislation, such as illicit enrichment, conflict of interest, bribes and payoffs in contract bidding. influence peddling, diverting public funds to private firms, discretionality in contracts with foreign companies, electronic and informatic crimes, political cliques, nepotism, etc.

Actually carrying out these tasks is almost a first for the Comptroller's office, even though the institution, founded in 1899 under the name Accounts Tribunal, is almost a hundred years old. But as Agustín Jarquín commented in a meeting with the envío team, "Since there's no culture of systematization in Nicaragua, or much historic memory, one doesn't feel one is working in a century-old institution, although you don't feel you're working in an institution that has carried this name for 18 years either!"
After the convulsive revolutionary epoch, when financial controls were weak, the Comptroller's office went through five different chiefs during the Chamorro government. Jarquín, the last, was elected in 1996 during a traumatic transition process in which there was a vacuum of norms, controls and procedures. "A good part of what was done in these years is not registered. No trace of the past remains, either because it was done intentionally or because of the culture of disorder that characterizes us." But he then added that "it would be an historic error to stubbornly insist on digging up this disordered past. The priority is to design a system that avoids repeating this in the future, a system that allows us to cultivate a political and administrative culture in which the normal thing is to be accountable and demand accountability from others."
The Comptroller's office is determined to create order, and is also, for the first time in its history, trying to follow up economic issues such as the public debt, the indemnification bonds, etc.

Discretionality and the "Broom"

Agustín Jarquín has been gaining strength and respect, proving his capacity and moral authority in this difficult task, made even harder by the fact that the Liberal government has been leaning on him the whole time. Jarquín reiterated to envío that he is not considering either resigning his post or running for the presidency in the next elections, as some claim. He appeared confident that he will be able to conclude his work successfully in 2002, when a new comptroller is to be chosen. "In my conversations with the President, I've told him on various occasions that the Comptroller's office will not be successful if his government isn't successful."
Among the problems that Jarquín pointed to as the most worrying within Nicaragua's political culture is that of public functionaries "who are accustomed to giving little data about what they do and handling this information according to their own discretion." To this must be added the lack of an institutionalized team of experienced civil servants due to the wide sweep of the "broom" each time there's a change of government.

Firing capable functionaries in order to give jobs to inexperienced political allies, which is a practice that has marked the Liberal government throughout its first year, doesn't permit a culture of civil service to take root in the country. The Comptroller's office expects to have a data bank ready in two years that contains the name and trajectory of all citizens who have exercised some public function, as a first step to learning the dimension of the problem and becoming able to overcome it.

Room for Hope

Corruption is one of the most serious problems Nicaragua faces. It is spoken of daily, and whether presented with sensationalism or deep thought, it is always laced with worry. It is a universal problem, worsened by the culture imposed by the current change in civilization, in which lack of decorum has become generalized and has turned into ideas such as these: "Dignity is fleeting, but money is lasting," "Good guys finish last," and "It's not how you play the game, but whether you win or lose."
In impoverished countries like Nicaragua, this corrupt channel of quick and easy money, in which the concept of public service has been forgotten, has an extremely high economic cost. But, as Agustín Jarquín says, "Here in Nicaragua we don't know how much it's costing us. We know it's a lot, but we still don't know how to calculate it."
In mid-November the annual Congress of the Central American Organization of Superior Auditing Entities was held in Nicaragua to discuss various issues of common interest. As a result of the encounter, the offices of Comptroller General in the area pledged to intensify their work of incorporating new crimes into their respective national legislation, to push for an environmental auditing entity to monitor the use of the national resources of each country, and to encourage the citizenry's participation in fighting corruption. The Comptroller General's office in Nicaragua presented a study for the creation of a Social Auditorship that would promote this participation.

The new Comptroller General's office has known how to cultivate a positive image. But it has more than just an image. It has been transforming itself into a hopeful reality as the result of a long list of bold, efficacious and exemplary actions. Jarquín values reality more than image and is worried that the work of the institution he presides over will become excessively personalized in him. He says that this is his antidote: "I follow the wise counsel of putting more emphasis on administration than on gestures."
If good and responsible administration continues to predominate in 1998, Nicaragua will have gained room from which perhaps to initiate the changes in political culture that any economic clean-up and growth program, any adjustment agreement, any development plan needs in order to really function on behalf of the nation and all its citizens.

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