Envío Digital
Central American University - UCA  
  Number 195 | Octubre 1997



The Dangers of a Democracy On Paper Only

We are on the verge of a new adjustment agreement with the IMF. Are we on the verge of an “understanding” between the government and the FSLN? At what cost? Time is what Nicaragua can least spare for rehearsals and reverses, especially now, when the country is sinking into dangerous quicksand.

Nitlápan-Envío team

The army of Nicaragua, born of the Sandinista guerrilla movement that routed Somoza's National Guard in 1979, then graduated with honors in the 80s when it proved more than a match for the US-financed counterrevolutionary war, celebrated its 18th anniversary on September 2. The commemorative activities included a parade of troops and various technical corps, which for the first time in the army's history was reviewed by the Presidents of El Salvador, Honduras and Guatemala, accompanied by their defense ministers and army chiefs.

While all this provided the immediate framework of General Joaquín Cuadra's speech, the head of Nicaragua's army took the opportunity to warn the Alemán government to temper its triumphalist mode. "Despite all efforts to the contrary," said Cuadra, after months of silence, "it must be recognized that Nicaragua's democracy is still blossoming, but it's too soon to make conclusive statements or definitive judgments. It is barely beginning to walk, and is still threading its way along the steep and tortuous roads of polarization, exclusion and intolerance." Cuadra spoke of the danger that Nicaraguan democracy could end up "on paper only" or, alternatively, that we could get "bogged down in the quicksand of one of the cruelest ironies of this turn-of-the-century world: democracy without prosperity."
References to the anti-democratic social exclusion of the current economic model was not the boldest part of General Cuadra's speech, however. Everyone is talking about that, and the majority are living it. Much more significant was his concerned reference to "the clear manifestations of political intolerance." This was clearly aimed at the sector of the Liberal government that has been irresponsibly reintroducing into Nicaragua a climate of irrational political intolerance that we thought was behind us.

For his part, President Arnoldo Alemán praised the army in his speech for marching "with vision and sure steps toward the new destiny that modern times and the great geopolitical changes in the world around us set out for it, scaled down and duly equipped in conformity with our country's small size, its resources and possibilities, congruent with the distension and realities of the Central American region, with maturity and responsible realism."

Bowing to the IMF Prod

Last month we cited an old Nicaraguan saying to describe the current moment: "Between two steel prods, no bull is brave." The two prods poking at the flanks of the Alemán government, putting in doubt its initial ambitions upon assuming office, were the International Monetary Fund and the FSLN. They have continued to goad it and there are signs that the effort has had a moderating effect. But in what sense? At what cost? For how long?
Time is of the essence for Nicaragua, given the breadth and intensity of the mounting crisis. General Cuadra pointed that out too, and dramatically. "It is necessary to recognize responsibly and frankly that the main challenge that we Nicaraguans are experiencing is the urgency to pledge ourselves to reverse the negative tendencies that are still battering us.... Social violence is replacing political violence, but its results are the same or worse. We still have time, but we shouldn't rely on it, since time is what we have least of."
Alemán's Liberal government had already run out of time to continue resisting the IMF pressures. The July announcement that the Nicaraguan Development Bank would be downsized was the first public sign that the government was caving in to these pressures.

The palpable reduction of foreign cooperation so far this year, the failure of foreign investors to arrive with the speed and amounts that were expected, the old deficits that are hobbling the Nicaraguan economy, the new ones caused by the government's chain of foolish and wasteful expenditures, and the total failure, at least this year, of the promise to make Nicaragua the "grain basket of Central America"—due to the seemingly interminable drought, among other reasons—are behind this "surrender" to the IMF. The government will be obliged to shelf the populist projects with which it thought to broaden its social base and thus nail down the governing party's successive reelection. Does it have any other option left but to lay out to the population the already too familiar promise that by tightening its belt today, tomorrow will be better?

Time Was Wasted

In mid-August Central Bank president Noel Ramírez officially announced that Nicaragua was ready to sign the second Enhanced Structural Adjustment Facility agreement (ESAF-II). This is a continuation of the one signed in 1991, which collapsed in 1995 due to the Chamorro government's inability to live up to various of its conditions.

By announcing the signing of a new ESAF, the government was admitting that it accepted the conditions imposed by the IMF. To stifle any debate on this point, Ramírez dramatically explained that, by not signing the ESAF and not fulfilling its tough conditions, the country would sink into even greater misery and "uncontrolled" economic chaos.

Left far behind were the initial declarations of various ministers of the government's new economic Cabinet. While not making public any economic plan, they had nonetheless assured that Nicaragua's economy would be "sovereign" and "unsubmissive" to the dictates of the International Monetary Fund. Also left behind were the arrogant and intolerant disputes within the economic Cabinet over what policy to follow, which culminated with the startling resignation of Minister of the Economy Francisco "el Che" Lainez.

Nicaragua paid a high price for those disputes. Enmeshed in their contradictions, the government lost time and could not negotiate greater flexibility in the IMF conditions.

ESAF Is Needed to Stay Afloat

Today these disputes within the Liberal government, at least those having to do with the economic policy, seem to have ceased. And the bravado has evaporated. Eight months of dismal economic management by the government has led it to "submit" to the adjustment after all, and at a serious disadvantage.

The situation is nothing less than dramatic. The Central Bank has been forced to issue millions of dollars worth of investment certificates just so it can maintain monetary stability, since the government failed not only to negotiate the adjustment agreement skillfully with the IMF but also to follow up effectively on the bilateral foreign aid already contracted during the Chamorro administration.

The country needs the new ESAF agreement just to stay afloat. Minister of Foreign Cooperation David Robleto declared at the end of August that only 30% of the external resources that the Chamorro government had contracted have entered the country. He also noted that the aid that has come in and is being implemented is $50 million less than in the same period of 1996.

Various factors explain this drop in the disbursement of already contracted foreign funds. But the key one has a political taint. It has to do with the government's absurd decision to replace the national counterparts of a vast number of foreign-financed development programs all over the country.

The new government made its debut by arbitrarily firing dozens of technicians and professionals with years of on-the-ground experience from each state entity and replacing them with members and sympathizers of the Liberal Alliance to whom it owed favors from the electoral campaign. Many of those favored are inept, others are novices in work of this sort, still others had been out of the country for a decade and a half and have returned with intolerant mentalities and habits that are out of step with the country's reality and with the efficiency that their new tasks require.

"This isn't trinket trade"

When the international cooperation agencies first saw how political criteria were riding roughshod over economic and technical ones, they reacted with concern, perplexity and attempts at dialogue. Some agencies then decided not to disburse more resources, thus paralyzing the implementation of projects, even ones already underway, until the government clarified and rectified its policy. One of the most outstanding cases of this response is the Dairy Development Program financed by the European Union in rural zones where there happens to be a high concentration of Liberal votes (Matiguás, Camoapa, Boaco).

The international agencies' fear is that the millions of dollars in aid that flow through so many cooperation programs will become another source of the corruption and political clientelism that has been the stamp of the new government's administration from the start.

"This is not trinket trade," they have told the President in an attempt to put a stop to his authoritarian impulsiveness. They have also found various ways and means to let the government know that if Nicaragua doesn't shake off this "political boss" administration style of the Alemán government soon, the country will have run out of time and will collapse with no one to pick it up.

Previews of the Document for the FMI

To prepare the way for the visit of the IMF mission in September, the government presented the international financing agency a document titled "Guidelines of a Program with the IMF," which contains the plans and promises the government is prepared to assume to get the IMF to sign the ESAF. Only with the ESAF signed can Nicaragua gain access to the credits, financial assistance and foreign debt renegotiations or pardons that will give it some vital breathing space.

The government proposes in this document to reduce the sliding devaluation of the córdoba, starting in 1998. As a consequence of this slippage, initiated during the Chamorro government, the national currency fell about 12% with respect to the dollar in both 1995 and 1996. By the close of 1997, the government predicts the same percentage, while projecting that in 1998 the devaluation will only be 8% and in 1999 will drop to 6%.

The government also pledges to reduce inflation to 7% in 1998 and 5% in 1999, forecasting that at the end of 1997 inflation will only be 10%. As things are going, however, independent economists predict that the year will close with 13-15% inflation, higher than in the last years of the Chamorro government.

"Conditions" Accepted

One of the most significant forecasts that the government made in the document is that the gross domestic product will grow by 7.1% in 1998 and by 7.4% in the last year of the century. To reach this and other targets, which are very ambitious given the current economic lag, the government has announced the following measures, among others:
*Strict application of the controversial tax reform, which should generate 450 million córdobas in income for the state annually. (According to triumphal government statements, fiscal income increased 40% in the first two months the new tax law was implemented).

*Rate increases for water, light and telephone services, purportedly to offset the currency devaluation. On average, this will mean a real increase of 5% for these public services. (According to declarations of the President, the rates will not go up for "the poor.")
*Greater reduction of the state apparatus, by laying off 2,947 employees over the rest of 1997 and eliminating more diplomatic posts.

*A fiscal austerity program that will freeze public spending during 1998 and 1999 at 1997 levels, though respecting the budget assignments established in the Constitution: 4% for the Supreme Court and 6% for the universities, understanding that the 6% is calculated only on the basis of the "ordinary" budget. There will also be a reported 50 million córdoba increase in the education budget in 1998.

This austerity assumes that the salaries of state employees will remain frozen for the next two years—as they have been for the last seven—and that the measly pensions for retired workers will be frozen as well. (The President declared that top functionaries will continue receiving their extremely high salaries, which have never been made public but which Alemán compared to the "worthy salaries that high executives of any company receive, since the state should function like a company.")

A "Task Force"

To these measures the government is adding a reform of the state banking system, in particular the already announced and controversial "redimensioning" of the National Development Bank (BANADES). The government calculates that this operation will require 520 million córdobas, which it does not have. It is also adding another phase of the privatization program, which will fundamentally mean that the oft-postponed sale of the state telecommunications operations will finally happen in 1998.

The government specifies in the document it gave the IMF that "these goals will only be feasible and efficient, avoiding the problems of this year, if we proceed to a genuine reform of the state and a re-engineering of the largest entities and ministries." It also borrows an English term that is used in economic technocracy but that in Spanish, particularly Nicaraguan Spanish from the 1980s, has a distinctly military connotation: "A task force has already been created for this purpose, made up of 80 functionaries from the various ministries to develop this work."

Hope Comes from Taiwan

The government is trying to project optimism in both the document for the IMF and public statements. The basis for this optimism is in the foreign resources that will be freed up once ESAF II is signed, the greater domestic resources that should continue coming in from the tax reform, and the increase in traditional and nontraditional exports, particularly those from the assembly plants for re-export (the maquiladora industry).

Optimism is also found in the "generosity" of Taiwan. That small and prosperous country is giving out donations and offering the cheapest loans on the international market to win points in its conflict with the gigantic and also prosperous continental China. President Alemán traveled to Taiwan in July with an entourage of 30 people who then enjoyed a vacation in Hawaii. The trip netted the Nicaraguan government $70 million in liquid funds for the next five years and another $60 million tied to various projects, among them $10 million for the construction of a presidential palace.

Taiwan is interested in a united Central America, which would make it easier for its own business class to make large investments, as the Taiwanese government is continually encouraging it to do. Taiwan is pulling various levers on behalf of Central American unity. Honduras and Nicaragua seem to be the countries within the region that are the most open to Taiwan's strategy, with El Salvador close behind. On August 26, the Honduran and Salvadoran Presidents unexpectedly proposed that Central America sign a political unity agreement as early as December of this year. The Nicaraguan President kicked in with the declaration that Taiwan is "the Central Americans' strategic ally."
This proposal, encouraged by the need to present unified positions to the Taiwanese government which would permit access to more economic resources, suffered a reversal soon afterward. The governments of Central America met in Managua on September 1 to study the possibility of a "political union" of their countries. Costa Rica openly rejected the idea, though agreement was reached in favor of a "gradual and progressive" Central American Union.

This contradicts a decision made in the XIX Summit of Central American Presidents, held in Panama on July 12-13, to reduce the budgets and personnel of the regional integration bodies, and initiate a process to eventually dissolve the Central American Court of Justice. In addition to Costa Rica's disinterest in integration, other factors behind the decision to downplay its political-judicial aspects at that time included pressure from the international financial agencies and US interest in the regional trade project. There was also a flurry of domestic sentiment in the poorer countries, particularly Nicaragua, to scale down or even eliminate the new Central American Parliament, whose elected members pull huge salaries and travel expenses for very few days in session each year.

Undaunted, Taiwan's President Lee Teng-Hui launched a diplomatic offensive in September in several Latin American countries, specifically those in the most dire straits, offering millions in aid in exchange for their vote in the United Nations and lobbying in other international forums on behalf of Taiwan's cause with respect to mainland China. Taiwan has only 29 diplomatic allies today, the majority of them impoverished countries of Africa and Latin America. Nicaragua assumed its place among this group of beggar allies when Violeta Chamorro took office.

"We aren't financially viable"

Despite all the official government optimism, Nicaragua's problems run wide and deep. One of the most important objectives in signing the new ESAF agreement is to become eligible to renegotiate the country's unbearable foreign debt. In the document presented to the IMF, the government states that there will be a $40 million public deficit and that all macroeconomic indicators will be in the red if the debt is not renegotiated. But it also specifies that, even with the renegotiation, the country's reserves will be at barely $1.7 billion in 1998, and the other indicators will remain negative.

The government notes that Nicaragua will need donations if it is to satisfy the interest payments on the foreign debt over the next three years (some $150 million annually). There is no other way it can meet this debt service. The government proposes cutting the service to half if ESAF is signed and the Club of Paris countries agree to renegotiate Nicaragua's debt. Only by renegotiating and paying the interest can we get access to the Club's program to condone the debts of highly indebted and severely impoverished counties, another beggar group to which Nicaragua and several African countries belong.

In the document to the IMF the government acknowledges that Nicaragua "is not financially viable" and needs a general pardon from its foreign debt that will reduce the service down to no more than 20% of the country's total export-generated income. Today it is more than 30%. "If Nicaragua does its part by signing an ESAF with the IMF," argues the document, "we are going to demand that the donor community help us cover the foreign debt service, which exceeds 20% of its exports."

Prevent or React?

The Central Bank president's announcement that ESAF is in the works plus the contents of the document to the IMF added more uncertainty to a landscape already painted in that hue. General Cuadra's speech following these announcements must also be seen as part of the overall reactions generated by the imminence of a new ESAF agreement.

"Aspects of the structural adjustment plan weigh heavily on the population," said Cuadra. "The measures to control the main macroeconomic variables have been successful, but they have also left serious social results.... We need the design and application of viable and bold social policies to offset the impact of the obliged economic reforms, particularly on the most vulnerable sectors of the population. The task is to articulate preventive policies before we find ourselves obliged to apply reactive ones, whose social and political costs are always high and, on occasions, even unpredictable."

The FSLN Keeps on Prodding

How should these "viable and bold social policies" be designed? The political premise behind any answer to this and similar questions is some kind of national unity, agreement or at least understanding. The FSLN has been prodding in this direction for several months, trying to moderate the anti-Sandinista attitudes that a sector of the Liberal government brought with it in January. At the same time, it is also trying to wring some advantage out of the obvious contradictions in the initial project of Somocista restoration that Alemán himself brought to the office.

Since April, with its so-called crisis of the barricades, the FSLN structures have kept their prod sharpened but at rest, skillfully using the popular discontent and any government error to their advantage. And there has been no lack of either one. Nonetheless, the way the FSLN has taken advantage of the government's weaknesses and contradictions has not often been very well coordinated with the reality of the Sandinista base. The party structures seem to be focusing far more on filing charges in the media than on offering alternative proposals from, with and for the grassroots base. There seems to be more repetition of populist rhetoric than there is a search for popular organization. This contradiction and many other political, ethical and organizational vacuums explain why the grassroots of Sandinista origin seem perplexed and passive.

"It can't comply"

The announcement that a new ESAF agreement—and all the anti-popular measures that go along with it—would be signed gave the FSLN its best shot at the Liberals. National Assembly representative Bayardo Arce immediately denounced the consequences that the accord will have since the government is signing it from a position of weakness. He particularly called attention to the government's inability to comply with the optimistic forecasts included in the document presented to the Fund.

Arce said that Nicaragua has only gotten $28 million in foreign aid in the eight months Alemán has been in office, that the government is reducing the state apparatus but inordinately increasing the salaries of top-level functionaries, and that the 1997 budget is still being implemented with discretion and a lack of transparency. Arce referred to the absence of funds in the country to back the government's issuance of bonds to prevent the economy from collapsing.

Taking all these points into account, Arce claimed that the main problem is that the government will be unable to comply with what it agrees to with the IMF, because it has presented an "unrealistic" program. He warned that the crisis resulting from a failure to comply will make the national situation even less viable within a few months. "When government functionaries speak about how the economy is improving and promise that it will continue to improve, they are deceiving the population, but they aren't deceiving the Fund."

Is There Another Way Out?

Does the FSLN have an alternative negotiating proposal with the IMF? Does such an alternative proposal even exist, independent of whether the FSLN or any other Nicaraguan political party has it or not? A solid basis for this eventual negotiation would be a national consensus that generates an agreement about what to ask of the international financing agencies and what to give them; what to promise and what to demand. A national agreement of this sort would require a new public morality, in which both the many obscene luxuries of a certain political class and the lack of controls and transparency would be excluded.

No alternatives can be negotiated with the IMF from the position of political intolerance and immorality that this government has fostered since its first day in office. Nor can they be negotiated if the FSLN does not inject new morality into its own structures and creatively stick to the accumulation of experience and desires for participation that so many Sandinistas still have. Much of this potential is today neglected due to insensitivity, a lack of patient leadership and excessive top-down decision-making.

Dialogue with Neither Shame Nor Glory

To give the IMF the image that a desire for national unity upon which to base an acceptable level of governability exists, the Liberal government called for a National Dialogue in June and installed it in July. It hoped to reach significant national agreements, at least at the image level.

The FSLN's boycott of the National Dialogue has not been the only action that has weakened this forum. It has also been damaged by the government's clear maneuvering in seeing to it that a simple majority could pass decisions after assuring that a majority of the invited organizations and individuals are in fact loyal to its positions (some 37 out of a total of 55 participants). All this explains much better than the FSLN's absence why this initiative isn't a success.

The dialogue isn't a total failure either, however. Two agreements have come out of it after 50 days: to suspend the evictions of people living on small urban and rural properties in conflict for another 150 days, and to give a six-month extension to the agricultural producers in arrears with the state banking system. The dialogue is also generating a long list of "recommendations" for the government.

The National Dialogue is thus continuing with neither shame nor glory. Only a very small political and social sector seems genuinely interested in its development. The explanation of why the Dialogue hasn't fallen completely apart, leaving the government representatives and their like-minded cohorts alone in the discussion hall, may lie in the fact that the other political groups still participating in it combine an untarnished anti-Sandinista position with opposition to the Alemán government. While more participants—representatives of the women's movement, among others—followed the footsteps of the Sandinista Renovation Movement by abandoning the Dialogue in August, it hasn't been a rout.

Property: Is There Really Closure?

In the past few months, the FSLN has used the threat of its steel prod to moderate the government's political intolerance, keep spaces open, maintain and increase its own advocacy role and defend the economic interests—some clean and some rather murky—of the party and many of its leaders. The prod has been kept especially busy on an FSLN priority: a definitive resolution of the property problems, which after seven years are still the most destabilizing in the country today.

The complexity of the various elements within this rubric is overwhelming. Tens of thousands of poor in the countryside and city were benefitted by law in the 1980s but never by legal title; dozens of property owners were unjustly confiscated and never compensated; hundreds of worker-owners, some real, some nominal, find that their shares in the valuable agricultural enterprises privatized to them are now coveted by the new government; thousands of properties are in dispute all over the country; a handful of new owners abused the social benefit laws to get their properties cheaply; there are open and covert "piñateros"; all of the numerous property laws are questioned by one side or the other; legal scams made with these laws have to be discovered and rectified, etc., etc. In addition, from the very start of its administration, the Liberal government wanted to add one more problem to this complexity: it irresponsibly encouraged Somoza family members to return to Nicaragua and claim their properties in the courts, thus stirring up polarization and political intolerance even more (see box, next page).

Despite the FSLN's abstention from the National Dialogue, the Liberal government and the FSLN never interrupted their bilateral dialogue about the property issue. For nearly nine months a commission of jurists for the government headed by Attorney General Julio Centeno Gómez, and a commission of jurists for the FSLN headed by the former Central Bank president Joaquín Cuadra Chamorro, continued talking.

The recurring crises that this bilateral dialogue has gone through—only guessed at from the contradictory, provocative and occasionally even constructive political statements made by both Sandinista and Liberal leaders—seem to have ended. We appear to have finally reached the point of putting the famed "final period" to this conflict: on September 5, the government and the FSLN announced that they had reached complete agreement. The two commissions formally turned over the text of the bilateral agreement, drafted in legal language to function as a legislative bill, to both President Alemán and ex-President Daniel Ortega, secretary general of the FSLN.

While this agreement could open a new stage in the country's dynamic, it isn't out of the woods yet. It immediately suffered a tug-of war about where to send it next. The government wanted it to go first to the National Dialogue, with its many Liberal sympathizers, including the intransigent organization of confiscated property owners. The FSLN, fearing the document would be significantly altered, wanted it to go straight to the National Assembly. Since the details of the agreement were made public just as envío went to press, and the issue of its path had not yet been resolved, we will analyze the agreement and its immediate fate in depth in the next issue of envío

Guadamuz: A symbol?

If the main property problems are indeed being resolved legally and politically in the government-FSLN agreement, many other problems remain to be resolved. Not the least of these are problems within the FSLN itself.
This month there were some signs that the FSLN structures may be shaking out their wrinkles so they can have more effective influence. The FSLN's internal dynamic returned to the center of public debate with the expulsion from its ranks of the popular Radio Ya director, entrepreneur and controversial second-place candidate for mayor of Managua, Carlos Guadamuz. As one FSLN militant told envío, the expulsion, which some Sandinista sectors had already been asking for at other moments, "is a symbol that indicates the direction in which we want to begin to move." After this shake-up, others will surely come to contribute similar symbols at a local level.

The final straw in the case of Guadamuz was his active involvement in the scandalous salary increase for Roberto Cedeño, Managua's Liberal mayor. The Municipal Council decided on August 16 to raise Cedeño's salary from $4,500 a month to $10,000, and raise to $1,500 the fee its own members receive for each of the 18 sessions they sit through each year. The support that four of the seven Sandinista council members gave to this decision was what justified the decision to expel Guadamuz, who headed the FSLN bench in the Council.

The high salaries and perks that Managua's municipal functionaries receive and ostentatiously use without a hint of modesty—as can be witnessed in the luxurious vehicular park that has been observed in the capital since the change of government—was already an affront to public sensitivity, particularly in the face of the grinding poverty of so many. It is one of the themes of public morality that is beginning to heat up. In fact, by September 3, the pressure of public opinion forced Mayor Cedeño to back down and stay with his original salary.

The FSLN communiqué on why Guadamuz was expelled explains that, for some time, he "has developed and promoted a current of disrespect and adversity to the resolutions and orientations of the party; he has even launched unfounded accusations with impunity against the moral integrity of party authorities in an irresponsible fashion." Many people recalled that his irresponsible radio commentaries about Sergio Ramírez and his family drove the final wedge into the differences that culminated in the division of the FSLN and the birth of the Sandinista Renovation Movement. Guadamuz himself, meanwhile, has formally appealed the decision with the proper party structure.

Democracy Only on Paper?

There has also been another signal in the search to reactivate and re-moralize the FSLN. At the end of August, the elections for leadership of the Sandinista Workers Confederation (CST) and several decisions made in its congress seem to be more than just cosmetic.

Shaking off some of its own inertia, the CST increased the presence of women on its national executive board; decided to seek to unify the Sandinista unions, divided for some years now; and will try to bring into the weakened Nicaraguan union movement the thousands of informal workers, unemployed and small merchants, all of whom lack representation to defend their positions and their rights.

The CST also firmly ratified an older disposition that has never been complied with: no Sandinista union leader may at the same time be a business leader in the companies privatized to the workers that make up the Area of Workers' Property. The "two hats" that historic CST leaders wore during the Chamorro government caused Sandinista unionism lose to credibility.

It is now to be hoped that these changes, which favor democracy because they lean toward broader and more transparent participation, do not remain at the level of proclamations, just another piece in the image games played by the upper echelons in the "democracy on paper."

Reforms to the Electoral Law: Signs from the Other Side

Other signals from the FSLN are coming from a less democratic side. The national unity that the country needs requires that the FSLN lucidly resist the temptation to put all its chips on bipartisan solutions. Falling into that temptation would isolate other political groups that, though they did not get a lot of voter support in the elections, do have enough social representation in various spaces to restrain the political intolerance, the Somocista tendencies or the immoralities of the new government. But it would appear that the FSLN may have been lured into a pact with the Liberals.

Sandinista and Liberal legislators spent a month guaranteeing very advantageous positions for both parties in the 24 modifications made to the Electoral Law for the election of regional authorities on the Atlantic Coast next March, and excluded the other parliamentary parties from these discussions. At the end, they approved the reforms in the National Assembly in the "steamroller" style that the Sandinistas have been so critical of the Liberals for using, without taking into account any of the objections of the other parties.

Some of the modifications for the coast elections are aimed at preventing some of the irregularities that characterized the October 1996 electoral process, but others, especially the reforms referring to financing of the parties and control of the polling places, inequitably favor the Liberals and the Sandinistas, with a clear anti-pluralist taint. Legislators from the other parties charged that, with these reforms, the country is witnessing the formal debut of a new bipartisan pact. Their use of pejorative terms from the 150-year long period of Conservative-Liberal deals—such as "historical parallels," "kupia kumi pact" and "zancudismo"—indicated how deeply the hostility to an exclusionary two-party system runs in Nicaragua.

A grassroots Sandinista militant with a long history in the party offered an analysis of the danger of this Liberal-FSLN "pact" that so many fear for so many different reasons. It is an analysis from just one side of this complicated issue, but is cogent as well as harsh: "It would seem at times that some Sandinista leaders prefer that a corrupt Liberal run this flea market rather than someone honest, whether or not it's a Sandinista. And why do they prefer that? Because they can cut deals with the corrupt one easier, and with that they can launder their own tricky schemes. With the honest one they don't know what to do. Besides, an honest one, and even more so if the person's a Sandinista, is competition for them. For these times, it goes better for them with corruption, with pacts. Afterwards, they say, we'll see how to win the next elections."
Will the property agreement between the executive branch of the government and the National Directorate of the FSLN have these risky tints of bipartisan exclusion? We will analyze this in the next issue too.

Time Is Running Out

The national unity necessary to face our crisis successfully in the limited time left to Nicaragua requires lucidity and realism on everyone's part. There is a lot of unused potential. In any meeting of so-called civil society, the Nicaraguan population clearly identifies the social problems affecting it and links them, also with clarity, to concrete causes and concrete consequences.

But even after such accurate assessments, it is still hard for them to come up with small, medium or large economic answers with which to begin to surmount these problems from their level—the local level—or on an even smaller scale. And it is hard for them to discover the fissures or loopholes in the system through which they can enter to engage in successful civic struggles. On the other hand, one sometimes gets the impression that our civil society organizations are busier diagnosing the problems than creating and promoting organization around concrete economic, legal and technological proposals to resolve them.

There are authentic leaders at the head of this multiplicity of social organizations and movements, although no credible leadership has yet emerged that can or is trying to pull the different organizations together and overcome the many rivalries—over leadership or over cooperation resources from the international NGOs—that keep them divided.

How and around what can the hopes—and the hopelessness—of people be organized? How can the political disappointment in social mobilization and in economic proposals be transformed? Perhaps it's not yet time for so much spirit, real but dispersed, to come together. But time is running out for Nicaragua if it wants to avoid sinking into the dangerous quicksand of a democracy on paper only.


In July four nephews of Anastasio Somoza Debayle announced that they had established a team of lawyers in an office in Managua, ready to file court claims for some 50 family properties (farms, factories, banking institutions, fishing operations, urban lots, etc.) confiscated by the revolution, which they valued at $250 million. "We know that we're the last on the list, and that they have declared civil death for us," said Luis Sevilla Somoza, on behalf of two of his brothers and one cousin, "but here we are."
In August, the Somozas took over one of the farms they were claiming on Managua's periphery by force, using a group of armed men. They were subpoenaed to the local court for this illegal act, but never showed up. At first President Alemán offered the opinion that "children are not guilty of the errors of their parents, so the punishments for crimes should not pass on to them." After that he avoided making any more pronouncements, though many other national personalities did--but on the other side of the issue.

Sandinista Renovation Movement leader Sergio Ramírez, who broke with the FSLN in 1994 in part over the FSLN's refusal to renounce violence as a method of struggle, used the most forceful language outside of the FSLN itself in opposition to the Somoza family's provocative pretensions. In a written statement published in El Nuevo Diario on August 30, titled "Reclamos Inmorales," Ramírez warned that "if the Somozas feel encouraged in their claims, and those claims are admitted, I am obliged to think that a plan is underway to return that family's power and privileges to it. That means that democracy is at risk, and peace is at risk. But we cannot admit any retreat in either democracy or peace.

"Polarization, such as it is now, is bad. But if it becomes necessary to close ranks to prevent the Somozas from again taking over Nicaragua, we will have to close them. It would be a shame, because then no space would remain for any dialogue, or understanding. The democratic system has been put to the test today as never before in this whole period of transition."

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