Tag: Acque & Terre

Recent developments in the political situation in Peru have taken foreign observers by surprise. The apparently paradoxical nature of the situation within the country makes Peru a ‘case’ that merits close study.
The first surprise came in 1990, with the election as president of Alberto Fujimori, an engineer of Japanese origins who had previously had nothing to do with politics. His meteoric rise during the last few months of the election campaign and his final victory over the clear
favourite, Mario Vargas Llosa, dumbfounded observers both at home and abroad.
However, it is clear that those analysts who took Vargas Llosa’s victory for granted were assuming that Peruvian electors would react to his proposed liberalist policies in the same way as European voters in similar circumstances. Evidently this was not the case, and this article I
will try to explain why.
The very fact of Fujimoro’s Japanese origins took by surprise those many pеоple who had underestimated the size and influence of the Oriental communities (both Japanese and Chinese) within certain Latin American countries. A second surprise came in April 1992, when
the Fuji Coup’ took place, with the President dissolving Parliament and assuming dictatorial powers (with the backing of the armed forces).

This turn of events seemed to run counter to the gradual democratization that could be noted in various South American countries during the course of the 80s; it was precisely one of those democratically-elected heads of state who was breaking the spell of optimism and
conjuring up the dark shadows of the sub-continent’s political past.
But was it really fair to see the ‘Fuji Coup in this way? Was the president – as some claim – taking advantage of a situation he had deliberately brought about (with help from some sections of the armed forces), or was he reacting against the excessive obstructionism of a Parliament that was openly hostile to him?

If the former reading of events is the right one, then Fujimori is just one more of the many dictators who have blighted Peru’s history, a man who has betrayed all the expectations that were raised at the time of his election (expectations that were fuelled, in part, by the undoubted novelty of his candidacy).
His presidency would simply mark another setback in Peru’s drive towards modernization, another defeat in the battle against the country’s underdevelopment.

If, however, the latter interpretation is the correct one, then Fujimori’s move would represent a step towards ridding the country of the old political elites and establishing a new basis for political life in the country a definite advance on the period 1980-1990 (when under
Presidents Belaunde and Garcia the country had its fullest experience of democratic rule).
The April ’92 coup was universally condemned by the international community, which clearly feared that it marked a disturbing return to the past.

However, the condemnation never really went beyond the verbal level. Neither the USA nor the other countries of Latin America ‘pushed’ the diplomatic crisis caused by Fujimori’s anti-democratic behaviour; only very limited sanctions were taken against his regime. The whole episode turned into another example of the total inadequacy of the Organization of American States (OEA), even when faced with a situation in which there was a clear threat to values that are fundamental to democratic government in the area.

When the dissolved Houses of Parliament removed Fujimori from office and appointed his second vice-president, Máximo San Román. in his stead there was a temporary international crisis, which soon fizzled out when it became clear that Fujimori was still firmly in control in Lima. The international community preferred not to press its condemnation of the coup, and protests soon came to end.
It is also true that there was no firm reaction within Peru, either at an institutional or a social level. There was nothing like the popular protest that the Procuradoría General, the Tribunal Constitucional and the press managed to stir up in Guatemala the following year when the president Jorge Serrano tried to follow Fujimori’s example and take dictatorial powers for himself. It would seem, therefore, that both the Peruvian and international community gave Fujimori the benefit of the doubt: the former apparently accepted his claim that the
extra presidential powers were needed to defeat terrorism and resolve the economic crisis, the latter seem to have accepted Fujimori’s repeated protestations that democracy will be restored once the emergency has been overcome Polls for the forthcoming presidential
elections in April ’95 give Fujimori a clear advantage (some 45% of all votes). Не
would appear to be a long way ahead of his most serious rival, the ex-SecretaryGeneral of the United Nations, Javier Pérez de Cuellar, who – just like Vargas Llosa five years ago – is the candidate that enjoys the unanimous approval of international commentators.

Whilst not wanting to give too much weight to polls – which did, however, turn out to be very accurate at the last presidential election it seems clear that Fujimori is in a very strong position and very likely to be re-elected. But how is it possible for a democratically-elected
president who has assumed dictatorial powers to then win democratic elections? A question that brings us up against another apparent paradox of Peruvian political life.

To give an adequate explanation of these apparent contradictions one has to look back in time to identify what have been constant features of Peruvian politics ever since the country gained independence in 1823.
For the first fifty years – up to 1872 – pоwer was in the hands of the army, whilst the Creole bourgeoisie supplied the state’s bureaucrats. One Caudillo succeeded another, yet none of them was able to put his mark on the state, which continued to grow without any overall plan or institutional stability.

One need only mention that between 1823 and 1867 the country had seven different constitutions, none of which became firmly established.
Naturally enough Peru was no different from any other South American nation in having its Liberal and Ultra-Conservative factions; but real power was always in the hands of the military. 1876 saw the election of Peru’s first civilian president, Manuel Pardo, leader of the Partido Civil, which represented the economic interests of certain elites who had been hard-hit by the number of concessions given to foreign companies.
Another important political party at the end of the century was the Partido Democratico, a conservative, populist party. However, the two-party system never gained a firm foothold in Peru: whilst in other Latin American countries the two-party system has lasted up to the present day (interrupted, of course, by periods of rule by authoritarian regimes) and helps to guarantee some sort of political stability, Peruvian political parties never seem to have become firmly rooted as expressions of the people’s aspirations.
In the 1930s the demise of the latenineteenth-century parties was accom panied by the emergence of new parties, which had very different political aims. Foremost amongst these were the Unión Revolucionaria and, above all Haya de la Torre’s Alianza Popular Revolucionaria Americana (APRA), which were of explicitly Socialist – but not Marxist – inspiration, and aimed to be the expression of a specifically Indo-American ideology.

Other parties – such as Acción Popular, Partido Social Cristiano and Izquierda Unida – have continued to emerge; but whilst obtaining partial successes, none of them have really been able to stamp its mark on Peruvian political life.
This weakness of political parties and their inability to become firmly rooted within society is, therefore, a constant feature of Peruvian politics. The second constant feature to be noted
is closely connected to the first. With political parties weak and trade unions counting for little (only 11% of all workers belong to a union), the one institution that has always maintained its political influence is the army. Power has thus tended to be exercised either by
the army directly or else by dictators who enjoy the support of the armed forces.
The most recent example of the Army’s power is the unexpected Peru-Ecuador confrontation over the border region of Cordigliera del Condor. It may be impossible to establish who is responsible for the outbreak of hostilities over this territorial dispute, but I suspect that
the Peruvian Army leapt at this chance to flex its muscles (with the struggle against
terrorism no longer so much in the limelight, the Armed Forces were only too happy to put on a show of force for domestic consumption). In Ecuador too, the armed forces are boss – and this serves to explain why the conflict has so rapidly degenerated, assuming a violence that is out of all proportion to the actual importance of the zone contended.
The political ‘clout’ of the Peruvian Armed Forces was, in fact, strengthened during the 80s (a period of democratic rule) by the fact that the struggle against the Sendero Luminoso terrorists enabled the army to exercise direct control over large parts of the country: in those
regions where a state of emergency was declared, civil law was suspended and the army was invested with wide-ranging powers.
And if one adds to this the fact that the Sendero Luminoso themselves exercised control in various parts of the nation (particularly in the south and the Andean areas), then its clear that Peruvians have had to live in a situation of precarious legality for some time – something which
cannot help but have undermined democratic institutions.
And this brings us to the third fundamental characteristic of Peruvian society. Faced with an elephantine but inefficient state apparatus, with a legal system that is incapable of regulating social and economic life adequately, with widespread exceptions to a normal state of law (due to the anti-terrorist legislation), and the absence of political parties that can be true expressions of people’s desire for change, society seems to have developed a system that runs parallel to the state – a system which has enabled ordinary people to survive this
period of uncertainty.

What I’m referring to is Peru’s booming ‘informal’ economy. This phenomenon is present throughout Latin America, and during the great economic crisis of the 80s (the so-called década perdida) developed enormously. Within Peru, however, there is one of the most striking- and best-studied – examples of this type of economic growth.
Together with the development of the informal micro-economy – in which very small firms provide services that make up for the shortcomings of the official economy and the State (thousands of private cars in Lima, for example, are – with the addition of a simple adhesive
badge – transformed into taxis that are now an essential part of the city’s transport system) – there is also a parallel legal system based more on commonly accepted standards than on parliamentary laws (1).
So, bearing these three constants in mind it is easier to evaluate the vicissitudes of Peru’s democracy and also to understand the political attitudes of Peruvians (which clearly differ from those that would be ‘normal’ in a solid, mature democracy).

This was the situation when Mario Vargas Llosa announced his candidacy in 1990.
A writer of international renown, Vargas Llosa was determined to carry Peru forward towards full modernization, which he understood as requiring the creation of a liberalist-democratic regime.
Such reforms were essential if Peru’s uncertain democracy was to be revitalized after ten years of debilitating misrule: in his five years in office (1980-85), President Belaunde had not been able to use the support of the Unión Popular and of the Partido Social Cristiano to implement the reform measures that were necessary for the country to develop, whilst the following five years of rule by the APRA president Alan Garcia were marked by total economic mismanagement and corruption on a scandalous scale. And alongside these political-economic difficulties went the threat posed by the Sendero Luninoso terrorists, who exercised effective control over parts of the country.

A complete outsider to traditional Peruvian politics, Vargas Llosa made the mistake of presenting his political manifesto a little too clearly; the reforms he proposed involved the cutting of public spending and therefore would have been costly in social terms (2).
For months it seemed, however, as though he would be elected without any serious opposition; then Fujimori appeared on the scene, backed by a blatantly populist election campaign which was deliberately vague over real issues.
Fujimori had the double advantage of being even more of a novelty than Vargas Llosa – who was burdened with support by various traditional parties – and of not threatening voters with economic sacrifices.

Once elected, Fujimori had to face the disadvantages of not having a properly organized party behind him (his movement ‘Change ’90 had not won many seats in parliament), but he nevertheless went ahead with certain austerity policies which not only ran counter to his
election promises but also failed to be part of an overall process of reform.
One could go on for a long time debating whether the April ’92 coup was a premeditated move by Fujimori the consequences of the two possible interpretations have already been outlined
above but one thing that has to be emphasized is the mistake made by many of the parties represented in the dissolved parliament when they decided not to put up candidates in the elections for the Constitutional Assembly held on November 1992. By not doing so, they
enabled the dictator’s group to win an absolute majority, and thus Fujimori could ‘recycle’ himself as a fully legitimate president. He made full use of this advantage when, in October 1993, he got a popular mandate for a new Constitution that fitted in so well with his own
interests (amongst other things, the Constitution envisaged the immediate re-election of the president).

However, these mistakes by his oppоnents do not explain why Fujimori is the opinion-poll favourite, with two out of every three Peruvian voters willing to re-elect him in April. The crux of the matter lies elsewhere in the voters’ view of Fujimori as the man who has finally defeated the Sendero Luminoso movement.

To understand just how grimly terrorism blighted life in Peru one only has to look at the statistics provided by the Institutuo Constitución y Sociedad: in 1980, terrorism caused more than 27,000 deaths and material damage to the value of some 20 billion dollars (which
does not even include the cost of the development opportunities missed because of the employment of resources in the struggle against terrorism) (3).
Civil life in the entire country was slowly being throttled by the conflict. Quite apart from those areas such as Ayacucho (Sendero’s ‘birthplace’) in which the terrorists were in effective control, there was no area of the nation in which they could not make their presence felt: in 1992 Lima itself was crippled for months when Abimael Guzmán proclaimed what he called an ‘armed strike’.
Guzmán was known to his organization as ‘President Gonzalo’, and considered the ‘fourth sword’ of Communism, the legitimate heir of Mao, etc – so, given the vertical power structure of his organization, his capture on 12 September 1992 dealt a fundamental blow to terrorism.
Since then, the strong-arm methods adopted by the armed forces in their battle against Sendero and the MRTA (Movimento revolucionario Tupac Amaru) have seriously weakened the threat such organizations pose: about 12,000 guerrillas have been captured, and another 3,500 have taken advantage of the opportunity offered by the government’s ley de arrepentimiento to lay down their arms.

However, whilst Guzmán may now be cooperating with the authorities and launching appeals to his followers to surrender their weapons, terrorism has yet to be totally defeated: a hard core of Sendero, under the leadership of Oscar Ramirez Durand, continues to be active
in the Ayacucho region. Nevertheless, it is true that the organization does not have the operative capacity it had in the past.

The change is palpable everywhere, particularly in the capital, where life seems to have returned to a kind of dazed normality. It should come as no surprise therefore that Lima, which
accounts for more than 60% of the entire Peruvian population, is a Fujimori stronghold.
And, quite apart from the success of his battle against terrorism, one must also bear in mind that Fujimori skilfully concentrated all the unpopular measures of his presidency in his first years in office, whilst in this pre-election year he is constantly on the move from the opening of one state-financed scheme to another. Such tactics make his populist appeal even clearer.
There may be only timid signs of economic recovery (with inflation now under control), and the situation as a whole may still be critical, but the average Peruvian tends to see a great improvement in things; whilst if he looks back at the period of ‘democratic’ rule all he
sees is a constant deterioration in living standards.
This is the context within which Pérez de Cuellar has announced his candidacy, moved he says byconcern over the regime’s authoritarianism and by the type of presidentialism enshrined in the new Constitution. He accepts that there is no alternative to his rival’s economic policy, but criticizes Fujimori’s social policies as mere ‘vote-catching’ when they should be part of an overall economic policy (it shouldn’t be forgotten that 50% of the Peruvian population lives below the poverty line). Pérez de Cuellar is also critical of the excessive centralism of Fujimori’s policies, which reinforces the dominant role of Lima and thus confirms a vicious circle, with
the capital tending to attract more and more people from the provinces (4).

Though enjoying widespread international support, it seems unlikely at the moment that de Cuellar will be the victor in the April elections. As I have pointed out, Fujimori is in a strong position precisely because of those same three constant features of Peruvian history (the weakness of organized political parties, the pre-eminence of the armed forces and of a certain tendency towards authoritarianism, and finally that Peruvian ability to ‘get along with’
illegality). In such a situation the widely publicized domestic quarrelling between Fujimori and his wife Susana Higuchi (who has even become his political opponent, with her own ‘Harmony- Seal XXI’ movement) does not seem to have had any great effect upon the president’s popularity. What is more, Fujimori may well benefit from a surge of nationalism brought on by the conflict with Ecuador. In fact, Pérez de Cuellar’s very international standing may well go against him, giving the impression of someone who is not really in touch with the everyday reality of the nation (even if, to obviate this impression, the candidate travelled the length and breadth of the country in the months before his candidacy was announced).
Even more than Vargas Llosa five years ago, De Cuellar runs the risk of being seen as a candidate imposed from ‘outside’; he has already declined the support of the traditional parties, so as to avoid any confusion with the old political classes which are so unpopular.
In the light of the above explanation of the Peruvian situation, I think that Fujimori’s current popularity appears less paradoxical and is just one more example of the blatant difficulties encountered by western-style democracy in a developing nation. The wide-ranging debate over the suitability of this political model in such nations involves both political scientists and policy-makers, and remains a question of extraordinary importance both for international strategy and for North-South relations in general.

Notes
(1) On Peru’s informal economy, see
Rostros de la informalidad, Instituto de
desarrollo del sector informal, Lima
1992.
(2) For a closer look at Vargas Llosa’s
position, see La contenta barbarie by
his son, Alvaro, Editorial Planeta,
Barcelona, 1993.
(3) Numerous works have been written
on the Sendero Luminoso phenomenon, see for example: D. Krujit, Entre
Sendero y los militares, Lima, 1991; G.
Gorriti, Sendero: Historia de la guerra
milenaria del Perù, Lima, 1990. Shining
Path of Peru, collection of essays, St.
Martin’s Press, New York, 1992.
(4) See the interview with Pérez de Cuellar in El Pais, 8 September 1994.

What will Fernando Henrique Cardoso’s first-round victory in the October 3 presidential elections mean for Brazil?

Have things reached a turning-point in Brazil, a country where everything is on a gigantic scale distances, potential capacities, social inequalities and even passions? Or is this going to be just another of the country’s many disappointments?

To find the answer we should perhaps first analyze the context within which the elections were held, and then look at what lies ahead for the newly elected president.

First of all, it should be remembered that Cardoso – an economist and sociologist of international standing, as well as a former MP for the Partido Social Democrata Brasiliero (PSDB) – is not replacing a formally elected president, but Itamar Franco, the vice-president who had to take over the presidency when Congress impeached Fernando Collor de Mello in December 1992.

That impeachment came at the end of a prolonged trial of strength between Collor de Mello and the two Houses of Parliament, which was only resolved with the ousting of the president as a result of revelations about his personal involvement in corruption and embezzlement of public funds.

Public indignation at the scandal was enormous: there were huge anti-Collor demonstrations throughout the year. For once the usual Brazilian apathy with regard to politics was shaken, particularly amongst the young, who formed the bulk of those who took to the streets in protest and felt particularly betrayed by Collor, whose election in 1989 had been hailed as representing the consolidation of the New Brazil. It should not be forgotten that he was the first popularly-elected president since the end of military dictatorship.

An outsider amongst traditional political forces and established parties, Collor had captured the public imagination with his youthful – and telegenic – air of a decision-maker whose programme was based upon liberal principles and – irony of ironies – the fight against corruption. He raised great hopes which were then dashed in the most brutal of ways. And, for the first time, disappointment stirred Brazil to react. Much has been written, both in Brazil and abroad, on the subject – and often in very enthusiastic tones.

However, I think it should be pointed out that public indignation was not the only factor that brought about Collor’s impeachment. Equally – if not more important was the weakness of the president’s own party (Partito da renovacào nacional, PRN) in both Houses. This explains the strained relations between Congress and the president – difficulties made even more acute by Collor’s excessive exploitation of the mass media and the failure of his anti-inflation programme (which had frozen salaries and bank accounts, creating severe difficulties for Brazilian families without having a noticeable effect on the skyhigh inflation rate).

Without these two supplementary factors, I think it highly unlikely that popular indignation alone would have led to impeachment.

Collor’s constitutional successor was his vice-president, Itamar Franco, unscathed by scandal; his inheritance included an inflation rate of 1,100 per cent, interest rates of 30 per cent, enormous foreign debts and an economy deep in recession.

The first few months of his presidency were characterized by uncertainty, with Franco giving no clear outline of his political programme. And when he did so, he put the rapid reduction of inflation and interest rates at the top of his list of priorities; the difficulties involved in achieving such aims led to conflict with both the monetary authorities and his own finance ministers (in the first eight months of his presidency, two finance ministers and two Governors of the Banco do Brasil resigned).

Announced in April 1993, Franco’s economic strategy envisaged a zero annual growth rate in the national deficit, the reduction of interest rates on the public debt, wide-ranging privatisation (with foreign capital being able to buy up to 100% of a privatised company), incentives for the building industry and for agriculture, and accompanying social measures. Drawn up by the finance minister, Resende, (who subsequently resigned), the plan was welcome by the Brazilian business community as it did not envisage the shock measures that had been part of the Collor Plan. But that was not all that was missing; Franco’s programme also had very little to say about how its objectives were actually to be achieved. The whole thing was more like a statement of good intentions than a practical plan of action that had some chance of succeeding.

These failings went together with the inherent political weakness of Franco’s position: he didn’t have a political party. to support him in Congress and throughout the short time he was in office he failed to show the necessary qualities of political leadership. And this is where Cardoso comes onto the scene – as Rasende’s successor at the Finance Ministry.

His first position in Franco’s government had been that of Foreign Minister – an appointment that was probably made for reasons of ‘image’: Cardoso had not only been exiled during the period of military dictatorship, he was also – as I have already mentioned – a world-famous economist who had taught at some of the best universities in Europe, the USA and South America. After the image disaster of Collor’s presidency, Cardoso was just the person to restore a bit of lustre to Brazil’s tarnished reputation.

Appointed Finance Minister, Cardoso set to work immediately; in June 1993 he presented his Plano Verdade, which was the basis for the more-detailed Plano Real presented the following December.

The main points of the Plano Verdade were: reduction of public spending, the struggle against tax evasion, suspension of central government payments to indebted states and cities (these bodies owed something like 40 million dollars), the concession of greater powers to the Bank of Brazil.

The outcome of negotiations with Brazil’s foreign creditors depended upon the success of these measures. This made it fundamentally important that central grants to debtor states be suspended. However, the Brazilian Constitution makes it clear such grants are not discretionary; and, given the delicate political situation in Brazil, changes in the Constitution are a very sensitive issue.

In fact, central political parties are not very strong, and therefore elected representatives tend to defend local interests rather than follow the party line. So, any measure that conflicted with those interests was bound to have a rough time in Congress.

In the end, the approval of the Fundo social de emergencia, which was financed by a fifteen percent reduction in central grants to states and cities, was a real triumph for Cardoso; besides preparing the ground for the success of his ecоnomic strategy, it also convinced international creditors that Brazil was serious about reform. The result was that in April 1994 the IMF gave its blessing to an agreement for the staggering of repayment of a part of Brazil’s 49 billion dollars of foreign debt.

Success on the foreign-debt front was indissolubly linked with success in restoring some balance to public finances. This balancing was effected by the first phase of the Plano Real, which tackled inflation by dealing with the public deficit: along with the aforementioned 15% reduction in central government grants to states and cities there was an overall 5% increase in federal taxes.

The second phase of the płan,which was adopted on 1 March 1994, aimed to tackle the psychological effects of past inflation by instituting a Unidade real de valor (URV), which was calculated daily by the Bank of Brazil on the basis of various cost-of-living indexes. The URV was to be adopted on a voluntary basis – except where salaries and transfer of insurance payments were concerned. Through dealings on the foreign exchanges markets the Bank of Brazil kept the URV pegged to the dollar.

June saw the third phase of the plan: the introduction of the real – with the URV being adopted by all sectors of the economy. The rapid move on to this third stage shows that the plan is succeeding – or at the very least is having positive psychological effects on both public opinion and the world of finance.

To the great relief of Brazilian families this summer saw a drastic drop in the monthly inflation rate: from 45 to 5%.

Encouraged by these economic successes, Cardoso announced his candidacy for the presidency, thus modifying a situation inwhich the opinion-polllead of Lula da Silva, head of the Partido dos trabalhadores (PT), had been unchallenged for months.

Various factors had contributed to increasing the popular appeal of da Silva, an ex-trade unionist from Sao Paolo who was defeated by Collor in a second ballot in 1989 but is universally respected throughout Brazil, even by his oppоnents. Still smarting from their experience of Collor’s very old version of ‘the new’, and with the parties of the Right unable to put forward a convincing leader or political manifesto, the nation seems to have been willing to give the undoubtedly honest da Silva a chance. Perhaps he would turn out to be the man capable of rooting out the endemic ills of Brazil.

Cardoso’s announcement of his candidacy after the success of his Plano Real changed everything.

A man of the Centre-Left, Cardoso widened the basis of consensus behind him by accepting support from the CentreRight Partido do Fronte liberal (PFL). But, in essence, the presidential election was a paradoxical challenge between two left-wing candidates; the others (Eneas, Brizola, Quercia and Amin) were not even in the race.

Da Silva based his entire campaign on attacking the PSDB-PFL alliance and the negative influence it would have on a Cardoso presidency; he also emphasized the high social cost of the Plano Real. However, the middle classes which had seemed inclined to vote for him were won over by the successes achieved in the fight against inflation, which had an immediate effect upon their everyday life and for which they gave the credit to Cardoso.

The PT’s candidate was not helped by the fact that the presidential elections were held along with federal elections for Governor and State Assemblies in 27 states (between 3 October and 15 November some 1700 elected positions were decided). There are various parts of the country in which the PT is not very well established, so the party organization was not able to set up a ‘snowball’ effect in support of its presidential candidate – something which the traditional parties could achieve for Cardoso.

But is the outlook for President Cardoso? There’s no doubt that the success of the Plano Real is to be considered asa positive factor, but will the president be able to continue with his reforms without alienating Congress, where Members are notorious champions of local interests and the status quo in general? And how will he handle the right-wing section of the coalition behind his candidacy? Will his government incline towards Social Democracy or Conservatism? His choice of Vice-President is already a cause for concern: Marcos Maciel is a old-hand at Brazilian ‘power politics’ and is notorious for his support of the military Junta; his appointment reminds us that Cardoso’s supporters included people like Rede Clobo, the person who ‘invented’ Collor in 1989.

But the debt owed to the Right is not the only problem hanging over Cardoso. How will he deal with the problem of the high social cost of his efforts to balance public finances in a situation which is already characterized by great social inequality? As I pointed out in my article on Salinas’ Mexico in the previous issue, the president must find a way of channelling economic growth so that distribution of wealth does not reinforce the already terrible inequalities between certain states and social classes and others.

Collaboration with da Silva – who has a good personal relationship with Cardoso – seems likely; and it to be hoped that the Trade Unions will also be involved in the reform process; but what will the president’s conservative supporters say to that?

Cardoso’s situation is, therefore, a risky one: he was elected with an overwhelming majority, but must nevertheless performa political juggling act if he is to govern successfully.

What is more, he has not only to balance the state’s books and deal with the social consequences, but also make some strategic choices that are fundamental for the future of the country.

On the one hand there have to be measures to further Brazil’s integration within the Mercosur (something that will require particular effort, given Brazil’s past preference for independent action); on the other, serious reforms have to be made to revitalize both the public administration and the state as a whole.

With regard to the second task one should point out that far-reaching measures are required within all three of the fundamental powers recognized by the Brazilian Constitution. The executive has to recover from the discredit cast upon it by Collor and, to a certain extent, by Franco (a president who suffered because of his extremely weak political position); the legislative body is sluggish, not to say idle (one need only think of the fact that in the last legislature only 176 of the 1402 laws approved by Senate and Congress were the result of draft bills presented by MPs, who are notorious for their absenteeism); and for their part, the Courts are snowed under with a backlog of cases which is increasing all the time. The public administration as a whole is top-heavy, not only in employees but also in institutions (the responsibilities of many of which appear to overlap).

The solution of all these structural problems will require an overall strategy and a political strength which perhaps will be beyond the reach of the new president.

While there is no doubt that Fernando Henrique Cardoso is a person of great abilities, and probably the best man the Brazilians could have chosen for the job, it is also true that he faces a positively herculean task.

Only during the course of his presidency will we be able to judge if the desire for change expressed by the Brazilian voters was the expression of a real determination to overcome the contradictions that riddle the country. If it was, then Brazil may well enter the twentyfirst century as a nation that is finally capable of exploiting its enormous potential.

There have been discordant interpretations of the outcome to the Mexican elections of 21 August. Some observers view it as a flop for the Pri (Partido revolucionario institucional), in power for sixty years. Despite winning the elections, the Pri saw the vote for its candidate Ernesto Zedillo Ponce de León drop under the fifty per cent mark: it was the first time this had ever happened, since in the past Pri presidential candidates were often almost single contenders.

Other commentators point to the fact that the elections were the most near run in the whole of the Republic’s history: for the first time three candidates stood with a fair chance of success, and the eve-ofelection forecasts even hinted at a possible defeat for Zedillo. In this light, the election result could be seen as a success for the Pri. It not only managed to have its candidate elected but above all it did so to the background of acceptably fair elections, thus improving its credibility at home and abroad.

But to make a balanced assessment we must analyze what was really at stake in the August 21 elections.

Let us first look at some facts and figures. Three main candidates stood at the August 21 presidential elections: the Pri candidate Ernest Zedillo carried the day with 48.87 per cent of the votes; the candidate of the conservative Pan (Partido de acción nacional), Diego Fernandez de Cevallos obtained 26.09 per cent, while the left-wing candidate Cuauhtémoc Cárdenas, leader of the Prd (Partido de la revolución democrática) came third with 16.43 per cent of the votes.

The presidential elections were also accompanied by the parliamentary elections which saw a landslide victory for the Pri: of the 298 seats in the Camara de Diputados (at the time of writing two are still vacant), the Pri obtained 268, the Pan 25 and the Prd 5. The opposition did a little better at the Senate since the electoral system has a twofold division of seats: initially the seats are assigned to the first-placed candidate in the constituency, but a certain number of seats are also given to the second-placed candidate. Of the 64 seats assigned using the first method, the Pri won 62 with the remaining 2 going to the Pan, of the second-placed candidates elected there were 22 from the Pan, 9 from the Prd and 1 from the Pri. Then by adding the senators whose term of office had not run out, the composition of the senate is as
follows: Pri 94, Pan 25, and Prd 9.

Significantly, there was a high public turnout, with over seventy per cent of those eligible casting their vote. This figure is much higher than the past average of fifty per cent and goes to show how seriously these elections was taken.

In fact the elections were rather overhyped as the most important in Mexican history. This was not only because the Pri was in danger of losing them, but also because of the background of events of fundamental importance for the country.

These events include Mexican membership of the North American free trade area (Nafta), together with the United States and Canada, introduced on 1 January 1994; the Chiapas peasant uprising which occurred on the same day and had an enormous impact on public opinion and on the Mexican political situation; and finally the shocking assassination of Luis Donaldo Colosio, the Pri presidential candidate, in Tijuana on 6 March.

Along with these key events were a number of other factors attesting to highly volatile situation: the economic reforms introduced by the outgoing liberal-minded president Salinas de Gortari, which turned out to be quite successfully but as yet have not tackled the basic contradictions of a social system with the upper classes fabulously wealthy and the third-world conditions of the rest of the population; the growing importance of the Mexican narcotraffickers (1), whose role is not so much in production as smuggling to the United
States; the climate of political violence, a permanent feature of Mexico which shows no signs of diminishing; the repercussion of a number of crimes never fully explained and clearly connected to the ongoing deep transformations in the country, such as the killing last year in Guadalajara of Cardinal Juan José Posadas and the kidnapping of the most important Mexican banker Harp Helu, a close friend of President Salinas and the key figure in the privatisation process initiated by the President.

Taken together, these factors highlight an extremely complex situation. To understand it we must take a step backwards and see what has happened in Mexico over the past few years.
Mexico has been an atypical case in the framework of Latin American political systems: following the stormy years from 1910 to 1930, the country was characterised by political stability.

The party which inherited the revolutionary legacy was founded by Lázaro Cárdenas (Cuauhtémoc’s father) in the late 1920s. For Europeans the Pri’s very name is a contradiction in terms, but not for the Latin Americans: it associates the revolution with what is apparently the opposite – the institutions. The underlying message in this approach is the transformation of revolutionary demands into a permanent forward motion.

The keystone of the Pri’s electoral success over the decades has been the agricultural reform: the distribution of land to the peasants was the main binding element and through it the party controlled the enormous Mexican rural areas. Land continued to be the property of the state but was entrusted to the campesinos. Around them the Pri built up a system controlling rural areas enabling the party to rule undisturbed without a political opposition until the 1980s. The electoral processes were strictly controlled through various methods: the trade union have always been political and more or less in the Pdi’s pocket, while the armed forces have never had a political role in Mexico and have played a low-profile role on the sidelines in civil society.

Thus the Pri was identified with the state in what was almost a single-party system sheltered from any kind of outside attack.

Naturally within the Pri a number of political families formed, and were often in conflict. But on the whole there was always some basic agreement enabling them to share out the political appointments and the key-posts in the economy. The Pri had absolute control over social life for decades: anyone with other aspirations in Mexico had to come terms and toe the line with this system. The fulcrum of the Mexican political system is the president, who exercises pseudo-royal powers during his six-year term of office. Very significantly, the outgoing president (who can only have one term of office) had the power to appoint the Pri’s candidate for the forthcoming presidentialelections (the so-called dedazo), which was tantamount to appointing his successor.

As far as the economy is concerned, there has always beena widespread presence of the public sector whose many companies stuck to the basic ideological principles of the party. An emblematic example is the public control over the oil sector (Pemex): the sector represents one of the main resources of the country, but Mexico always pursued an independent policy outside of Opec.

The two principal weak points in the Mexican economy were traditional the low influx of foreign capital, impeded by legal difficulties, since for a long time foreign citizens could not own Mexican assets (they were state-owned) and the aforementioned problem of the distribution of wealth between the social classes.

In the 1980s Mexico was by crippled the problem of the external debt: to find a way out of the negative spiral, the government of President De la Madrid launched the first free-market reforms of the economy led by the future President Salinas who at the time held a key position in the Ministry (Secretariat) for Planning and the Budget.

But it was only with the advent of President Salinas, a forty-year old technocrat with a Harvard Ph.d. and a completely different figure from the lumbering dinosaurs ofthe Pri apparatus, that the road to liberalization was definitively taken.

Salinas came to the presidency in 1988 with the background of an excellent economist, a brilliant minister but little clout inside the old families of the Pri. This was no drawback for the new president since one of the two key points in his programme was to break the organic links between government and party as a decisive step towards full democracу; the other key point was of course the liberalization of the economy.

The first great stumbling block for Salinas was his election. Serious doubts were cast on its legitimacy by notorious epіsode: Cárdenas, also a candidate at the time, was leading the count when a spurious electronic fault led to the need for a manual count, which in practice was controlled by the Pri.

In the end Salinas was proclaimed the victor with a tiny majority over Cárdenas, who, however, triumphed in the enormous Distrito Federal (a significant victory given the importance of the Distrito Federal in the overall context of the country): the Pri candidate came out on top thanks to the rural areas, the party’s clientelism and because the massive presence of its militants at the polling booths compared to a much weaker Prd presence greatly undermined the legitimacy of the result.

Thus yet another chapuza (mess) meant that the president’s programme for liberalization and accountability could not have got off to a worse start.

During his presidency, Salinas achieved a number of positive results: from the economic point of view, the privatisation of the banks, the stimulus to investments, the revitalized stock exchange and the basically fairly sound performance of the currency must be set against a worsening balance of payments and a downward trend in the Gdp growth rate. From the foreign policy point ofview, his presidency saw the recent admission of Mexico to the Oecd (more about the Nafta below). The agreement with the Catholic church has been another important result, which has tempered the rather paradoxical excesses of an aggressively secular state in a deeply catholic country (for example, the clergy were not allowed to vote and could not wear their habit in public); and finally even as far as the Pri and its grand families are concerned, Salinas had a number of important successes. In this field his closest ally had been Luis Donaldo Colosio, president of the Pri for four years before being appointed presidential candidate.

But the real turning point for the Salinas administration was the historic agreement on free trade with the United States and Canada (Nafta). This treaty is a fundamental strategic choice for Mexico, which always had very complex relations with its powerful neighbour: or to quote the rather over-used phrase by president Porfirio Diaz, Mexico’s main problem is that it is tan lejos de Dios y tan cerca de los Estados Unidos («as far from God as it is as near to the United States), a vision is shared by many people in the country We could discuss at length the pros and cons of Nafta for Mexico and its two partners,(2) but even when the advantages were only psychołogical, Salinas’s decision is of capital importance: in a world on the road to the global liberalization of trade, principally through processes of regional integration, Mexico has decided to break completely with its dirigiste and protectionist past and take up the challenge of competition, forming with the United States and Cаnada the largest market in the world.

Salinas and his group of United Statestrained technocrats made a choice in keeping with their intellectual background and attempted to followed the way indicated by the Bretton Woods institutions.

But the equation liberalization equals development also needed to have a strong dose of democratization, and above all it needed a democratically elected president with not a shadow of doubt over the fairness of the electoral process.
Colosio, another member of the fortyyears-old group, had the right credentials for the job. Much more a man of the people, he also enjoyed better public relations than the rather aloof Salinas. Colosio’s assassination at Tijuana will probably remain one of the great unsolved mysteries of Mexican history: among the various conjectures is the theory of an internal vendetta in the Pri (Colosio was the former party president), a narco-traffic connection, a combination of the two, or a thousand other possible explanations.

The outcome was Salinas had to make a difficult choice of candidate at the height of the election campaign. In the end he opted for Zedillo, former Treasury Minister and organizer of Colosio’s electoral campaign. Moreover, he was one of the few possible candidates not in government office, and therefore his candidature was in keeping with the Mexican constitution.

A rather uncharismatic forty-two-year old economist, Zadillo had the same kind of background as Salinas and Colosio and therefore suited the requirements of the outgoing president.

But before analyzing the three options offered to the Mexican electorate in the presidential elections, we must consider the Chiapas uprising.

We have already stressed how this revolt had an important impact on Mexican public opinion: the revolt broke out in the southernmost and least developed state in the country with a large Indian community. The reasons for the revolt must be sought for in various factors: the objective underdevelopment of the region, the end of the mirage of land for all (Salinas had in factput an end to this phenomenon), diffidence towards Nafta, seen as bringing few benefits for the southern states and the Mexican Indians’ difficult relations with central power.
The Ezin (Ejército zapatista de liberación nacional) is inspired by the most radical figure in the Mexican revolution – Emiliano Zapata. What drew so much attention the Chiapas incidents was not only the surprisingly well-organized uprising for a country with no great tradition of guerrilla warfare, but above all the striking cry of alarm over the underdeveloped conditions of large sections of the Mexican population and the possible political repercussions in the election year.

The government chose the way of dialogue. And although it did not obtain the rebels support, they did participate in the election, which was an important contribution to legitimating the electoral process.

But let’s look at the three main candidates, whose programmes were not very radically different. All were in favour of Nafta, although Cárdenas pushed for a partial renegotiation. Cevallos insisted on more administrative decentralization to the individual states. Cárdenas promised greater public spending, while Zedillo was more prudent on this point, only hinting at more spending in education and health; Cevallos wanted a more important role for Congress in political life.

The pre-election polls (a novelty in Mexico since previously there had been no point in having them) came very close to forecasting the actual result, but few took them seriously.

But what were the consequences of the election result? Firstly, it must be said that the important test of the fair organization the elections was successfully passed: the national and international observers agreed that, despite a few anomalies the result was basically valid. Thus Zedillo started from a stronger position than Salinas since there could be no doubting that he was a legitimate president. In this sense Cárdenas’ protests seem rather wildly off the mark. He lagged so far behind Zedillo that his complaints are more like clichés than real convictions.

What is surprising was the rise of the Pan to previously unscaled heights. The party always had considerable support in the northern states where the factor of the attractive United States neighbour exercised a fundamental influence. But I feel the new support for Pan came from those convinced of the need for liberalization policies but were less than enthusiastic about the Pri bureaucratic machinery and hoped for a change in the ruling class.

The in some ways unexpected decline of Cárdenas may be seen as a defeat for the traditional populist Latin American left, which in its various forms is basically out of touch with history. The swing away from Cárdenas’s was certainly drastic, although the fact Cárdenas was denied access to the main national television network (Televisa) should not be underestimated. This ban lasted until a new electoral law forced a change in the situation. But in any case the falling off in support for the Mexican left has taken on considerable proportions.

But did the Pri win or lose its own particular battle? The idea of change in continuity sqso dear to the Pri policy-makers seems to have prevailed. Zedillo has already declared he wishes to form a government with people not compromised by the old style of the Pri. Не has also shown a willingness to coopеrate with the opposition parties: these are unheard-of phenomena in traditional Mexican politics and suggest that now the Pri has abandoned its almost single party status it may even lose power.
But the Pri decline was inevitable. Its monopoly in historical terms was redundant. What is important is that the Pri seems to be capable of channeling society’s needs for change in an acceptable way.

Paradoxically Cárdenas’s defeat should be seen in this light: evoking the revolutionary legacy turned out to be an anachronistic decision. In a country beleaguered by contradictions, but where the myth of modernity has made a breakthrough, the traditional ideological values lost ground to new ideas based on liberalism as the key to development.

Although the process of formal democratization seems unremitting and should take place without the Pri necessarily passing to the opposition, the future of Mexico willhinge on the themes of social development and therefore on substantial democratization.

Only if a way is found to redistributing more effectively the benefits of economic growth and to raising significantly the population’s living standards will the present political class survive.

On the other hand, if Mexico remains the country of blatant inequality, the future will inevitably be overcast with doubts.

Notes
(1) On this point, see Le Mexique
confronté à la puissance des narcotrafiquants,
Le Monde Diplomatique, August 1994.
(2) For a study of the advantages and
disadvantages of Nafta see: W. A. Orme
Jr., «Myths versus Facts», Foreign Affairs,
November-December 1993; P. Krugman,
«The Uncomfortable Truth about Nafta»,
ibid; J.G. Castaneda, «Can Nafta change
Mexico?», Foreign Affairs, September-October 1993