from the Sister Cities Staff
Dear Sister Cities,
People have been asking us for in-depth analysis of capabilities and expectations for the Funes government in El Salvador, and here it is. This analysis comes highly recommended from Equipo Maiz economist Agosto Villalona. Enjoy...
Sister Cities staff
Saturday, March 28, 2009
Notes on the Electoral Victory of the FMLN
By Agusto Sención Villalona
1. The triumph of the FMLN constitutes new progress of the revolutionary and progressive forces of Latin America. For the new government of the United States it is their first defeat, as they could not impede the overturning of the ultra-right [in El Salvador], organized in the ARENA party.
2. The Victory of the FMLN was due to the combination of two fundamental factors: the decision on the part of the majority of the population to defeat ARENA, and the weakness of the government of the United States, whose hegemony is declining in the world and above all in Latin America. The Salvadoran right, fraudulent and repressive, was afraid of the people and grew isolated in this continent, where the FMLN has the support of the majority of the governments and political parties, including many liberal right parties.
3. The victory of the FMLN is even more significant if one takes into account that this party overcame a fraudulent electoral system, where the right dominates the electoral tribunal and the National Registry of Natural Persons (under the control of the Executive Branch). The right wing refused to approve residential voting [voting by absentee ballot] and gave identity cards to people from other countries of the region to be able to vote in El Salvador. Moreover, even though the FMLN officially won by a margin of 2.6%, the political truth is different, as this party had the support of 60% of the voting population. The fraud carried out by the ARENA party reduced the margin of victory.
4. To characterize the new government that will begin on June 1, it is necessary to take into account that what has been won is simply the Executive Branch, and the right maintains its dominance in other branches and institutions of the State. We see:
- In the Legislative Branch the FMLN has 35 of the 84 seats and the right wing parties, together, control 47: ARENA has 32, the PCN has 10 and the PDC has 5. A party allied with the FMLN has 1 seat, and one other legislator was kicked out of the PCN party.
- In the Judicial Branch, of the 15 Magistrates of the Supreme Court, 12 are of the right wing. Soon 5 new judges will be elected, but this decision is in the hands of a congress (the Legislative Assembly) that is right wing in its majority. Although the minimum number of votes for their election is 56, the right has a greater possibility of imposing its judges, as they can if they with nullify the election, create a crisis in the justice apparatus and affect the image of the new government. The Attorney General of the Republic, who will soon end his term, will also be elected by the Congress, with at least 56 votes. Neither the FMLN or the right have the votes, but the right can nullify the election, in which case the second in command at the Attorney General’s office, linked to the ARENA party, would take up the role of Attorney General.
- In the Supreme Electoral Tribunal, composed by 5 people, the right will maintain three members, as they are elected by the following format: three are proposed by the three parties with the most votes (FMLN, ARENA and PCN) and two are elected by congress. Of the three first the right has two. And of those elected by the congress the right will receive at least one. This way they will continue to dominate the tribunal.
- The Accounts Court, in charge of investigating internal affairs and public corruption, can continue to be under the direction of the right, as the person who presides over this institution is elected by congress, ruled in its majority by the right.
5. The composition of these branches and institutions of the State means that the FMLN and President Mauricio Funes can only do what corresponds to the Executive Branch. It is important to be clear on this point, as there are voices on the ultra-left, nationally and internationally that are demanding the party and president elect to do things that they will not be able to do. And we must be clear that the FMLN government cannot govern behind the back of the Constitution, as this government is not product of an armed struggle that destroys an old State, nor an electoral victory in all branches of the State.
6. The government that Mauricio Funes will direct will implement an important part of his program, the part that is dependent of the Executive Branch. The measures that depend on other State institutions cannot be implemented. Let’s mention some:
- Modifying the tributary structure, and above all higher taxes on private business income, elevating the base levels exempt from income tax, raising tariffs on certain luxury imports and eliminating some loopholes that permit legal tax evasion. The approval or modification of taxes is done in congress, with a minimum of 43 votes, which the FMLN does not have.
- Taking another look at some of the privatizations. Neither the legislative nor judicial branches will facilitate this job.
- Repealing the general amnesty law approved in 1993 by the ex-president of ARENA, Alfredo Cristiani. This law was approved to protect members of ARENA and the Armed Forces named by the Peace Commission (created in the 1992 peace accords) as responsible for many of the crimes committed before and during the war.
- Other measures, such as undoing dollarization or annulling CAFTA, were not brought up by the FMLN and can not be implemented. The first one implies approving a law that grants the Central Bank the faculty to emit national currency and obliges the commercial banks to transfer their dollars to the Central Bank. This law would have to be approved by congress with a minimum of 43 votes. CAFTA can only be annulled or modified by common agreement between the parties that signed it: the governments of El Salvador and the United States.
7. Having established some of the limits to the new government, it is necessary to discuss what it can indeed do, with is considerable. Let’s see:
- Controlling tax evasion that big business carries out to the amount of nearly 2 billion dollars per year, equivalent to 60% of the national budget. If the government is successful in this job, it could elevate its income. It is probable that the government would try to reach a fiscal pact with big business, but it is not very probable that these businesses agree to pay much of what they evade. For this reason, the table of the fiscal pact should become a theater of national struggle around the issue of tax evasion. The people should pressure to gain access to the information regarding the amount of this evasion and for the businesses to pay the money that the law demands of them, much of which comes indirectly from the people themselves.
- Control some prices and tariffs of basic goods and services.
- Raise salaries in the public and private sectors.
- Subsidize, with some part of the new income, some basic services.
- Deposit in the state banks part of the national budget and convert the Bank of Agricultural Production (Banco de Fomento Agropecuario) in a development bank that guarantees credits to small rural production, both individual and cooperative, as well as micro and small enterprise in the cities. The deposits from municipalities governed by the FMLN should also be oriented toward the State banks, as well as social organizations and the population that supports the government.
- Incorporate into the Petrocaribe to achieve favorable conditions to pay for oil imported from Venezuela.
- Incorporate into the ALBA, to obtain benefits from the projects of cooperation that are included in said initiative, together with Venezuela, Cuba, Bolivia, Dominica, Nicaragua and Honduras.
- Substantially raise the public resources destined to the Institute of Women and approve and apply policies oriented toward reducing gender inequality
- Establish diplomatic relations with Cuba and broaden relations with the countries of South America, above all with the principal economies (Brazil, Argentina and Venezuela.)
- Legalize productive units of thousands of rural peasants that do not have property deeds. This decision is in the hands of the Institute of Agrarian Transformation (ISTA), who has not wanted to implement this.
- Expropriate property over the 245 hectare limit per owner established in article 105 of the Constitution. Many land owners break the law with the complicity of the current government. These lands and some state properties can be adjudicated to the rural population, that is of 300,000 people who principally produce basic grains (corn, sorghum, beans and rice) and to a lesser extent seasonal crops (vegetables, fruits, etc.) as well as raising farm animals, mostly for their own consumption. Parts of the rural population (64,000 people) belong to agricultural cooperatives, where basic grains are produced. Some of these also produce coffee or sugar cane.
- Augment the budget for the Ministry of Agriculture and the Environment, to support the reactivation of the agricultural sector and confront the grave environmental situation of the country.
- Develop a program of reactivation of the rural economy, with internal support and international cooperation. For this it would be necessary to give State lands, grant credits from the national bank, give some subsidies and agricultural input at low cost, as well as agricultural machinery and technical assistance (which could be obtained with help from Brazil, Argentina and Venezuela) and establish guaranteed prices for small producers. At the same time a literacy program could be developed, with the support of Cuba, to eradicate illiteracy, as was done in Venezuela and Bolivia, as well as a broad program of health, water and hygiene carried out with public and international funds.
- The reactivation of agriculture will allow the reduction of importation of food to confront the competition from agricultural production from the United States, which is subsidized and enjoys the benefits of CAFTA. In a moment that the crisis in the United States provokes a decrease in Salvadoran exportations and the remittances flowing back to the country, reducing importation is key to confront a possible scarcity of dollars. As well, the reactivation of the agricultural sector would raise employment and accessible food. In three years, the improvements in the level of quality of life of the rural population (40% of the total) would be a big hit to the right, which would lose a good part of the municipalities that it still governs.
- In the cities as well the quality of life of the population with the fewest resources can rise, if the government is successful in the reactivation of agriculture and lowering the cost of foods, eradicating illiteracy, creating projects of popular housing, improving water services and supplying medicines to hospitals, as well as granting credits and technical support to small business. Public investment and support of international organizations would permit these results. For this reason it is important to control tax evasion, incorporate into the ALBA and sign cooperation agreements with the principal economies of South America. The external support could also come from China. Of course, we are not looking for the external resources to become the basis of our economic rise and social improvement, rather a important complement, above all in the first years of the new government. In fact, they could be maintained throughout the full Funes administration if it is understood that this government constitutes the first phase of a process of change that begins in the country.
- Apply a program of attention to the street gangs, that includes employment, scholarships, and other actions of social reinsertion.
- Cleaning up the National Civilian Police and the security institutions of the State to diminish criminality and reduce the climate of insecurity of the population. The police must be changed into an institution in support of the people. The FMLN has the advantage of having incorporated into the police force part of its demobilized combatants, some of whom even possess intermediate roles of power. In the new government, the FMLN will have control of the principal structures of control, including the police chiefs.
- Channel a part of the funds for publicity toward the media (radio and newspaper) that are not controlled by big business. This is not simply upon a criteria of equality, also the need to confront the right in political and ideological struggle.
- Modify the educational texts, above all around the subjects of history, to combat the right, those responsible for the military dictatorships and death squads that assassinated tens of thousands of people during many years. In teaching history one must establish, among many other things, the death squad origins of the ARENA party and the responsibility of its founder, D’Aubisson, in the assassination of Archbishop Oscar Arnulfo Romero.
8. These are some of the measures that can be adopted by the Executive Branch. To make them effective it is necessary to orient the people adequately and gain support, above all in the case of those measures that will be strongly rejected by big business, such as the control of some prices and fiscal evasion, redistribution of the publicity costs of the government, the deposit of much of the government money in the state bank, and expropriation of lands as described in the constitution.
9. What will begin in El Salvador is an advanced reformist government, that will be able to redistribute wealth, improve quality of life for the population with the fewest resources and sectors of the middle class, democratize the State and reduce the political dependence, above all through an independent foreign policy. If this is achieved, it would be an important step in the transformation of the country. The FMLN could advance in the legislative and municipal elections of 2012 and obtain a victory in the presidential elections of 2014 and deepen its program in the following years.
10. The government that Funes leads will be of transition and accumulation to continue advancing in following years. That is how we must understand it. It is not an “anti-system” government, rather one of important social reforms and consolidation of the FMLN.
11. The local right and the government of the United States will forcefully confront the new government and will stimulate the minds of the ultra-left to try to debilitate the bases of the FMLN. When they reject some measures of this government they will do it with tenacity. At the same time they will say that Funes has good intentions and that the leadership of the FMLN wants to push forward an orthodox program. And as the government will be reformist, this supposition could generate discontent among a radicalized portion of the party, which is often victim of the “radical” tag, often from outside the FMLN.
12. To confront the tactics of the right, the militancy of the FMLN and the social forces of the left should avoid wrong turns. It would be a mistake to assume a passive role from the right, or demand the government to do things that it is unable to do. It is important to demand compliance with what has been promised, but taking into account the limitations of the next government, and the need to back it up in each moment.
Augusto Sención Villalona is a Dominican Economist who works for Equipo Maiz, in El Salvador.