The Policeman Cometh:Yesterday’s insurrection by the police is over, but the results are far from certain. October 2, 2010Posted by rogerhollander in Ecuador, Latin America.
Tags: Ecuador, ecuador coup, Ecuador Government, ecuador protest, gerard coffey, Latin America, latin america politics, lucio gutierrez, mpd, Rafael Correa, roger hollander
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Quito . 1st October
Yesterday’s insurrection by the police is over, but the results are far from certain.
It felt strangely like a film, a very long film. It was exciting, at times dangerous, and had a good ending. The good President (Rafael Correa) was rescued after a gun battle between the army and the police, returned triumphant, and denounced the evil ex President (Lucio Gutierrez) as being the influence behind police units that took him hostage. So at ten o‘clock, when it was all over, I switched off the television and went to bed.
This morning it doesn’t seem quite so clear cut . On the radio I can hear talk about the next time, about the police and the military joining up with the civil servants affected by the new legislation that supposedly sparked yesterday´s insurrection. A friend warns me: “in Latin America “, he says “these semi coups are often followed by real ones”. He’s probably thinking about Chile in 1973. It was a long time ago though, and things have changed. Maybe. His words are worth pondering.
On the radio I can hear a repeat of yesterday’s pronouncements by the head of the joint military command, General Ernesto Gonzalez. He’s saying that the fault lies with the imposition of the legislation. Correa is not mentioned by name, but it’s evident that he’s the one implicated. General Gonzalez also suggests that the legislation be amended or shelved. It’s hardly a ringing endorsement of the government or a condemnation of the police. On another station, someone asks why the military took so long to act. We don’t know. It could have been nothing more than logistics. But the question is valid. It took from the time for the General’s declaration, around three in the afternoon, until about eight at night for the special forces to get to the hospital where the President was being held.
Once there, it has to be said that they did their job well. There was a lot of shooting. A lot. In total the confrontation lasted about five hours. Some members of the military were taken hostage by the police. But there was little bloodshed (only two police and one soldier died- More recent figures but the overall total at 8 dead and 193 injured). The president was successfully rescued, ‘carried out like a corpse’ as he put it later. And if anyone seriously doubted that this was an attempted coup (at least by some elements of the police), then the long drawn out gun battle needed to get Correa out of the hospital must have put those reservations to rest. There seems no other explanation. This was not the result of a dispute over piece of legislation.
Today, there is some police presence on the streets, but little evidence of the military apart from the odd helicopter flying overhead. Things are quiet. Relief is the general sentiment. People are talking, exchanging stories. commenting on the events of the day before: the looting and bank robberies in Guayaquil; the robberies in Quito, where two banks were also broken into; the aggression of the police. A friend who took part in the march to the hospital where Correa was being held, says he´s never seen so much tear gas. I had my own stories. I was knocked over when I tried to intervene to save a man who being attacked by about ten police; I later had to escape when police charged with guns drawn and firing live ammunition into the air, as far as we could tell. There wasn’t much point in hanging about to make sure. So we all ran, like hell. I saw one man lying on the ground surrounded by a few friends. He looked seriously injured (he now appears to have died). There was no way to know; at that moment the police reinforcements arrived: a phalanx of motorcycles that chased the crowd into the park. I took shelter on the other side of the street. My neighbor has his own account. He’s about 65, works as a carpenter´s assistant and can only be described as having humble origins. He tells me he was in the main square until eleven at night listening to the President when he returned triumphant. “We said we were going to stay and die there or wait till Correa came back” he tells me.
I was also there, but earlier in the day. The square was full, and most of the people were like my neighbour, working class, although that’s a bit of a misnomer. Most of them likely don’t have full time work, are sub employed as they say. The same thing couldn’t be said for the people I met a little later outside the National Assembly. They were evidently protesting and the red flags led me to think, somewhat naively, that they were Correa supporters. But no. These were judicial workers, also affected by the new Civil Service legislation, and they were also angry, and all well dressed. The flags belonged to the Marxist Leninist party and its political wing, the MPD, which seemed to be behind the demonstration. I asked one woman if they supported the police. She said yes. The world was off its axis. I shook my head and walked away. On television I saw images of other MPD supporters confronting ‘a palos’ as they say, a group of Correa supporters.
For Correa this is part of the problem. In his four years in office he has made a lot of changes , mainly for the good, but also a lot of enemies. He has never courted the social movements and they’re not on his side. Despite what the woman said to me outside the National Assembly it seems unlikely that the unions, the indigenous groups, the environmentalists , the majority of teachers , or even the majority of civil servants, actively support the police. There is general agreement that they are dangerous, often in league with thieves and recently the subject of accusations of Human Rights violations made by the Truth Commission. But these groups definitely don’t like Correa that much. His major support is amongst the poorest least organized sectors, and that could be a bit of problem if it comes to another confrontation.
A lot of people have been affected by Correa’s confrontational, steamroller style. He´s a man in a hurry. And that causes problems. But because of it there have major positive changes. He far outshines the other do-nothing governments I’ve know. The country is no longer the banana republic it was for example in the time of President Bucaram, in the mind nineties. But the opposition, of whom many previously spent a lot of time calling for governability, doesn’t seem to understand that in a democracy the ruling party implements its agenda, and there is little the rest can do about it except shout. Or maybe they do understand. They just don’t like it. Which is fine, but even for them actions such as yesterday’s can hardly be called democratic. The police have no business taking control of the streets.
For their part the media are calling for more democracy, more dialogue, although it’s hard to understand what that means, unless you take it as a call for Correa to implement what the opposition wants. And for better or worse, ´dialogue´ is not Rafael Correa´s strong point. As for the agents of law enforcement, no one seems sure of what will happen. What do you do with a group of armed and dangerous people in uniform? In the long term the rebellious elemants, the kidnappers, have to cleared out and dealt with. But in the short term it’s hard to imagine thatmuch can, or even should, be done. No one wants a repeat of yesterday, and that is still a possibility. It´s still a delicate situation. There is undoubtedly a lot of resentment. There is also the question of relations between the police and the military. The police will undoubtedly feel aggrieved that their ‘legitimate’ protest was put down by the army. But if the police do decide to take to the streets again, there is a feeling that the support of the military may not be that firm the next time around.
The most important point is that government is back in control. Plans will likely include a large scale march of support for the President, bringing people in from all parts of the country. Correa himself is still very popular nationally, with approval ratings over sixty percent , and this may help to dissuade any further troublemaking. But things do need time to cool down. And for the time being at least, a more rational, less confrontation approach would seem the wisest course of action.
Ecuador: Mining and the Right of Way April 9, 2009Posted by rogerhollander in Ecuador, Environment, First Nations.
Tags: ascendant copper, canadian mining, CONAIE, copper mesa, Corriente, ecuador constitution, ecuador environment, Ecuador Government, ecuador mining, environment, IAMGOLD, indigenous rights, intag, international minerals, jennifer moore, Kinross, latin america environment, mining contamination, mining technology, Rafael Correa, roger hollander, shuar, water rights
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|Written by Jennifer Moore
|www.upsidedownworld.org, Wednesday, 25 March 2009
|Indigenous leaders delivered a lawsuit in Quito last Tuesday before Ecuador’s Constitutional Court asking that the country’s new mining law be declared unconstitutional. The case is the next step that the Confederation of Indigenous Nationalities of Ecuador (CONAIE) is taking to try to put the brakes on large scale metal mining which has achieved unwavering support from President Rafael Correa’s administration.
“The burning issue in our province and on our ancestral territories is mining,” said Angel Awak, President of the Shuar Federation of Zamora Chinchipe. “It is going to contaminate the rivers and result in social conflict.”
Ecuador has been an oil producer for more than forty years. Now that oil reserves are running low, the Correa administration views metal mining as a future source of state revenues. However, even before any large scale project has reached production, indigenous and non-indigenous communities alike are divided over whether it will result in net benefits or net destruction.
“The constitution clearly states that organic laws (the highest category of laws in Ecuador before international conventions and the political constitution) can only include those that regulate personal rights or norms pertaining to state institutions,” explained Lawyer Wilton Guaranda from the Regional Human Rights Advisory Foundation in Quito, and one of the signatories on the case.
With this legal status, Guaranda believes that the mining law becomes a “barrier” limiting judicial decisions and the development of new laws, such as those to regulate water and nature.
Awak’s biggest concern is water, a right achieved in the 2008 political constitution that Ecuadorians overwhelmingly approved in September and that government representatives affirmed this week during the Fifth World Water Forum in Turkey.
“Mining companies consume millions of liters of water,” said Awak, “which effectively privatizes it.” He envisions that the precious resource could become scarce and speculates that they will end up having to buy back water from the companies. “We will struggle so that our water is not privatized.”
However, Canadian companies situated in Awak’s home province and hoping to develop some of Ecuador’s biggest gold and copper deposits have already secured government approval. The same day that CONAIE presented its lawsuit, both Vancouver-based Corriente Resources and Toronto-based Kinross announced that they have received notice fromthe Ministry of Mines and Petroleum to resume exploration work following a suspension on all large scale mining.
From chaos to closer alignment between Correa and Canadian interests
“The rules of the game are clear for everyone now,” Undersecretary of Mines Jose Serrano said speaking to Reuters. “The mining decree has been fulfilled…it can’t be revived.”1
But what is most clear is the importance of Canadian investment to Correa.
All large scale mining was suspended last April when the National Constituent Assembly passed a mining decree that ordered the Ministry of Mines and Petroleum to revoke most mineral concessions for reasons such as failure to consult with communities, or for overlap with protected natural areas and sources of water. It also gave the government 180 days to rewrite the mining law.
At the time, Correa met with Canadian investors and explained that the decree was necessary “to put the sector in order,” which had been open to speculation and weak regulation since legal reforms were implemented following a World Bank sponsored study in the 1990s.
But in addition to the controversy that the new law has generated, application of the mining mandate has also been limited. Most notably, Copper Mesa Mining (formerly Ascendant Copper Corporation) in the northwestern Intag valley lost two of its main concessions for failure to consult with local communities. In contrast, companies such as IAMGOLD, Corriente, Kinross, and International Minerals maintain key holdings in the south despite heated conflicts over similar complaints.
In the case of Corriente Resources, its suspension dates back to late 2006 when violent repression of local protests was carried out by state security forces making use of company installations. With such issues yet to be fully investigated and Corriente now on the verge of selling its project to an industry senior, Correa continues courting Canadian business leaders.
With assistance from the Canadian Embassy, investors met with Correa in February to discuss how to deepen relations across various sectors including mining, tourism and hydroelectric generation – also necessary for large scale mining. Correa gushed to the national press afterward saying that “Canada has always been a good friend of Ecuador.”
In a possible new offense to delegitimize the CONAIE, he added that he has invited Canadian Ambassador Christian Lapointe to bring indigenous leaders from Canada to Ecuador “so that they can testify for themselves, because here some of the leaders of our ancestors have taken up the flag of anti-mining.” He called such leaders “false” adding “they are just radical indigenous leaders,”2 even if they represent about 90 percent of first peoples across Ecuador.3
“In the mining sector,” he added, “they are the best investments, they respect the environment and our laws the best.”4 This simplistic claim is backed up with images of Ecuador’s small scale and artisanal miningsector which is short on investment and environmental controls, and long on devastating impacts to rivers and local communities.
Top-of-the-line technology will prevent any future disasters, he argues, echoing industry promises while calling activist concerns over watercontamination “absurd.”5
But groups protesting large scale metal mining have heard these promises before.
“We will use the latest technology…[and] The steel being used meets international norms…which will diminish the risk of rupture in case of seismic movements,” recalled Quito-based environmental organization Accion Ecologica in a press release entitled: “You were warned, the OCP spill confirms that secure technology does not exist.”6
The privately-owned Heavy Crude Pipeline (OCP) was built in 2003 after years of multi-sector opposition. As another major contract that benefitted Canadian investors, the OCP faced its first major accident on February 25. The company says a tremor caused the spill which dumped approximately 14,000 barrels of oil into the Santa Rosa river in Orellana Province.
The pipeline travels from the Amazon region to the coast, crossing 94 seismic fault lines and 6 active volcanoes.7 Designed to boost oil production previously limited by the capacity of the state-owned SOTE pipeline, Canada’s EnCana was the country’s biggest investor at the time of its construction with a 31.4 percent share in the $1.2 billion project.8
For lawyer Wilton Guaranda “the accident is clear evidence that the geographic and natural conditions of Ecuadorian territory are not compatible with such a highly contaminating and toxic activity.” He added that the CONAIE is considering a lawsuit against the OCP consortium.
“This event should be cause for reflection so that a much more critical examination takes place of the natural reality of Ecuadorian territory to really determine the costs and benefits of [mining],” said Guaranda, “not just in relationship to the environment but alsowith regard to its social dimensions to know whether or not in the long term it will provide us with the opportunity for development and progress, or if this will become a barrier so that we have to obtain international loans or other debts in order to recuperate the nature that has been affected.”
So far, Minister of Mines and Petroleum Derlis Palacios has congratulated company remediation efforts while asking social organizations to be “a little more objective with the hope that certain communities or leaders don’t try to benefit from this misfortune by making a business out of it.”9
But for communities living in constant conflict over mining whose benefits and protections are stacked on the side of big business, leaders like Angel Awak are trying to avoid unnecessary risk.
Awak sees greater potential in ecotourism and micro-credit programs for small farmers over the long term and adds that their wealth and well being is in their territory: “When the Shuar have territory, they have everything they need, they can hunt, they can fish, they have the river and all of the elements that are necessary for the Shuar to live well. This is what we want to defend so that our youth are also conscious of this and work to defend the natural environment.”
Explaining that this is what “Sumak Kawsay” or right living means for the future of the Shuar nation, he said the government should be behind them.
“We are not saying anything beyond the law. Rather we are demanding that our rights be respected within the framework of the constitution,” he said, noting that Sumak Kawsay is a central principle of Ecuador’s new Carta Magna.
However, given Correa’s current stance and his likely success in upcoming national elections at the end of April, social-environmental conflicts over mining are anticipated to grow with groups promising to halt projects at the local level. A response from the Constitutional Court to the CONAIE’s lawsuit is anticipated within six to twelve months.
2. President Rafael Correa, National Radio Address, 31 Jan 09
3. Kintto Lucas, IPS 22 Jan 09, “Los indigenas vuelvan al camino de la protesta” http://www.ipsnoticias.net/nota.asp?idnews=91081
4. El Comercio, 19 Feb 09 “Ecuador desea la inversion Canadiense”
5. President Rafael Correa, National Radio Address, 18 Oct 08
7. Lorna Li, June 25th 2007, “Ecuador’s OCP Pipeline – A False Promise of Wealth”
8. Dr. Leslie Jermyn, 2002 “In Whose Interest? Canadian interests and the OCP crude oil pipeline in Ecuador”
9. EFE, Mar 5th 2009 “El ministro Palacios habla del buen manejo en la solución al derrame de crudo en la Amazonia”
Ecuador accuses US official of taking police files February 14, 2009Posted by rogerhollander in Ecuador, Latin America.
Tags: colonialism, Ecuador, Ecuador Government, Ecuador politics, ecuador u.s. relations, maria eugenia tello, Rafael Correa, roger hollander
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Maria Eugenia Tello
GUAYAQUIL, Ecuador, Feb 10 (Reuters) – Ecuador’s leftist president, Rafael Correa, on Tuesday accused a U.S. diplomat he expelled of taking computers and sensitive police files from the country.
Correa threw out the embassy official on Saturday, saying the low-level diplomat had meddled in police affairs by trying to handpick officers involved in a U.S. aid project.
“A foreign embassy official takes computers with him … and information from the national police. We won’t stand for this. We will investigate and make a complaint,” Correa told navy officers in the city of Guayaquil.
“The days of colonialism are behind us,” said Correa, an ally of Venezuelan President Hugo Chavez who faces re-election in April.
Correa, a U.S.-trained economist, has generally had good relations with the United States, but political analysts say he could bolster his poll ratings by taking a tough line on what he deems as foreign interference.
U.S. authorities have downplayed the incident, saying the official, Armando Astorga, had already left the Andean nation in January as part of a normal staff rotation.
Carlos Cordova, a pollster with Cedatos-Gallup said, “This shows you that Correa will use every tool to gain votes for his re-election. He wants to inflate the nationalistic spirit and portray himself as a strong leader.”
Many Ecuadoreans are critical of U.S. policy in Latin America, particularly Washington’s military aid to neighboring Colombia to fight a four-decade guerrilla war that sometimes spills across the border.
The United States is Ecuador’s main trading partner and the destination for much of its oil and banana exports.
Ecuador: A Philosophical Analysis December 23, 2008Posted by rogerhollander in Ecuador Politics, History, Government, Culture, Ecuador Writing, Ecuador: A Philosophical Analysis.
Tags: campesino, Ecuador, ecuador analysis, Ecuador Government, Ecuador history, Ecuador politics, eugene gogol, gotha program, IMF, indigenous, Latin America, lucio gutierrez, luis macas, manta military base, marx, marxist humanist, mpd, neoliberal, nina picari, Pachakutik, roger hollander, wilma salgado
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(My political writing, I freely admit, has a schizophrenic character. When I am attempting to place an article in a mainstream publication, I have no choice to try to “lay it between the lines.” My major achievement in this respect was the oped piece of mine on free trade published by the Los Angeles Times in October of 2005. In writing to “family and friends,” I am much more free to be explicit about my political revolutionary socialism, but I tone it down there as well – don’t want to turn people off with Marxist terminology [sadly, and for reasons which are too complicated to go into here, this is the reality]. However, I often write for the Marxist-Humanist periodical, “News and Letters,” and it is here where I feel under no compulsion to censor myself. See for yourself the difference in style and content in these various efforts.)
ECUADOR ANALYSIS (June 2003) for News and Letters
What is occurring in Ecuador today is a classic example of the fate of philosophically rudderless progressive political movements. It is characterized by the confusion and bickering within the ranks of the governing coalition (the Patriotic Society Party, organized by Gutiérrez, and Pachakutik, the political wing of the Indigenous movement,), but, above all, by the opportunism of the Right and its capacity to exploit philosophic debility through cooptation.
Colonel Gutiérrez’s dramatic and decisive electoral victory of November 2002 was nothing less than an expression of massive popular discontent with the neo-Liberal status quo. His position as a viable presidential candidate in the first place arose directly and exclusively from his support of the aborted popular coup d’etat of January 2000, that was the culmination of decades of intense political organizing within the Indigenous communities. The uprising was in response to a government that had overseen a major banking collapse which caused the loss of capital equal to the nation’s annual GNP and that was in the process of accelerating the implementation of the IMF’s economic plan for the country. The demands of the movement (which was lead by the Indigenous and campesino communities but included the support of labor and other progressive social organizations) included a moratorium on payment of the external debt, and end to privatization, freezing utilities costs, fundamental restructuring of the nation’s political institutions through popular assemblies, and the reclaiming of sovereignty over the military base at Manta, which is in the hands of the U.S. military.
Both Pachakutik, which was in formal electoral coalition with Gutiérrez, and the Marxist-Leninist backed Movement for Popular Democracy (MPD), which backed the Gutiérrez candidacy, based their support on written and signed agreements that reflected the demands of January 2000.
Gutiérrez’s drift to the right began immediately after his stunning victory in the first electoral round (the pundits had him coming in fourth or fifth). As with so many progressive politicians who begin to taste real power, he felt the immediate need to “assure” the investing community that had nothing to worry about from a Gutiérrez presidency. Many of his supporters, with the naiveté that is a product of philosophical vagueness, saw this as a necessary “tactical” maneuver. They should not have been surprised, however, when his first act as president was to worship at the shrine of Bush and the IMF.
Five months into the Gutiérrez presidency, both the government and, to a degree, the Indigenous and social movements, are in a state of disarray. There have been scandals, nepotism, corruption, ministerial resignations, and a total of thirty-one strikes and work stoppages that have included teachers, public health workers, civil servants and oil workers in the public sector, and workers in agriculture and transportation in the private sector.
The advancement of the neo-Liberal economic agenda and the alignment with Bush and Uribe on the Colombia question are now fixed policies. The pathetic ideology that Gutiérrez employs to mask his treasonous adventure speaks of including all Ecuadorians in the sharing of power, again a traditional approach when so-called progressives take power (e.g., Papandreou in Greece, Mitterrand in France, the NDP in Ontario, Canada). Thus he has given the socially oriented ministries (education, health, social welfare, etc.) to the progressives and the economic ministries (finance, international trade, etc.) to the Right (the chief of whom is Mauricio Pozo, Minister of the Economy, longtime Central Bank functionary and neo-Liberalism true believer). Guess who has all the power, influence and budget.
There has been some bitter sweetness to all this. Nina Picari of Pachakutik, a prominent and respected Indigenous leader, is Secretary of State, to my knowledge the first Indigenous woman ever to hold such a position anywhere. The sweetness is to see an Indigenous person in traditional dress, representing a nation on the international scene, where she is taking leadership on the question of human right for Indigenous peoples. She is no Colin Powell. The bitterness comes from the fact that she lends credibility to a corrupt government that is certain to taint her own credibility in the future and contribute to disunity within her own movement. The same can be said of long time Indigenous leader and fighter, Luis Macas of Pachakutik, who as Minister of Agriculture is making attempts to stop the flow of communal lands to agribusiness; and Wilma Salgado, who, as head of the banking insurance entity, is taking concrete steps to bring a degree of justice to those who lost their life savings.
Those who integrate themselves with apparently progressive governments or popular fronts usually do so based upon the naïve believe that they can do more “good” from within than from without. What they end up achieving is confusion and conflict within the movements they represent. They fail to recognize that it is the masses in motion, not leaders from above, that initiate fundamental social change. In effect, they separate themselves not only from their initial base support, but also from libratory philosophy.
Marx spoke to this in his scathing critique (Critique of the Gotha Program) of the unification of the two German socialist tendencies (one of which was considered to be Marxist) based upon bourgeois and reformist principles with respect to the questions of labor, nationalism and the state; Marx re-enunciated the essential themes of true liberation from the oppression of capital: “the need to uproot the state machinery, the state form, to pose an international not a national viewpoint, the vision of the nonstate to be, ‘from each according to his ability, to each according to his needs,’ and the inseparable relation of theory and organization …”[i] The adoption of
programs of contradictory and incorrect principles render such tendencies which adopt them at
best irrelevant and at worst counter-revolutionary.
Pachakutik has recently reaffirmed its support of and participation in the Gutiérrez government.
It is doubtful, in the light of those who have the real power within the government, that this will be
sustained much longer. However, the longer it is, the greater the damage to popular movements.
[i] Gogol, Eugene, “The Concept of Other in Latin American Liberation: Fusing Emancipatory Philosophic Thought and Social Revolt,” (Lexington Books, 2002) p. 363. I highly recommend this important book by the former managing editor of News and Letters. It takes a sweeping view of the Latin American scene, and speaks to the various dead end paths taken by failed revolutionaries, from Cuba to Nicaragua to Central America, etc.
Ecuador: Paradox or Paradigm December 23, 2008Posted by rogerhollander in Ecuador Politics, History, Government, Culture, Ecuador Writing, Ecuador: Paradox or Paradigm.
Tags: alarcon, alvaro noboa, arteaga, brady bonds, bucaram, default, Ecuador, Ecuador Government, Ecuador history, ecuador poverty, external debt, Latin America, mahuad, roger hollander
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(This is an article I wrote (October 5, 1999) and submitted somewhere, I don’t remember. In any case it was rejected. It summarizes Ecuador’s political and economic climate and suggests that it might be a paradigm for the rest of Latin America.)
Whereas the vast majority of Ecuadorians would not know what a Brady Bond is any more than they could identify the Brady Bunch, it can only be fear of violent Ecuadorian public reaction to further “belt tightening” measures that prompted the fundamentally conservative center-right government of President Jamie Mahuad to default on $44.5 million in Brady Bond interest payments earlier this month. While Ecuador may be one of the smallest and least economically developed amongst its Latin American neighbors and thereby easily dismissed as not comparable to the economic “giants” such as Brazil, Mexico or Argentina, to overlook the significance of this event for that reason is to ignore a continent-wide unrest of which Ecuador is as representative as any other Latin American republic.
The relatively mild international reaction to Ecuador’s unprecedented action would indicate that the world banking community is convinced that the tail is not likely to wag the dog. This, on the one hand, overlooks several key characteristics that Ecuador shares with its Latin American neighbors – large gaps between rich and poor, entrenched governmental corruption and instability, deep poverty, small and shrinking middle classes, overwhelming external debt, and dependency upon unstable world commodity markets. More importantly, it fails to take into account the single most critical factor that economists love to under-rate: the angry passions of desperate masses.
Ecuador is blessed with abundant natural resources. It is the world’s largest exporter of bananas and is also a major producer of cocoa, coffee, fresh flowers, coconut, pineapple, rice, and sugar cane. Its offshore and inland fishing industry yields massive quantities of lobster, shrimp, tuna, tilapia, and other high demand seafood products. The discovery of large oil deposits in its tropical rainforests in the 1970’s has thrust Ecuador amongst the leading petroleum producing nations of the Americas. The same Oriente region is potentially rife with precious metals such as silver and gold. With such natural riches, a diversity of bio-geographic regions (tropical rainforest, the Andes cordillera, lush coastal plains, and the Galápagos Islands) that is amenable to high yield agriculture and aquaculture production as well as regional and international tourism, and with a small population of just under thirteen million, Ecuador should be among the wealthiest nations on earth.
Yet, it is one of the poorest and it suffers perpetual economic crisis. Ecuador has both the highest inflation rate and per capita external debt in all Latin America. It has high rates of infant mortality and illiteracy that reflect a minimal public investment in health and education. Nearly one quarter of its adult population is unemployed and half of those employed are underemployed, managing a bare existence by selling everything from hard candy to tropical fruit, tooth paste to toilet paper, on city streets. The poverty rate is estimated at 80 per cent, with more than half of that considered to be deep poverty. It is not uncommon to see children as young as four and five years of age begging and/or working on the streets of Guayaquil, a seaport of over two million inhabitants, which is the country’s largest city and which suffers from a dilapidated infrastructure, disease epidemic due to inadequate sanitation, air and water pollution, and which is experiencing the proliferation of bamboo housing slums on its borders due to the influx of refugees from even more severe rural poverty.
Ecuador returned to constitutional government after a military dictatorship that lasted throughout the 1970’s. Its political culture is characterized by corruption, greed and incompetence. Its judicial system is almost entirely politicized. Over a dozen political parties jockey for power, and the inability of the legislative and executive branches to find common ground leaves the country in a state of almost perpetual political paralysis. There is constant labor strife, fueled, among other things, by the fact that government workers, particularly teachers and health workers whose salaries are embarrassing low to begin with, are compelled to initiate work stoppages to force government ministries to release their pay checks, which are often several months in arrears. In addition, there is chronic unrest amongst students, petroleum and utilities workers, Indigenous peoples and campesinos, and other sectors of society as a result unpopular policies that are perceived as throwing the burden of economic crisis on the backs of the poorest and most vulnerable members of society. Even the Catholic Church, despite its essentially conservative nature, often finds itself along side more traditional dissidents in chastising the government.
In 1996, Abdalá Bucaram, a demagogic and unbelievably vulgar “populist,” representing a party with left wing rhetoric and right wing policies, won the presidency and ring-mastered a governmental circus that was overthrown by a Congress-led, military supported and bloodless coup d’etat which followed two days of massive nation-wide general strike in February of 1997. With more than a bit of theatric irony, Bucaram, who proudly calls himself El Loco, was ousted by the Ecuadorian Congress on the constitutional ground of “mental incompetence,” and went into exile in Panama. Immediately, the Congress, in violation of the constitution, appointed its own leader, Fabian Alarcón, as interim president, bypassing the legitimate successor, the elected Vice President, Rosalía Arteaga, who had the misfortune to have been born of the wrong gender.
In August of 1998, under the banner of the center-right Popular Democracy party, Jamil Mahuad, a former mayor of Quito, Ecuador’s capital city, began a four year presidential term, having barely edged out Alvaro Noboa, heir to Ecuador’s largest banana fortune and the country’s wealthiest individual, a man with no prior political experience other than an appointed position in the government of Bucaram, who would no doubt have returned from exile should Noboa have won. Mahuad proceeded to implement a “paquetizo,” a package of economic policies far more stringent and devastating than those proposed by and which lead to the ouster of Bucaram. By mid-1999 the government had more than doubled the price of gasoline, devalued the currency, and raised the cost of public utilities as much as five hundred percent. A nation-wide banking crisis in the spring had lead to a week-long closure of all banks and was followed by the freezing of bank accounts. Hundreds of thousands of Ecuadorians lost their life savings. Things came to a head in early July, when a two day general strike called for by transportation workers ended up shutting down Ecuador’s inter-regional transportation for nearly two weeks.
The only political party in Ecuador with representation in Congress that as a matter of policy advocates the cessation of external debt payments is the Marxist-Leninist oriented Movement for Popular Democracy (MPD), which draws its major support from the teachers’ union and middle class professionals. A handful of so-called “center-left” parties, who always morph into center-right should they capture the presidency, will sometimes echo such demand while in opposition. However, nothing less than extraordinary circumstances can explain the unilateral withholding of a scheduled debt payment, particularly when such an action is taken by a government with no pretence toward or prior history of radicalism.
It is interesting to note that Ecuador is not among those countries for which the IMF is seriously considering the forgiving of past debt. Ostensibly this is because of Ecuador’s relative “wealth,” which fails to take into account its skewed distribution, and because of the endemic corruption within the political process. However, even if Ecuador were to be magically freed of the Albatross of external debt, apart from some undeniable short term benefit, this would not begin to solve the structural problems that lie at the root of the nation’s tragic history.
Crippling external debt is the symptom not the cause of Ecuador’s woes, and it can be argued that the same is substantially the same for virtually every Latin American nation. In short, given its history of external resource exploitation which presents us with today’s reality, a reality characterized by brutal discrepancies in the distribution of wealth and an overall dearth of both physical infrastructure (roads, utilities, sanitation) and social infrastructure (health, education, democratic government), Ecuador simply is not a viable political/economic unit. As government after government has proven, no amount of reform, be it of the strong armed neo-Liberal variety, which is the current style, or the more traditional borrow and spend (or steal) it variety, will get to the root of the problem.
Ecuador lacks a responsible leadership class. Election to public office is considered tantamount to a license to accumulate wealth. Presidents, Vice-Presidents, and Congressmen who leave office are almost as likely to go into exile in Panama, Chile, Costa Rica or Miami as they are to return to private life in Ecuador. There is no sense amongst Ecuadorians that its crisis can be solved at the political level as it presently exists. An example of this was the Popular Assembly, a by-product of the February 1997 uprising that lead to the ouster of Bucaram, which was seen as a way to reform the Constitution over the head of the Congress, which was considered too mired in corruption to achieve meaningful change. The interim government, however, set the ground rules for the Assembly, which resulted in the existing political parties being able to get their loyal supporters elected to and in control of the Assembly, which in turn produced nothing that constituted genuine change.
On the other hand, one does find in Ecuador a relatively strong union movement, militant teachers, angry students, a highly organized and effective Indigenous movement, a nascent and growing women’s movement, a discontented and fearful professional class, and millions of suffering and disillusioned “ordinary people.” Like the Guagua Pinchincha volcano, which as been on low boil for nearly a year and only this week has begun to spew tons of ash and dust over nearby Quito, the repressed and volcanic passions of this small but not atypical Latin nation may erupt at any moment, and without warning.
And the rest of Latin America may not be that far behind.
Fears Rise Over Possible Ecuador Default November 23, 2008Posted by rogerhollander in Ecuador, Latin America.
Tags: default, Ecuador, Ecuador external debt, Ecuador Government, Ecuador history, external debt, global bonds, MarketWatch, Moody, polya lesova, Rafael Correa, roger hollander, S&P
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“La Cruda Realidad” (The Crude Reality), Foto: Lou Dematteis
I regularly receive reports from www.amazoniaporlavida.org, an environmental organization that is waging a campaign to prevent exploitation of petroleum in Ecuador’s ecologically sensitive Yasuni region.
A recent e-mail made reverence to a former U.S. agent, John Perkins, who describes himself as a former “economic hit man,” in a tell-all book.
I found an interesting interview with Perkins on Amy Goodman’s “Democracy Now!” radio program, which sheds light on the problem as seen by today’s Ecuadorian environmental and anti-neoliberal activists.
First, my translation of the “Amazonia por la Vida” Report:
“In the Agenda of the United States and Its Intelligence Services”
When John Perkins was contracted by MAIN (a CIA front) to intervene in the political economy of Indonesia, Ecuador and Panama, he was told that by using macroeconomic statistics, he should be able, for example, to inflate the rate of economic growth in Indonesia from 6% to 19%. In the case of Ecuador, where he served as an economic advisor, he was told that, by manipulating its macroeconomic statistics, he should be able to put the country in debt to the point where they are trapped with the impossibility of repayment.
The CIA succeeded in manipulating Ecuadorian macroeconomic information to the point where in twenty years the country was in bankruptcy and had to over exploit and privatize its [natural] resources in order to deal with the debt.
In defining the statistics and the conditions of work in transnational corporations at that time [the 1970s] Texaco played an essential part. The former agent [Perkins] has revealed how Texaco was able to enter Ecuador via the Instituto Lingüístico de Verano [ILV, Summer Institute of Linguistics, a U.S. evangelical missionary organization, also known as the Wycliffe Bible Translators, with ties to the CIA], with whom he was also associated.
The CIA strategy was to establish the conditions for the re-taking of natural resources after they had been partially nationalized. Texaco, the company most affected, found itself in conflict with [Ecuadorian President] Jaime Roldós, who not only expelled the ILV from the country, but also refused the conditions to which Texaco aspired. After the assisination [of Roldós], [his successor] Oswaldo Hurtado reinstated the ILV and Texaco began its greatest campaign of explorations (John Perkins, “Confessions of an Economic Hitman,” 2004).
Evolution of the Total Ecuadorian External Debt (in millions of U.S. Dollars)
CEIDEX (Comisión Especial de Investigación de la Deuda Externa del Ecuador)
Now to John Perkins:
From the prologue to the “Democracy Now!” interview:
John Perkins, was a former respected member of the international banking community. In his book Confessions of an Economic Hit Man he describes how as a highly paid professional, he helped the U.S. cheat poor countries around the globe out of trillions of dollars by lending them more money than they could possibly repay and then take over their economies.
20 years ago Perkins began writing a book with the working title, “Conscience of an Economic Hit Men.”
Perkins writes, “The book was to be dedicated to the presidents of two countries, men who had been his clients whom I respected and thought of as kindred spirits–Jaime Roldós, president of Ecuador, and Omar Torrijos, president of Panama. Both had just died in fiery crashes. Their deaths were not accidental. They were assassinated because they opposed that fraternity of corporate, government, and banking heads whose goal is global empire. We Economic Hit Men failed to bring Roldós and Torrijos around, and the other type of hit men, the CIA-sanctioned jackals who were always right behind us, stepped in.
John Perkins goes on to write:
“I was persuaded to stop writing that book. I started it four more times during the next twenty years. On each occasion, my decision to begin again was influenced by current world events: the U.S. invasion of Panama in 1980, the first Gulf War, Somalia, and the rise of Osama bin Laden. However, threats or bribes always convinced me to stop.
John Perkins, from an interview with Amy Goodman on “Democracy Now!” November 9, 2004.
… I was initially recruited while I was in business school back in the late sixties by the National Security Agency, the nation’s largest and least understood spy organization; but ultimately I worked for private corporations.
… when the National Security Agency recruited me, they put me through a day of lie detector tests. They found out all my weaknesses and immediately seduced me. They used the strongest drugs in our culture, sex, power and money, to win me over. I come from a very old New England family, Calvinist, steeped in amazingly strong moral values. I think I, you know, I’m a good person overall, and I think my story really shows how this system and these powerful drugs of sex, money and power can seduce people, because I certainly was seduced. And if I hadn’t lived this life as an economic hit man, I think I’d have a hard time believing that anybody does these things
Basically what we were trained to do and what our job is to do is to build up the American empire. To bring—to create situations where as many resources as possible flow into this country, to our corporations, and our government, and in fact we’ve been very successful. We’ve built the largest empire in the history of the world. It’s been done over the last 50 years since World War II with very little military might, actually. It’s only in rare instances like Iraq where the military comes in as a last resort. This empire, unlike any other in the history of the world, has been built primarily through economic manipulation, through cheating, through fraud, through seducing people into our way of life, through the economic hit men. I was very much a part of that.
Well, the company I worked for was a company named Chas. T. Main in Boston, Massachusetts. We were about 2,000 employees, and I became its chief economist. I ended up having fifty people working for me. But my real job was deal-making. It was giving loans to other countries, huge loans, much bigger than they could possibly repay. One of the conditions of the loan—let’s say a $1 billion to a country like Indonesia or Ecuador—and this country would then have to give ninety percent of that loan back to a U.S. company, or U.S. companies, to build the infrastructure—a Halliburton or a Bechtel. These were big ones. Those companies would then go in and build an electrical system or ports or highways, and these would basically serve just a few of the very wealthiest families in those countries. The poor people in those countries would be stuck ultimately with this amazing debt that they couldn’t possibly repay. A country today like Ecuador owes over fifty percent of its national budget just to pay down its debt. And it really can’t do it. So, we literally have them over a barrel. So, when we want more oil, we go to Ecuador and say, “Look, you’re not able to repay your debts, therefore give our oil companies your Amazon rain forest, which are filled with oil.” And today we’re going in and destroying Amazonian rain forests, forcing Ecuador to give them to us because they’ve accumulated all this debt. So we make this big loan, most of it comes back to the United States, the country is left with the debt plus lots of interest, and they basically become our servants, our slaves. It’s an empire. There’s no two ways about it. It’s a huge empire. It’s been extremely successful.
[I worked] … very closely with the World Bank. The World Bank provides most of the money that’s used by economic hit men, it and the I.M.F.
Here is Perkins’ blood chilling account of the alleged assassination of Panama’s Omar Torrijos:
“Omar Torrijos, the President of Panama. Omar Torrijos had signed the Canal Treaty with Carter much—and, you know, it passed our congress by only one vote. It was a highly contended issue. And Torrijos then also went ahead and negotiated with the Japanese to build a sea-level canal. The Japanese wanted to finance and construct a sea-level canal in Panama. Torrijos talked to them about this which very much upset Bechtel Corporation, whose president was George Schultz and senior council was Casper Weinberger. When Carter was thrown out (and that’s an interesting story—how that actually happened), when he lost the election, and Reagan came in and Schultz came in as Secretary of State from Bechtel, and Weinberger came from Bechtel to be Secretary of Defense, they were extremely angry at Torrijos—tried to get him to renegotiate the Canal Treaty and not to talk to the Japanese. He adamantly refused. He was a very principled man. He had his problem, but he was a very principled man. He was an amazing man, Torrijos. And so, he died in a fiery airplane crash, which was connected to a tape recorder with explosives in it, which—I was there. I had been working with him. I knew that we economic hit men had failed. I knew the jackals were closing in on him, and the next thing, his plane exploded with a tape recorder with a bomb in it. There’s no question in my mind that it was C.I.A. sanctioned, and most—many Latin American investigators have come to the same conclusion. Of course, we never heard about that in our country.”