DOMINICAN ELECTION SERIES #4 -- RE-ELECTIONISM

C O N F I D E N T I A L SECTION 01 OF 03 SANTO DOMINGO 006931 SIPDIS STATE FOR WHA AND DRL; NSC FOR SHANNON AND MADISON LABOR FOR ILAB; TREASURY FOR OASIA-LAMONICA USDOC FOR 4322/ITA/MAC/WH/CARIBBEAN BASIN DIVISION USDOC FOR 3134/ITA/USFCS/RD/WH E.O. 12958: DECL: 11/29/2008 TAGS: PGOV DR SUBJECT: DOMINICAN ELECTION SERIES #4 -- RE-ELECTIONISM Classified By: DCM LISA KUBISKE. REASON: 1.5 (B/D). ¶1. (SBU) Following is the fourth in our series on the Dominican presidential election: RE-ELECTIONISM (U) Why does Dominican President Hipolito Mejia continue to drive toward re-election, in the face of increasingly vocal dissent? The business sector and politicans are deeply worried about government finances and the possibility of runaway inflation. Many Dominicans are seeking irrationally for a "magic bullet" against the financial crisis; some think that all will be well once again if only Mejia will face the facts and renounce his attempt at re-election. (SBU) The deeply personalistic nature of Dominincan politics encourages this simplistic view. In fact, the crisis is systemic, rooted in the casual dealings, influence peddling and corruption of Dominican institutions. Mejia is a winner in this environment and has shown great ability to get along. Although he bears some responsibility for the financial crisis (because of the administration's decision to guarantee all -- repeat all -- the deposits in the failed Baninter), Mejia's early departure from the political scene would not solve the economic problem. Just the opposite: he would forfeit all credibility in the tough dealings needed to meet the conditions for the IMF agreement. To get that standby, this President needs to deliver in very short order a 2004 budget which will include additional further taxes to increase revenue by about 0.6 percent of GDP. That probably means obliging a nervous Congress to raise the value-added tax (VAT) for 2004 from 12 percent to 14 or 15 percent, a measure which must be voted by late December as part of the next budget. (SBU) Mejia is already walking a fine line between courting political support and accepting budget reality. Perhaps to make the medicine of the coming austerity go down more smoothly, he just boosted hopes concerning medicine prices by issuing a decree exempting from import taxes the inputs and capital goods for the pharmaceutical industry, and he exempted books and magazines entirely from the VAT. This week he publicly fudged comments on the IMF terms ("I will not sign any agreement which raises electricity rates" -- this at a time when his economic team is proposing monthly price adjustments, scaled according to consumption). At the same time, he has reaffirmed privately to us his intention to sign an agreement with the IMF that includes both sharp spending cuts and tax increases. Voices against Re-election (C) Supreme Court President Jorge Subero Isa told an emboff in early November that pressure against Mejia's re-election effort was growing. Respected intellectual Hugo Tolentino Dipp -- the former foreign minister who resigned over his disagreement with Mejia about sending Dominican troops to Iraq -- is among the notables talking against re-electionism. He gave his "valued friend" Hipolito Mejia a good hard shove in that direction on November 13, publishing an elegantly worded, hard-hitting "Public Letter to the Honorable Hipolito Mejia, President of the Dominican Republic" in the government-owned daily Listin Diario. (U) Among Tolentino,s grave, courtly comments: "Can it perhaps be true that the fascination with the power to command, with the delight of seeing the obedience of the governed, and the vanity induced by ceremony and deference, have managed to bring the long-time PRD stalwart Hipolito Mejia to betray one of the most democratic traditions of the Dominican people and of the PRD? I do not wish to believe it, despite the heavy doubts that weigh on my understanding and despite the strictly personal arguments of justification you used when casting yourself forward from the seat of power into a re-election effort. In your justification, Mr. President, there was not a single consideration, not even an inappropriate one, which could be interpreted as addressing a national interest." and "The tradition of continual presidential re-election - - 'continuism' - - has been a heavy burden for the Dominican people, Mr. President. Do not go along that road believing you will be the exceptional man who will justify yourself and overcome the severe damage that 're-electionism' has inflicted on the Dominican Republic. Vehement ambition followed in pursuit of remaining in power has always been linked with the deliberate frustration of popular will. And this is even more so, for when dealing with elections in which the President of the Republic is a candidate, our institutions lack the necessary independence and sufficient moral stature to guarantee complete transparency of the results. Refusing to recognize this reality, our 're-electionists' have marked their futures with the stigma of illegitimacy and even of despotism." (SBU) Tolentino Dipp does not speak for any particular faction of the PRD, but his lofty exposition of the PRD's traditional opposition to presidential re-election has all the more resonance for that. (U) The Catholic Church, a traditionally influential voice in civil society, has felt called upon to express its concern at a time of perceived national crisis. On November 26, the Conference of Dominican Bishops, comprising 19 prelates headed by Archbishop Nicolas de Jesus Lopez Rodriguez, asserted in a document demanding reforms to deal with the crisis, "There are those who believe that the renunciation by the honorable President of his candidacy for re-election would highly favor social peace, confidence, and governability. We leave this to his conscience." To their credit, the bishops also called for called for cuts in public spending, removal of corrupt government officials, and public and private efforts to restore business confidence. (U) Two Protestant evangelical organizations also recommended this past week that the President "examine his conscience" on the issue. (U) Elena Viyella, president of the National Council of Private Enterprise, has consistently characterized the President's re-election effort as a source of uncertainty and concern for the private sector. Marisol Vicens, the lawyer who heads the National Young Entrepreneurs Association, is unambiguous in urging the President not to run. A PPH vision (C) President Mejia is playing a forceful, calculated re-election game. On November 22 he opened a new headquarters for his PRD/PPH (Proyecto Presidencial Hipolito),and on November 30 he officially registered his candidacy for nomination at a party convention December 14. To a question about his re-election bid, he shot back, "Stop asking me that. No way I'm going to withdraw." PRD insiders tell us that his campaign is basing its approach on the results of privately commissioned polls showing he can take 58 percent of the votes in the PRD convention. These players believe that PRD President Hatuey Descamps can gather less than 10 percent of party support for his rival convention on December 7 intended to reject re-electionism. The mid-levels of the national PRD machine -- including mayors, city councils, and legislators who have benefited from Mejia's public works projects and other government spending -- provide a still considerable base of support. Looking further out, Mejia loyalists think that the President has a good prospect of besting Leonel Fernandez (PLD) in a second round on June 30, in part by attracting voters who will have supported Reformista (PRSC) candidate Eduardo Estrella in the first round May 16. Working on those assumptions, the PPH is not paying much attention to the anti-re-electionistas. The Burden of History (U) Mejia's critics oppose his re-election not only because of their objections to his policies, but because of the Dominican Republic's history of manipulated voting in presidential elections. The late strongman Joaquin Balaguer, operating in a formally democratic political system, accumulated 22 years in power through repeated use of military intervention, violence, press restrictions and fraud during elections. International and domestic outrage forced him to step down in the face of an overwhelming opposition victory (in 1978) and to accept an abbreviated term and a constitutional change prohibiting re-election (in 1994). Mejia used his control of Congress to abolish the constitutional ban in 2002. (end text) ¶2. (U) Drafters: Michael Meigs, Bainbridge Cowell HERTELL