PANAMA'S DEMOCRATIC REVOLUTIONARY PARTY (PRD) AND

C O N F I D E N T I A L SECTION 01 OF 04 PANAMA 000802

SIPDIS


DEPARTMENT FOR WHA/CEN/BRIGHAM


E.O. 12958: DECL: 04/01/2014
TAGS: PREL PGOV ETRD PM POL CHIEF
SUBJECT: PANAMA'S DEMOCRATIC REVOLUTIONARY PARTY (PRD) AND
MARTIN TORRIJOS -- WHERE WILL THEY LEAD PANAMA? WHAT DOES
THAT MEAN FOR U.S. INTERESTS?


REF: A. PANAMA 0040

B. PANAMA 0145

C. PANAMA 0615

D. 03 PANAMA 3294


Classified By: AMBASSADOR LINDA WATT FOR REASONS 1.5 (B) AND (D).


SUMMARY
--------------


1. (C) The prospect of a PRD government assuming power on
September 1 is high, barring an unforeseen development.
Martin Torrijos enjoys a big lead in the polls barely four
weeks before Panama's May 2 presidential election. According
to many observers, Martin has consolidated his control over
the PRD after wresting it away from former president Ernesto
Perez Balladares (EPB). Today's PRD, dominated by Martin and
his friends, is quite different from the 1979-1989 political
arm of the now-defunct Panama Defense Forces and dictators
Omar Torrijos (Martin's father) and Manuel Noriega. Embassy
believes that Torrijos will keep PRD radicals -- the
anti-U.S. nationalist/leftist intellectuals known as "La
Tendencia" -- and high-level EPB supporters on the sidelines.
A Torrijos government would actively pursue and advance
shared bilateral interests in security and law enforcement
matters and free trade policy, and views Canal expansion as a
priority. Whether and to what degree Torrijos will be an
effective agent of anti-corruption and social change in
Panama remains to be seen. End Summary


Martin's PRD
--------------


2. (SBU) With over 400,000 members, the PRD is Panama's
oldest, biggest, most disciplined, and best organized
political party. (See Ref A). PRD candidates garnered 33%
of the presidential vote in 1994 and 38% in 1999, when Martin
Torrijos lost to Mireya Moscoso. Although EPB kept control
of the party during Martin Torrijos's failed 1999
presidential bid, Torrijos wrested it away from him later
that year and has effectively controlled it ever since.
Martin has democratized the party, which now chooses its
candidates in open primaries. At the same time, he has
promoted his close friends and schoolmates, many of whom have
strong U.S. connections like himself, to positions of
prominence. Although a last-minute "April surprise" is not
out of the question, all indications suggest that Martin
Torrijos will defeat his opponents by a solid margin. As the
youngest candidate in the race, Torrijos (age 40) appeals to
Panama's thousands of youthful voters. (Note: Over 55% of
Panama's registered voters are under 40 years old. End
Note.) The PRD also looks set to control the Legislative
Assembly, possibly with the help of its Partido Popular (PP)
ally.


Who is Martin Torrijos?
--------------


3. (SBU) Martin Torrijos is running for president of Panama
because of his last name. The son of Panamanian dictator
Omar Torrijos and Xenia Espino, a former Air Panama flight
attendant who was not his wife, Martin Torrijos was born in

1963. Omar Torrijos recognized Martin as his son when he was
in his teens, and sent him to St. John's Military Academy in
Wisconsin. Martin, who spent ages 15-29 (1978-1992) mostly
in the United States, earned bachelors degrees from Texas A&M
in political science (1986) and economics (1988). (He
married Vivian Fernandez Bello, whose parents are Cuban, in

1990. They have three children, Daniella, Martin Jr., and
Nicolas.) Until EPB called him back to Panama to help
reorganize the PRD in 1992, Martin spent four years managing
a McDonald's restaurant in Chicago. Martin eventually became
PRD Youth Committee chairman. When EPB became president in
1994, he named Martin as vice minister of government and
justice. After EPB lost a 1998 referendum to permit him to
run for another term, EPB grudgingly allowed Torrijos to run
for president in 1999.


A Credible Democratic Ally
--------------


4. (C) The PRD under Torrijos has forged an electoral
alliance with the Partido Popular (the ex-Christian
Democrats),historically the fiercest and most consistent foe
of Panama's military governments and the PRD. The PP's
retired chief, ex-vice president Ricardo Arias Calderon,
recently told POL Counselor, that he initially shunned
Torrijos, as the son of the dictator who exiled him from
Panama in 1969 but he changed his mind after meeting Martin.
"I made a mistake," Arias Calderon said. "He's (Martin) a
good man. He's the son of his mother, not the son of his
father." Martin sometimes is excessively cautious and takes
too long to make decisions, the veteran politician added, but
he has demonstrated his political "claws" in taming the PRD
to his will.


Torrijos, the PRD, and U.S, Interests
--------------


5. (C) Martin Torrijos has shown every indication of his
intention and his ability to work closely with U.S. officials
should he and his party assume the presidency. His advisors
have told us that Martin's supreme foreign policy priority is
to maintain good relations with the United States, pursuing
mutual interests in security and law enforcement matters,
free trade, and Canal expansion. (Note: Embassy is doing due
diligence on rumors of possible choices for key positions in
a future government. See Ref C. EmbOffs will use the four
months between the May 2 election and the September 1
inauguration to bolster contacts with whichever party wins so
that we can ensure a smooth transition to the new
administration. End Comment.)


Good Choices for VP
--------------


6. (C) Most observers agree that Martin made good VP
choices. For first vice president, he chose non-politician
Samuel Lewis Navarro, son of former Noriega foreign minister
(later anti-Noriega exile) Gabriel Lewis Galindo. The PRD's
chief "Gringo handler," the articulate, intelligent, pro-U.S.
Lewis Navarro is a successful businessman with multi-national
interests in fruit and packaging. He also is rumored as
Martin's first choice for foreign minister. (See Ref B.)
Martin's candidate for second vice president is soft-spoken
Partido Popular chief Ruben Arosemena. Arosemena is rumored
to be slated for anti-corruption coordinator in a Torrijos
government.


Martin's Anti-Corruption Credentials
--------------


7. (C) Martin has little credibility so far on his pledge to
reduce corruption. The prior PRD administration under EPB
was notably corrupt and after five years out of power, PRD
stalwarts are hungry for power and its perquisites, observers
say. Martin's first cousin, Hugo Torrijos, until recently
Martin's campaign manager and finance chief, is heavily
implicated in a multi-million dollar scandal involving Ports
Engineering and Construction Company (PECC -- See Ref D).
Many observers think that Martin himself may be implicated in
the multi-million dollar CEMIS scandal (although we have not
seen any evidence yet to support these allegations). Martin
is rumored to have a mutual non-prosecution pact with Mireya
Moscoso. Martin skillfully handled the PRD primaries, but
opponents have criticized him for promising government jobs
to primary losers to keep them in the party.


A Dictator's Creation
--------------


8. (SBU) The Partido Revolucionario Democratico (PRD) was
founded on October 3, 1979 as the political arm of the Panama
Defense Forces, eleven years after an October 1968 military
coup brought the military to power, and one year after the
Carter-Torrijos treaties forced dictator Omar Torrijos to
tolerate the reemergence of political parties. The PRD
flourished under the military, who used it to staff a bloated
government bureaucracy, supply puppet presidents, distribute
patronage, and spy on the populace. Through a rigged and
repressed political system, the PRD provided Panama's
dictators with a democratic "cover story" and
"anti-imperialist" (read anti-U.S.) ideology and rhetoric to
enhance their image and lend them international
respectability.



9. (SBU) After Operation Just Cause ended Panama's
dictatorship in December 1989, the PRD lapsed into sullen
opposition and disarray, and led violent but politically
fruitless anti-U.S. demonstrations to protest the loss of
life associated with the U.S. invasion. In 1994, former
close Noriega crony Ernesto Perez Balladares (EPB) squeaked
by to win the presidential election with just 33% of the vote
in a crowded and divided field.

Dictator Dad
--------------


10. (C) A 2004 PRD campaign poster attempt's to capitalize
on Omar's lingering mystique with certain voters, showing
Martin giving a speech superimposed on a photo of his
uniformed dictator dad puffing on a cigar. Despite his role
in the destruction of Panama's democracy, Omar Torrijos (who
died in a 1981 plane crash) was popular with poor
Panamanians, who saw him as the scourge of the traditional
"rabiblanco" ("white-tailed") upper class. Omar Torrijos
connived with the rich, bankrupted the country and stole it
blind, while engaging in drug running and other kinds of
criminal activities, but many poorer Panamanians benefited
from his policies to expand the bureaucracy and to reduce
racial discrimination. The core PRD constituency is still
about one-third of the electorate. But at least one-third of
Panamanians regard the PRD as an anathema and they would
never vote for it.


What About "La Tendencia"?
--------------


11. (C) The PRD, Panama's oldest party, ran the government
for 15 years (1979-89 and 1994-99),much longer than any
other Panamanian party. Many former high PRD officials were
associated with an internal grouping of anti-U.S. "leftist,"
pro-dictatorship intellectuals known as "La Tendencia."
Although the term is less often used today than in the past,
most of the individuals associated with La Tendencia are
still around. An informal rule-of thumb puts internal PRD
support for La Tendencia at 15-20% and for EPB at around 20%,
leaving the pro-Torrijos faction with 60-65%.


EPB "in a Box"
--------------


12. (C) Ambitious, arrogant, corrupt, wily former president
Ernesto Perez Balladares (EPB),who openly flaunts his
ill-gotten wealth, is still a force to be reckoned with in
the PRD, although his political career has fizzled. EPB
wants to be president again, although he lost a 1998
referendum to permit him to hold two terms by a 3-to-1
margin, and he still has his sights set on the 2009 election.
To that end he repeatedly attempted to sabotage Martin
Torrijos's nomination and campaign, believing that his
re-election prospects are better if a PRD candidate does not
win in 2004. (Comment: The Department revoked EPB's visa in
2000 for alien smuggling, which became a high-profile case in
Panama and makes EPB's prospects for re-election even more
remote. End Comment.)


Love-Hate
--------------


13. (C) Observers say that EPB and Martin Torrijos have a
love-hate relationship. EPB was instrumental in launching
Martin's career but would have tried to control him if he had
become president in 1999. Although he is wary of EPB, Martin
cannot afford to antagonize EPB and his supporters during an
election campaign, and EPB will need Martin's good graces for
his future political plans. Therefore the two have been
careful not to antagonize each other, despite their mutual
mistrust. Observers have given Martin high marks for
managing EPB, and for bringing a sizable number of former EPB
supporters to his side.



14. (C) Martin also reportedly has "bottled up" former EPB
cabinet loyalists (and U.S. betes noires) Mitchel Doens and
Francisco Sanchez Cardenas, marginalizing them from the party
mainstream decision-making process. (Comment: We also
understand that ex-EPB foreign ministers Jorge Ritter and
Ricardo Alberto Arias, vocal anti-U.S. nationalists who in
the late 1990s opposed establishing a U.S.-backed
anti-narcotics center in Panama, have put the past behind
them and are ready to work with us if the PRD wins. End
Comment.)


Worth Watching: A "New" Balbina Herrera
--------------


15. (C) An ambitious PRD legislator with known presidential
ambitions and links to "La Tendencia," Balbina Herrera is a
savvy political operator, well on her way to becoming one of
the most powerful women in Panama. She is number-two in
command of the party and, if Martin is elected president,
will become acting secretary general and will gain the
ability to control PRD appointments to the government,
payroll, and PRD "businesses." Observers speculate that her
ambitions may run afoul of Vivian Torrijos, who also will
become one of Panama's most powerful women if her husband
becomes president.


The Proof is in the Pudding
--------------


16. (C) Many observers are convinced that Martin Torrijos
means what he says about "leading by example." But he cannot
govern by himself. As we have repeatedly told PRD leaders,
including Torrijos, the U.S. will judge his government (or
whoever wins the elections) by the quality of appointments to
top positions and by the willingness of these individuals to
work with us in areas of mutual interest, especially on
security, law enforcement, and trade/investment matters.
While we believe Torrijos is truly committed to establishing
good relations with us, we are less certain of his ability to
deliver quality people in key positions. Nevertheless, we
will continue to hammer home the importance that we attach to
a mutually beneficial relationship, and that we are prepared
to work constructively with whichever party wins on May 2.


MCMULLEN