PALACIO'S ASSEMBLY PROPOSAL BLOCKED BY TRIBUNAL

C O N F I D E N T I A L QUITO 002409

SIPDIS

E.O. 12958: DECL: TEN YEARS
TAGS: PGOV PINS EC
SUBJECT: PALACIO'S ASSEMBLY PROPOSAL BLOCKED BY TRIBUNAL

REF: QUITO 2359

Classified By: PolChief Erik Hall for reasons 1.4 (b&d).


1. (C) Summary: The rejection of President Palacio's
referendum proposal to convoke a national constituent
assembly by the electoral tribunal was swift and has forced
the GOE to reevaluate its options to promote reform. Signals
from Congress are mixed, with some calling for new talks with
the Palacio government about consensus reforms by referendum,
and others calling on Congress to act on its own. Rumors
that the two largest parties are planning to oust Palacio
with military help were denied by the Defense Minister.
Social groups favoring reform have rallied to Palacio's
support, and polls indicate widespread popular support for an
assembly. While further confrontation between executive and
legislative branches could be averted, we are uncertain
whether Palacio will seek to lower tensions. End Summary

TSE Rejects Legality of Presidential Move

SIPDIS
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2. (U) The Supreme Electoral Tribunal (TSE) , composed of
seven political party representatives, declared by a 5-2 vote
on October 20 that Palacio's one-question referendum proposal
(reftel) was unconstitutional. The indigenous Pachakutik
party and the New Country Movement voted in favor. According
to the majority, President Palacio had overstepped his
constitutional authority by proposing a constituent assembly,
which is not authorized by the constitution. Instead, he
must submit the proposal to Congress, the TSE ruled.

Plan B?
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3. (C) After the negative decision of the TSE, defenders of
the president's tactics were thin on the ground.
Presidential secretary Luis Herreria claimed he had opposed
the assembly proposal from the start, blaming it on a
competing presidential advisor, Jose Apolo, and the
president's legal advisor. For his part, presidential legal
advisor Roberto Gonzalez told PolChief on October 20 that he
agreed with the TSE's constitutional interpretation, and had
offered his resignation to Palacio over the issue (it was
refused). He claimed to be unaware of the government's
rumored "Plan B" and speculated that the TSE decision had
come swiftly to prevent popular support for the assembly from
growing in the interim.


4. (SBU) Pachakutik leaders and civil society leaders
publicly alleged efforts by the two major parties to
encourage the military to cooperate with a plan to oust
Palacio from office. Defense Minister Jarrin publicly denied
the charge, and threatened to sue one indigenous leader for
slander.


5. (SBU) Indigenous and civil society groups have rallied to
Palacio's side on the assembly proposal, seeing an
opportunity to insert favored causes in an assembly to
redraft the constitution. Indigenous and human rights groups
want to include debate over an FTA with the U.S. in this
forum, which by Palacio's request would coincide with the
2006 election campaign. Proponents of an assembly are citing
polls showing overwhelming public support for an assembly,
and have begun to organize street marches to show support.


6. (SBU) Former anti-Gutierrez protesters, labeled "bandits"
("forajidos") by Gutierrez, have reactivated to rally in
support of the constituent assembly proposal. Infamous Radio
Luna is calling for a noise-making demonstration in support
starting at 20:00 tonight (October 21),in the tradition of
the anti-Gutierrez protests.

Comment
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7. (C) The ball is clearly now back in Palacio's court, and
his intentions are not yet clear. In a conversation with the
Ambassador on the subject on October 19, Palacio appeared
serenely resigned to a negative TSE decision, but would not
elaborate on how he would react. Emboldened by favorable
poll data and growing support from social groups, Palacio may
well spurn dialogue with political party leaders and continue
to press his case with the public. Rumored talks between the
opposition and the military are always possible here, but
there is an equal opportunity for compromise with Congress
should Palacio choose to pursue it.
JEWELL