EXHAUSTED GUTIERREZ JUSTIFIES EMERGENCY, OUTLINES

C O N F I D E N T I A L SECTION 01 OF 02 QUITO 000850

SIPDIS

E.O. 12958: DECL: 04/17/2015
TAGS: PGOV PREL ASEC EC
SUBJECT: EXHAUSTED GUTIERREZ JUSTIFIES EMERGENCY, OUTLINES
NEXT STEPS

REF: A. QUITO 842


B. QUITO 841

C. QUITO 840

D. QUITO 839

E. QUITO 836

Classified By: Ambassador Kristie A. Kenney, Reason 1.4 (b)


1. (C) SUMMARY: A fatigued President Lucio Gutierrez met
with the Ambassador over breakfast April 18 and discussed the
now-withdrawn state of emergency (Reftels) and his plans for
reducing political temperatures. Gutierrez defended the
April 15 decree, but claimed security conditions had improved
sufficiently to merit its next-day retraction. He worried
that street protests demanding his resignation would
continue, however.


2. (C) Ordering the state of emergency was a bad tactical
move, the Ambassador asserted, and not notifying the Embassy
beforehand a breach of trust. She warned that other harsh
GoE moves, especially any attempt at dissolving the
legislature, would not be tolerated by the USG. Congress's
resolution April 17 that vacated the Supreme Court (Septel)
offered the president a chance to be conciliatory and perhaps
reduce calls for his head; he needed to capitalize.
Gutierrez claimed his team was reaching out the opposition
and had sought a Church role in spurring dialog. We are not
sanguine over his long term political prospects. END SUMMARY.

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Demonstrations Taking Their Toll
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3. (C) During the 22-hour Quito state of emergency, the
Ambassador and Gutierrez conversed twice; in their second
telcon, she requested a face-to-face. A bleary-eyed
president greeted her April 18 at their Presidential Palace
working breakfast (Administration Secretary Carlos Polit
later confirmed that Gutierrez had worked straight through
the night). He turned immediately to the emergency decree,
again claiming it was the only option available to ensure the
Supreme Court did not nullify arrest orders against two
fugitive bankers and simultaneously foment a bank run (Ref
D). The order had had its desired effect: dismissing the
temporary Court and calming Quito's streets. As such,
repealing it after less than one day was an easy call.


4. (C) Quito's social convulsions were the capital's alone,
Gutierrez argued. Elsewhere he was as popular as ever -- in
western lowlands province Los Rios, which the president had
visited April 17, residents had called for his re-election.
He believed street protests in Quito would continue, however,
and recognized their potentially destabilizing effects.
Nonetheless, Gutierrez would not clamp down on press
freedoms, even allowing the borderline-seditious Radio Luna
to continue broadcasting. He congratulated Congress for its
day-earlier decision to vacate the Supreme Court, and hoped
members would make good on their commitment to repopulate it
with apolitical justices.


5. (C) Gutierrez accepted and understood the public's
disgust with the return of exiled former President Abdala
Bucaram (PRE),the work of now ex-Supreme Court president
Guillermo Castro. The president disliked having to turn to
parties like the PRE and PRIAN, but six months ago, he had no
other choice (referring to the opposition's October/November
2004 attempt to impeach him). With 89 deputies supporting
the April 16 resolution, Gutierrez hoped a new spirit of
cooperation might reign in Congress. He waxed confident that
history would judge him well for forcing debate and ultimate
independence of Ecuador's judiciary.

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Cause for Concern, Not Emergency
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6. (C) The Ambassador differed with Gutierrez's rosy
portrayal of the situation. While the media harangue and
daily "cacerolazos" (noisy but non-violent street protests)
were nuisances and merited GoE attention, declaring a state
of emergency was a mistake. If anything, it had steeled the
opposition's resolve and tilted a wavering public solidly
against the president. She also expressed indignance that
the Embassy learned of the decree unofficially, noting she
and the foreign minister had spoken just one hour before
Gutierrez announced the measure on nationwide television.
(Gutierrez said the FM was out of the loop; only a few
insiders knew of the plan.) USG opposition aside, the
Ambassador praised the restraint shown by Ecuador's security
forces during the 22-hour emergency.


7. (C) She cautioned Gutierrez that the USG would not
tolerate further moves that threatened the independence of
Ecuadorian institutions, Congress in particular. In passing
the April 16 resolution, the legislature had displayed rare
unanimity and concern for the national interest. The
president would be wise to praise publicly Congress's move
and promise his administration's full cooperation in birthing
a truly independent judiciary. Conversely, inflammatory
public remarks such as the president's "If I leave, it will
only be feet first" would only embolden his political enemies.


8. (C) Administration press outreach was a good beginning,
she offered. The government might also look to restart
dialog with political opponents. Aware the presence of
certain Gutierrez insiders infuriated the opposition, the
Ambassador queried whether another Cabinet "re-oxygenation"
awaited. Last, she emphasized that Ecuador had friends in
the hemisphere wanting to help -- had he thought of
requesting OAS or further UN assistance?

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Similar Thoughts
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9. (C) Gutierrez revealed the Cabinet would assemble later
in the morning. Topping the agenda was an analysis of
Congress's resolution and how it might be utilized to lower
temperatures and spur compromise. His administration already
had reached out to Guayaquil Mayor Jaime Nebot (PSC),whom he
considered approachable. Concurrently, unofficial advisor
Guayaquil banker Guillermo Lasso was gauging the Church's
interest in assuming a conciliatory role in resolving the
political crisis. Gutierrez dodged the Ambassador's
inquiries regarding a Cabinet but hinted at invitation to the
OAS and/or UN, however.


10. (C) Two hours later, the Ambassador dialed Defense
Minister Nelson Herrera. Ecuador's armed forces had
performed responsibly in an unenviable job, she believed. As
the president looked exhausted and thus apt to err, the
Ambassador hoped Herrera might advise the chief executive to
get some rest. Herrera promised that the troops would
continue to comply with their constitutional obligations and
not play politics. He considered the state of emergency
tactically and morally wrong, but the Constitution mandated
he enforce the order. The president regularly burned
midnight oil; Herrera agreed he appeared sleep-deprived.

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COMMENT:
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11. (C) An optimist would consider last night's
Congressional unanimity proof the legislature has
back-burnered partisanship in hopes of fixing Ecuador's
dysfunctional judiciary. Pressure against Gutierrez
therefore should diminish, the theory goes. Having witnessed
Ecuador dispose eight presidents in eight years, however, we
aren't so optimistic, despite the president's enviable
survival instincts. The "street" continues to protest, for
example, with calls of "Fuera (Out!) Lucio" joining the
incessant horn-honking and pot-banging now commonplace
city-wide. Business elite in Quito also now calling for his
ouste. And an opposition lawmaker, shortly before Congress
passed the resolution, claimed that sufficient votes existed
(51) to declare Gutierrez mentally unfit to govern. Septel
details Embassy next steps; we will continue to tell all who
will listen (and some who won't) that dialogue is key, and
that a rotating-door presidency benefits no one.
KENNEY