FIRST MEETING WITH EVO AS PRESIDENT

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SIPDIS

SIPDIS

STATE FOR WHA A/S T.SHANNON AND PDAS C.SHAPIRO
STATE ALSO FOR WHA/AND P.FRENCH AND L.PETRONI
MCC FOR A.ROSSIN AND J.HEWKO
USCINCSO ALSO FOR POLAD
TREASURY FOR S.GOOCH AND R.TOLOUI
NSC FOR D.FISK

E.O. 12958: DECL: 01/21/2016
TAGS: PREL PGOV SNAR ECON PINR EAID BL
SUBJECT: FIRST MEETING WITH EVO AS PRESIDENT

Classified By: Ambassador David N. Greenlee for reasons 1.4(b) and (d).


1. (C) SUMMARY: During a nearly two hour conversation with
the Ambassador at the Presidential Palace on February 18, Evo
Morales would not be pinned down on details of eradication
but showed interest in at least limited cooperation on
broader counternarcotics and anti-corruption issues. The
Ambassador admonished Morales to keep in check gratuitous
slaps at the USG for local political gain, pushed hard for
clarification on eradication, interdiction and alternative
development policies, and laid the blame for declining
military support on the GOB's grandstanding on Article 98.
The chemistry between Morales and his Vice President, Alvaro
Garcia Linera (also at the meeting) seemed cooler than in
previous encounters. Garcia Linera closed the meeting by
saying he hoped to attend the Microsoft-sponsored Government
Leaders Forum in Washington March 14-15. The Ambassador
advised him to apply for a visa via diplomatic note. END
SUMMARY.

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THE POTUS-MORALES PHONE CALL
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2. (C) The Ambassador, accompanied by DCM, Econ/Pol
Counselor, and the Embassy's declared intelligence chief met
at our request with President Evo Morales for almost two
hours at the Presidential Palace on February 18. Vice
President Alvaro Garcia Linera and Minister of the Presidency
Juan Ramon de la Quintana were also present. Morales opened
by thanking the Ambassador for the congratulatory phone call
received from President Bush on February 1, but worried that
a translator error left the impression that his regime was
moving toward socialism rather than clarifying that "Movement
Toward Socialism" was the name of the governing party. The
Ambassador assured Morales that he had clarified any
misunderstanding, but noted that it appeared to be a
distinction without a difference as some form of socialism
appeared, in fact, to be the guiding ideology of the
president's party. Morales did not reply.

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COUNTERNARCOTICS--A USG PRIORITY
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3. (C) The Ambassador underscored the USG's commitment to
democracy in Bolivia, our interest in Morales succeeding
within that framework, and our willingness to work
collaboratively where possible. Morales broke in almost
immediately to suggest that he and the Ambassador make a
joint trip to the Chapare--ground zero in the drug war--an
idea the Ambassador acknowledged might be interesting, but
only after we reached agreement on the broad counternarcotics
agenda, including continued aggressive eradication, and a
coordinated set of talking points. The Ambassador went on to
remind Morales that the drug agenda had consequences in
almost every area of our cooperation and that it was
important for the GOB to be clear in its policies. He
reiterated our confusion over cocalero demands, apparently
supported by the presidential spokesman, that all USG
agencies and their counterparts leave the Chapare, and said
that we could pull all of our multi-million dollar programs
from the country immediately. The Ambassador also warned
Morales that his strident rhetoric ( "..twisting the arms of
the Yankees on the cato of coca...") may score points in the
Chapare, but did not play well in Washington, and that, if it
came to it, we knew something about arm-twisting. Finally,
the Ambassador noted that we had discussed earlier the
cocalero declaration with Quintana and had received his
assurances that eradication would continue, that the GOB
would respect the 3200 hectare limit for coca in the Chapare

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enshrined in the cocalero-Mesa Government agreement pending
the results of the EU-financed demand study, and that the DEA
would continue working in Bolivia.

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EVO RESPONDS
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4. (C) After thanking the Ambassador for his good wishes and
declaring the importance of a cooperative relationship with
the USG, Morales said he was baffled by the cocalero
declaration, noting that it was never discussed in his
presence and admitting that the GOB was having trouble
controlling its message. At the same time, he side stepped
the 3200 hectare limit in the Chapare and launched into a
false debate (made publicly on recent occasions) in favor of
allowing one cato (sixth of a hectare) of coca per federation
affiliate rather than per family as a means to reduce
cultivation in the region. Morales recounted that he had
wanted the original agreement with the Mesa government to
allow 4,000 hectares, but GOB had revised the number
downward. When the Ambassador asked if the current
administration intended to continue with the 3,200 hectare
limit, Morales replied that this was the goal but that the
final number following negotiations with cocaleros could be
more flexible. The Ambassador reminded Morales that,
although the U.S. was not a party to the agreement, Morales'
signature was on it and that we did not care about cocaleros'
internal debates -- what mattered was the bottom line and we
would watch with consequential interest for the eventual
outcome.


5. (C) Morales responded by delving into the details of his
Chapare strategy, including sending Vice Minister of Social
Defense Felipe Caceres to fly over the Carrazco National Park
to finally demarcate its boundaries. Morales said the
cocaleros had agreed the previous day to prohibit cultivation
in the park and to cooperate with military conscripts to
eradicate coca already there. Morales repeated that the
federations themselves would enforce the one cato per
affiliate limit and kick out any farmer that exceeded it.
Reving back a bit, Morales added, "That is where I want to
get in our negotiations, though as yet I do not have their
agreement for this proposal. But when these federations make
an agreement, they are honored." Again, the Ambassador
reminded Morales that the USG would conduct its annual
certification review and that paltry eradication numbers, so
far around just 5% of previous results, would not be
understood. He reiterated that the challenge was to arrive
at a coordinated strategy which assured that eradication
continued at a satisfactory pace.


6. (C) On a lighter note, and by way of explaining why DEA
needed to change its tactics, Morales said that in 1997, on a
bus ride back to the Chapare after a day of beer drinking, he
asked the driver to pull over so Morales could relieve
himself. In mid-stream, two burly DEA agents grabbed him by
the shoulders and spun him around, apparently thinking they
were stopping him from running away with narcotics.
Chuckling as he told the story, Morales said he had no
problem with the DEA remaining in the Chapare, as long as
there were some (unspecified) adjustments in the way they
worked. He alluded as well to an incident several years ago
in which a DEA agent allegedly supplanted local police at a
checkpoint -- commenting at the same time that such an action
might have been a necessary counter to endemic police
corruption.

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ARTICLE 98
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7. (C) Responding to local news articles citing a New York
Times piece erroneously characterizing a cut in
military-to-military assistance as a slap at the Morales
administration, the Ambassador sounded a strong note of
caution. He reminded Morales that the Embassy had been
silent on Article 98 for some time and accepted the new
regime's opposition to an agreement. At the same time, he
warned that continued inflammatory statements from Morales
and GOB officials claiming the U.S. wanted impunity through
Article 98 for its troops to commit wanton murder--especially
when we had troops actively at war in other regions--were
damaging to our relatioship and completely ignored our own
integrity and dignity (favorite one-way themes for the
Morales team). The Ambassador suggested Morales seek a
higher plane, and one based on facts, from which to launch
criticisms.


8. (C) The Vice President interjected to lament the Bolivian
armed forces' professional disarray and asked if we could
reconsider cutting our military assistance. The Ambassador
said the decision to sacrifice aid to what we considered
misguided principle was the GOB's. He reiterated that,
absent ratification of an Article 98 agreement, Bolivia would
lose about USD 33 million in military assistance over the
next three years and suggested the GOB revisit the issue.
(Comment: Garcia Linera's aversion to U.S. military presence
in Bolivia is well known. His urging for more help may
reflect direct armed forces' concern or that Venezuelan and
Cuban assistance may not be in immediate prospect. End
comment.)

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POSSIBLE INTELLIGENCE RELATIONSHIP
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9. (C) Introduced by the Ambassador, the Embassy's declared
intelligence chief offered Morales an agency coin (which
Morales at first regarded with puzzlement, but later with
considerable interest) and offered a rudimentary explanation
of our cooperation with intelligence units in the National
Police, focusing on international terrorism, crime and drug
trafficking. The intelligence chief noted that military
intelligence units were poor, but that the Directorate for
National intelligence under the Police had competent
professionals. He added, however, that these units had not
been exploited by the Morales administration perhaps because
of perceived "gringo" influence.


10. (C) After initial skepticism, Morales warmed to the idea
of cooperating on at least some intelligence matters--mainly
corruption and commercial issues--and quipped that, while he
did not understand well the workings of intelligence
agencies, he was accustomed to being followed by them. He
added that he discounted the GOB's intelligence units.
relying instead on "comrades ("companeros") all over Bolivia
who give me information." Quintana added that the GOB wanted
to create a civilian intelligence service that worked for the
state, and not for the police, and acknowledged Morales'
direction to discuss areas of cooperation with the
intelligence chief. (Comment: Quintana has avoided contact
with the Embassy's declared intelligence officer since taking
office and did not follow up after the meeting. Garcia
Linera also remained cool to overtures on intelligence
cooperation. End comment.)

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DEVELOPING A WORKING RELATIONSHIP
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11. (C) When asked how to develop a bilateral

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counternarcotics relationship, Morales suggested that the
Embassy continue meeting with Vice Minister Caceres. He also
recommended that we meet other ministers and vice-ministers
on other issues. The President stated a desire to work with
us on controlling precursor chemicals and developing a zero
cocaine strategy, "which is really the best way to eliminate
excess coca." Interestingly, he acknowledged that cocaine
trafficking propped up the price of coca leaf. He also said
he hoped to develop voluntary reduction programs in the
Yungas (Caranavi). At the same time, he lamented that
Bolivia had lost to Peru the opportunity to export coca
leaves legally to the United States. (Note: We understand
the only company in the United States legally allowed to
import coca leaves is Stepan Company in Maywood New Jersey
which produces cocaine for medical uses. End Note.) The
Ambassador replied that Bolivia's cocaleros were the
country's greatest neo-liberals, always looking for new
export markets. Morales smiled.


12. (C) Morales went on to say he wanted to optimize the
efficiency of the alternative development (AD) in the
Chapare, suggesting that a soccer field that can be built by
the mayors for 30,000 bolivianos would cost 90,000 bolivianos
as part of an AD program. Morales believed that road
infrastructure program was the most effective AD program in
the Chapare.


13. (C) Finally, upon hearing of the Ambassador's upcoming
trip to Washington, Morales asked to convey his best regards
to President Bush and to Secretary Rice, carefully
pronouncing her first name.

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THE VICE-PRESIDENT'S INTERVENTION
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14. (C) After 75 minutes, and with the conversation winding
down, Garcia Linera asked Morales for permission to speak.
The Vice President then embarked on a twenty-minute
monologue, starting by saying that this GOB had not declared
itself an enemy of the USG. "We don't want to create
problems. We agree on much but differ on some things."
Areas of agreement included democracy, counter-terrorism,
anti-corruption, and counternarcotics. The Ambassador
observed that we could offer model legislation on money
laundering, precursor chemicals and conspiracy that the GOB
might find helpful. Garcia Linera thought such input would
be useful.


15. (C) On the other hand, the Vice President acknowledged
that coca would remain an irritant. "You ask for exact
numbers (about coca cultivation and eradication)," he said,
"but we are a very ambiguous society." He assured that the
GOB would proceed with its coca strategy, making adjustments
as needed. Garcia Linera recognized that addressing the coca
issue in the Yungas would be especially complicated.


16. (C) The Ambassador commented that he understood that the
Vice President had taken some shots at the USG the previous
day at an economic forum on free trade agreements (see
septel). Garcia Linera vehemently denied the charge, stating
that his remarks had evidently been mischaracterized to the
Ambassador. "I carefully avoided mentioning any countries,
and any implicit criticisms were meant for the Europeans," he
said. (Comment: At the economic forum, the Vice-President's
attacks were clearly directed against U.S. trade policy. His
unusually defensive reaction-never seen before-may be due to
the fact that this issue was raised in the presence of
Morales. End Comment.)


17. (C) Garcia Linera mentioned that he would like to go to

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the Microsoft-sponsored Government Leaders Forum in
Washington March 14-15 but claimed not to know if he had a
visa. The Ambassador suggested that the Foreign Ministry
send a formal request and that the Embassy would proceed with
processing his visa application with the Department.

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COMMENT
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18. (C) Following the sometimes tense discussions about coca
and Article 98, Morales began to relax and show an engaging
sense of humor. Clearly more at ease telling stories than
discussing policy, he jumped from topic to topic and was most
comfortable when talking about the subject he understands
best--coca in the Chapare. As the Vice President stated
during the meeting, the President is spending a lot of his
time personally trying to negotiate with the cocaleros. For
Morales, this is one of his most difficult
challenges--walking the tightrope between succumbing to U.S.
demands and upsetting his key political power base in the
Chapare.


19. (C) There seemed to be tension between Morales and
Garcia Linera during the meeting. The two rarely looked at
each other or supported the other's points. The Vice
President's intervention at the end of the meeting seemed
unnecessary and forced, almost as if he believed his job was
to put an intellectual sheen on Morales's statements, or,
more ominously, insert himself as a buffer to a direct
relationship between the Ambassador and the President.
Morales paid little attention to Garcia Linera's words.


20. (C) Once again, most of what Morales said could be
interpreted as reassuring. But one month into his
administration, his capacity for doublespeak, or else his
incapacity to forge internal consensus, is as disturbing as
it is impressive.
GREENLEE