ON INAUGURATION DAY, OSCAR ARIAS PROMISES A

UNCLAS SAN JOSE 000979

SIPDIS

SIPDIS

(C O R R E C T E D C O P Y - PARAS RENUMBERED)

E.O. 12958: N/A
TAGS: PGOV PREL CS
SUBJECT: ON INAUGURATION DAY, OSCAR ARIAS PROMISES A
GOVERNMENT THAT WILL MAKE DECISIONS

REF: A. SAN JOSE 159

B. SAN JOSE 204

C. SAN JOSE 444

Summary
--------------

1. Oscar Arias was sworn in as president for a four-year
term beginning May 8. Present at the mid-day ceremony were
the heads of state of the Central American countries, Mexico,
Colombia, Ecuador, Haiti, and Taiwan, Prince Felipe of Spain,
First Lady of the United States Laura Bush, and former Polish
President Lech Walesa. Arias gave an inspirational speech
with a simple line that clearly contrasts his style of
leadership with that of his predecessor: "We must make
decisions." The full text of the speech in English will
follow septel. End summary.

Breaking With the Immediate Past
--------------

2. On May 8, Costa Rica may have entered into a new era.
The administration of Abel Pacheco (2002-06) was notoriously
without direction, vision, or discipline. Pacheco's handling
of the U.S.-Central America-Dominican Republic Free Trade
Agreement (CAFTA-DR) was emblematic of a government that was
fearful of the opposition and therefore refused to take
action. Pacheco delayed 14 months before submitting CAFTA-DR
to the legislature for ratification and then encouraged
further delay after submission. He also failed to introduce
necessary implementing legislation so that CAFTA-DR could
enter into force. He constantly made contradictory public
statements about CAFTA-DR, expressing doubt that the
agreement would benefit the poor but, more recently, saying,
"Without CAFTA-DR we will starve."


3. In contrast, Arias and his government team appear to have
definite ideas on what they hope to accomplish and how to do
it. The first positive step was made even before May 8 when
Arias's National Liberation Party (PLN) forged a legislative
plan with the smaller Libertarian Movement Party. This
informal and ad hoc coalition will work together on CAFTA-DR
ratification, tax reform, and in other areas with the likely
support of the five-deputy Social Christian Unity Party
(PUSC) and that of two other deputies. All together, this is
a large enough majority to push through most of Arias's
ambitious legislative agenda.

A Call For Practicality and Decisiveness
--------------

4. After being presented the presidential sash, President
Arias laid out for the nation what he believes to be the
principle challenges of the next four years. His speech in
the National Stadium was of course televised and then
published in newspapers the following morning. The daily
newspaper "La Nacion" captured the most noteworthy line in
Arias's speech in its May 9 headline: "We must make
decisions." Arias used those exact words twice and repeated
the idea several times in different ways. He said that for
years Costa Ricans have chosen to rest on their laurels and
chosen "indecision as a method to deal with life...We cannot
continue to wander without direction, discussing endlessly
amongst ourselves, chasing the illusion of unanimity, using
up the best of our days and our efforts as if time did not
exist and as if the march of history would stop to wait for
tiny Costa Rica to weigh anchor." This was perhaps the most
pointed comment in the speech, a criticism of Costa Rica's
political culture which is best personified in Arias's
immediate predecessor, Abel Pacheco.


5. Arias also criticized Latin America politicians and
intellectuals in general who "continue to chase after utopias
and then blame others for our failures" and who "have a
chronic inability to see reality as it is, not as we wish it
to be, and are unable to read the world in prose and not in
poetry."

Making Costa Rica a Developed Country
--------------

6. Arias said that if there is a consensus in Costa Rica on
anything, it is that "the status quo is not an option." He
said that his first task as president begins today -- "to
define a direction for Costa Rica and start navigating in
that direction." He then laid out a program for his
government that he admitted was long term and would reach its
culmination only 15 years hence on the country's bicentennial
anniversary of independence; by that time, he said, Costa
Rica will be able to join the ranks of the international
community as "a developed country." (Note: In previous
speeches and in comments to us, he said that the goal was to
be the most developed country in Latin America. Such a
cocksure statement would have been offensive to the heads of
state from neighboring countries in attendance.)
GOVERNMENT THAT WILL MAKE DECISIONS


7. The first agenda item Arias mentioned was "the struggle
against poverty and inequality." That could be done, he
said, only by "stimulating the creation of formal jobs in the
private sector" and by "reforming and adequately regulating
telecommunications, energy, and infrastructure so that they
are competitive internationally." Though never mentioning
CAFTA-DR, Arias warned, "To return to protectionism or to be
disdainful of foreign investment nowadays is the surest path
to condemning our youth to unemployment and Costa Rica to
underdevelopment...A country that fears the world and cannot
adapt itself to outside forces inevitably condemns its young
people to seek well-being beyond its borders...It will not be
my government, either out of fear or prejudice, that isolates
Costa Rica from the international economy."

Need for Public Investment
--------------

8. Arias declared, "I want to be emphatic on the following:
in this administration we will resolve the perennial fiscal
crisis of the Costa Rican state." (Note: He offered no
details about how he would do it.) There would be new and
significant investments in infrastructure so that "never
again will our roads, ports, and airports be cause for
national shame; never again will we condemn our producers to
pass through a nightmare to sell the fruits of their labor."
Arias promised to strengthen public education and public
health care, making every effort possible in the next four
years to increase government spending on education to 8
percent of GDP. His government will "universalize" secondary
education by providing stipends to the poorest families so
that they can keep adolescents in the classroom. Arias said
his government will "fight narcotraffickers without rest, not
only by patrolling our waters and guarding our airports, but
especially by dealing with the traffickers on our street
corners, in our parks, and in front of our schools."

An International Debt-Forgiveness Proposal
--------------

9. On foreign policy, Arias stressed Costa Rica's
traditional "defense of democracy, full enforcement and
promotion of human rights, the struggle for peace and global
disarmament, and the search for human development." He said
his government will be committed to "multilateralism and
strict adherence to international law." He warned that the
big issues of our time, such as "a civilized coexistence
between peoples constantly buffeted by political and
religious fundamentalism and by the weakening of
international law," will not be resolved "automatically."


10. Arias expressed his major international initiative as
follows: "As a country without an army, from today we call
upon the world, especially the industrialized countries, that
they all give life to the 'Costa Rica consensus.' With this
initiative we aspire to establish mechanisms to forgive debts
and support with financial resources those developing
countries that every day invest more in health, education,
and housing for the people and every day less on weapons and
soldiers. It is time for the international financial
community to reward not only orderly spending, as has been
done until now, but also ethical spending."

Comment
--------------

11. There were several applause-worthy lines in Arias's
speech, and Arias in fact received a lot of applause except
from the 17 deputies of the Citizens' Action Party (PAC),the
major opposition to the Arias government's agenda for the
next four years. (Note: The PAC deputies' apparent decision
not to applaud at all is perhaps a sign of what to expect
from them in the future.) The speech overall was well
received; most Costa Ricans we have spoken with were proud of
their new president whom they believed was eloquent and
represented their country's most positive values. Tomas
Duenas, Costa Rican Ambassador to the U.S., with whom we had
lunch afterwards, said the speech for him was "like a shot of
adrenaline," and he couldn't wait to get back to Washington
and go back to work.
LANGDALE