DOMINICAN POLITICS III #9: MIGUEL VARGAS MALDONADO, PRD HEIR APPARENT

C O N F I D E N T I A L SANTO DOMINGO 003413

SIPDIS

SENSITIVE
SIPDIS

STATE FOR WHA, WHA/CAR, INR/IAA; USSOUTHCOM ALSO FOR POLAD;
TREASURY FOR OASIA-JLEVINE; DEPT PASS USDA FOR FAS; USDOC
FOR 4322/ITA/MAC/WH/CARIBBEAN BASIN DIVISION; USDOC FOR
3134/ITA/USFCS/RD/WH; DHS FOR CIS-CARLOS ITURREGUI

E.O. 12958: DECL: 11/01/2016
TAGS: DR PGOV PREL VARGAS MALDONADO MIGUEL
SUBJECT: DOMINICAN POLITICS III #9: MIGUEL VARGAS
MALDONADO, PRD HEIR APPARENT

Classified By: Economic-Political Counselor Michael A. Meigs, Reasons 1
.4(b),(d)


1. This is the third cable in our series on Dominican
politics in the third years of the administration of
President Leonel Fernandez.

Political Series III #9:
Miguel Vargas Maldonado, PRD Heir Apparent

(SBU) On October 30 the Ambassador received Miguel Vargas
Maldonado, the beefy, self confident businessman who is
certain of winning the opposition PRD,s presidential
nomination at the party convention of January 7, 2007.
Vargas, a wealthy construction entrepreneur who served as
President Mejia,s Minister of Public Works, had essentially
concluded arrangements to be nominated in early November but
in face of protests from perennial PRD candidates, he agreed
to a delay in the consecration. Other candidates of the
&Unitary Faction8 agreed to put up former Education
Secretary Milagros Ortiz Bosch as their pro forma contender.

SIPDIS

(SBU) Vargas arrived with an escort of influential PRD
leaders, all of them well known to the Ambassador:

- - Sen. Andres Bautista, three times president of the Senate

- - Congressional representative for Santo Domingo &Nene8
Cabrera, who received more votes in the May 2006 election
than any other candidate for the House

- - Former Labor Minister Milton Ray Guevara, co-author of
the new Labor Code in the 1990,s and president of the 2004
general assembly of the International Labor Organization

- - Peggy Cabral, PRD international affairs director and
widow of the party,s hallowed leader, the late Francisco
Pea Gmez

- - Dr Puello, head of the country,s Olympic Committee for
25 years, including for the Pan American Games of 2003, and

-- Hugo Rivera Fernandez, one of the chief negotiators for
the DR-CAFTA regional trade agreement with the United States

(U) Earlier announced but not accompanying was Alfredo
Pacheco, former president of the House of Representatives and
unsuccessful candidate for the Santo Domingo mayor,s office.
Pacheco is recorded in the newspapers as a member of Vargas
Maldonado,s organizing committee.

(SBU) Vargas Maldonado went through in some detail the level
of support he believes he has already achieved in the primary
race. He said that 46 of the 57 vice presidents of the party
presidium support him, as do 5 of the 6 PRD Senators and 50
of the party's 53 mayors.

(SBU) Vargas said that the United States was the most
important country to the Dominican Republic, for many
reasons. U.S. concerns such as terrorism, counter-narcotics,
illicit flights from Venezuela, and extradition are "also
concerns of ours . . . the United States is our main partner
in combating these ills, which are also domestic issues
because they contribute to the crime problem in the Dominican
Republic.8 He studied in the United States, he said, &or
virtually, since I did my engineering degree in Puerto
Rico.8

Foreign Relations


(C) Relations with Venezuela could be difficult for a PRD
government, he said, recalling that President Chavez had
abruptly cut off petroleum shipments in 2003 when Mejia had
declined to take action in response to allegations from
Venezuelan security services that former Venezuelan President
Carlos Andres Perez was conspiring against Chavez. "Even
so, we respect governments that are legitimately
established." As for the current competition between
Venezuela and Guatemala for a Security Council seat, Chavez's
granting of favors during his international campaign amounts
to "playing with his people's money." Turning to Cuba,
Vargas believes that the Cuban people are ready for change,
and that the Dominican Republic's experience with a
democratic transition is one it could share. Vargas said
that there is some concern here that a post-Castro Cuba might
attract more visitors and hurt the Dominican tourism sector.

(SBU) Vargas Maldonado conceded that the current government
led by the Dominican Liberation Party (PLD) has achieved some
economic growth but asserted that these gains are not being
felt by the common man. The cost of basic foodstuffs is up,
and the PLD has broken a series of promises to the public.
Were he to win the presidency, his administration would focus
on four priorities: education, health, economic growth, and
housing. &I will raise spending on education from 1.9
percent of GDP to 4 percent, which is the requirement already
established in law.8

(C) &Education and health sectors have been abandoned by the
PLD -- just check the (budget) numbers." While the current
government spends large amounts on a Metro system that will
serve fewer than 10 percent of the inhabitants of the capital
and will require eternal subsidies, virtually nothing is
going to the countryside, where the lack of furniture in
schools means that some children have to sit on cement
blocks. The health sector has by and large been turned into
a jobs program for PLD supporters -- fewer than 50 percent of
the public health employees are health professionals,
according to the candidate.

(C) Vargas called the PLD's efforts on combating corruption
"a joke." Vargas cited the large number of vice-consuls at
the Dominican Consulate in New York. He sees these positions
as pay-offs. To be sure all present understood his meaning,
he made a hand gesture signifying the payment of currency.

Campaigns and Institutions

(C) Looking past the party primary to national presidential
campaign, Vargas predicted divisions within the PLD would
come into the open in January. President Fernandez could be
challenged for the PLD nomination by presidential chief of
staff Danilo Medina, and Medina can count on the support of
Reinaldo Pared Perez, the president of the Senate. Pared
Perez is a dogmatic, directive party figure, and his
management of the Senate has reflected this. &Instead of
working in collegial fashion, he is continually throwing
rocks in the faces of the PRD senators.8 Vargas was not
ready to assess the Senate,s current review of more than 200
prospective candidates for the 9 positions on the National
Electoral Board. 8But the law requires the appointments to
be made in consultation with the parties, for they are the
representatives of the people.8

(C) Vargas asserted that there had been PLD-orchestrated
electoral fraud in the past and more could occur in the 2008
election. He stressed the illegal use government resources
for campaign purposes. The PRD leader described as

suspicious the fact that, in the 2006 mid-term elections, a
number of his party's candidates lost races by very small
margins (as few as seven votes). The PLD government's
provision of security is insufficient, as demonstrated by
violence and deaths that occurred during the campaigns.

Comment

(C) There was a bit of Kabuki theatre going on here, since
this was the candidate,s first formal call on the Ambassador
of the United States of America. He was repeating for us the
campaign messages already in play in the provinces and in the
media. The Ambassador touched on the general theme of
corruption, but Vargas Maldonado replied in generic campaign
fashion rather than acknowledging the rumors and assertions
by some that his own wealth has come through shady dealings
In this ritual setting he could hardly do otherwise; but he
will need better answers about his own antecedents and
intentions once Fernandez and the PLD turn their attention to
campaigning.


2. (U) Drafted by Peter Hemsch, Michael Meigs


3. (U) This report and extensive other material can be
consulted on our SIPRNET site,
http://www.state.sgov.gov/p/wha/santodomingo/
HERTELL