SPAIN/ETA: RELEASE OF PRISONER TRIGGERS POLITICAL

1. (C) Summary. Just two months after ETA's December 30 bomb
attack at Madrid's airport set off a bitter debate regarding
the Zapatero Government's handling of the Basque issue,
Zapatero has drawn fresh criticism for allowing a hunger
striking ETA member to serve the remainder of his sentence in
house arrest for "humanitarian" reasons. The prisoner, Jose
Ignacio de Juana Chaos, had served 17 years of a 30-year
sentence for his role in the deaths of 18 individuals in the
1980s, most of them members of the Spanish police and
security forces. However, as he was about to be released in
2005, prosecutors charged him with continued ETA activities
while in prison and eventually won an additional 3-year
conviction against him. De Juana undertook two hunger
strikes, igniting fervor among young Basque radicals and
becoming a central element in the national political debate
on how -- or even whether -- to maintain peace talks with
ETA. Former Minister of Defense Jose Bono told the
Ambassador that the Zapatero Government had determined that
De Juana was truly near death and that his "martyrdom" would
unleash a wave of ETA violence and definitively derail the
Basque peace process. There are rumors that Socialist elder
statesmen are privately critical of the De Juana decision,
even as they voice public support for Zapatero. The
opposition Popular Party (PP) and terrorist victims' groups
reacted with indignation and mass rallies, charging that
Zapatero has given in to ETA blackmail. The Socialist Party
(PSOE) has responded vigorously, asserting that De Juana's
treatment is no different than former President Aznar's
relocation of ETA prisoners to the Basque Region during
Aznar's own attempt to negotiate peace with ETA.



2. (C) The De Juana decision, along with the Government's
low-key response to the December 30 Barajas airport attack
and apparent willingness to consider allowing ETA's political
front to participate in May municipal elections in the Basque
Region, represent a huge gamble for the Zapatero Government.
Zapatero is betting that the electorate will prefer continued
talks with ETA, even under distasteful circumstances, to a
tough Government reaction that results in renewed ETA
violence. A key element of Zapatero's strategy is to equate
his own overtures to ETA with those undertaken by the PP in
the 1990s. Polls suggest widespread public disgust with De
Juana's release, but this has not translated into greater
political support for the PP. The inability thus far of the
PP to gain traction on this issue may explain why Zapatero
appears willing to place his Government's fortunes in the
hands of ETA and its political allies. End Summary.

//A NOTORIOUS ETA TERRORIST//



3. (U) De Juana Chaos, a former member of the Basque Regional
Police, became among the most vicious ETA terrorists and a
leader of ETA's feared "Madrid Commando" during the 1980s.
He was captured in January 1987 and was convicted of killing
12 Civil Guards and wounding 58 people in one attack, killing
five Civil Guards in another attack, and killing a Navy
Viceadmiral in a third attack. De Juana is accused of
involvement in as many as seven more deaths as well. In
1989, he was convicted to a total of 2,655 years in prison, a
symbolic punishment since he was convicted under the 1973
Penal Code which allowed for a maximum of 30 years
imprisonment.



4. (U) De Juana became eligible for release in 2005 under
normal penal guidelines allowing prisoners to reduce their
prison terms through "good behavior" and similar benefits.
However, a National Court magistrate blocked De Juana's
release in 2005 by charging him with making "terrorist
threats" in two articles he authored for the radical Basque
daily "Gara" near the end of his prison term. Also, although
many ETA terrorists had benefited from early release programs
during the Gonzalez, Aznar and Zapatero administrations,
Spanish public opinion was strongly against De Juana's
release because of the number of his victims and because he
had never expressed remorse.



5. (U) The new charges triggered a complex legal contest
pitting prosecutors and police against De Juana and ETA
support groups, at a time when the Zapatero Government was
undertaking tenuous peace talks with ETA. In November 2006,
the National Court agreed with the new charges against De
Juana and sentenced him to 12 more years in prison. On
appeal, the Supreme Court in February 2007 partially
overturned his conviction and reduced his sentence to 3 years
in prison for a single count of making terrorist threats.

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This three-year term would have made him eligible for release
in 12 to 18 months (summer 2008), under normal prison
guidelines.

//DE JUANA BECOMES AN ETA HERO//



6. (U) While the treatment of ETA prisoners, and particularly
their dispersal throughout Spain, has long been a central
issue for ETA negotiators, the De Juana case did not gain
special status until De Juana announced a hunger strike on
August 8 to protest his continued incarceration. Observers
in the Basque Region reported rumors that ETA leaders had
opposed De Juana's hunger strike out of concern that it would
inflame ETA supporters and complicate peace talks with the
Zapatero Government. De Juana abandoned his hunger strike in
October, but initiated a second hunger strike on November 7,
a day after the National Court sentenced him to a further 12
years in prison. His condition reportedly declined despite
forced feeding by doctors, and in early February De Juana's
attorneys released pictures of him appearing emaciated and
attached to IV tubes to keep him hydrated. Between August
and February, De Juana became the most important symbol of
ETA resistance to Madrid, particularly among the young ETA
hardliners who have reportedly taken over the organization
and who were behind the December 30 attack at Barajas Airport
that killed two people.



7. (U) The February 12 decision of the Spanish Supreme Court
to reduce De Juana's sentence from 12 years to 3 years paved
the way for the Zapatero Government to release him. The
reduced final prison term made him eligible for release under
special humanitarian guidelines for prisoners facing
relatively short sentences. On February 28, Minister of
Interior Alfredo Perez Rubalcaba approved the transfer of De
Juana from a Madrid prison hospital to a hospital in San
Sebastian, near De Juana's home, as well as authorizing De
Juana to complete the remainder of his prison term in his
home under police and electronic surveillance once he has
recovered enough to leave the hospital. In a press
conference announcing the Government's decision to ease De
Juana's conditions, Rubalcaba emphasized the Government's
determination that De Juana was near death, or at least on
the point of suffering irreperable physical damage, and that
the Government's decision was made on humanitarian grounds.
Other Government officials defended the decision as
appropriate for an inmate with little more than a year left
in his prison term, also noting that De Juana had expressed
support for the Basque peace process. A judge officially
approved Rubalcaba's decision on March 1 and De Juana arrived
at a San Sebastian hospital the same day to a hero's welcome.


//BASQUE EXTREMISTS CHEER VICTORY, PP CONDEMNS RELEASE//



8. (U) An ETA prisoner support group quickly claimed a
political victory for radical Basque nationalists and urged
the release of seven more ETA prisoners who are in poor
health. A representative of ETA political front group
"Batasuna" demanded the immediate release of sick ETA
prisoners and the relocation to the Basque Region of all
other ETA prisoners (a long-standing Batasuna demand). While
some in Batasuna and ETA seem willing to downplay De Juana's
release to avoid embarrassing Zapatero, most ETA supporters
clearly view the hunger strike as an effective weapon in
negotiations with the Government. Several prisoners
(including several common criminals) have announced their own
plans for hunger strikes.



9. (U) The PP and groups representing victims of terrorism
were quick to respond to news of De Juana's release,
denouncing the decision as tantamount to succumbing to ETA
blackmail. A PP youth group staged an unauthorized
demonstration in front of the Ministry of Interior the day De
Juana's release was announced and several "semi-spontaneous"
demonstrations called by victims rights groups have taken
place throughout the country, attracting several thousand
people each. Several demonstrations have been marred by the
participation of far-right Francoist and fascist groups. The
PP is organizing a massive protest march for March 10 (by
coincidence, the eve of third anniversary of the March 11,
2004 Madrid train attacks by Islamist extremists) under the
motto "Spain for Liberty - No More Concessions to ETA."

//ZAPATERO WALKING A FINE LINE//



10. (C) The Zapatero Government understands that it has
assumed a significant political risk, both in releasing De
Juana and in continuing to seek peace with ETA. Former
Minister of Defense Jose Bono told the Ambassador that the

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Zapatero Government had determined that De Juana was truly
near death and that his "martyrdom" would unleash a wave of
ETA violence and definitively derail the Basque peace
process. While releasing De Juana under pressure was certain
to cost Zapatero political support, Zapatero and the PSOE
reportedly determined that ETA's resurgence would be far
worse, both in terms of human lives and in political
consequences. Though all senior PSOE leaders, past and
present, have expressed public support for Zapatero's
decision on De Juana, Bono and former President Gonzalez were
rumored to be adamantly opposed in private. During his
tenure as MOD, Bono was outspoken in his opposition to Basque
nationalists.



11. (C) The Government will soon face yet another political
challenge: deciding whether to fight or support the
participation of ETA political group Batasuna in Basque
municipal elections in May. Although many observers
discarded any possibility of Batasuna's participation in
elections after the December 30 airport attack, it now seems
that Zapatero and his advisers are inclined to support
participation by Batasuna, or its candidates running under
another banner. A Batasuna role in Basque elections would be
certain to draw relentless criticism by the PP, and likely
grumbling from within the PSOE as well.

//POLITICAL KNIVES SHARPENED//



12. (C) While the De Chaos case will be the immediate cause,
the PP hopes its March 10 demonstration will convey
widespread dissatisfaction with Zapatero's ETA/Basque policy
and prove a political liability for the Socialists in the May
27 regional/municipal elections. Various polls conducted
following the announcement of De Juana's release indicate
broad disgust with the decision. In a poll by Spain's second
leading daily, "El Mundo," 63 percent of respondents called
De Juana's release "Bad or Very Bad" and 63 percent
(including 58 percent of self-identified PSOE voters) said
they expected Zapatero's decision would negatively affect the
PSOE in upcoming elections. A separate poll indicated strong
public support (80 percent) for tougher sentencing
guidelines, but tracked with other polls in indicating that
the PSOE would still edge out the PP the general elections
(scheduled to take place by March 2008, but there is
speculations that Zapatero could call elections as early as
November).



13. (C) Zapatero and the PSOE are countering PP criticism by
equating the De Juana decision to former President Aznar's
decision to move a number of ETA prisoners to the Basque
Region as part of 1998 negotiations with ETA. The PSOE has
produced two videos detailing Aznar administration overtures
to ETA and calling the current PP attacks hypocritical.
Zapatero has also threatened to divulge previously "secret"
PP dealings with ETA during the Aznar Government, leading PP
figures to threaten to resurface the so-called "GAL Case,"
the PSOE's dirty war against ETA during the Gonzalez
Government. The political environment surrounding these
various ETA issues is likely to become even more volatile
through the May 27 municipal/regional elections, and through
the runup to the national elections in late 2007 or early


2008.
//COMMENT//



14. (C) As the De Juana episode makes clear, Zapatero is
willing to raise the ante in pursuit of avoiding violence and
furthering the Basque peace process, which he views as the
central legacy of his administration. To a significant
extent, he has placed his political future in ETA's hands.
In fact, many within Zapatero's PSOE ranks privately believe
that these high stakes are unreasonable, particularly in the
wake of the December 30 ETA bombing at Barajas airport.
Nevertheless Zapatero is counting on the PP to fumble the
opportunity and not be able to mount a successful challenge
to the PSOE's leadership in the national elections - as long
as ETA violence is held in check. ETA is doubtlessly aware
that it holds the wildcard in those elections and will
extract whatever concessions it can over the next several
months. However, the Zapatero Government cannot concede on
core ETA demands, such as Basque self determination, and the
key question is whether the Government will be able to do
enough to stave off another ETA blast, with its attendant
political consequences. Thus far, the PP and its leader
Mariano Rajoy have not been able to gain substantial
political momentum beyond their own core base, despite all of
the issues surrounding Zapatero's ETA policy - mainly because
the Spanish public views the PP as too right wing and too
associated with Aznar's perceived mistakes following the

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March 11, 2004 terrorist attacks in Madrid.
AGUIRRE