WORKING RELATIONS: DEATH BY A THOUSAND PAPER CUTS

C O N F I D E N T I A L LA PAZ 001023

SIPDIS

SIPDIS

E.O. 12958: DECL: 05/03/2018
TAGS: PGOV PREL PBTS MARR EAID ECON OPDC OPRC ADPM
BL
SUBJECT: WORKING RELATIONS: DEATH BY A THOUSAND PAPER CUTS

REF: A. LA PAZ 899

B. LA PAZ 711

C. LA PAZ 695

D. 07 LA PAZ 2960

E. 07 LA PAZ 2634

Classified By: EcoPol Chief Mike Hammer for reasons 1.4 (b) and (d)


1. (C) Summary. Despite a constant barrage of anti-U.S.
vitriol and baseless accusations of U.S. conspiracies against
the Morales government, there are also many examples of
continuing good relations among working-level and even
senior-level contacts. However, there is clearly a campaign
underway since mid-2007 to "distance" the Bolivian Government
from the United States backed by a number of concrete
actions, including new restrictions, demands, and calls to
renegotiate, reject, or freeze long-standing agreements.
Many government officials have cut off contact with the
mission, either at their own behest or through the orders of
superiors. Due to an influx of new political appointees
government-wide, it is sometimes difficult to determine
whether actions are intended to be slights or simply
incompetence. We have also observed a new fear of
association with the Embassy among some working-level
contacts. Constant high-level government accusations of U.S.
conspiracies inherently make it more difficult to engage at
the working level. We will continue to reach out to the
Bolivian government at all levels (ref a),but we do not
expect to escape scapegoat status any time soon. Many
high-ranking government officials are simply not ready to
accept any reality that does not fit into their paranoid view
of the United States. End Summary.

Fear of the Empire: Paranoid Political Backdrop
-------------- --


2. (C) Although the government has spewed anti-U.S. rhetoric
since Morales took power in January 2006, consistent with
Morales' positions before he became president, we had not
seen concrete steps taken to follow through on the rhetoric
until October, 2007 with the release of the presidential
foreign assistance decree (ref d). Before then, veteran
officers dismissed the rhetoric as bluster, consistent with
the assurances of working-level contacts and political
contacts that such outbursts were simply part of the
government's ongoing campaign to rally its base around
symbolic, but ultimately hallow, anti-imperialist vitriol.


3. (C) However, since the decree was issued, we have
witnessed a steady ratcheting up of concrete measures
detrimental to our working-level cooperation. Vice Foreign
Minister Hugo Fernandez confirmed this intentional
"distancing" in our bilateral relationship back in September.
Much of this "distancing" is reflected in actions that are
not entirely attributed to us, but that nevertheless are
clearly aimed in our direction, for example opening
diplomatic relations with Iran, suggesting the UN be moved
from New York, and blaming the "empire" (read U.S.) for
global climate change.


4. (C) These actions to distance us are compounded by and
consistent with an increase in the quantity and scope of
government attacks against the U.S. in general, and the
Embassy and the Ambassador in particular. Government and
ruling MAS Party contacts confirm that these attacks are not
just political gamesmanship, but sincere fears we are trying
to undermine their rule and orchestrate their ouster.
Whatever the case, these accusations are scaring some of our
contacts away from us.

New Assistance Rules: Bark, Bite, or Both?
--------------


5. (C) Ever since the government passed a decree requiring
closer international assistance coordination with public
institutions in October, 2007, we have waited to see how the
government would apply the vaguely-worded, potentially
far-reaching decree (ref d). Although we are still waiting
for implementing regulations, it is clear the government
wishes to exert more control over our assistance budget ($124
million in FY07).

--Following months of allegations that USAID programs were
undermining the government, the government finally requested
a comprehensive review of USAID programs (ref c). While the
government has labeled this a technical exercise, the signals
are clear that there is a strong political element to the
review, including efforts to control U.S. funds and secure
patronage for the MAS party faithful. While we are concerned
that the government may be using the review to stop at least
parts of USAID's programs (democracy in particular),we also
note that the government is disorganized and plagued by
infighting.

--This review has been much more in)depth and lengthy than
past reviews. Normally a host country government review
would take a few days, not the 30 days the government
requested. The review has already passed its 30 day deadline
and there is much more work to be done. At the current pace,
the entire review could last as long as six months. While
the process may be necessary to show we are transparent and
focused on development, it is a drain on staff time and
resources.

--One point of contention are the numerous and evolving
information requests made by the government to USAID. We
suspect they are after information to build a case against
us. As much of what they seek is protected by U.S. law or
part of diplomatic archives, we have pushed back on these
requests.

--So far, a welcome irony of the review has been the very
positive reception USAID and government staff has received
from community members when we have traveled to the field to
visit projects. The government reviewers see how valuable
this work is and what little capacity they have to carry out
these programs without USAID and its project partners.
Furthermore, farmers and mayors have given the government
reviewers an earful on the need to thaw certain projects
frozen by the government.

USAID: Continued Scrutiny
--------------


6. (C) The government has not put its criticisms of USAID on
hold pending the results of the review (ref b). In the weeks
prior to the May 4 Autonomy Referendum in the Department
(state) of Santa Cruz, President Morales has been falsely
accusing USAID of going door-to-door offering people money to
oppose the government. On April 19, the President reportedly
levied this attack on USAID. "Our patience can end. If they
want to work, they can work; if they want to help, they can
help, and if they do not want to do it, get out of Bolivia."

--This latest round is fueled for the first time by so-called
"evidence" of USAID conspiracy: a letter from an
Assistant-Mayor to Morales asking him to suspend USAID
activities in Potosi Department (state) because USAID is
"offering money to leaders that are provoking conflicts and
divisions in our communities." (Note: We have not seen the
letter. End Note.)

--In a highly-publicized rejection of U.S. support,
Agriculture Minister Susana Rivero refused to accept 19,000
tons of wheat flour because she considered the donation an
affront to national dignity. The Ambassador noted that it is
Bolivia's sovereign right to refuse assistance. The refusal
has been a public relations disaster for the government amid
soaring inflation and rising bread prices."

--By and large, the criticisms come from the President and
the Minister of the Presidency, and don't seem to be shared
widely within the cabinet. However, the President's public
criticisms prompt some ministers and vice ministers to avoid
dealing with USAID, at least for the time being.

Cutting Off Uncle Sam: The "Distancing" Begins
-------------- -


7. (C) Some government officials have threatened to or
actually stopped meeting with us, have refused to continue
cooperation or with our programs, or have failed to renew
agreements for no other reason than we are the U.S. Embassy.

--The government has suspended a routine annual exchange of
diplomatic notes granting our military in Bolivia on
temporary assignment rights and protections consistent with a
Status of Forces Agreement. The government has made clear
the freeze is based on political reasons and will not be
lifted until the "atmosphere" improves. The Vice Foreign
Minister readily suggested that the USG repackage the SOFA
exchange of notes as a "new" agreement to get past resistance
to renewal. Suspension of the exchange has already cost
Bolivia more than a million dollars in medical assistance
benefits for 2008 and threatens 2009 humanitarian assistance
projects.

--The government suspended military participation in the
Western Hemisphere Institution for Security Cooperation
(WHINSEC),alleging the training facility is teaching
Bolivian students to oppress their own people. Although
Government Minister Alfredo Rada said the police would
likewise be banned from attending the facility, no official
order has followed and police continue to attend. The
Bolivian Navy has interpreted the WHINSEC ban to include any
training that discusses strategy, which sometimes requires
them to stretch the definition of "technical" training.

--The Vice Ministry of Culture refused to work with our book
donation program in 2008, ostensibly because they were too
busy. We are now simply working directly with libraries and
local authorities. The snub has had no impact on the
program, as Ministry participation was confined to taking
credit for the donations at public events.

--The government's export promotion office (Ceprobol) has
been instructed to stop supporting programs if USAID or the
U.S. Embassy is involved. This automatically bans USAID or
Embassy from funding commercial diplomacy projects. The ban
includes staff members attending Bolivian Institute of
Foreign Trade (IBCE) seminars funded by USAID.

--The Morales Administration cut funding for all U.S.-funded
Bolivian personnel in the administrative unit of the Bolivian
Food and Animal Health Safety Agency (SENASAG) in 2008.
Without this administrative control, some $4 million in USDA
funds targeting problems such as hoof and mouth disease and
fruit fly control, have been frozen.

--Vice Minister of Coca Geronimo Meneses told our Narcotics
Affairs Sections (NAS) he had been specifically instructed by
the Agriculture Minister Susana Rivero not to meet with U.S.
officials. He followed these orders from December to
February, when Minister Rivero announced her resignation
(which later was rejected by President Morales).

Fear Factor: Guilt by "Imperial" Association
--------------


8. (C) In additional to officials that have stopped
associating with us altogether, many of our contacts have
confided they are under pressure not to work or meet with us.
Other government contacts have reduced their contact with us
and will only meet in neutral locations out of sight or under
the most official of circumstances. Clearly, it is not
career enhancing to appear too close to the Embassy if you
are a government official. Presidency Minister Juan Ramon
Quintana has likewise attempted to frighten our own Bolivian
employees by publicly questioning their patriotism.

--One of our MFA contacts asked PolOff to arrange meetings
via his anonymous private e-mail account, to not talk
publicly about friendly MFA officials, and to not call him on
his business phone or e-mail. He also says the fear factor
has infected every career diplomat at the MFA, to the point
that everyone uses cell phones at work and assumes their
phones are tapped and e-mails monitored.

--Our Regional Security Office (RSO) police contacts' are
being pressured to minimize association with the Embassy and
fear meeting anywhere outside of police headquarters. On
rare occasion, some will still meet informally in discrete
restaurants, but only on condition that they arrive and leave
separately. Embassy Force Protection Detachment reports
contacts in Trinidad and Tarija Departments (states) are
being told to sever all contact except when absolutely
necessary.

--Army Commander Gen. Freddy Mackay commented to us that ever
since we identified him as a graduate of WHINSEC courses, he
has had "to watch his back." This despite the fact that
Minister of the Presidency Juan Ramon Quintana is also a
graduate and has never reconciled his fiery attacks on the
institution with his presence there.

--Contacts may have good reason to fear government
retaliation. Returning diplomats from overseas postings are
routinely placed on leave without pay if they are not deemed
sufficiently pro-government. A MAS political appointee, who
had worked well with the Embassy in issuing courtesy visas to
U.S. Fulbright scholars, was sacked earlier in April. While
the courtesy visa procedure was never "legal" under Bolivian
law, it had been in use for many years (see below). The
Director of the Bolivian Agency for Development of
Information Society (ADSIB; a quasi-government organization
supported by the Vice President's Office) was fired in March
following his public involvement in a computer donation
sponsored by Intel. Apparently, association with a U.S.
multi-national company is sufficient grounds for removal in
the Morales administration.

--In an attack on our Bolivian national employees in August,
2007, Presidency Minister Juan Ramon Quintana said Bolivian
"traitors" working with the United States would be "judged"
by history.

Passive Aggressive Procedures: Show us Your Papers
-------------- --------------


9. (C) Post notes working level contacts are increasingly
requiring us to present information we have not had to
present in the past and routing us through new or newly
enforced procedures. Government requests for itemized
project and expenditure lists has become the norm throughout
the Embassy and a result of the government's efforts to
ensure "transparency."

--Fulbright scholars and exchange fellows initially enter
Bolivia on tourist visas, which are later expanded by the MFA
as courtesy visas for the duration of their programs. The
MFA broke with this long-standing policy in March and refused
to grant our scholars courtesy visas. Because the Bolivian
Mission in the United States has limited capacity to produce
any visa type other than the 90-day tourist visa, we are
stuck in a Catch-22. Of the three Amcits the change
immediately impacts, one will exit Bolivia and re-enter with
a new 90-day tourist visa, one will convert to a missionary
visa in accordance with her work with a Catholic university,
and the third still has more than 60 days before her visa
expires. The MFA has indicated a willingness to negotiate a
new bilateral cultural agreement with the USG. Our
correspondence with the MFA cites a 1960s agreement on
cultural exchanges; however, neither the Bolivians nor we can
find a copy of the agreement. Absent the agreement, the MFA
has "determined" that it cannot legally issue courtesy visas.

--The Ministry of Housing submitted a list of training
competencies to our Public Affairs Section that it suggested
we target through our Fulbright and exchange programs. We
have received similar letters in the past, for which we send
a letter back explaining how the programs work and that many
of the programs will overlap with the Ministry's very
extensive and broad list of suggested training. This year,
however, the Housing Ministry responded to our reply by
requesting a comprehensive list of all Bolivian exchange
program participants and their biographical information
through the inception of the program in Bolivia.

--The government agency responsible for regulating radio
frequencies turned the normally routine process of renewing
Embassy satellite telecommunications back-up links into a
long and arduous process. We were required to provide over
100 legal/technical documents, half of which had to be
certified by a notary public.

Government Double Whammy: Hostility and Incompetence
-------------- --------------


10. (C) At times it is difficult to distinguish whether the
government's actions are intended to spite us, are simply the
product of ineptitude, or some combination of both.

--The government announced a new, politically motivated "visa
fee" for U.S. citizen tourists visiting Bolivia (ref e). In
the process, the U.S. was moved from the highest to the
lowest tier of countries under Bolivian immigration law -- we
are now lumped in with Angola, Somalia and Yemen. Insult was
added to injury when the MFA put new and incompetent
political appointees in charge of the change. Our officers
had to explain basic consular terms and principles, and even
had to correct their math at the many painful meetings
leading up to the much-delayed, often-revised, and never
fully-explained policy. Following the clumsy implementation,
the Consular Section has heard reports of American Citizens
who have been unable to obtain a visa at Bolivian consulates
abroad, as the consulates simply ran out of the visa stickers
or were unclear about the requirements. Overall, however,
the new visa system has not/not proven overly onerous for
U.S. citizens.

--Although there are theoretically seven requirements in
order to obtain a tourist visa at a Bolivian port of entry,
Bolivian immigration officers have told ConOffs that in
practice, due to time and personnel constraints, they only
enforce three (the passport, application, and fee). This
inconsistency has led airlines to refuse boarding passengers
in Miami because they lacked one of the seven requirements
(such as the yellow fever certificate),when this is not an
actual requirement at the port of entry.

--The MFA also failed to notify us of the formal sentencing
of an American Citizen on terrorism charges in a very
high-profile case. When an Embassy official tried to call
the judge to inquire about the status of the case, he
pretended that he was someone else when the judge realized he
was talking to an Embassy staffer. "The judge is out," he
said, before abruptly hanging up the phone.

--Cooperation from the MFA and Bolivian courts as we attempt
to ramp-up adoption services for U.S. citizens following U.S.
ratification of the Hague Convention has been similarly
lacking. Interlocutors have privately observed that given
the political climate, it is unlikely that this process will
move forward.

"Misunderstandings," Reversals, and Half-Baked Apologies
-------------- --------------


11. (C) Government officials have reversed some actions we
found to be part of U.S. "distancing." We may never know
whether these examples were honest mistakes by overly
cautious and possibly new officials or politically motivated
slights overruled by internal Bolivian government pushback.

--Although the Bolivian military has been slow to fill
(non-WHINSEC) U.S.-sponsored training slots in 2008 and
initially refused our requests for vehicle access passes
(until recently routine),these issues have since been
improved upon significantly or resolved, respectively. These
delays could have been intended as an intentional effort to
slight us, or could be explained by the yearly change in the
high command, or could be a little of both.

--The Foreign Ministry denied one of our MILGP candidates a
dipnote necessary to receive a U.S. visa. He was told all
such dipnotes were on hold for U.S. training. The matter was
resolved and has not been repeated, but we do not know if a
policy change occurred and was reversed or if a Bolivian
consular officer simply did not understand procedure.

--Technology and Information Advisor for the Ministry of the
Presidency Jeol Flores de Carpio told the Bolivian Telecom
Chamber (CTIC) that his office would support any program as
long the U.S. Embassy and USAID are not involved. Once
EcoPol officer reminded him that USAID and Commerce
established the chamber and also support the ExpoTeleInfo
annual fair, Flores revised his earlier ban on our help to
accepting assistance that is conducted "in a transparent
manner."

--Production Minister Javier Hurtado told EconOff that the
unilateral Bolivian naming of a new PL-480 Board President in
violation of bilateral agreements was a mistake, not
hostility. He urged patience for the learning curve of many
new government employees. On the other hand, Hurtado
asserted that the U.S. owed Bolivia something for its
"blatantly political" freezing of the MCC compact process.
He went on to claim that attacks against the Embassy and the
Ambassador by President Morales were merely responses to U.S.
aggression and hostile actions, such as holding up the MCC
process.

--U.S. military delegations visiting Bolivian bases used to
be required only to obtain the approval of a service
commander or the Armed Forces Commander. Now, the Ministry
of Defense must approve a formal request. However, this is
not being universally enforced, leading us to suspect the new
requirement may have more to do with new military officials
misunderstanding requirements than intentionally complicating
the process.

--A few high-ranking military officers have backed out of
U.S.-sponsored military conferences with dubious excuses.

Not All Bad News
--------------


12. (SBU) We note that these examples are not reflective of
the whole of our working-level relationships, which remain
cordial and, in some cases, better than we expected. Some
examples:

--Although we did have problems with an airport manager,
including denial of tarmac access for Embassy staff assisting
in diplomatic pouch runs and denial of VIP lounge access to
the Ambassador's bodyguards, his behavior was rectified after
we complained to his superior. Otherwise, GSO and Human
Resources offices report no politically-motivated changes at
the working level.

--At a recent inauguration of USAID-funded social
infrastructure projects and with press present, community
members, the mayor and municipal council members, and the
representative of the government's Vice Ministry of Coca and
Integrated Development, roundly praised the USG for its
support.

--Access to senior military and Ministry of Defense officials
remains better than most posts and cooperation with both our
military and anti-narcotics interlocutors is enthusiastic.

Comment:
--------------


13. (C) We have been going the extra mile to explain our
assistance programs, basic concepts of international
agreements and diplomatic protocol, and our interest in
working with the Morales administration from the outset, but
have little to show for it. Despite two years of patiently
dealing with government paranoia and suspicion, the U.S.
government and, in particular, the U.S. Embassy continues to
be assaulted with an almost constant barrage of accusations
that we are conspiring against the Morales administration.
We understand the political value of scapegoating the United
States in Bolivia, but this has gone on for so long and such
a high pitch that it has begun to affect our ability to carry
out our work. There is no amount of rational explanation
that is likely to change this dynamic as it is becoming
increasingly evident that there are some leaders in the
government's inner circle (Quintana and Rada particularly)
that do not want these "misunderstandings" to be resolved.


14. (C) Optimistically, as critical elements of the
government work to uncover evidence of our supposed nefarious
activities, they are bound to learn their suspicions are
baseless, how important our assistance is to the people of
Bolivia, and pave the way for contacts to reengage. This
should be our goal. End Comment.
GOLDBERG