PANAMA POST: 8TH EDITION; VOLUME II

C O N F I D E N T I A L PANAMA 000206

SIPDIS

SIPDIS

E.O. 12958: DECL: 03/07/2018
TAGS: PREL PGOV PM
SUBJECT: PANAMA POST: 8TH EDITION; VOLUME II

REF: PANAMA 181 (AND PREVIOUS)

Classified By: POLCOUNS Brian R. Naranjo. Reasons: 1.4 (b) and (d)/.

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Summary
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1. (C) The first week of March was a busy one for the Panama
post. As the PRD wound down its congressillos in advance of
its March 9 convention, Ambassador engaged the Panamenista
Party's leading candidates for its presidential nomination,
the knife was stuck in a CID Gallup poll, and one mutual
assistance pact was born while another languished on its
deathbed. Our headlines this week:

-- As governing Revolutionary Democratic Party (PRD) internal
elections wind down, vote buying rises in price and goes
high-tech;
-- Movement of Liberal Republican Nationalists (MOLIRENA)
President Sergio Gonzalez-Ruiz looks for an alliance partner;
-- Confident Panamenista presidential nomination candidate
Juan Carlos Varela lunches with Ambassador;
-- Who killed the CID Gallup poll?: A Panamanian Political
Murder Mystery
-- "El Pacto de Chame? -- Panamenista presidential nomination
candidate Alberto Vallarino and Moral Vanguard of the Nation
(VMP) presidential candidate Guillermo Endara agree to
"mutual support?;
-- Whither the other "Pacto de Chame" -- Do Minister of
Housing Balbina Herrera and Panama City Mayor Juan Carlos
Navarro have a deal?;
-- Herrera gives testy, impromptu interview to La Estrella;
and
-- Former President Ernesto "El Toro" Perez Balladares and
National Assembly President Pedro Miguel Gonzalez (PMG)
scheme.

The second week of March looks to be a very busy week as
well, beginning with the PRD's convention on Sunday, March 9.
Also, Panama City Mayor Juan Carlos Navarro will formally
announce his candidacy for the PRD presidential nomination on
Wednesday, March 12.

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PRD Internals: Voting Buying Gets Expensive, Goes High Tech
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2. (C) "A lot of money is being thrown around in our
internal elections," National Assembly Majority Leader
Leandro Avila told POLCOUNS on February 27. According to
Avila, the average cost of each PRD delegated that was
elected on January 12 to vote your way in a congressillo was
about USD 500, up from US 250-500. Allegedly long-timer PRD
members Ramon Ashby and Jose "Chavitin" Huertas were
distributing a lot of cash. Unfortunately for many, Avila
said that the entrance of Rod Diaz, candidate for the PRD
National Executive Committee (CEN) 5th Sub-Secretary seat,
had raised the price of things by offering up to USD 2,500
per head in congressillos. Separately, former PRD National
Directors Committee (CDN) member Bernabe Perez told the
Panama Post on March 3 that some delegates casting their
votes in congressillos had taken cell phone cameras into the
voting booth to snap pictures of their completed ballots as
proof that they had voted as requested so that they could
collect their payments. "It has been a filthy competition,"
Perez said. Political analyst Jose Blandon (the father, not
Jose Blandon the son who is a Panamenista National Assembly
deputy) confirmed to Ambassador on March 7 that significant
government resources were being used to sway the voting.
First VP and FM "Samuel Lewis was told to use all the
resources possible -- you know exactly what that means -- to
stop Pedro Miguel Gonzalez from winning the 3rd sub-Secretary
seat," Blandon said, for example. (Note: Blandon has close
long-term links to the PRD and a close personal relationship
with Lewis.)


3. (C) Comment: Rumors and claims of vote buying in the PRD
internal elections are rampant and further contribute to a
widely held perception that these PRD internals are some of
the most bruising in recent memory. The Electoral Tribunal
has rushed out a new regulation that forbids voters from
taking cell phone cameras or any other electronic devices
into the voting booth. As for Diaz, he is considered a
shoe-in for the 5th Sub-Secretary seat. Blandon
characterized these PRD internal elections as the first in
history in which there was no obvious, pre-ordained
presidential candidate for the PRD. Should Minister of
Housing Balbina Herrera succeed in getting herself, Minister
of Education Belgis Castro, National Assembly President Pedro
Miguel Gonzalez, and National Assembly Deputy Hector Aleman
on to the CEN, Herrera will control the CEN, therefore the
PRD, and be well positioned to launch a focused campaign for
president, Blandon explained. Blandon told Ambassador to
watch three races closely to see who wins control of the PRD:
the races for:

CEN position: Torrijos' Herrera's
Candidate: Candidate:
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2nd sub-Secretary Mitchell Doens Hector Aleman
3rd sub-Secretary Rivera Pedro Miguel Gonzalez
4th sub-Secretary Belgis Castro Belgis Castro

The Panama Post will be out in force covering the PRD
convention.

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MOLIRENA President Leans Toward Martinelli
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4. (C) "The party is in very bad shape," MOLIRENA President
Sergio Gonzalez-Ruiz told POLCOUNS on September 27. "We are
bankrupt, aging, failing to attract new blood, fighting
amongst ourselves, and largely on life support." Eager to
form an alliance however to sustain the party, Gonzalez-Ruiz
offered, "We do have something to offer an alliance partner
though: a national structure and a presence in ninety-three
percent of Panama's precincts (corregimientos)." While he
said he would like align MOLIRENA with Democratic Change (CD)
presidential aspirant Ricardo Martinelli, Gonzalez-Ruiz
acknowledged that he would need to bring along the rest of
his party. Separately, the Panama Post has heard from
several sources, including Gonzalez-Ruiz, that long-time
MOLIRENA member and leader Arturo Vallarino prefers to put
the party in alliance with Panamenista presidential
nomination candidate Alberto Vallarino (no relation). Until
there was better definition of the internal Panamenista
campaign, Gonzalez-Ruiz said that alliance forming efforts
were unlikely to take much shape.


5. (C) Comment: MOLIRENA is indeed a party that is up
against the ropes. It hemorrhaged a number of luminaries,
including Guillermo "Billy" Ford who now heads the Patriotic
Union (UP) party. It is not clear though what MOLIRENA would
indeed bring much to the table. Martinelli political advisor
Jimmy Papadimitriu, skeptical of the value of an alliance
with MOLIRENA, told POLCOUNS March 5, "They are cannibals
simply eating one another in that party. There will only be
a carcass left." Indeed, former MOLIRENA President Gisela
Chung remains in a scorched earth battle with Gonzalez-Ruiz
for her "proportional representation" in the party's
structures.

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Varela Exudes Confidence During Lunch with Ambassador
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6. (C) Panamenista presidential nomination candidate Juan
Carlos Varela confidently asserted to Ambassador March 4 that
he would defeat Vallarino. Accompanied by his brother and
campaign manager Jose Luis "Popi" Varela, Varela said that he
saw four races: (1) the internal Panamenista race between
him and Vallarino; (2) the subsequent race between him and
Martinelli; (3) the PRD race between Minister of Housing
Balbina Herrera and Panama City Mayor Juan Carlos Varela, and
(4) the race between the winners of #2 and #3. Varela
explained that he was in the second phase of his campaign,
the listening phase. The first phase was completed with his
launch and nationwide tour where he re-introduced himself as
a presidential candidate, not simply the president of the
Panamenista Party. "We have already seen a jump in my
numbers following my reintroduction," Varela asserted. In
the current second phase, Varela said he would tour the
country to learn more about the real concerns of the public.
Then in late April/early May, before Panamenista candidates
had to formally file their candidacies on May 9, Varela said
he would start the third and final stage of his primary
campaign by laying out a program of government. Varela said
that he was leading Vallarino among Panamenista voters by 12
points (Varela 40 percent; Vallarino 28 percent),according
to an unreleased CID Gallup poll (see para 8-10).


7. (C) Comment: A man, a plan, Panama -- Varela believes
that he is the man with a plan who is on track to be
president of Panama. His relations with Martinelli strained,
Varela told the Ambassador that the two opposition leaders
would have dinner later the same night. Clearly, Varela
believes Martinelli is more of a hurdle to be overcome than
his fellow Panamenista Vallarino. Furthermore, in the wake
of her exceptional poll numbers, Varela was convinced that
Herrera would be the PRD presidential nominee. Well,
Papadimitriu confirmed that Martinelli and Varela patched
things up over dinner at Panama City businessman Felipo
Sosa's home on March 4, but he added, "I am not too sure how
long this patch will hold."

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A CID Gallup Poll Gets Murdered: Who Did It?
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8. (C) Panamanians awoke March 4 to see reported on the
cover of Panama-America that this Panama City right of center
daily newspaper had severed its seventeen year relationship
with regional polling outfit CID Gallup. Varela asserted to
Ambassador on March 4 that Martinelli, "who always has a poll
showing he is ahead under his arm," had quashed publication
of this poll because it showed Varela leading Martinelli.
Asked by POLCOUNS whether Martinelli killed this poll,
Papadimitriu said, "Vallarino, not Martinelli, squashed the
CID Gallup poll. Alberto leaned hard on Panama-America to
not publish that poll." Furthermore, Papadimitiru asserted
that Vallarino had tried to quash the Dichter and Neira poll
published recently by La Prensa (reftel) since it showed him
performing so poorly. Papadimitriu noted, "We have done a lot
of dirty tricks already in this campaign, but we did not do
this one," referring to efforts to quash the CID Gallup poll.
Separately though, the Panama Post learned from one source
close to CID Gallup that Martinelli did indeed pressure
Panama-America to suppress this poll by threatening to pull
his Super99 supermarkets chain's advertising from the paper;
the Super99 account is one of the paper's largest advertising
accounts.


9. (U) CID Gallup's poll shows Varela securing 40 percent
support of Panamenista Party members who intend to vote in
contrast to Vallarino's 28 percent support. The same poll
shows Varela with 26 percent support among opposition
candidates in contrast to Martinelli's 22 percent showing
Vallarino's 14 percent showing. This nationwide (except for
islands) poll conducted February 7 to 12 included 1,446
interviews in homes, in person, and by telephone. Only a
total of 180 interviewees identified themselves as
Panamenista Party members who were then asked to indicate
their voter preference among Panamenista primary presidential
nomination aspirants. Only 345 prospective voters identified
themselves as "opposition members" and were subsequently
asked their preference among opposition candidates. The same
poll indicated that 52 percent of PRD party members supported
Herrera leading Navarro who garnered only 19 percent support.
A total of 378 interviewees identified themselves as PRD
members and were asked to answer the PRD voter intention
question.


10. (C) Comment: This CID Gallup poll is suspect given the
unusually small sample sizes for key questions and the
pollsters at least partial reliance on telephone interviews.
(Note: Telephone interviews tend to skew to higher
socio-economic brackets as many Panamanians do not have ready
access to phones at home or at work.) Additionally, the
question regarding preferences among opposition candidates
was skewed by the inclusion of three Panamenista candidates
running against one candidate from each of the other
opposition parties. Vallarino would not be the sole
beneficiary of suppression of this poll; its publication
would have tarnished Martinelli's front-runner status as
well. Given its sloppiness though and the fact that it does
not track at all with other polling, the best that can be
said for this poll that was strangled in its crib is that
confirmation will be needed to see if there is a trend that
favors Varela in the Panamenista Party and whether Martinelli
is indeed losing so much ground to others in the opposition.
"Ultimately, Ricardo's numbers have to come down as other
opposition candidates ramp up their campaigns." Papadimitriu
said, "I have tried to explain that to Ricardo." Stay tuned.

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"El Pacto de Chame:" Vallarino-Endara Mutual Support Agreement
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11. (C) Vallarino and Endara announced March 5, following
their lunch at La Nueva Posada restaurant in the seashore
village of Gorgona, that they had agreed to support one
another mutually, as reported by major Panama City media
outlets. From media accounts, it looks like fellow former
presidential candidate Jose Miguel Aleman brokered this
meeting. Vallarino asked the press rhetorically, "If we (the
Panamenista Party) are not internally united, how are going
to be able to preach unity to the Moral Vanguard of the
Nation and other opposition parties?" At lunch with
Ambassador on March 6, Vallarino explained, "Essentially what
happened was that Endara, who has a significant quota of
support inside the Panamenista party, endorsed me."


12. (C) Comment: So what does this mean? Endara, broke
and slumping in the polls, is desperate for media attention
and surely welcomed this opportunity to raise his profile.
Endara, who has repeatedly noted that in his heart of hearts
he is a true Panamenista probably also welcomed the
opportunity believing it would allow him a chance to remind
Panamenista voters that he is still an option. Vallarino for
his part hoped to co-opt Endara's base of support inside the
Panamenista Party to his cause. Blandon asserted that
Vallarino stole a march on both Martinelli and Varela
catching them completely off guard; "The message of the
Vallarino-Endara alliance is that Vallarino can unify the
opposition. A vote for Vallarino, including those votes from
pro-Endara Panamenistas is a vote for opposition unity."
Vallarino still needs to defeat Varela and Marco Ameglio to
secure the Panamenista Party's presidential nomination.
Vallarino has been reaching out to prospective alliance
partners, including MOLIRENA and UP, trying put something
together. While UP's President Guillermo "Billy" Ford stiff
armed Vallarino, MOLIRENA's Gonzalez-Ruiz at least heard
Vallarino out.

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Wither the Other Pacto: Herrera's ad Navarro's Agreement
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13. (C) "Balbina (Herrera) told Juan Carlos (Navarro) 'I'll
support you as long as you are ahead of me in the polls," PRD
women's leader Irasema de Ahumada told the Panama Post on
March 3. Allegedly, Herrera told Navarro that if she was
ahead of him that she would not be the one to blame. De
Ahumada said she decided to ask Herrera directly concerning
her electoral aspirations -- to run for Panama City Mayor or
for President -- in the wake of what is becoming an
overheated parlor game of trying to determine Herrera's true
intentions. "The Herrera-Navarro pact is dead; it existed at
one point, but it's now dead," Blandon told the Ambassador.
Blandon predicted that Hector Aleman would push a resolution
at the PRD convention calling on Herrera to run for
president, thereby putting the final nail in the coffin of
this pact by making her candidacy a "call from the people."
Learning of this, Blandon said, Navarro did not waste any
time getting all the Panama City and San Miguelito precinct
representatives and city councilmen to sign a resolution
calling on Navarro to be the party's candidate. (Note:
Panama City and San Miguelito are Panama's most vote rich
municipalities.)


14. (C) Comment: It is widely believed, both inside the PRD
and among opposition leaders that Herrera will run and that
she will be the PRD candidate to beat for president of the
republic.

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A Testy Herrera Gives Impromptu Interview
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15. (U) "What pact? What pact?" Herrera told Panama
broadsheet daily La Estrella in an interview published on
March 6. Testy, Herrera answered a series of questions
regarding her political aspirations in an impromptu interview
on the campaign trail. Asked whether an emerging split in the
PRD would break her pact to support Navarro for the
presidency, Herrera responded, "I can tell you, if you were
criss-crossing the country as I am doing, I believe that you
would have an x-ray of my party. Nobody, nobody -- let my
underscore -- nobody is going to destroy the unity of my
party." Doggedly, Herrera stated that she supported her
President (Torrijos) as a Minister and her Secretary General
(Torrijos) as a sub-Secretary, that she was working to
fulfill her party's 25-year vision for Panama, and that she
was working with her task force to implement that vision.


16. (C) Comment: Herrera was offered an opportunity to stand
up publicly for her alleged pact with Navarro and decided to
take a pass. Taking refuge in party solidarity, Herrera is
laying the groundwork to launch her campaign for president as
being in response to the demands of the PRD rank-and-file.
Indeed, her campaign for the presidency of the PRD has
enabled her to deploy a nationwide team that can easily be
turned to supporting her campaign for the presidency of the
republic.

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Vallarino Lunches with Ambassador
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17. (C) "Polls don't mean much in the primaries," Panamenista
presidential nomination candidate Alberto Vallarino told
Ambassador over lunch on March 6. "Panamenistas are only one
out of every ten voters, so one would need to contact 10,000
people to get a decent sample by which to measure voter
intent in the party." Nonetheless, Vallarino was confident
that he was making good progress with his campaign. "I'm
listening to a lot of people as I travel from one end of
Panama to the next, trying to get a sense for their
concerns." Vallarino said that the cost of living, access to
clean water, and law and order topped the issues that voters
raised with him. Noting that he would be touring San
Miguelito later in the day, Vallarino complained that not
enough time was being scheduled for him to meet with
individual families and their neighbors that he was expected
to see. "They have me only spending 20 minutes in these
homes," Vallarino complained. "How can one jump start a
word-of-mouth campaign by barely spending time with people?"
Campaign advisor Jose Manuel Teran said, "You need to spend
at least 45 minutes at each stop."


18. (C) Comment: Vallarino was confident -- almost smug ---
that he would eventually win the Panamenista presidential
nomination. He was also extremely short on specifics about
his campaign strategy or policy proposals. He provided very
few insights into how he would govern and argued that policy
positions were not very important for the primaries,
"electability" was.

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El Toro and PMG Meet Behind Close Doors
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19. (C) Former President Ernesto "El Toro" Perez Balladares
met behind closed doors with National Assembly President
Pedro Miguel Gonzalez (PMG) for dinner at Panama City
restaurant Jade on March 5. While most of Panama City's
journalists speculated about what these two PRD members
discussed, Bernabe Perez -- who was present at the encounter
-- reported that while both were courteous to one another
they both warily keep their distance as well. Perez asserted
that PMG was more assertive than El Toro claiming that PRD
was "split" and in very bad condition. Allegedly, PMG said,
"We need to take it back." As for El Toro, he was looking
for backing to achieve his immediate goal to secure the PRD
presidency on March 9.


20. (C) Comment: Perez's assessment is probably right on
the money: "They are both mad, both against Torrijos. More
than being joined by specific interests, the roads that each
one finds himself on are leading to the same point. Were
these two to work together that would put (President) Martin
(Torrijos) in a very bad position and that has nothing to do
with the convention on Sunday, but rather the future real
leadership of the party and possibly the government." El
Toro and PMG are not birds of a feather that flock together.
El Toro anchors the party's authoritarian right wing, while
PMG represents the party's left wing "tendency (tendencia)"
faction.
EATON