PANAMA POST: 4TH EDITION -- THE DIRECTOR'S CUT --

C O N F I D E N T I A L PANAMA 000077

SIPDIS

SIPDIS

E.O. 12958: DECL: 01/25/2017
TAGS: PGOV PREL PM
SUBJECT: PANAMA POST: 4TH EDITION -- THE DIRECTOR'S CUT --
VOLUME II

REF: A. (A) PANAMA 51 (AND PREVIOUS)


B. (B) PANAMA 72

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

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Summary
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1. (C) The January 17-21 visit of State's Director for
Central American Affairs John Feeley provided the Panama Post
an excellent opportunity to touch base with numerous
political heavy hitters. Feeley met with all the
"presidenciables," except for Panamanista aspirant Alberto
Vallarino who was out of town and on the stump and Minister
of Housing and frequently cited front-runner for the
governing Revolutionary Democratic Party (PRD) presidential
nomination Balbina Herrera. (Note: Ambassador lunched with
Herrera on January 24 (REFTEL B).) Several common themes
emerged from the Feeley's visit:

(a) opposition leaders uniformly stated that they believe
that ultimately the governing Revolutionary Democratic Party
(PRD) presidential nominee would be Balbina Herrera, the
current Minister of Housing;

(b) only Panamenista Party leaders believe that there will be
an inter-party primary, all other opposition leaders rejected
it, and not even Panamenista President and presidential
candidate Juan Carlos Varela mentioned it during his meeting
with the Director; and

(c) PRD and Torrijos Administration contacts uniformly
asserted that National Assembly President Pedro Miguel
Gonzalez (PMG) would not be re-elected.

If Herrera is sincere in her desire to run for Mayor of
Panama City, not President, then the opposition could be
preparing to run against the wrong PRD opponent. The
universal rejection of the inter-party primary by
non-Panamenista candidates and Varela's omission to advocate
for it may suggest that this idea's time has come and passed.
While unlikely to take place, the inter-party primary may
continue to be a political football in intra-opposition
wrestling.

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Ford Concedes Panamenista Preference
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2. (C) "I am leaning towards the Panamenista party," UP
President Guillermo "Billy" Ford told Director on January 17.
Ford conceded, UP needed to bargaining to bargain hard when
negotiating an opposition alliance, in short, whether UP
would support the CD's eventual presidential nominee
Martinelli or to support the eventual Panamenista nominee.
Aware that UP VP Jose Raul Mulino was for all intents and
purposes already working on Panamanista presidential nominee
candidate Alberto Vallarino and that UP VP Anibal Galindo was
coordinating closely with Martinelli, Ford said that he had
assembled a team of thinkers to develop some "programmatic
ideas" for which UP would seek the support of an eventual
alliance partner. "We need to get the best deal for UP,"
Ford explained. During the meeting, Ford spotted Delia
Cardenas, noting that Cardenas was spearheading the work on
these programmatic ideas. (Note: Cardenas, a fellow
life-long Movement of Liberal Republican Nationalists
(MOLIRENA) member, jumped to UP with Ford.) "Ideology is not
that important these days in Panama," Ford said. "What
people want are ideas to solve problems."


3. (C) Asked if Endara's early formalization of his status as
VMP's presidential candidate would limit Endara's ability to
maneuver and form alliances, Ford, who was Endara's First VP,
said, "No. Endara needs the clout that being a candidate
brings. He will be able to make deals." Ford said he
expected that Minister of Housing Balbina Herrera would be
the PRD's eventual presidential candidate and asserted that
there would not be an inter-party primary.


4. (C) Comment: Okay, so now UP appears to be headed not
just in two directions, but rather three. Mulino is working
on Vallarino's campaign, Galindo on Martinelli's campaign,
and Ford is trying to hold his party back from splitting so
that they can get the best deal from either whoever
ultimately wins the Panamenista primary or Martinelli. There

also appear to be three groups working on "programmatic
ideas:" former Solidarity Party members led by Mulino,
former Liberals led by Galindo, and former MOLIRENistas led
by Ford. Stay tuned.

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Martinelli Gets a Face-Lift
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5. (C) Arriving at the chic Decapolis Hotel bar for drinks
with Feeley, Martinelli, with two badly bruised eyes, looked
like he had been on the losing side of a bad bar fight. Not
exactly. Martinelli explained that he had just had a
face-lift. Not a shrinking violet, Martinelli strode into
this very public setting without a care in the world for what
others might think of his facelift. That was essentially it
for news at this meeting as Martinelli went over well trod
ground providing Feeley with a first-hand opportunity to
taste Martinelli's confidence, witness his brash and direct
manner, and to see that, hell or high water, Martinelli would
run for president. As Ford noted, Herrera would be the PRD's
eventual presidential candidate, and there would not be an
inter-party primary, according to Martinelli.


6. (C) In an aside to POLCOUNS, Martinelli political advisor
Jimmy Papademetriu said, "I am very suspicious of Varela. If
he wins the Panamenista presidential nomination, I do not see
how Varela will be able to hold himself back from running for
president." Papademetriu confided that he was "working on
Martinelli" to get him to understand that Varela might not
follow through on his private pledge to back Martinelli if
Martinelli is leading the polls as of May 2008. (Conversely,
Martinelli had pledged to step down in favor of Varela should
he be trailing Varela.) Slowly, Martinelli was coming to
realize that he might not bring Varela to his side. As for
the internal Panamenista race, Papademetriu asserted that
Varela "was clobbering" Vallarino.


7. (C) Comment: Martinelli values youth and vigor. His
advisors are young, he likes to hang out in hip places, and
now he is trying to appear younger. While visiting
Transparency International, Feeley saw a picture of
Martinelli from 2004. It was apparent that Martinelli has
already undergone hair treatment to cover what was a balding
pate.. Indeed, Martinelli sees projecting an image of youth
and vigor as essential to his political success and probably
sought an alliance with Varela in part for his youthful image
and track record for having revitalized the Panamenista Party.

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Endara to Embark on "Listening Tour"
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8. (C) "I will begin my campaign with a listening tour," VMP
Presidential Candidate Guillermo Endara told Director on
January 18. Noting that people were tired of "empty
promises," former President Endara said that he needed to
hear their concerns. "We will not be doing big events.
People are insulted by them because they diminishes
individuals," Endara explained. "Instead we will be doing
smaller events and speaking directly to voters. I want to
treat the voters with respect." Ultimately, the Panamenista
party would end up tearing itself to pieces, Endara asserted.
Ameglio, Varela and Vallarino are going to spill a lot of
blood in the Panamenista primary," this life-long Panamenista
claimed. Furthermore, there would not be an inter-party
primary; "Only the Panamenista candidates event talk about it
any more." As Ford and Martinelli noted, Herrera would be
the PRD's eventual presidential candidate, and there would
not be an inter-party primary, Endara said.


9. (C) Comment: One wonders whether Endara truly prefers
small gatherings or if he is attempting to make a virtue out
of the fact that he is broke and cannot afford to hold large
events. Absent any clear proposal for what he wants to do or
how he would govern, Endara is choosing to go listen instead.
Endara's strategy appears to be to sustain enough visibility
to remain alive politically (He pulled seventeen percent in
2004.),wait for the Panamenistas to collapse, and then ride
the wave of surging Panamenista faithful looking for a true
Panamenista to support: him. To facilitate coalition
building, Endara also appears to be refraining from attacking
other presidential aspirants.

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Juan Carlos Navarro Confident Will Secure PRD CEN Seat

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10. (C) Panama City Mayor and PRD presidential nominee
candidate Juan Carlos Navarro said that there would not be
any surprises when the PRD faithful went to the polls on
January 20 to elect delegates for the party's March 9
convention. "I expect that thirty percent of the party's
membership will turn out," the mayor predicted. (Note:
Navarro's expectations were exceeded when some forty-two
percent of PRD members voted, about twelve percent of all
voters.) "I have a good machine and expect to have the
support of about fifteen percent of the elected delegates.
That should be enough to secure a seat on the CEN" (National
Executive Committee) of the PRD. Navarro went on to add, "El
Toro (former President Ernesto Perez Balladares) will not do
well."


11. (C) Comment: Navarro is probably right that he will be
able to handily win election to a seat on the PRD CEN.
Though results of the January 20 PRD election have not yet
been released, Navarro has refrained from playing the numbers
spin game. While Perez Balladares asserted that he had
"surprised" everybody be securing fifty percent of the
delegates and Herrera wildly asserted that she had the
support of ninety-five percent of the delegates, Navarro has
not thrown out numbers, but has argued that Panama's mayors,
city councilman, and district representatives form the base
of his machine. Navarro asserted that he was being
conservative in his estimation of his support. Herrera later
explained to Ambassador on January 24 that she arrived at the
ninety-five percent number by subtracting the percentage of
delegates committed to supporting El Toro (about five
percent). Navarro's ultimate goal remains securing the PRD's
presidential nomination. He exhibited no loss of confidence
in his belief that Herrera would support him, not run against
him, for the presidential nomination.

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Varela: "I am beating Vallarino two to one."
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12. (C) "I am beating Vallarino two to one, according to
internal Panamenista polls. I am getting fifty percent to
Vallarino's twenty-five percent support," Panamenista Party
President and candidate for the party's presidential
nomination Juan Carlos Varela stated on January 21. Varela
predicted that the general elections would between Herrera,
Martinelli and him.


13. (C) Comment: Varela made no mention of his pledge to
Martinelli to bow out of the race should he be trailing
Martinelli in the polls in May 2008. His mention that the
race would eventually come down to a three-way race between
Herrera, Martinelli, and himself suggests that Varela is
already looking forward to the generals. As for listening
for the dogs that do not bark, it is interesting to note that
Varela did not push the inter-party primary as a way to unify
the opposition as he is usually wont to do.

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Lewis Ecstatic with High PRD Turn-Out
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14. (C) Meeting with Feeley and DCM the day after PRD members
went to the polls, First VP and FM Samuel Lewis beamed at the
high turn-out for the PRD's internal election for delegates.
"I told you guys on January 18 that about one-third of the
party's members would vote," Lewis said on January 21.
"Well, it looks like forty-two percent went to the polls.
That's more than people that the entire Panamenista party,"
Panama's largest opposition party. Lewis noted that he had
not decided whether to run for a seat on the CEN. Lewis told
us that PMG would not be re-elected as President of the
National Assembly. Believing that PRD centrists had carried
the day, Lewis asserted that El Toro would not be a force at
the party's convention.


15. (C) Comment: Lewis may still be nurturing dreams of
running for president. Absent popular support, Lewis would
have to rely on party movers and shakers to line up delegates
in his favor for a CEN seat. Depending upon how successful
he were at securing such a seat, he might then return to a
presidential run that begins with efforts to lock up the
support of party luminaries before turning to work its bases,
where Lewis iss clearly outpaced by Herrera.
EATON