CHILEAN RIGHT WING STILL LUKEWARM ON PINERA IN

C O N F I D E N T I A L SANTIAGO 000901

SIPDIS

TREASURY FOR DAS BRIAN O'NEILL

E.O. 12958: DECL: 10/05/2018
TAGS: ECON EFIN IDB PGOV PREL CI
SUBJECT: CHILEAN RIGHT WING STILL LUKEWARM ON PINERA IN
2009; EXPECTS MODEST GAINS IN 2008 MUNICIPAL ELECTIONS

REF: SANTIAGO 893 AND PREVIOUS

Classified By: Ambassador Paul E. Simons for reasons 1.4 (b and d).

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Summary
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1. (C) The doctrinaire wing of the center-right Alianza
remains undecided as to whether it will give its support in
2009 to the presidential ambition of the opposition
coalition's front-running but more moderate Sebastian Pinera.
The results of the October 2008 municipal elections, as well
as whether the governing Concertacion coalition runs multiple
presidential candidates, will help shape its decision. End
summary.


2. (SBU) The Ambassador and E/Pol Counselor met October 6
with Senator Juan Antonio Coloma, president of the Union
Democrata Independiente (UDI),one of two parties (the other
being the Renovacion Nacional) that make up the center-right
Alianza opposition. The UDI is considered the more
doctrinaire of the two parties but, as Coloma noted, the UDI
has had to move from seeking to influence policy through
standing on ideological principle to the practical reality of
adopting positions which can win elections. Coloma was
joined by UDI SecGen Senator Victor Perez.

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A Shifting Electoral Panorama
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3. (C) Coloma believes that the Alianza can cut into the
Concertacion's 2004 municipal election edge of 10 percentage
points by "two or three points," a modest gain that would
augur well for the 2009 presidential elections. As
importantly, the Alianza would do well in so-called
"emblematic" municipal races such as for mayor of central
Santiago, where the Alianza's populist Pablo Zalaquet is neck
and neck with the Concertacion's Jaime Ravinet, a former
defense minister (and mayor of Santiago). A strong showing
for the Alianza in the municipals would signal as well the
continued weakening of the Democracia Cristano (DC),the
"right wing" of the center-left Concertacion; Coloma
predicted the DC would drop to being the third largest party
nationwide.


4. (C) Coloma said press reports over the previous weekend,
wherein former president Ricardo Lagos had declared he would
not seek the presidency in 2009 where not as definitive as
they seemed. "All ex-presidents want to return to power and
Lagos is no different." Lagos believes "he is the
Concertacion" and is concerned that the party's reputation -
and so his - have suffered over issues such as the
Transantiago mass transit debacle. Coloma predicted Lagos
may not be a candidate "today" but will accept should
Concertacion ask him next year.


5. (C) Asked whether the UDI would support the RN's Pinera as
the sole Alianza candidate for president in 2009 (Pinera is
far and away the leading candidate in all polls),Coloma said
the UDI would be "pragmatic." It was yet too early to make
that determination. If the Alianza did badly in the
municipals (i.e., loses by 10 or more points) then support
for Pinera would have to be reevaluated. Likewise, if the
Concertacion puts up multiple candidates (i.e, Lagos or OAS
SecGen Jose Manuel Insulza from the Socialist party or former
president Eduardo Frei or Soledad Alvear (both of the DC))
then the Alianza may do so as well. In all events, Coloma
continued, we are "not obsessed" with the question of whether
to back Pinera and are not opposed to doing so if
circumstances warrant it. (Note: Another UDI heavyweight,
Senator Pablo Longuiera, declared the very next day that the
RN's recent announcement to run its popular SecGen, Lily
Perez, for a Senate seat (against Coloma) in 2009 was a
virtual declaration of war, and would almost guarantee that
UDI would run its own presidential candidate. End note).

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Other Issues
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6. (C) Coloma and the Ambassador touched on several other
matters, including:


-- IDB financing of Transantiago: Coloma and Perez noted
that without "substantial redesign" of the troubled
Transantiago mass transit reform plan, the Senate is unlikely
to approve new funding for the system. Coloma said as well
that there is "unhappiness" over the manner in which the
IDB's USD 400 million dollar loan to the GOC for Transantiago
was handled. Chile's Supreme Court ruled the loan
inconstitutional; moreover, given that it was public
knowledge the Congress was opposed to a bailout, the loan
appears like "interference" in an internal domestic dispute.

-- Bolivian Crisis: Coloma expressed his concern over the
development of an "axis of countries" which are putting into
place "failed policies of the past." Chavez's model was
outdated even when he was proposing it ten years ago. The
Ambassador noted that Chile's institutions are strong and
that we are working closely with the GOC to find ways to
promote the Chilean model in the region.

-- Policies of an Alianza Government: In response to the
Ambassador's query, Coloma said the priorities of an
Alianza-led government would be to improve security and
eliminate delinquency, implement educational reform,
encourage innovation and development of new technologies, and
foster the private sector. "We must get away from the notion
that ideas germinate (solely) in goverment."

-- IPR: The Ambassador stressed the Embassy would continue
to press the GOC to improve its record on IPR and expressed
his hope Coloma could help move along proposed new copyright
legislation now before the Congress.

-- ICC: Coloma said he remains opposed to the very concept
of an International Criminal Court - "I don't trust
international law" - and hinted he would work to keep the
GOC's efforts to ratify the Rome Treaty bottled up in the
Senate.

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Comment
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7. (C) The Alianza's historical inability to defeat the
Concertacion in national elections stems at least in part
from the center-right's failure to unify enthusiastically
behind a single candidate. While Coloma did not raise the
fact that the RN is now targeting his seat, his lukewarm
support for Pinera couldn't have been more obvious. Still,
with the UDI having nobody in the wings that registers even
in the low single digits, Pinera remains the Alianza's best
and probably only hope for ending the Concertacion's twenty
year hold on power, a fact the UDI may eventually, if
reluctantly, come around to accepting. End comment.
SIMONS