GOB DIVIDED ON APPROACH TO U.S.

1. (C) Summary: Our recent experiences with the Bolivian
government show its internal divisions, between those
officials who distrust the USG but recognize the value of
repairing relations and those who view us as a threat and
want to reduce us to a minimal in-country presence. The
upcoming second round of the U.S.-Bolivian bilateral dialogue
will test those divisions. For now, these disparate voices
within the GOB provide a schizophrenic quality to our
relations, as the Bolivian government veers daily from
public, vitriolic attacks on the U.S. to requests for
assistance and signals welcoming dialogue. End summary.



2. (C) Following months of public and private Bolivian
complaints about the slow pace of our bilateral dialogue,
Foreign Minister David Choquehuanca offered an
uncharacteristically upbeat assessment of relations October
7, explaining publicly that "advances" had been reached in
the U.S.-Bolivian process and that the GOB looks forward to
the second round of dialogue later in the month. Privately,
Choquehuanca and acting Bolivian ambassador to the UN Pablo
Solon appear invested in the bilateral dialogue. Both
clearly hope to show concrete progress as quickly as possible
to overcome internal GOB resistance and to reposition Bolivia
with the U.S. (also with an eye toward recovering lost trade
preferences).



3. (C) At the same time, President Evo Morales rarely misses
an opportunity to condemn the U.S. "empire," which he and his
inner circle identify explicitly as the source of all of
Latin America's problems. Bolivian state television aired a
documentary October 6 rehashing a range of unfounded
accusations against USAID, former Ambassador Goldberg, and
the U.S. Embassy. A separate newscast featured an "expose"
of a recent embassy reception that the station alleged had
been aimed at co-opting pro-government social groups and
providing financial support to the opposition. Morales's
diatribes are part of his standard routine, while broadsides
against the U.S., such as the latest television documentary
and occasional allegations of American subterfuge, are a
staple of GOB discourse. Still, sometimes the same officials
who attack us one day will find something positive to say a
few days later (or vice versa).



4. (C) Similarly, the Bolivian government continues to
wrestle with its approach to President Obama, praising him
personally while insisting that he has been unable to effect
what Morales and others view as needed change. In response
to the President's winning the Nobel Peace Prize, Vice
President Garcia Linera (a hard-core leftist ideologue) was
effusive in congratulating President Obama and lauding his
accomplishments, at the same time characterizing the
President as a captive of imperialist forces that continue to
dominate the U.S.



5. (C) USAID's operations have been especially affected by
the Bolivian government's internal conflicts between its
pragmatists and more hard-line elements. We have been
confronted by conflicting messages regarding the GOB's
demands for closure of many of our programs, as requests for
termination have been followed by revisions and reversals,
and then reassertions of the original demands.



6. (C) Despite a GOB diplomatic note requesting an end to
all democracy, public administration and conflict mitigation
programs (ref A), Minister of Planning and Development Noel
Aguirre informed USAID October 1 that the GOB wants to reopen
discussion of our Municipal Strengthening Activity programs
and two near-finished Integrated Justice Center projects. FM
Choquehuanca also asked us to consider a GOB proposal that
would allow the municipal strengthening program to continue.
The GOB appears to have reconsidered these USAID programs yet
again in response to intense lobbying from municipal,
indigenous and social groups.



7. (C) Amid this ongoing uncertainty about the fate of many
USAID programs, the GOB signed September 29 a one-year
extension of USAID's integrated alternative development
program, with the support of Vice Minister of Social Defense
Felipe Caceres (who claimed to have intervened personally
with President Morales to make it happen). The extension
allows the program to continue while the parties coordinate
on future changes to the program. Still, Morales reportedly
later instructed Aguirre and Presidency Minister Juan Ramon
Quintana to oversee program implementation, to ensure that it
conforms with overall objectives for foreign assistance
(which could result in an another attempt to channel all
resources through the GOB, or in program delays).



8. (C) We were unable to get a similar extension for USAID's
health programs, however, as Aguirre informed the Charge that
all further agreements between USAID and the GOB would be
discussed as part of the bilateral dialogue. USAID health
programs will nevertheless continue, through direct
agreements with implementing partners, until an agreement can
be concluded with the GOB.



9. (C) Comment: The Bolivian government's internal conflicts
over relations with the U.S. have been evident for some time
now, as working-level contacts and more pragmatic senior
officials such as Choquehuanca and Caceres compete with
hard-liners such as Quintana -- who would prefer to scuttle
the bilateral dialogue entirely. These disputes manifest
themselves in the GOB's spasmodic approaches, as well as its
lurching from attack to expressions of interest in
cooperation. Although no one expects a successful conclusion
of bilateral talks to quiet GOB critics of the U.S., moderate
voices within the Bolivian government are looking to this
month's second round to provide them with strong arguments to
persuade Morales that progress is possible.
CREAMER