The following is the original text of an article published by Independent Voice in Canada in its December ediciton.

LEFTIST CORREA WINS IN ECUADOR
DEMOCRACY IN LATIN AMERICA?
By Ronald J. Bird

27 November 2006

Coming from behind after the first round of presidential voting six weeks ago in Ecuador, Rafael Correa, the 43-year-old progressive candidate and proponent of new directions for South America was swept to power yesterday. With two candidates espousing two well-articulated but contrary concepts to choose from, the voters were given a chance to pick their future as well as their president.

With over half of the votes counted, it appears that Correa has garnered some 68 % of the popular votes in this country of 13 million citizens and some 9 million voters. His banana-millionaire, right-wing, pro-American, neo-liberal and status-quo opponent, Álvaro Noboa, was able to collect no more than a meagre 31 % of the votes despite his lead going in, his support by private-media companies, his populist handouts of food, wheelchairs and computers, his blatant appeals to popular religion and his promises to build hundreds of thousands of low-cost housing.

Although Correa was behind a month ago, unofficial polls showed him nosing ahead of Noboa by the time campaigning ceased a few days ago. Voting is compulsory in Ecuador. But, as polling drew near, nearly one in five was still undecided. Apparently, in the end, they voted their hopes and aspirations and carried Correa into office with an overwhelmingly clear mandate.

Outside observers provided by the OAS (Organisation of American States) confirmed today that the elections went smoothly and that there has been no evidence of fraud. Oh, that every democratic country could claim the same!

For the first time Ecuador will have a president who has no members of his party in Congress. This is likely to make life very difficult for Correa even despite his huge majority. He will have to appeal over the heads of Congressional leaders to the voters who put him in power.

Ecuador

Ecuador was for years a small, poor but politically relatively-stable country in the northwest corner of South America. The discovery of oil simply emphasised the resource nature of its economy (until then mainly bananas) as well as its dependency upon international markets. Like many oil countries, Ecuador loaded itself with debt in the 80s by mortgaging the prospect of ever-more-pricey crude. Several international clouds gathered to rain on this parade.

First, although prices for oil were expected to rise over time, no one expected them first to drop into the cellar in the 80s and 90s, ushering in the SUV boom in America and financial chaos in many oil countries. At one time crude oil prices dropped back as low as seven dollars a barrel. By the time prices bounced back countries like Ecuador were faced with unpayable international debt, a full-blown financial crisis leading to the collapse of both its own national currency and its banking sector, huge unemployment and massive impoverishment amongst its people, the flight of capital and the departure of a large part of the country’s working population to the USA or Europe and a revolving door of federal politicians without the know-how, means, power or support to deal with the situation. An IMF negotiating team arrived at the gate. As usual, the IMF doctor ordered neo-liberal policies - free markets; globalised trade; floating currencies: the works! - to stabilise the economy and reassure international investors. The dollar replaced the sucre.

Second, historically national politics has always been dominated in this country by a small and wealthy oligarchy which was already well-positioned to feather their nests when the petroleum money came along. The US, French and other oil multis found that payoffs produced easy access and high profits.

The petroleum deals were one-sided in favour of the oil companies, the benefits to Ecuadorians narrowly focussed on those in a position to be bought off. Most Ecuadorians remained poor and struggling. Instead of a poor country with poor people, Ecuador with oil became a rich country with a lot of poor people.

After eight presidents in as many years, most driven out by street-action, in the run-up to the 2006 presidential elections Ecuador was being led by an interim president, the population desperate for some stability and a return of at least some measure of prosperity. But, heading into the federal elections on 15 October, the electorate was also wary and suspicious of politicians in general and cynical of the real motives behind the campaign spin.

In the best democratic theory, the first round of the election when dozens of parties took part threw up two major end-round candidates representing clear alternatives for the future. Álvaro Noboa of the right and Rafael Correa of the left. They couldn’t have been more different personally or politically.

On my right, Álvaro Noboa

Noboa, 56, is by all accounts the richest man in Ecuador. At home in Guayaquil and Washington, Cape Cod and Miami, his wealth was inherited from his father, the founder of the family banana kingdom. Noboa himself is no wimp. He fought and won a hugely public and bitter inheritance battle with his mother and siblings. Known in the country for his tough business policies, he has been condemned by Human Rights Watch for his exploitation of child labour on his plantations and his bullying tactics toward labourers and labour organisers alike. Physically, he is short and stocky with a bull neck and thinning hair though not totally without charm, one supposes, since he has a young, blonde wife who is also a congresswoman.

More critically, he is seen as the representative of the old policies, the old oligarchy and the old corruption. He is a neo-liberal, pro-capitalism, pro-Washington, pro-Catholic, and pro-free-trade with the USA. He has run an over-spending populist campaign, handing out food, wheelchairs and computers and promising to build hundreds of thousands of low-cost housing for the poor. “I am sent by God to help the poor,” he cried to a huge crowd before then falling to his knees with a Bible in his hand.

Out of ignorance, true, many of the poor in the barrios and the hill farms may have swallowed this whole. The fearful small-businessman who supports Noboa, on the other hand, hopes only for economic stability and a continuation of the system he already knew.

And on my left, Rafael Correa

Expected to be the leader after the first round of voting in October, his mediocre showing worried his supporters and fired up his opponents on the right and centre. Over the last six weeks, however, Correa returned to the attack. His modern and youthful good looks, his excellent academic credentials (M.A. from Louvain, Belgium; PhD in Economics from University of Illinois), his straightforward appeal to all levels of voters including indigenous voters (indígenas represent some 30 % of the population, a caste of near-untouchables only now beginning to feel its political muscle; Correa alone of the candidates speaks Quechua).

Although on occasion arrogant and abrasive, he is a Catholic humanist with roots in both liberation theology and modern economics. He describes his approach as “practical socialism for the 21st Century”. He wants to remove the stranglehold of the oligarchy and clean up the corruption. Like most Latin Americans, too, he is sick of the American role in the Western Hemisphere where ignorance and arrogance have been too often the wellsprings of Latin-American policy in Washington, the iron fist too frequently the means.

The six-week run-off campaign was marked by mudslinging from the right. They called Correa a wild man, a spawn of Fidel Castro, pawn of Hugo Chávez and a naïve political-ingénue. But the electorate apparently believed the bad-mouthers were going overboard. The voters had also begun over recent weeks to recognise that Noboa’s vest was anything but clean: the Human-Rights Watch critique came back to haunt him, for example, and his banana empire of shell companies looked distinctly shady. Moreover, he appeared to be revealing his true authoritarian nature as the campaign progressed, threatening to jail Correa if Noboa won. Touting the advantages of his personal contacts to a regime in Washington that is itself barely legitimate, decreasingly democratic, nakedly aggressive, militaristic, imperialistic and now also even unpopular at home did nothing to help the cause. A vote for Noboa was going to be a vote for the Same Old, Same Old.

Policies

Correa was proposing new but not entirely untried directions. Right from the first he acknowledged his admiration for Hugo Chávez and the popular regime in Venezuela. Who else in our day has been able to offer a second road for Latin American development or an alternative to now discredited neo-liberal policies?

Free trade. At the grand end of his plans, Correa has from the beginning said that he will immediately drop the pursuit of a free-trade agreement with the USA. Washington has anyway been sitting on its hands to punish Quito for a conflict about oil. And, more and more, the U.S.A. with its huge trade deficits has less and less in purchasing power to offer.

A mainline economist himself (perhaps even a crypto neo-liberal?), Correa intends now to pursue regional-free trade with his neighbours in a pan-Bolivarian model promoted by Chávez. Although regional free trade is a longer-term aim, some of the neighbouring countries are perhaps anyway for the moment beyond the pale: Columbia and Peru, for example, have already signed free-trade agreements with the USA; Columbia is intimately tied to the USA in “Plan Columbia” to fight coca and drug running and to put down home-grown rebellions like FARC.

Washington has been trailing its own neo-liberal free-trade model for decades around Latin America. For its part, however, the U.S.A. has been almost totally unwilling to make any real concessions. Ecuadorians are not blind: they see what has happened to small farmers in Mexico and Central America when subsidised American maize floods in. Americans also demand extensive concessions for US patents and other intellectual rights that many feel would block development in Third World countries.

As the decade has progressed, too, Washington has uncorked Middle-Eastern genies that it is apparently unable to stuff back into the bottle. Not central to the so-called “War on Terror” (increasingly a cultural war against perceived “Islamo-fascists”) and contributing nothing to winning in Iraq, Latin America is largely ignored and left to doctrinaire politicians of a strongly neo-conservative bent whose outlook is anti-Castro, anti-communist, anti-change and ante-deluvian. If anything, American policy seems to be formulated with a view solely to the one million anti-Castro exiles in the critical swing-state of Florida. Over and above that, American international policy has anyway become so militarised of late that it appears unable even to articulate a cohesive trade policy of any sort.

Manta airbase. It is a minor facet of this new orientation that Correa also swears to allow the treaty for the US “Forward Operating Base” in Manta on Ecuador’s Pacific coast to expire when it comes due in 2009. Admittedly, the airbase is small, by treaty limited to drug interdiction and, since Ecuador has no coca, aimed mainly at Columbia. But it is on the other hand the only US military base in South America and an affront to the national pride of many Ecuadorians who also fear being drawn unwillingly into the Columbian narco-wars.

Constitutional reform. Correa has promised to introduce early constitutional reform similar to that in Venezuela. (Chávez called a constitutional assembly, presented the results to the voters in the form of both a referendum and a vote of confidence for himself. It and he won overwhelming support.) One supposes that the Ecuadorian approach will be similar and will put more power in the hands of the Executive by permitting two or more successive terms and lengthening the term of office, for example.

End corruption. Voters, admittedly, roll their eyes when they hear that Correa promises to clean up corruption in Ecuadorian politics. They have heard it all too frequently before. But they seem now to be giving Correa a chance. Since Correa has no party members in Congress, that famously venal body, he at least owes nobody anything there.

Social and economic reform; economic development. Under a new constitution granting more power to the president and parallel to a clean-up of corruption, the new administration intends to make good on its social and economic reform: a just taxation system, investment in education, healthcare, housing and economic development.

Although the Right tars this as good old-fashioned Communism, there is nothing radical about this whatsoever. If it resembles the “Social Contract” or the “New Deal” that Americans and Europeans developed in the 150 years prior to Ronald Reagan and Margaret Thatcher, the only surprise here should be not the warmth with which progressives in Latin America embrace such humanistic concepts but the haste with which Americans, Canadians and Europeans have set about ditching them.

Petroleum is key; International debt is important too

None of this can happen without addressing macro-economic issues and, in the Ecuadorian context that means dealing with international oil. Ecuador might still be the largest exporter of bananas in the world, but selling oil to the USA brings in a lot more money. The country’s financial position – including its huge public debt sector - will be determined for years ahead by world oil markets and Ecuador’s cut of the deal.

Correa intends to renegotiate the royalty agreements with the US, French, Mexican and Brazilian oil multis to get a better deal for Ecuador, to limit the ongoing ecological damage to the headwater provinces of the Amazon River and to get more downstream processing done domestically (Ecuador exports crude and, curiously, re-imports finished products like diesel fuel and motor oil).

Although he is pro-American and pro-US free trade, it was the current conservative interim president of Ecuador who earlier this year grabbed the oil bull by the horns and took over Occidental Petroleum’s in-country operation. This was after Oxi had stalled for months about a new deal and about paying for environmental damage to the jungle. As punishment Washington stopped talks on free trade with Ecuador. Given his new regional free-trade initiative, this is unlikely to bother Correa now. Washington has also seen President Ove Morales nationalise natural gas and mineral resources in Bolivia and may realise the tide is turning. Perhaps it will force the USA to reappraise yet another of its neo-conservative precepts.

Fortunately for Ecuador and Correa, Big Oil has already been through this in Venezuela. It is not that Venezuela demanded more than what was just. Royalties there were generally well below what is normally paid in Canada or the USA. As the head of Royal Dutch Shell stated when signing with Chávez, international oil companies had simply become accustomed to a free ride in Latin America. That free ride is likely to be over soon. The royalty incomes will be essential to achieving Correa’s social and economic goals at home.

Expect Correa to renegotiate the repayment of international debt as well. He resigned from the last government as Economics Minister because he felt the IMF had demanded too much of the oil-royalty stream be devoted to debt pay-down and too little left for Ecuadorian economic development.

The way forward

Correa’s clear support from the voters will be his strength going forward. He must move fast to institute the constitutional reforms and show that he can deal with Big Oil. Venezuela has already set precedents for Big Oil; that makes Correa’s life easier. He will soon be talking to the IMF as well. If international investors mark down Ecuadorian government bonds, Correa can probably count on Chávez to back him up financially as he has already down for other South-America countries including indeed Ecuador.

Expect the new president to appeal over the heads of lower-level opposition politicians to the voters. Given the corrupt nature of the Congress, the electorate is likely to welcome this, feeling perhaps they have something ongoing to say in matters for a change. Correa’s constituency will certainly include the country’s large indigenous peoples now finding a legitimate political voice for the first time.

Distracted and out of touch, Washington’s attitude is likely to be as it has always been. How easy it would be for Washington to show the generous side of American’s nature, to show more sensitivity to countries like Ecuador, Bolivia and Venezuela, and indeed all of Latin America! The strengthening of regional economic ties need not be seen from the White House as anti-American. But, whether Democratic or Republican, don’t expect the USA to change any time soon.

Democracy in Latin America?

Democrats everywhere should be giving three cheers following the presidential election in Ecuador. As democratic roots deepen across Latin America (by which is meant un-cynical and responsible involvement by the broad citizenry to determine its own affairs, a willingness of losers to accept the results of elections and of the military to stay in its barracks), in an era when moderate New-Deal, reformist governments are coming to power in Spanish-speaking America and pushing aside a failed neo-liberal agenda, progressives everywhere should be applauding these efforts and providing them with democratic encouragement and practical assistance.

Considering the other, more dreadful means by which democracy has been exported to the waiting world in our own day we should all be joyful at the results of Ecuador’s election and wish Rafael Correa luck in his efforts.

Democracy is apparently alive and well here!