Nicaragua will hold presidential elections on November 6, 2016. Barring some unforeseen event, all that is left is for the counting and cheers to confirm the re-election of Daniel Ortega to a third consecutive term; his fourth since his movement, Frente Sandinista de Liberación Nacional (FSLN or Sandinistas), overthrew President Anastasio Somoza Debayle in 1979.
Whether a “self-coup” or not (as claimed by the opposition), the unprecedented consolidation of power by President Ortega and his wife, Rosario Murillo (previously his spokesperson and now his vice-presidential running mate) has been made possible by a hapless opposition, a growing economy and a ruthless dedication to methodically controlling every branch of government.
The most recent example of the consolidation of power was the expulsion from the National Assembly of 28 opposition deputies resulting from an internal dispute over who controls the main opposition party, the Partido Independiente Liberal (Independent Liberal Party—PLI). The Sandinista-controlled Supreme Court ruled against the faction led by former presidential candidate Eduardo Montealegre, handing the leadership of the party to Pedro Reyes Vallejos, more seen as an ally of Ortega than a leader of the opposition, who had earlier sued for control of the PLI.
Many of the PLI deputies refused to recognize Reyes’ leadership. In response, he requested that the Supreme Electoral Council (CSE)—also controlled by the Sandinistas—remove them from office. The CSE complied, ordering that the legislators be stripped of their positions, and the leadership of the National Assembly—also controlled by the Sandinistas—booted them out on August 1, 2016. The pretext for their removal was that Article 131 of the Nicaraguan Constitution establishes that the party, and therefore the party leadership, controls the seats into which deputies are elected.
The opposition claims the removal of the deputies and the actions against Montealegre’s faction constitutes an “auto-golpe,” or “self-coup,” by President Ortega and the Sandinistas to guarantee his electoral victory and eliminate any possible meaningful opposition. If so, it’s a self-coup that Ortega has been orchestrating for years.
Ortega’s return to power
Ortega lost the presidency in 1990, after 11 years of Sandinista rule, to a coalition of conservative parties that promised an end to economic deprivation, civil war and hostility toward the United States. The experience of the 1990 elections taught Ortega and his supporters that power was fleeting and that public opinion can easily be swayed by underlying economic and political conditions.
In truth, even during Ortega’s 11-year interregnum, the Sandinistas were never entirely excluded from power; they maintained influence in the armed forces and continued to control a significant minority of seats in the legislature. Additionally, Ortega and other party leaders used their time out of office to amass sizeable property holdings. Out of the presidential palace, the former Marxist revolutionary leaders turned into ruthless and shrewd—though crony—capitalists.
Ortega’s return to power in 2006 was made possible through an alliance with former President Arnoldo Alemán (1997-2002). In 1999, Alemán and Ortega reached an agreement called El Pacto (for those of you who don’t speak Spanish, this stands for “The Pact”) under which Alemán and Ortega received permanent seats in the legislature, giving them lifetime immunity from prosecution on corruption charges. A constitutional amendment adopted as part of the agreement lowered the threshold for victory in the presidential election from 45 percent to 35 percent—provided the winning candidate had at least a five percent margin over the nearest rival. The criteria were tailor-made to Ortega’s proven electoral base.
While Alemán’s vice president, Enrique Bolaños, easily won the 2001 elections, he quickly broke with Alemán over corruption charges. Alemán then sought to use his alliance with Ortega to bolster his position and protect himself from the legal consequences of his brazen theft of public funds when he was in office. El Pacto ultimately split the conservative forces, between Alemán’s supporters and those opposed to further deals with the Sandinistas, with the latter having the open backing of the United States. They never recovered from this split: factionalism, personal conflicts, corruption, and the lack of a coherent political project doomed Nicaragua’s main conservative party afterwards.
The political benefits of economic pragmatism and growth for Ortega
Despite fears that he would return to the state-managed economy of the 1980s, Ortega has pursued pragmatic economic policies that promote trade and foreign investments. Nicaragua’s economy has grown an average of 5 percent in the past five years. Since 2007, the country has grown at a rate above the Central American regional average, second only to Panama. Per capita GDP has increased from $1,204 in 2006 to $1,929 in 2015.
Since the Central American Free Trade Agreement (CAFTA-DR) came into effect in 2005, reduced tariff barriers have provided Nicaragua greater access to the U.S. market, while foreign investment has also increased, jumping 423 percent, from $287 million in 2006 to $1.5 billion in 2015. The biggest sectors have been manufacturing, food processing, energy, telecommunications, and mining, with substantial participation from investors from the U.S., Canada and Mexico. Nicaragua also has the lowest minimum wage is Central America, making it cheaper than its regional competitors for low-end manufacturing jobs, such as textiles. Nicaraguan clothing exports, largely to the U.S., skyrocketed from less than $2 million in 2005 to around $2.7 billion in 2014.
Subsidies from Venezuela, particularly oil subsidies through Venezuela’s PetroCaribe program, have also helped. In 2014, $435 million of the country’s $2.5 billion budget came from Venezuela. However, reductions in oil prices and a political crisis have since led to a sharp decline in those subsidies: Venezuelan aid to Nicaragua decreased by 23 percent in 2015, and there is no sign this trend will be reversed any time soon.
Economic growth and foreign investment have given the government the space to increase public spending, particularly on social programs such as Zero Hunger, which provides subsidies to rural communities, and Zero Usury, which provides microloans to small entrepreneurs, particularly women. Politically, the social welfare projects have given the regime an opportunity to imprint a partisan brand on popular programs. Through the use of the Consejos de Poder Ciudadano (Citizen Power Councils—CPCs) to mobilize community activities, the government can monitor citizens’ relations with the government and boost the regime’s ability to penetrate society. About 25 percent of Nicaragua’s population report participating in CPC meetings. They also help direct government spending and programs. As a result, FSLN-affiliated groups often receive preferred treatment in the distribution of government subsidies and projects.
The crown jewel of Ortega’s economic policies was to be the building of an interoceanic canal. The idea of a canal across Nicaragua is as old as the country itself. But despite numerous plans, no cross-Nicaraguan canal has ever been shown to be economically feasible. The country lost out to Panama in the early twentieth century when the Senate of the United States debated the various options for an interoceanic canal through Central America and supporters of the Panama route outmaneuvered those of Nicaragua.
The canal dream had faded until the Chinese rescued it recently. In July 2012, the government established the Nicaraguan Grand Interoceanic Canal Authority, and in June 2013, the National Assembly granted the Hong Kong Nicaragua Development Group (HKND), a Chinese based company led by billionaire Wang Jing a 50-year concession, giving the firm exclusive rights to plan, design, construct, and operate the canal. Under the agreement Nicaragua would receive $10 million annually for the first 10 years of operation. And then shares would pass periodically to Nicaragua, eventually making it the majority shareholder. The project has been estimated to cost $50 billion dollars and create up to 50,000 direct jobs, in addition to more than 200,000 jobs in related enterprises and services.
Unfortunately for the Nicaraguan people, the canal project seems to be a white elephant. A slowdown in China’s economy has created doubts regarding the Chinese firm’s investment. Opposition from environmental groups has questioned the impact of the project on the fragile eco-system of Lake Nicaragua, through which the canal route would pass. And changes in the demand for maritime commercial transportation have reduced the viability of a Nicaraguan canal, particularly given the recent expansion of the Panama Canal completed this year. In the end, if ever built, the project will end up as a monument to Ortega’s political ambitions rather than a boost to the country’s economy. The ultimate losers will no doubt be the Nicaraguan people (including indigenous groups in the path of the construction) and the country’s eco-system.
Consolidating institutional power
Ultimately, Ortega’s success in maintaining power owes a great deal to his ability to control all levers of authority in the country.
As a result of El Pacto with Alemán, the Sandinistas were able to gain control of the Supreme Court and the Supreme Electoral Council. Prior to the 2011 elections, the Supreme Court ruled that the constitutional prohibition on presidential reelection was “anti-democratic,” paving the way for Ortega re-election that year.
After holding onto office for a second term, Ortega quickly sought to further consolidate power by sponsoring a series of constitutional changes to codify the Supreme Court’s decision against re-election by lifting the prohibition altogether. Additionally, the reforms approved by a Sandinista-controlled National Assembly in 2014 enhanced the president’s power to govern by decree, lifted the prohibition of active military officers holding government positions, and established a simple majority for presidential elections (thus eliminating the already reduced threshold from El Pacto).
Among the most significant moves to consolidate power was Ortega’s effort to re-politicize the military by promoting loyal Sandinista officers and consistently intervening into internal military matters. Initially rebuffed by the armed forces, Ortega has succeeded in changing the military code to increase presidential authority over the military, politicizing the management of the military and isolating the Ministry of Defense from the chain of command.
The changes approved in early 2014 also included the addition of “national security” to the Army’s essential role. The new military code assigns the Army new tasks: “to intervene in uprisings and riots that exceed the Police’s capacity to extinguish them,” to control telecommunications and to “protect” both public businesses—a task previously assigned to the Police—and “mixed capital” companies, which include the numerous businesses controlled by state-owned entities from the powerful ALBA consortium. A new police code also approved in 2014 further consolidates Ortega’s personal and political power over the entire security apparatus.
Once an example of change—albeit imperfect—Nicaragua’s civil-military relations have deteriorated since 2006 in ways that have undermined the military’s apolitical nature. While subordination to the elected president remains, the independence of the military has been weakened and many Nicaraguans fear that the institution will return to its pre-1990 condition as the armed wing of the FSLN.
What comes next?
With the re-election prohibition permanently lifted, a simple majority needed to win, a divided and dispirited opposition, and complete control of all levels of the state bureaucracy, Ortega has established the conditions to stay in power for as long as he, or the Sandinistas, wants to.
Unlike his Venezuelan soulmates, Presidents Chávez and Maduro, Ortega has managed to be more pragmatic in his economic policies and benefited from a more diversified economy. While Nicaragua remains one of the poorest countries in Latin America, improved economic conditions have lifted many Nicaraguans out of poverty.
But in a democracy process matters. Undermining the independence of institutions and concentrating power in an individual or party undermines the fundamental principles of free and fair competition so essential for democratic governance.
In the short-term, most actions by the United States to punish the Ortega administration would likely backfire. President Ortega is popular, and the political opposition is in no position to effectively challenge his authority. Any overt attempt by the U.S. to support the opposition would be used by the regime to discredit them as “sell-outs.” In fact, even if the United States were to decide to provide direct support for the opposition it is not clear which faction is most viable.
The United States recently expressed “grave concern” over the expulsion of the opposition legislators, and called on Nicaragua to “respect the voices of its people and take the steps for fair and transparent elections.” The U.S. also condemned the expulsion of a scholar from the Army War College doing research on the Nicaragua Canal and two embassy officials that Nicaragua claimed were performing unauthorized duties.
Beyond such condemnations, it is not clear what else the U.S. is willing to do. U.S. aid to Nicaragua is rather small, amounting to a little over $18 million in direct aid for 2016. Nicaragua is not part of the multi-million dollar, U.S. Strategy for Engagement in Central America (the so-called Alliance for Prosperity). The most significant link is trade through CAFTA-DR, and it is not likely the U.S. would jeopardize trade relations unless the Nicaraguan regime moved away from its pragmatic economic policies.
Regrettably, the prospects of regional actions against the Ortega regime are slim. Recent statements by the Secretary General of the Organization of American States (OAS), Luis Almagro, regarding the crisis in Venezuela raised hopes the organization would finally take action against regimes that consistently and blatantly violate the Inter-American Charter of Democracy. Unfortunately, the OAS could not move beyond expressions of concern and calls for further discussions. If steps were not taken against Venezuela, it is even less likely the OAS would have the political will to move against Nicaragua.
Ortega’s unchallenged control of the levers of power might not fit the definition of a “self-coup” exactly—partly because the process has taken many years—but as the saying goes, if something walks like a duck and quacks like a duck, it’s not farfetched to assume it’s a duck! Unfortunately, no one in the regional community or in the media seem willing to call it out and discuss what it means to have a duck in the midst of a flock supposedly committed to protecting democracy.
Orlando J. Pérez is Associate Dean of the College of Arts, Humanities and Social Sciences at Millersville University. He is the author of Civil-Military Relations in Post-Conflict Societies: Transforming the Role of the Military in Central America (Routledge Publishers, 2015).
