Ecuador marching rapidly toward the cliff

Carlos Alberto Montaner

It seems that Ecuadoreans will elect Rafael Correa as their next president when they go to the polls on Oct. 15. He is young, charismatic and intelligent; an economist with a degree from a U.S. university who communicates well with the public.

Some years ago, I met him fleetingly at the University of San Francisco in Quito, where he had gone to deliver some lectures. He made a good impression on me, from a human standpoint. If the surveys are not mistaken, he is about to occupy Carondelet Palace, the old presidential mansion in Quito.

What's likely to happen, however, is that, despite his notable personal features, Correa will fail noisily and drag the country down with him.

Like many of his compatriots, his intentions are right, but his therapy is irremediably wrong. It's true that a good portion of Ecuador's population lives in wretched conditions, and Correa does not err when he says that the institutions are rotten, corruption is rampant and many in the ruling class have gained or maintain their wealth thanks to their toadyish links to power.

All that is true, but these old and endemic ills are not solved by rejecting a free-trade agreement with the United States, exacerbating ethnic conflicts, picking a fight with the World Bank and the IMF, placing Ecuador in Hugo Chávez's insane orbit and spouting nonsense such as the search for ``alimentary sovereignty.''

By going down that road, Correa will create other serious problems and will manage only to further impoverish his compatriots. It will stimulate the mass emigration of the boldest and most productive workers, scare away capital, increase unemployment and otherwise grate on the lives of the people to the point of triggering severe violence.

In fact, in Ecuador it is not surprising that a politician with a similar brainless program will rise to power. It is no coincidence that Ecuador is the Latin American country where the Cuban dictatorship has the largest number of sympathizers. Periodic surveys by Latinobarómetro invariably profile a society with a very high percentage of people who favor a paternalistic, anti-market and anti-American state.

The previous president, Lucio Gutiérrez, was elected in early 2003 by a majority of voters who expected him to lead a neopopulist government. He resisted doing so, either because he was well advised or because of some natural prudence.

However, 27 months later, for reasons involving political rivalry, Gutiérrez was deposed by Parliament. Alfredo Palacio, his vice president, beset by unpopularity, will finish the term and hand the presidential sash to Correa to undertake the task that Gutiérrez shunned.

The predictable outcome is that Correa, too, will fail and that his toughest obstacle will be the dollar. He will come to power with a dollarized economy, a straitjacket the state had to slip on grudgingly in 2000 because it was incapable of holding back inflation and the consequent galloping devaluation of the sucre.

And because Correa knows that a dollarized economy is incompatible with the populist and welfare-based model he dreams about imposing, he will surely introduce a new national unit of currency. This will enable him to deal with a brutal increase in public expenditure by the simple expedient of printing more money every time the Treasury coffers are halfway empty.

But this inflationary reform -- which is indispensable if Correa intends to set up a neopopulist government in the Chávez mold -- will create an uncontrollable economic mess that will pit him against almost the entire business world, credit institutions and the other political parties, unleashing an institutional crisis even worse than those that led to the removal of the three previous presidents.

Abdalá Bucaram, Jamil Mahuad and Lucio Gutiérrez were violently substituted by their vice presidents or someone designated by Congress, although on this occasion it will be difficult for Correa's vice president-designate to occupy the presidential chair. His name is Lenin Moreno, which is not precisely a soothing omen for those who will need to control the disturbances ahead.

Ecuador, then, marches rapidly toward the cliff. The imperfect republic and the fragile democracy that gives it form and sense are dangling by a thread.

The nation's convulsed history suggests that, at some point, a military officer will cut that thread with one saber blow. If that happens, it will be the beginning of another tragic cycle.

October 3, 2006

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