Cablegate: Fsln Mounting Strong Campaign, Convinced of Victory

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PP RUEHWEB

DE RUEHMU #2249/01 2840012
ZNY CCCCC ZZH
P 110012Z OCT 06
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC PRIORITY 7865
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUEAIIA/CIA WASHDC
RHEFDIA/DIA WASHINGTON DC
RHEHNSC/NSC WASHINGTON DC

C O N F I D E N T I A L MANAGUA 002249

SIPDIS

SIPDIS

DEPARTMENT FOR WHA/CEN

E.O. 12958: DECL: 10/03/2026
TAGS: KDEM NU PGOV PINR
SUBJECT: FSLN MOUNTING STRONG CAMPAIGN, CONVINCED OF VICTORY

1. (C) SUMMARY: Poloffs recently met with Sandinista
National Liberation Front (FSLN) dissident Alejandro Martinez
Cuenca and FSLN foreign affairs director Samuel Santos to
discuss the party's progress in the election campaign and
examine the FSLN governing platform. Both figures reported
that the FSLN remains the most organized political party in
Nicaragua, claiming that the party's strength and a coherent,
socially-focused, campaign give it an edge over competitors.
Santos told Poloffs that his party is running on a platform
based on promises to improve education and reduce poverty.
He also suggested that an FSLN government would pursue, at
least on some level, a decentralized, statist model to ensure
the equitable distribution of the benefits of a strong
economy. He noted that the FSLN will pursue a plan to
construct an inter-oceanic canal in Nicaragua. Cuenca noted
that the FSLN has the most resources of any party to mobilize
voters on election day, but warned Poloffs that the FSLN is
poised to win the elections by resorting to fraud if need be.
He argued that the FSLN would govern using an ad-hoc
strategy, and that the administration would focus on
asserting its dominance by further politicizing public
institutions and iron-fisted attempts to silence critics.
END SUMMARY.

2. (C) To get a better handle on how the Sandinista National
Liberation Front (FSLN) view the campaign and what an FSLN
government might look like, Poloffs on 28 September met with
Sandinista dissident Alejandro Martinez Cuenca and Samuel
Santos, a former FSLN mayor of Managua who remains close to
Daniel Ortega. Receiving the perspectives of both a source
highly critical of Ortega (Cuenca) and a party spokesman
(Santos) proved insightful in that both agreed that the FSLN
remains the strongest, most organized, political party in
Nicaragua. Santos is convinced that a Sandinista win is
inevitable. Cuenca argues that it is not too late to defeat
the party, but that its defeat would almost certainly require
the unification of the Nicaraguan Liberal Alliance (ALN) and
Liberal Constitutional Party (PLC).

3. (C) The FSLN is the best organized political party in the
campaign, has a clearly defined platform, has successfully
avoided engaging in dialogue with the other candidates, and
has taken advantage of the infighting among its competitors.
The Sandinistas have spent more funds on their campaign than
their competitors - local NGO Etica y Transparencia in a
recent study said the FSLN has spent more than its
competitors combined - and has dominated almost all of the
recent local polls. The FSLN also enjoys the advantage of
having significant sway over the judicial system and
influence in the Supreme Electoral Council (CSE).

CUENCA AND SANTOS ON SAME PAGE: POLLS OVERSTATE ALN STRENGTH,
FSLN POISED TO WIN
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4. (C) Santos told Polcouns and POL TDYers that Daniel
Ortega leads his closest competitor by 10 points and will
easily win on 5 November. He discounted as biased or flawed
the recent local polls showing Eduardo Montealegre gaining
ground on Ortega. Santos was convinced that the Sandinistas
could not fail to win given such a lead. As one of the
FSLN's biggest advantages, he cited the 16 years of
mismanagement and poor government by the Liberals, which
gives his party the opportunity to present themselves as an
alternative solution. (COMMENT: Santos did not cite a
specific poll and Post has not seen any credible local poll
that gives Ortega a 10-point lead. He is probably referring
to one of the studies the FSLN has no doubt commissioned on
its own. END COMMENT.)

5. (C) Cuenca posited similar opinions of the local polls
and argued that the continued division between the ALN and
PLC only increases the odds of an FSLN victory. Cuenca
devoted a generous portion of the meeting to a passionate
critique of Montealegre and his party, saying that the ALN is
weak and that their confidence in local polls is "childish."
Cuenca is convinced that the only way to defeat Ortega is to
persuade Montealegre to drop out of the race and support PLC
candidate Jose Rizo "for the good of the country." Cuenca
said that the problem is not "who" can beat Ortega (i.e. a
particular candidate), but rather "what party has the
strongest structure." Discounting local polling trends as
biased because of their tendency to undercount the rural
vote, Cuenca maintained that the PLC remains the second most
powerful force in Nicaragua and the only vehicle capable of
defeating the FSLN. By contrast, the strength of the ALN and
Sandinista Renovation Movement (MRS) lies in the consistently
overestimated personal popularity of their headlining
candidates. (COMMENT: Further, the resignation of
Montealegre would not guarantee an Ortega defeat, as many of
Montealegre's independent supporters might shift to the other
anti-pact candidate with whom he sympathizes -- Edmundo
Jarquin of the MRS -- rather than to the PLC. That said,
mobilization of party supporters on November 5 will be
crucial, and the ALN is cognizant that it requires a
considerable infusion of funds to achieve this. END COMMENT.)

CUENCA: PARTY RESOURCES WILL DETERMINE THE ELECTION
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6. (C) Cuenca argued that the deciding factor on election
day will be which party is able to mobilize the most
supporters by physically getting them to the polls. He said
the FSLN will be expending significant resources to fund
buses, trucks, and other vehicles to transport voters to the
polls. Cuenca opined that only the PLC has the networks and
resources to conduct such an operation. (COMMENT: Cuenca is
far removed from both the PLC and ALN; thus, his assessment
is likely based on the PLC's traditional strength, which has
eroded over the past year. END COMMENT.)

7. (C) Cuenca mentioned that he had sent an emissary to the
Atlantic Coast to determine the strength of the various
political parties. He said the PLC remains strong in the
Northern Autonomous Region, and that the results would be
largely a repeat of the regional elections in March. He
noted that the ALN has a very weak campaign presence in the
area, and that the MRS is almost non-existent. He claims
this to be true of other rural areas, including Esteli,
Somoto, Jinotega, and Matagalpa.

FSLN PLATFORM BASED ON SOCIAL INITIATIVES AND HINTS OF
STATIST SOLUTIONS
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8. (C) Asked to describe the Sandinista campaign platform,
Santos said that the FSLN is focusing on a socially conscious
agenda with rural development, healthcare, and education as
the primary issues. Santos argued that the benefits of
Nicaragua's relatively stable macroeconomic growth in the
last few years have failed to trickle down to the lower
echelons of society. He claimed that as a result there are
fewer children in school and a greater incidence of poverty.
Santos noted that perhaps the most important social objective
of the government would be to expand education opportunities
for the average Nicaraguan and claimed that illiteracy rates
have actually gotten worse since the 1980s, saying that they
have increased by 35%. He told Emboffs that the key to
improving poverty lies in reforming the rural sector by
providing farmers with the opportunities to expand and
improve their holdings. Santos claimed that one of the
highest priorities for an FSLN government would be the
creation of a development bank to support rural development
projects and extend cheap credit to the rural sector.

9. (C) While discussing several of the campaign platform
items, Santos alluded to the possibility that the Sandinistas
would pressure the business sector, particularly financial
institutions, into changing some of their practices. For
example, he hinted that the Sandinistas would use their
influence to force banks to ease their lending conditions.
He also suggested providing various types of insurance to
consumers under more favorable terms, but did not expand on
whether he thought this would be done by forcing the private
sector's hand or by offering a government-backed alternative.

10. (C) The FSLN's position on remittances also suggests
that the state could intervene to reduce the charges imposed
on money transfers by service providers. Santos complained
that recent attacks against Ortega in the press that the FSLN
would pass legislation to make sure all remittances were
converted to cordobas vice dollars were unfounded. Instead,
he indicated that change was desperately needed in regulating
how much financial in
stitutions could charge customers for the wire transfers. He
indicated that in some cases people have to pay up to 20%
($20 for every $100) of the amount sent from abroad to family
members in Nicaragua.

11. (C) In terms of how the FSLN would structure the overall
government, Santos noted that the Sandinistas would change
the balance of power between national and local levels. He
said that the central government would cede greater authority
and resources to the municipal governments, allowing the
local governments to assume a larger role in implementing the
FSLN social agenda. (COMMENT: Decentralizing authority to
regional governments - which the Sandinistas dominate - may
also be a solution to sidestep what could be a contentious
National Assembly. Santos admitted that the Assembly will be
composed of four or five parties, which will inevitably
lengthen the time it takes to negotiate deals to pass
legislation. Decentralizing may be an attempt to bypass the
negotiation process as well as to avoid being prevented from
carrying out their goals by Assembly opponents. END COMMENT.)

RESURRECTION OF THE NICARAGUAN CANAL PLAN
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12. (C) Santos also detailed his party's support for the
construction of an inter-oceanic canal in Nicaragua via the
San Juan River and Lake Nicaragua. The plan - which calls
for a lock-based rather than sea-level design - would be
completed in about 2019 and be financed and constructed in
conjunction with a consortium of international businesses.
Santos claimed the project would have a 22% return on
investment, more than double GDP, and stimulate other sectors
of the economy. He also claims that the FSLN has already
received interest from potential investors in Brazil, Japan,
and China.

13. (C) Santos reported that the canal plan would not strain
Nicaragua's budget as all of the relevant funds would come
from external sources. Nevertheless, he was cognizant of the
fact that initial difficulties could impede getting the
project off the ground as it would require a vote in the
Assembly to approve the plan, funding mechanisms, and set the
rules for the bidding process. This would be overcome,
however by the realization by nearly all involved that the
project will benefit all Nicaraguans. He said "we cannot do
it alone" but that it is a "national project." Santos
claimed that the canal would in no way interfere with the
Panama Canal, and that Ortega had discussed the matter with
Panama's President Martin Torrijos. Santos also said that
the FSLN is working closely with the Bolanos administration,
including with President Enrique Bolanos himself and
presidential adviser Frank Arana. (COMMENT: Bolanos has
publicly backed the canal plan, and devoted some time to the
subject during this week's Defense Ministerial. This
cooperation between the President that the FSLN suggests that
Bolanos continues to dialogue with the FSLN behind the
scenes, probably in hopes of ensuring a relatively peaceful
conclusion to his term in office and the chance to establish
something of a positive legacy - Bolanos's approval ratings
continue to be very low. END COMMENT.)

CUENCA: FSLN WELL-PLACED TO STEAL THE ELECTIONS
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14. (C) Cuenca was convinced the FSLN will resort to fraud
if it meant the difference between winning and losing the
race. He assessed that given their influence in the Supreme
Electoral Council (CSE), the Sandinistas would be able to
steal the few points it would need to tip the scales in their
favor. He commented that it was Ortega's influence in the
CSE that prompted the CSE in September 2005 to deny Cuenca's
request that the FSLN be compelled to hold open primaries -
as stipulated in party bylaws. At the time, Cuenca was
seeking to use primaries to challenge Ortega's leadership of
the party.

15. (C) Cuenca reported that the FSLN will use a myriad of
tricks to strengthen their vote, including using its
influence over individual voting tables (JRVs) to annul the
votes from those tables in which they are losing. More
alarming, Cuenca suspects the FSLN is positioning itself to
disrupt or prevent the electronic transmission of results
from polling centers to the main repository. Cuenca claimed
he has caught wind of several mass thefts of telephone cable
from around the country, including in areas near JRVs. For
example, near his house in San Juan del Sur - which is close
to the local polling place - he said thieves recently made
off with about 100 meters of telephone lines, leaving the
surrounding area without external communication for days. He
claimed that in Esteli there have been several reported cases
of fiber optic lines being cut. He said he has asked Enitel,
the local phone company in charge of overseeing the
transmission of the results, to investigate the matter.
Regardless of how fraud is engineered, Cuenca claimed it is
bound to happen. "The FSLN and PLC have had five years to
plan for this election," explained Cuenca.

16. (C) COMMENT: The final tally sheets from each voting
center will be electronically submitted via scanner or fax to
the CSE central computing center. Enitel officials have told
POL TDYer that the cable thefts are a longstanding problem
and not necessarily related to the election. One official
noted that the price of copper has gone up over 300% thus
prompting an uptic in wire thefts by criminals interested in
selling the copper lining. END COMMENT.

CUENCA'S VERSION OF FSLN GOVERNMENT DARKER THAN SANTOS'
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17. (C) Asked to comment on the Sandinista government plan,
Cuenca said that the biggest danger of an Ortega government
would be the lack of a coherent strategy. The agenda would
most likely consist of a disparate mix of policies reflecting
the input of various individuals Ortega has had to embrace
for political expediency. Cuenca speculated, for example,
that Jaime Morales Carazo and Brooklyn Rivera were probably
both promised some say in the direction of the government in
return for their backing of the FSLN. He argued that this
would prompt the government to begin operating on an ad hoc
basis, which would provide an opening for Venezuelan
influence to have more of an impact.

18. (C) While Cuenca said that Ortega would not immediately
attempt drastic changes, the ultimate direction of his
administration would be apparent by the guest list at his
inauguration, which will include Evo Morales, Fidel Castro,
and Hugo Chavez. Ultimately, Cuenca sees an Ortega
government devolving into one of iron-fisted rule and rife
with corruption. He expects that Ortega would show his true
colors by attempting to restrict personal liberties. He
noted that the government would particularly seek to reduce
the ability of critics to disparage his government. He added
that shortly after assuming office, Ortega would seek to
further entrench his authority by appointing loyalists to key
institutions with the only restriction that they do his
bidding when asked, but who would otherwise be free to abuse
the system as they see fit.

COMMENT: SANDINSTAS STRONG BUT NOT INVINCIBLE
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19. (C) COMMENT: Despite its significant financial
resources, and focused message, the FSLN faces the same
challenges that have prevented it from winning in the
previous three elections. First, a majority of the
population hold a strong antipathy toward Daniel Ortega and
fear a return of the 1980s style government of repression and
economic malaise. Second, recent polls indicate that
Montealegre has been slowly gaining on Ortega. While the ALN
candidate still trails Ortega by a few points in the polls,
there remains a good chance that this trend will continue. A
wide array of Embassy contacts (i.e. political parties,
private sector, the Church, etc) have told us that much of
the population will vote for whichever candidate has the best
chance to defeat Ortega. This suggests that Montealegre
would receive a boost closer to the elections, providing that
his poll numbers remain sufficiently strong to convince the
population that he is the one that can defeat Ortega. END
COMMENT.
TRIVELLI

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