This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 02 QUITO 001190 
 
SIPDIS 
 
SENSITIVE 
 
DEPARTMENT PLEASE PASS TO USOAS 
 
E.O. 12958: N/A 
TAGS: PGOV KDEM PREL EC
SUBJECT: ECUADOR: DEMOCRATIC ACTION PLANNING 
 
 
¶1.  (SBU) Summary:  With democratic stability set back by 
repeated irregular changes of government, the mission has 
begun a process to take stock of our democracy-support 
efforts and chart new directions.  That action planning 
process will culminate, we hope, in a clear analysis of the 
challenge ahead.  That analysis will, in turn, become the 
basis for a range of policy and program options to support 
democratic strengthening.  Ecuadorian society, meanwhile, is 
launching its own debate about possible democratic reforms, 
which will affect the realm of possibility.  We face our own 
policy constraints in Nethercutt and impending TIP sanctions, 
but aim to maximize the impact of limited resources in 
support of democracy here.  End Summary. 
 
Democracy is Broken Here 
------------------------ 
 
¶2.  (SBU) None of the last three democratically elected 
presidents of Ecuador has successfully served out his term. 
During the same nine-year period, seven presidents, not 
counting a triumvirate that lasted only three hours, have 
ruled Ecuador.  The most recent president to be deposed was 
Lucio Gutierrez on April 20.  Gutierrez had himself 
participated in a 2000 coup that brought down his 
predecessor, Jamil Mahuad.  The first democratically elected 
president in this recent cycle of instability was Abdala 
Bucaram, who lasted seven months in office.  Ironically, by 
letting Bucaram return from exile in Panama in March, 
Gutierrez fueled popular protests that sealed his own fate. 
Bucaram is now back in Panama.  Mahuad lives in the United 
States.  Gutierrez is now living in Brazil. 
 
Diagnosis and Prescriptions 
--------------------------- 
 
¶3.   (SBU) The fall of Gutierrez involved complex 
constitutional questions, but the problem of instability in 
Ecuador stems from a different popular conception of what 
democracy means.  Most Ecuadorians believe it means the 
support of the people.  When a significant segment of the 
people are dissatisfied enough to mobilize, they demand 
change from the streets rather than wait patiently for a 
chance to decide at the ballot box.  Political elites are 
complicit in this process, seeking to use popular discontent 
as a weapon to advance their own interests.  While the causes 
of popular discontent and the composition of the popular 
forces which provoked the fall of the last three elected 
presidents have varied, the result has been the same:  an 
irregular change of government caused by popular protests in 
the capital. 
 
¶4.  (SBU) Most Ecuadorians took the recent irregular fall of 
the government in stride and were initially diverted by the 
process of selecting a new government and cabinet.  With that 
over, the national debate is shifting toward the need for 
political reforms.  While no consensus has emerged, several 
possible elements are clear. 
 
-- Executive:  the GOE, beholden to street protesters for its 
creation, wishes to be responsive to citizen calls for 
reform.  President Palacio has offered a vaguely defined 
public dialogue process, to be managed by the Vice President. 
 The dialogue process is intended to generate ideas for 
possible inclusion in a popular referendum.  Palacio met with 
UNDP and other international representatives on May 19 to 
publicly request support and technical assistance to 
facilitate the process. 
 
--   Congress:  Congress has completed its Supreme Court 
reform, which now moves toward implementation.  Congress will 
also debate possible electoral reforms (to regulate 
proportional representation, permit representation by 
districts) and constitutional changes (the creation of a 
Senate, to balance national and local interests).  Some have 
also floated the idea of a semi-parliamentary system through 
the institution of a prime minister, accountable to Congress. 
 Congress is already the venue for debate over a reform to 
expedite the referendum process, which currently includes a 
year-long cooling off period before constitutional reforms 
can be voted on. 
 
-- Judicial:  With the Supreme Court on the (probably rocky) 
road toward recovery, several other judicial issues linger. 
The Supreme Electoral Tribunal has been re-conformed to 
reflect the new balance in Congress.  Some, however, are 
calling for constitutional reform to make the tribunal 
independent of political parties, rather than controlled by 
them.  The Constitutional Court, meanwhile, remains to be 
reconstituted by Congress.  The selection of an Attorney 
General is also pending, awaiting the reconstitution of the 
National Judicial Council by the eventual Supreme Court. 
 
-- International Organizations/Donors:  On May 16 President 
Palacio and VP Serrano met with international organizations 
including UNDP, UNICEF, the Andean Community of Nations to 
request financial and technical support for the government's 
social dialogue (the OAS representative was invited but did 
not attend).  UN representative Mauricio Valdes later told 
the Ambassador that the UN had concerns about becoming 
involved in an ill-defined dialogue process, after 
unsuccessful experiences elsewhere.  Former Spanish Prime 
Minister Felipe Gonzalez visited Ecuador May 16-18 on behalf 
of the Madrid Club.  He privately urged Palacio to lead the 
dialogue process himself, and to be pragmatic in focusing his 
plan of government. 
 
-- Civil Society/Protest Movement:  Has been invited to help 
organize and participate in national dialogue with the GOE. 
Some are demanding guarantees from Palacio that he will 
submit any FTA with the U.S. to a referendum before signing, 
and will include the issue of whether to hold a constituent 
assembly (dissolving Congress) on the referendum.  Follow-up 
protests against the GOE have fallen flat, perhaps reducing 
their influence.  Civil society groups have announced a 
100-day deadline for the government to develop its referendum 
proposal, with civil society input. 
 
USG Interests 
------------- 
 
¶5.   (SBU) The question of whether our efforts prolonged the 
tenure of the last government is moot; our efforts to promote 
democracy, as we know it, have again failed to bring an 
elected government to term here.  Political instability has 
high costs and elevates risk, economic and otherwise. 
Irregular changes of government are inherently unpredictable, 
put ongoing USG interests at risk, and force us to start over 
with a new government.  While we are doing so with the 
Palacio government, the Ambassador also launched an internal 
process to evaluate the problem of democratic instability, 
and seek to devise options to address it. 
 
Action Plan 
----------- 
 
¶6.   (SBU) AID has led the mission's democracy action 
planning process, inviting full participation from other 
country team elements.  One focus is necessarily short-term, 
since the democracy debate is in full swing here, but a 
parallel process is focusing on longer-term structural 
issues.  We have also launched dialogues with international 
financial institutions and donor representatives, who have 
agreed to develop a common framework to support democracy and 
judicial strengthening, in a coordinated dialogue with the 
government.  The mission's review process will culminate at a 
Country Team retreat which will define a concise problem 
statement concerning democratic instability, and chart a 
range of short-term actions to address longer-term problems, 
for consideration by incoming mission leadership (and 
ultimately Washington agencies). 
 
¶7.  (SBU) The outcome of this process will be affected by a 
host of factors and constraints, among them (on our side) 
existing Nethercutt and impending TIP sanctions, which will 
force us to withdraw direct support for the GOE and channel 
assistance through civil society, and vote against Ecuador in 
the International Financial Institutions.  While these 
constraints have their own merits, they will complicate the 
task of supporting democratic progress here. 
 
¶8.  (SBU) Ultimately, the Ecuadorian people will determine 
the health and fate of democracy in Ecuador.  We share with 
them an interest in democratic strengthening, and seek to use 
our limited resources to maximum effect. 
 
Chacon