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

C O N F I D E N T I A L SECTION 01 OF 02 SAN JOSE 000158 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 01/17/2016 
TAGS: PGOV PINR PREL ECON CS
SUBJECT: PRESIDENTIAL CANDIDATE RICARDO TOLEDO SWIMMING 
AGAINST THE CURRENT, AND SINKING 
 
 
Classified By: Ambassador Mark Langdale for reasons 1.4 (b) and (d) 
 
Summary 
-------- 
¶1.  (C) In a meeting with Ambassador on January 9, President 
Pacheco's confidant and former chief of staff Ricardo Toledo 
tried to put the best light possible on his foundering 
presidential campaign--a difficult task considering he has 
not broken 5 percent in the polls and now appears to have 
slipped from fifth to sixth place in a field of 14 
candidates.  His Social Christian Unity Party (PUSC) is 
hampered with two former presidents being investigated for 
corruption and a third (Pacheco himself) who is widely seen 
as a failure.  Toledo believes he is being "punished (by the 
voters) by association."  Toledo made it clear that we have 
not seen the last of him and that several Costa Rican 
presidents were elected only on their second or even third 
try.  End summary. 
 
What Toledo Stands For 
---------------------- 
¶2.  (C) On January 9, Ambassador paid a courtesy call on 
Ricardo Toledo, presidential candidate for the ruling Social 
Christian Unity Party (PUSC).  For the election Toledo is 
trying to position himself as a centrist.  He told Ambassador 
that frontrunner Oscar Arias and Libertarian candidate Otto 
Guevara both represented the economically powerful who would 
like to privatize electricity, telecommunications, insurance, 
and even social security.  On the other side is leftist 
candidate Otton Solis "who resembles Hugo Chavez and Evo 
Morales."  Toledo said:  "My position is in the middle, where 
things are discussed to arrive at agreements, without 
imposition or being imperial."  (Note:  In practical terms, 
this means nominal support for CAFTA-DR in the style of 
President Pacheco.) 
 
¶3.  (C) Toledo is a traditional politician who sees his role 
primarily as doling out government benefits to the people. 
His main criticism of Pacheco is that Pacheco listened too 
much to his four consecutive cost-cutting finance ministers, 
the first three of whom quit in disgust because they believed 
he did not listen enough.  Toledo has proposed to increase 
spending dramatically on education, provide subsidies for 
first-time home-buyers, and give a computer to every 
high-school graduate, a program for which he was roundly 
ridiculed in the press.  When asked where he will get the 
money he mentioned consolidating ministries and cutting the 
Foreign Trade Ministry, which is responsible for implementing 
CAFTA-DR.  He worries that the Costa Rican Electricity 
Institute (ICE), which will lose its monopoly status in 
telecommunications under CAFTA-DR, will be swallowed up by 
foreign private investors like Carlos Slim of Mexico.  Toledo 
distrusts public concessions to private companies.  He 
opposes an existing concession to a Spanish company for 
vehicle inspection, is lukewarm toward the airport concession 
to an American company, and supported the cancellation of a 
concession to an American company to build a prison. 
 
Election Campaign 
----------------- 
¶4.  (C) Until this election, being the PUSC nominee meant 
having at least an even chance of being elected (three out of 
the four most recent presidents, including the current one, 
are from PUSC).  That changed in 2006, and perhaps 
permanently, because two of those former presidents have been 
under investigation since late 2004 for corruption (with a 
lot of damning evidence made public) and the third, President 
Pacheco, is seen as incompetent and ineffective.  Toledo 
cannot, as much as he might try, distance himself from 
Pacheco.  He was for a time Pacheco's Minister of the 
Presidency (Chief of Staff) and most trusted confidant. 
Further, he was behind many of Pacheco's worst decisions, 
e.g., caving to public sector unions, opposing "neoliberal" 
policies of consecutive finance ministers, wavering on free 
trade.  The voters are making Toledo pay; polls show that he 
is below 5 percent and has sunk from fifth to sixth place in 
a field of 14 candidates. 
 
¶5.  (C) Toledo complained that he is being "punished (by the 
voters) by association" with Pacheco and that voters are not 
aware of the many accomplishments (which he did not 
enumerate) of the Pacheco administration.  Though Toledo 
seemed resigned to ultimate defeat, he put the best possible 
light on his campaign and his personal popularity.  He told 
Ambassador that he had had successful political rallies in 
Limon province and that 3,000 people greeted him in the 
Talamanca indigenous district.  He cautioned against trusting 
the polls "because they are done by phone, and our strength 
is with the poor who are phoneless."  Toledo said that he 
believes he can win 20 percent of the vote, forcing a runoff 
with frontrunner Oscar Arias. 
 
Future of PUSC 
-------------- 
¶6.  (C) Toledo claimed that despite scandals and the negative 
perception some have of the Pacheco administration, PUSC 
continues to be a strong party at the grassroots level.  He 
pointed out that 51 of Costa Rica's 81 mayors are from PUSC 
compared to 26 from Arias's National Liberation Party (PLN). 
(Four mayors are from neither.)  He said that PUSC was 
especially strong among the poor and in the poorest 
provinces--Limon, Guanacaste, and Puntarenas--because the 
party is a natural descendant of Costa Rica's great social 
reformer, Rafael Angel Calderon Guardia, creator of Social 
Security and a progressive labor code.  Fifty years ago, 
Toledo said, the PLN adopted and even expanded on many of 
Calderon Guardia's reforms but under Arias has turned its 
back on the poor.  Arias has therefore been able to attract 
fat-cat campaign contributions, according to Toledo, even 
from those who formerly supported PUSC.  Toledo predicted 
that the number of PUSC municipal officials and deputies 
(members of the Legislative Assembly) would decline after the 
election, but not dramatically. 
 
Future of Toledo 
---------------- 
¶7.  (C) Toledo confided to Ambassador that he already has a 
job lined up to begin February 15, ten days after the 
election.  He will be the general manager of a company that 
provides courier services.  As former head of the Costa Rican 
postal system, Toledo has experience in that area.  He is 
also trained as a lawyer and agronomist, and he once operated 
a donut franchise in Miami.  Toledo said he will return to 
politics as a presidential candidate, noting that former 
presidents Daniel Obuder and Miguel Angel Rodriguez each lost 
an election and Rafael Angel Calderon Fournier, son of 
Calderon Guardia, lost twice before being elected president. 
 
Comment 
------- 
¶8.  (C) Toledo engaged in a lot of wishful thinking. 
Although he did manage to get the PUSC presidential 
nomination, it was mainly due to the lack of serious 
competition.  The party banner, because of scandal and 
fecklessness, is badly tattered, and there were few 
volunteers to do what Toledo is willing to do--go down in 
flames.  Moreover, the party is divided, and Toledo 
represents a minority wing.  Rafael Angel Calderon Fournier, 
who was forced to resign as party president after his 2004 
arrest for corruption, is still pulling the party strings. 
The PUSC list for deputies, for example, was put together by 
Calderon, not Toledo.  The deputies are not campaigning 
together with the presidential candidate (Toledo), as is 
customary, but separately from him.  We know anecdotally that 
many PUSC loyalists plan to vote for the PUSC party list for 
the Legislative Assembly but for a non-PUSC presidential 
candidate like Oscar Arias, Otto Guevara, or even Otton 
Solis.  Toledo's dream of a second chance, even though he is 
only 47 years old, is no sure thing. 
LANGDALE