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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 
- - - - - - - - - - - - - - - - - - 
 
¶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 
- - - - - - - - - - - - - - - - - - - - - 
 
¶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