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C O N F I D E N T I A L SECTION 01 OF 04 MANAGUA 000130 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR WHA/CEN GREENE AND NYMAN 
DEPT FOR DRL G. MAGGIO 
NSC FOR V ALVARADO 
SOUTHCOM FOR FPA 
 
E.O. 12958: DECL: 01/30/2018 
TAGS: PGOV PHUM ECON KDEM NU
SUBJECT: 2008 SCORECARD - ORTEGA'S CITIZENS' COUNCILS 1, 
OPPPOSITION 0 
 
REF: A. 2007 MANAGUA 2516 
     ¶B. 2007 MANAGUA 2562 
     ¶C. MANAGUA 49 
 
Classified By: Ambassador Paul A. Trivelli for reasons 1.4(b,d) 
 
¶1. (C)  SUMMARY: In a legal shell game, Nicaraguan President 
Daniel Ortega folded his embattled Citizens' Power Councils 
(CPCs) into the Council of Economic and Social Planning 
(Conpes), an existing body which advises the GON on public 
policy matters, and placed his wife, First Lady Rosario 
Murillo at the helm of Conpes.  This move, coupled with the 
Supreme Court of Justice's (CSJ) January 10 decision to 
uphold President Ortega's veto of legislation that would have 
ended the CPCs, has severely restricted the opposition 
legislative bloc's options to sideline the CPCs.  As the 
scope of CPC meddling in civil society and the public sector 
continues to expand, the private sector is getting 
increasingly nervous.  Recent opinion polls demonstrate that 
the public is solidly against the CPCs (65.6 percent oppose 
them) and support opposition attempts to block their 
formation.  The challenge for civil society organizations 
will be to harness and shape public discontent into an issue 
for the 2008 municipal elections.  END SUMMARY. 
 
 
Presidential End-Run Secures CPCs 
- - - - - - - - - - - - - - - - - 
 
¶2.  (C) On November 29, President Ortega issued presidential 
decrees that placed the CPCs under the control of Conpes and 
that named his wife as Conpes' Executive Secretary.  Conpes 
was established by the National Assembly (NA) as a 
bi-partisan organization to advise the president on public 
policy.  By folding the CPCs into Conpes, Ortega won a 
measure of protection because any changes to Conpes' charter 
-- including its dissolution -- would require 56 votes in the 
Assembly, 4 more votes than the opposition bloc controls.  By 
placing Murillo at the helm, Ortega ensures that his pet 
social project will continue according to his and Murillo's 
vision.  (BACKGROUND NOTE: These decrees followed a ten-day 
stand-off between Ortega and the 52-deputy opposition bloc in 
the National Assembly over the deputies' override of a 
presidential veto of legislation forbidding the formation of 
the CPCs (Law 630).  After the Managua Appellate Court (TAM) 
approved an injunction to block the NA's override decision a 
scant 63 minutes after that vote, the opposition bloc 
boycotted the Assembly and Ortega threatened, on November 26, 
to "rule by decree" (ref A). END BACKGROUND NOTE) 
 
Supreme Court Upholds Constitutional Court Decision on CPCs 
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 
 
¶3.  (C) On January 10, 2008, just over one month after the 
Constitutional Chamber of the CSJ upheld Ortega's veto of Law 
630 (ref B), the CSJ issued its final decision, ruling that 
Ortega indeed enjoys the right to create the CPCs.  Ortega 
himself announced the court's decision in his State of the 
Union address to the National Assembly, in a session 
boycotted by the opposition bloc.  While the CSJ's decision 
came as no surprise -- deputy Jose Pallais, President of the 
Judiciary Committee, had predicted the outcome in a December 
6 meeting (ref B) -- it is a set back for the opposition bloc 
which fought tenaciously to strike the CPCs from the law, and 
for civil society whose role is slowly being subsumed by the 
ever-expanding CPCs.  (NOTE:  A study recently published by 
the Due Process of Law Foundation (DPLF) on corruption in 
Central American legal systems found that the Nicaraguan 
judicial system was perceived as the most corrupt and 
politically-influenced in the region by a factor of nearly 
two.  Demonstrating the political nature of the CSJ, the 
study revealed that 79 percent of judges believed that their 
appointments depended on having a close relationship with a 
CSJ Magistrate.  END NOTE) 
 
More Cases of CPC Meddling 
- - - - - - - - - - - - - - 
 
¶4.  (U) In the first 2 weeks of 2008, the CPCs have made the 
news on several occasions by inserting themselves into a 
variety of private and public situations: 

- In Leon, the CPC allegedly urged the mayor's office to 
accept concessions from local transportation providers to end 
a standoff and accused the mayor of corruption. 
 
- In the municipality of Solingalpa, Matagalpa, CPC members 
reportedly attacked a cellular tower installation team, 
claiming that the tower would negatively affect the health of 
pregnant women in the area. 
 
- Six female members of a CPC in Managua's District Five 
filed slander charges against the daily newspaper "La Prensa" 
after the paper compared CPCs with "gang members" and 
"delinquents" following the December 19 attack on "La Prensa" 
journalist Jorge Loaisiga by Ortega's "blue shirt" personal 
security unit, originally believed to have been CPC members 
(ref C).  These women were not directly involved in the 
incident and none of the attackers were identified by name in 
the article. 
 
- In mid-January, CPC representatives unexpectedly showed up 
to a meeting between private sector representatives and 
Venezuelan President Hugo Chavez, prompting the president of 
the Higher Private Enterprise Council (Cosep) to get up and 
leave. 
 
CPCs Penetrating Public Institutions? 
- - - - - - - - - - - - - - - - - - - 
 
¶5.  (C) According to both private and public sources, CPCs 
are gaining more influence -- and in some cases are being 
installed -- in government ministries and other public 
institutions: 
 
- Sources reported that the Ministry of Agriculture and 
Forestry (MAGFOR) sent out a memo in December requesting that 
all employees who had studied in current or former communist 
countries attend an orientation session to form an in-house 
CPC.  (Apparently, turnout was very low.) 
 
- A source at the National Tax Authority (DGI) reported that 
DGI employees are required to participate in CPC events and 
rallies and are authorized to use government resources. 
(COMMENT: We can confirm that the DGI turned out in force at 
the November 30 CPC rally.  With offices located near the 
rally site, nearly 200 employees paraded to the site carrying 
CPC banners and sporting CPC tee-shirts which they allegedly 
were required to purchase on an installment plan.  END 
COMMENT) 
 
-  Stating that "Constitutionally, it is the State that has 
the responsibility to guarantee the social protection of the 
family, something that has been violated during the past 16 
years," the Minister of Family (MiFamilia) announced on 
January 9 that she would reactivate a feeding program for 
children (Painin) with help from municipal governments and 
the CPCs, eliminating the role previously played by a number 
of NGOs. 
 
- In a January 30 press release Education Minister Miguel De 
Castilla explicitly stated that information about the CPCs 
(and ALBA) will be included in school curriculum under the 
heading of "Cultural and Popular Organizations."  This 
initiative follows a December 7, 2007 announcement by De 
Castilla in which he stated that CPCs would "play a more 
visible role" in public education.  A CPC education committee 
member confirmed last week that education representatives 
from neighborhood CPC cabinets and committees are ramping up 
their direct presence in schools as advisors to school 
directors, diminishing the traditional role and influence 
played by parent councils. 
 
Private Sector Fearful of CPCs 
- - - - - - - - - - - - - - - - 
 
¶6.  (C) In a January 23 meeting with USAID AA/LAC Paul 
Bonicelli, vegetable producers in Managua recounted how much 
progress they had made over the past decade and shared their 
goals of increasing exports to the U.S. and other 
international markets.  When asked about the role the CPCs 
might play in their expansion plans, the producers shared 
their fears that the CPCs will play a more direct and 
heavy-handed role in their day-to-day business and ability to 
market/distribute produce. 
 
¶7.  (C) The reaction was similar in a meeting Bonicelli held 
with an outspoken participant in a USAID-funded Moot Court at 
the National Autonomous University (UNAN) in Leon.  In the 
side meeting with Bonicelli, the participant was accompanied 
by two other unidentified individuals.  When Bonicelli asked 
her about the role the CPCs were playing or could play, the 
previously outspoken participant fell silent and the two 
other individuals chimed in.  They subsequently identified 
themselves as members of the local CPC and said that 
"everything was fine" and that "people," including the 
students, supported the CPCs.  The Moot Court participant 
remained silent through-out the discussion. 
 
Atlantic Coast Continues to Resist CPCs 
- - - - - - - - - - - - - - - - - - - - 
 
¶8.  (C) Public and private sources report that strong 
opposition to the imposition of CPCs continues in Nicaragua's 
North Atlantic Autonomous Region (RAAN).  Although he 
represents the pro-Ortega YATAMA political party, RAAN 
governor Reinaldo Watson has publicly voiced opposition to 
the CPCs.  According to press reports, Watson is concerned 
that the CPCs will "alter the cultural and ethnic traditions" 
of the indigenous populations.  He also stated that the CPCs 
are "not well-managed."  Similar opposition has been voiced 
by indigenous community and political leaders in the RAAN 
over the past several months in meetings with Embassy 
officers.  In a meeting last week, ex-commandos in the RAAN 
reported that the FSLN is pressuring hurricane Felix victims 
and others in poor communities throughout the RAAN to join 
CPCs with the tacit understanding that they will receive 
relief supplies, which local leaders continue to insist have 
been stockpiled by FSLN allies, such as Brooklyn Rivera. 
 
CPC Staple Food Distribution Raises Financial Questions 
- - - - - - - - - - - - - - - - - - - - - - - - - - - - 
 
¶9.  (U) Two months after the National Enterprise of Basic 
Grains (ENABAS) began selling beans, rice, and cooking oil 
through CPC-approved (and often run) neighborhood corner 
stores and other points of sale (ref A, B), ENABAS Executive 
Director Roger Romero Ali reported an uncollected balance of 
300,000 Cordobas (USD 15,000) to the Controller's Office on 
nearly seven million Cordobas (USD 368,000) in sales. 
According to public comments made after the meeting, 
Controller Guillermo Arguello Possey stated that Romero had 
not provided any specifics on the outstanding balance or on 
plans to ensure collection.  The government, through ENABAS, 
was also criticized for selling Taiwanese grain donated for 
Hurricane Felix relief through this CPC-established network. 
 
CPCs Unpopular in Recent Polls 
- - - - - - - - - - - - - - - - 
 
¶10.  (U) Two recent public opinion polls (IRI/Datexco: 
December 15-16 with 1,005 participants; M&R: December 26-30 
with 1,600 participants) show that the CPCs are decidedly 
unpopular.  According to the IRI/Datexco research, 65.6 
percent of Nicaraguans are opposed to the installation of the 
CPCs and 62.5 percent indicated that they would not vote for 
a candidate who supported the CPCs even if the CPCs offered 
benefits their members.  The M&R study revealed that 46.7 
percent of respondents supported the opposition bloc's 
override of Ortega's veto and that 50.6 percent opposed the 
CSJ's decision to uphold Ortega's veto.  Additionally, 88.7 
percent of M&R respondents reported that they are not part of 
a CPC and the majority indicated they have no intentions of 
joining one. 
 
Comment 
- - - - 
 
¶11. (C) With the CSJ's January 10 decision to uphold Ortega's 
veto of Law 630 reforms it appears that opposition 
legislators have reached a legal dead-end.  Since the court's 
decision, opposition leaders have been silent on the issue 
and have not outlined a response strategy in private 
meetings.  While legislators remain silent, the media 
continue to hammer away at the CPCs at every possible 
opportunity.  Neither of the two mainstream newspapers have 
ever run a single positive story on the councils.  As the 
recent polls indicate, this constant haranguing has 
undoubtedly helped to harden public opinion against the CPCs. 
 The looming question is whether this growing public 
suspicion of and resentment towards the CPCs will spill over 
into civic action and if civil society organizations can 
harness, channel, and mold this resentment into an election 
issue.   Through our Democracy Initiatives programs we will 
continue to engage with our democracy partners, civil society 
actors, and the media to ensure there is active debate on the 
CPCs and other issues of importance in the lead-up to the 
2008 municipal elections. 
SANDERS