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C O N F I D E N T I A L PANAMA 000697 
 
SIPDIS 
 
E.O. 12958: DECL: 08/21/2018 
TAGS: PGOV PREL PM
SUBJECT: PANAMA POST:  EDITION 13, VOLUME II 
 
REF: PANAMA 574 (AND PREVIOUS) 
 
Classified By: POLCOUNS Brian R. Naranjo.  Reasons:  1.4 
(b) and (d) 
 
------- 
Summary 
------- 
 
¶1. (C) Panama's opposition panorama is beginning to clarify 
as two opposition coalitions are emerging.  Presidential 
candidate Ricardo Martinelli announced recently that his 
Democratic Change (CD) had reached an alliance agreement with 
Patriotic Union (UP), an alliance that UP is expected to 
ratify at a party convention in November.  Meanwhile, 
presidential candidate Juan Carlos Varela's Panamenista Party 
appeared to have essentially sealed, though not have 
announced, an alliance with the Movement of Liberal 
Republican Nationalists (MOLIRENA).  Moral Vanguard of the 
Nation's presidential candidate Guillermo Endara appeared to 
be looking for a soft landing to allow him to exit the race, 
and most observers believed Endara would ally with the 
Panamenistas.  Minister of Canal Affairs Dani Kuzniecky 
shared with POLOFF some of President Martin Torrijos' 
political views regarding the evolving PRD internal race and 
the broader general election campaign.  In this edition of 
the Panama Post, our headlines are: 
 
-- Cabinet Minister Dishes on Dynamics in Torrijos 
Administration 
-- Panamenista and MOLIRENA Parties Essentially Allies 
-- Ford to Take Leave of Absence from UP 
-- "I'll be Martinelli's VP candidate" 
-- Dealing with the "Moscoso" Factor 
-- Endara Hangs in for Now 
 
End summary. 
 
--------------------------------------------- ----------------- 
Cabinet Minister Dishes on Dynamics in Torrijos Administration 
--------------------------------------------- ----------------- 
 
¶2.  (C) "Torrijos now realizes how little time is left (in 
his Administration) and is working at full steam, something 
he should have been doing before," Minister of Canal Affairs 
Dani Kuzniecky told POLOFF on August 15.  "He's finally 
getting operational after taking three years to learn to make 
decisions, and he is now giving firm and specific orders." 
Kuzniecky also commented, "Torrijos has been left alone.  His 
friends like (former Minster of Government Ubladino) Uba Real 
and (former Minsiter of Industry and Commerce Alejandro) Andy 
Ferrer deserted him after fulfilling their personal interests 
and that leaves only a handful of ministers who are 
multitasking and giving him our full support."  In 
particular, First VP and FM Samuel Lewis was "working 
incessantly" for Torrijos, Kucniecky said, highlighting 
Lewis' legendary loyalty to Torrijos. 
 
¶3. (C) Governing Revolutionary Democratic Party (PRD) 
presidential nomination candidate "Balbina (Herrera) is 
desperate to identify a vice presidential running mate, but 
is having no success," Kuzniecky said.  "I was not even 
flattered when (PRD fundraiser and behind the scenes 
operative) Jimmy Arias invited me to lunch to offer me the 
vice presidential position under Balbina."  All the previous 
VP offers had gone to individuals with similar 
characteristics, Kuzniecky explained, they were "white, 
younger than her, and well-to-do men," including Ferrer, 
Panamanian Ambassador to the U.S. Frederico "Freddy" Humbert, 
and Lewis.  "I told Arias, 'Thanks, but no thanks, I'm not 
even a (Revolutionary Democratic Party) PRD member," 
Kuzniecky explained. 
 
¶4. (C) Recently, Kuzniecky said that Torrijos had invited him 
to a one-on-one lunch, "which is something we do not do often 
as I am not part of his political team."  Torrijos told 
Kuzniecky that he would not indicate publicly whom he 
supported in the PRD primary, Herrera or Panama City Mayor 
Juan Carlos Navarro.   That said, Torrijos allegedly confided 
that he was "inclined to help Balbina somehow."  Kuzniecky 
then said he told the President, "I saw it coming, so I 
immediately told him that Jimmy had already made me an offer 
that I turned down.  I bluntly told him that I would probably 
not even vote with the PRD in 2009."  In response, Torrijos 
calmly said, "(Panamenista presidential candidate Juan 
Carlos) Varela's political proposal is very similar to what I 
offered in 2004.  The government is spent and exhausted.  The 
likely government candidate (Herrera) smells of old rotten 
bones, but Varela is the new chicken in the chicken coop. 
It's a simple and easy decision."  Regarding PRD presidential 
nomination candidate Navarro, Kuzniecky said, "Martin cannot 
help Navarro; they had a political confrontation in the past. 
 Furthermore, Samuel Lewis despises -- despises (using the 
word in English and Spanish) -- his cousin (Navarro), so 
Martin will not betray Samuel given his proven loyalty." 
 
¶5. (C)  Comment: Torrijos is keenly aware that time is 
running out on his administration.  Indeed, Kuzniecky opened 
his discussion by showing his new "toy" that Torrijos had 
just given him:  a pocket-sized digital clock that counted 
down the time left before his administration left office on 
July 1, 2009. Kuzniecky portrays a president who has finally 
decided to take action only to realize that there is not much 
time left on the game clock and who is eager to secure a 
partner for likely PRD presidential candidate Balbina Herrera 
who can help assure Torrijos his legacy. 
 
--------------------------------------------- ------ 
Panamenista and MOLIRENA Parties Essentially Allies 
--------------------------------------------- ------ 
 
¶6. (C) Though the final "i"s still need to be dotted and the 
final "t"s crossed, the Panamenista and Movement of Liberal 
Republic Nationals (MOLIRENA) parties are essentially allies. 
 Still to be finalized are the details for a few local level 
slates, POLOFF learned recently.  This alliance-in-waiting 
was on full display on August 12 at MOLIRENA's dinner in 
honor of the 28th anniversary of the party's founding. 
Commemorating key MOLIRENA leaders over the years, several 
MOLIRENA speakers, including MOLIRENA President Sergio 
Gonzalez-Ruiz, referred to Panamanista presidential candidate 
Juan Carlos Varela (in attendance) as the future President of 
Panama.  MOLIRENA leaders and Panamenista leaders slapped 
each other on the back, told war stories of past campaigns 
together, and spoke as if an alliance had been announced and 
formalized, neither of which has happened.  Moral Vanguard of 
the Nation (VMP) presidential candidate Guillermo Endara was 
also present. 
 
¶7. (C) Comment: Panamenista members nearly outnumber MOLIRENA 
members two to one at this MOLIRENA event.  VMP could only 
fill about half of a ten person table.  MOLIRENA, wracked by 
in-fighting in recent years, has been greatly weakened by 
defections to other parties (most notably former First VP 
Guillermo "Billy" Ford but also youth leader Abraham 
Carrasquilla who took several dozen youth members with him). 
Ford was the only representative from the Democratic Change 
(CD)-Patriotic Union (UP) alliance.  Sitting next to POLCOUNS 
through the dinner, Ford reminisced about the days when 
MOLIRENA was the "life blood" of the anti-Noriega opposition 
and visibly winced when speakers referred to him as the 
"President of Patriotic Union." "I'll always be a 
MOLIRENista," Ford said.  Indeed, this August 12 dinner took 
on the aura of a Panamenista-MOLIRENA-VMP alliance that would 
compete against the CD-UP alliance and the PRD. 
 
------------------------------------- 
Ford to Take Leave of Absence from UP 
------------------------------------- 
 
¶8. (C) "I am going to take a leave of absence from Patriotic 
Union (UP)," UP President and former First VP Guillermo 
"Billy" Ford told POLCOUNS on August 15.  Frustrated that his 
party's VPs had not consulted with him before taking UP into 
an alliance with Ricardo Martinelli's Democratic Change (CD) 
party, Ford explained, "I was hoping to use our muscle to 
broker a grand opposition alliance, but Jose Raul Mulino and 
Anibal Galindo went behind my back and signed an alliance 
deal with Martinelli."  Ford acknowledged, however, that the 
prospects for a grand alliance were very thin:  Panamenista 
presidential candidate Juan Carlos Varela had decimated his 
primary opponent, CD presidential candidate was "thickheaded" 
and dead set on running for president, and the governing 
Revolutionary Democratic Party (PRD) prospects at a "sure 
win" were starting to dim with the likelihood that Herrera 
would win the PRD primary.  Herrera was the ideal candidate 
for the opposition to confront, something that ironically 
complicated rather than facilitated opposition unity. 
 
¶9. (C) Comment:  Ford stood next to no chance at playing the 
bridge building role to which he aspired.  Ford was chosen to 
preside over UP, a new political entity ormed by the uniting 
of the Liberal National and the Solidarity parties, because 
he was one of the few figures in Panama acceptable to all 
members of this new party.  Once former Panamanista 
presidential aspirant Alberto Vallarino was knocked out of 
the race, the die was essentially cast that UP would join CD 
in an alliance.  Vallarino is the son-in-law of 
behind-the-scenes UP godfather and Panamanian politics puppet 
master Samuel "Don Sammy" Lewis Galindo.  (Don Sammy is also 
First VP and FM Samuel Lewis Navarro's uncle.)  His 
son-in-law out, Don Sammy had little to gain from an alliance 
with the Panamenistas.  Furthermore, viewing Varela as the 
weaker of the two Panamanista options, UP VP Jose Raul Mulino 
calculated that UP could do better with Martinelli.  Both 
developments cleared the way for pro-Martinelli UP VP Anibal 
Galindo to steer the party into alliance with CD. 
 
----------------------------------- 
"I'll be Martinelli's VP candidate" 
----------------------------------- 
 
¶10. (C) "I will be Martinelli's vice presidential running 
mate," Patriotic Union (UP) VP Anibal Galindo told POLCOUNS 
on August 13.  Galindo said that UP would make its 
announcement in mid-October and then formalize both its 
alliance with Democratic Change (CD) and his VP candidacy at 
a UP convention in November.  Galindo said that UP would give 
CD the structure and political discipline it needed to win. 
Galindo saw little chance that CD and UP would be able to 
join with the Panamenista and Movement of Liberal Republican 
Nationalists parties to form a grand opposition alliance. 
 
¶11. (C) Comment:  Galindo has been angling for a vice 
presidency for months now.  The Panama Post has not yet been 
able to confirm with the Martinelli camp whether indeed 
Galindo will be Martinelli's running mate, but the Panama 
Post believes that a Galindo vice presidential candidacy was 
likely a key element of the CD-UP alliance pact. 
 
--------------------------------- 
Dealing with the "Moscoso" Factor 
--------------------------------- 
 
¶12.  (C) "Juan Carlos (Varela) is not doing enough to pull 
the Panamenistas together," Panamenista primary presidential 
race also-ran Alberto Vallarino groused to POLCOUNS on August 
¶14.  Explaining that his support came from two key groups in 
the party, Vallarino said, "The National Assembly deputies 
who supported me are political animals; they know how to get 
over things quickly and to adjust to the new political 
reality.  (Former President) Mireya Moscoso's crowd though, 
profoundly distrusts Varela."  Vallarino concurred that it 
would be difficult for Varela who had defined himself 
politically as being the one to clean up the party following 
the mess created by Moscoso's exit from office under an 
ethical cloud highlighted by serious corruption allegations. 
"Varela campaign under the 'clean hands' slogan, and so he 
needs to be very careful how he comes to terms with Mireya," 
Vallarino said. 
 
¶13. (C) Jose Luis "Popi" Varela, Juan Carlos Varela's brother 
and campaign manager, confirmed to POLCOUNS on August 18 that 
they would have to reach some "understanding" with Moscoso if 
they were to be able to unify the Panamenista party.  "Juan 
Carlos has tapped me to engage 'La Dona'," referring to 
Moscoso.  "I am going to try to convince her that she should 
not fear a victory by my brother."  Jose Luis Varela noted 
that Martinelli had already tried to hit Varela hard with an 
ad that linked Varela to Moscoso.  "We did not ask the 
Electoral Tribunal (TE) to quash that ad, because we are 
prepared to attack Martinelli as another 'traditional' 
politician by underscoring his ties to Moscoso.  My brother 
stands by his record of working to renew the party after the 
Moscoso years." 
 
¶14. (C) Comment:  Slowly but surely, the Panamenista party is 
unifying.  Moscoso is a tough-as-nails political tactician, 
and Popi may very well may be able to secure her commitment 
to lie low and stay out of the limelight. 
 
----------------------- 
Endara Hangs in for Now 
----------------------- 
 
¶15. (C)  Trailing badly in the polls, "there's no rush to 
pull out of the race now," former President Guillermo 
Endara's right-hand man Menalco Solis told POLCOUNS on August 
¶12.  For the time being, Endara's Moral Vanguard of the 
Nation (VMP) party would keep plugging away on its campaign. 
Solis, who was accompanied by his wife and National Assembly 
Deputy Mireya Lasso, said that VMP would release a USD 1 
million add campaign soon to advocate for the party and its 
presidential candidate.  Asked if that was essentially all 
the cash that the party, Solis acknowledged, "Yes."  Solis, 
who previously has always brushed away suggestions that 
Endara would exit the race, for the first time said that 
Endara might step down in November or December. 
 
¶16. (C)  Comment: So what's keeping Endara in the race? 
Three things are:  Anamae, Mireya, and the party.  First, 
Endara wants to ensure his wife Anamae's place on an alliance 
ticket ideally for Mayor of Panama City.  Second, Solis wants 
to ensure that his wife, Mireya Lasso, will secure the 
support necessary to win re-election to her seat in the 
National Assembly.  Third, Endara wants to ensure that VMP, 
which has lost nearly 30,000 or about half of its members in 
recent months, continues to exist as a party; to do so, it 
must secure a minimum number of locally elected seats.  The 
Panamenista primary by assigning candidates to virtually all 
electoral openings complicated a Panamenista-VMP alliance 
because now the Panamenistas would have to encourage somebody 
to step down to make space for Anamae and Mireya. 
STEPHENSON