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C O N F I D E N T I A L SECTION 01 OF 03 MANAGUA 001178 
 
SIPDIS 
 
STATE FOR WHA/CEN AND DRL 
STATE PASS USAID FOR LAC - CARDENAS 
NSC FOR FISK/GARCIA 
 
E.O. 12958: DECL: 09/17/2018 
TAGS: PGOV PHUM KDEM NU
SUBJECT: NICARAGUA: OPPOSITION LEADER MONTEALEGRE 
MODERATELY OPTIMISTIC 
 
Classified By: Ambassador Robert J. Callahan for reasons 1.4 (b,d) 
 
¶1. (C) Summary.  In his first meeting with Ambassador 
Callahan, Eduardo Montealegre, nominal leader of the Liberal 
opposition and candidate for Mayor of Managua under the 
Constitutional Liberal Party-Vamos con Eduardo (PLC-VCE) 
ticket, expressed optimism for his chances of election. 
Montealegre is framing the election as a referendum on Ortega 
and believes voters are unhappy with the Government's poor 
performance to date.  Montealegre cited poll figure showing 
high level of intent to vote among residents and showing him 
with a lead of between 9 and 15 percent.  Montealegre 
lamented continued reluctance by the private sector to 
support his campaign and the broader election effort.  After 
the elections, Montealegre believes that Ortega will seek 
constitutional changes to perpetuate his hold on office and 
suggested that a long-term alliance with the PLC to unite all 
Liberals will be necessary to survive.  END SUMMARY. 
 
CAMPAIGN FOR MAYOR GAINING MOMENTUM 
----------------------------------- 
 
¶2. (C) Montealegre reported that the campaign for Managua was 
going well and that the reaction by average city residents 
has been surprisingly positive.  Montealegre continues to go 
door-to-door in different neighborhoods five days a week. 
Usually, most mornings are devoted to meeting with 
associations, community groups, or coordination with other 
political groups.  Based on his visits, Montealegre believes 
people are not happy with the Ortega government, high prices 
for gasoline and basic foodstuffs, and want better jobs, 
health care and schools.  The prominent role of the Citizen 
Power Councils (CPCs) - First Lady Rosario Murillo's personal 
project - have had an overall negative effect in voters, 
serving to remind them of what the FSLN did to the country in 
the 1980s and the failings in their current efforts to 
provide better and cheaper social services.  The CPCs "are 
not helping to make people happy." 
 
¶3. (C) According to Montealegre, internal polling conducted 
by a Costa Rican-based firm and other polling by the 
International Republican Institute point to a growing lead 
over FSLN candidate and former boxing champion Alexis 
Arguello.  Current polls show between a 9 and 15 percent lead 
for Montealegre, with more and more independent voters 
breaking his way.  Montealegre has yet to publicly release 
any of the polling, for fear of dampening the sense of 
urgency among pro-democratic voters to get out the vote. 
Montealegre noted that he is keeping the election focused on 
Ortega and Murillo, rather than candidate Arguello.  "I don't 
even mention his name."  He believes this has helped produce 
the positive movement in the polls by keeping people focused 
on the election as a referendum on Ortega, painting the 
mayoral candidate as a pawn of Ortega and Murillo, and 
steering clear of Arguello's genuine personal name 
recognition and popularity. 
 
¶4. (C) Montealegre does not believe that the FSLN in the 
National Assembly would pursue further the effort to strip 
him of his immunity as a National Assembly Deputy over 
investigations of his role as Finance Minister in the 
issuance of bonds to refloat Nicaragua's troubled banking 
sector, the so-called "CENIS cases." He considered the whole 
CENIS issue an effort simply to intimidate him into quitting 
the mayoral race or into cutting a power-sharing deal 
directly with the FSLN, in place of the PLC.  He suggested it 
would take more than three months to strip him of immunity, 
making it a useless tool to prevent his election. 
Furthermore, several prominent FSLN members are among the 
more than 30 people charged in the CENIS cases, opening up 
potential internal political problems for the FSLN should 
they pursue the cases ahead of the elections.  Montealegre 
was less certain about what the FSLN would do should he win 
the election.  He admitted that they could take many steps to 
make governing the city difficult, such as delaying transfers 
of funds or disrupting intra-city transportation, among many 
other actions. 
 
PRIVATE SECTOR STAYING OUT OF THE GAME 
-------------------------------------- 
 
¶5. (C) Montealegre lamented that the private sector has not 
 
MANAGUA 00001178  002 OF 003 
 
 
been forthcoming with needed financial help for the campaign. 
 "The private sector is intimidated by Ortega," who is using 
all means at his disposal, such as customs and tax 
inspections, to maintain the pressure.  "They are hoping to 
stay out of the fight to protect themselves" but don't 
recognize that it will only be worse for the private sector 
should the democratic forces lose.  Montealegre expressed 
dismay that younger professionals are already starting to 
leave Nicaragua for opportunities elsewhere.  While the 
numbers were small now, Montealegre noted it was a bad signal 
for Nicaragua's future. 
 
CONSTITUTIONAL CHANGE AND POSITIONING FOR 2011 
--------------------------------------------- - 
 
¶6. (C) Motealegre commented that "the election is a mandate 
-- dictatorship versus democracy."  If the opposition can't 
win, especially in Managua, Montealegre doubts there will 
even be presidential elections in 2011.  A strong win by the 
FSLN will empower Ortega to press ahead with plans for 
constitutional change and secure an "accommodation" with 
ex-President and convicted felon Arnoldo Aleman.  Ortega and 
Aleman "know they can't be re-elected" legitimately by the 
Nicaraguan public.  The only way they can stay in power is by 
giving that power to select a national executive to a small 
group -- the National Assembly.  Within this group, Ortega 
and Aleman wield enormous power and could engineer their 
continued hold on office.  Aleman and Ortega maintain the 
closest of relationships, sharing businesses, property, 
investments and a tradition of having only two political 
forces in Nicaragua, thus ensuring they will have a common 
interest in pursuing constitutional changes. 
 
¶7. (C) Ortega, in particular, is eager to secure an agreement 
that permits re-election of the president or that would 
secure his position as prime minister under a 
quasi-parliamentary system.  Above all, Ortega needs 
re-election in order to retain control over the FSLN.  He has 
no heir apparent, other than Rosario Murillo, who is hated by 
both the base of the party and many others in the party 
hierarchy.  For that same reason (i.e., to eliminate 
potential rivals), Murillo has orchestrated the public 
attacks of the last several months on potential internal 
rivals, such as current Managua Mayor Dionisio "Nicho" 
Marenco, as well as on ex-heroes of the revolution, such as 
Ernesto Cardenal, Doria Maria Tellez, and Carlos Mejia Godoy. 
 
 
¶8. (C) Turning to the "opposition," Montealegre said that 
despite strong support from the base and the intermediate 
levels of the PLC for Liberal unity, many in the PLC 
leadership are not sincere.  The majority of the National 
Assembly Deputies are not independent and are beholden to 
Aleman for personal, financial, or even criminal reasons. 
However, Montealegre reported that the Liberal base (and even 
independents) care much less about the risks of aligning with 
Aleman and are urging a stronger Liberal unity movement to 
confront Ortega.  Montealegre believes that after the 
elections it will be time to finalize a deal with the PLC to 
form a new Liberal Party.  He would even be willing to 
concede leadership of the party to PLC President and National 
Assembly Deputy Francisco Aguirre Sacassa in order to secure 
an agreement.  The growing authoritarian tendencies of 
Ortega, he said, and the removal of smaller parties, such as 
the Conservative Party (PC) and the Sandinista Renovation 
Movement (MRS), leaves his movement with no other option but 
to form a longer-term alliance with the PLC. 
 
COMMENT 
------- 
 
¶9. (C) Montealegre expressed more confidence in his chances 
of election than he has in previous meetings, probably buoyed 
by the improving poll numbers and a growing level of 
enthusiasm from the door-to-door campaign.  However, the 
start of the ovq{QJJ broader effort to shape the elections into a national 
referendum on Ortega.  The lack of funding for the campaign 
continues to hamper Montealegre's efforts as well, driven by 
 
MANAGUA 00001178  003 OF 003 
 
 
the increasingly skittish private sector's desire to avoid 
any appearance of conflict with Ortega.  Finally, given the 
ongoing manipulation of the mechanics of the electoral 
process by the Supreme Electoral Council (CSE) and the FSLN's 
increasingly prominent public relations campaign across the 
city, Montealegre will have to continue to generate 
enthusiasm and turn out the votes if he hopes to win in 
Managua. 
CALLAHAN