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P 151921Z DEC 08
FM AMEMBASSY SANTIAGO
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INFO RUEHAC/AMEMBASSY ASUNCION PRIORITY 3673
RUEHBR/AMEMBASSY BRASILIA PRIORITY 0578
RUEHBU/AMEMBASSY BUENOS AIRES PRIORITY 1184
RUEHLP/AMEMBASSY LA PAZ DEC 6041
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C O N F I D E N T I A L SANTIAGO 001099 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: DECL: 12/15/2018 
TAGS: PGOV ECON CL
SUBJECT: CHILE'S PRESIDENTIAL RACE:  PINERA AND FREI 
CONSOLIDATE SUPPORT, INSULZA EQUIVOCATES 
 
REF: SANTIAGO 1094 
 
Classified By: EPol Counsellor Juan Alsace for reason 1.4 (b). 
 
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Summary 
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¶1. (U) Business tycoon Sebastian Pinera emerged as the sole 
presidential candidate of Chile's center-right Alianza 
coalition after winning the endorsement of the conservative 
Democratic Union (UDI) party on December 12.  Former 
Christian Democrat party leader Soledad Alvear movingly 
endorsed former president Eduardo Frei Ruiz-Tagle as the DC 
presidential candidate and called for party unity on December 
¶13.  Socialist candidate and OAS Secretary General Jose 
Miguel Insulza continued to reach out to the smaller 
Concertacion parties--the Party for Democracy (PPD) and 
Radical Social Democrats (PRSD)--and said that he will resign 
from his position at the OAS if he receives the endorsement 
of, as a minimum prerequisite, the PPD.  End Summary. 
 
Conservative UDI Party Decides to Support RN's Pinera 
--------------------------------------------- -------- 
 
¶2. (U) After a ten-hour closed door debate on December 12, 
the conservative Democractic Union party (UDI) agreed to 
unite with their Alianza coalition partner National Renewal 
(RN) in backing Sebastian Pinera, a business tycoon and 2000 
presidential candidate currently leading in the polls.  There 
had been some talk of having an Alianza primary election, 
just as the center-left Concertacion has planned for April, 
with Deputy Jose Antonio Kast and Senator Evelyn Matthei 
named as possible candidates.  Nonetheless, an Alianza 
primary was considered by many observers to be unlikely, and 
UDI's eventual unanimous decision to support Pinera came as 
little surprise to many.  With UDI's support certain, Pinera 
plans to reach out this week to Chile Primero (Chile First), 
a small party that broke away from the progressive Party for 
Democracy (PPD) in 2007, while the UDI and RN presidents meet 
to discuss campaign strategy. 
 
Christian Democrats Unite Behind Frei 
------------------------------------- 
 
¶3. (U) The Christian Democrats (DC) unanimously endorsed 
former president and current senator Eduardo Frei Ruiz-Tagle 
as their presidential candidate at their party conference on 
December 13.  Soledad Alvear, former DC party leader, had 
hugs and words of praise for her former rival, asking party 
members to unite and "transform Eduardo Frei into the tip of 
an arrow that will carry us to reconquer the heart and the 
confidence of the Chilean people."  Alvear's heartfelt calls 
for party unity provoked tears in the emotional gathering, 
while the crowd enthusiastically responded to Frei's 
appearance by chanting and waving placards.  Frei wasted no 
time in criticizing the conservative presidential candidate, 
Sebastian Pinera, saying that Chile needed "a president and 
not a manager" and chiding Pinera for not abandoning his 
business dealings as Frei himself had done upon entering 
politics.  The DC candidate also set forth broad outlines of 
an economic plan, which includes investing 1% of GDP in 
infrastructure, supporting small and medium enterprises, 
increasing low-income housing construction, and calling on 
the Central Bank to lower interest rates. 
 
¶4. (U) According to press reports, negotiations between the 
Frei and Alvear camps within the DC had been going on for 
some time.  In return for her support for Frei's presidential 
bid, Alvear and her supporters will have substantial control 
over the direction of the party, including in this weekend's 
selection of Juan Carlos Latorre, an Alvear confidante, as DC 
party head.  Latorre moved quickly to invite the "colorines", 
DC defectors who are now part of the Regional Independent 
Party (PRI), to return to the DC fold, saying that the "doors 
were open" and highlighting the placement of a former colorin 
on DC's executive board.  However, PRI leader Jaime Mulet 
said that he and his colleagues were unlikely to return to 
their former party. 
 
Insulza Continues to Dither 
--------------------------- 
 
¶5. (C) OAS Secretary General Jose Miguel Insulza spent the 
weekend continuing to seek out the support of the Party for 
 
Democracy (PPD) and Radical Social Democrats (PRSD) and 
avoiding firm pronouncements on his status as a candidate and 
his future at the OAS. He told an interviewer that if the 
PRSD and PPD select him as their candidate in their party 
conventions in mid to late January, he will then resign from 
his OAS post. (Note:  Insulza advisor Enrique Correa told the 
Ambassador December 15 that Insulza will not finalize his 
decision - or submit his resignation from the OAS - before 
January 26.  A more complete readout of that meeting follows 
septel.  End Note.)  He dodged the question of whether or not 
he would continue as a presidential candidate if he had only 
the backing of his own Socialist party, saying only that it 
would be a mistake for the secular Concertacion parties (PPD, 
PRSD, and PS) to fail to unite behind a single candidate. 
Insulza also tried out what is likely to be one of his 
central campaign themes:  painting the conservative Alianza 
coalition as too wedded to neoliberal economic theories, and 
expressing support for public education, labor rights, and an 
active role for the state. 
 
¶6. (U) Insulza also sought out his friend and former boss, 
Eduardo Frei, at his home this weekend to discuss ground 
rules for their electoral competition.  The two agreed to 
"fair play" during the primary campaign, and so far have only 
criticized each other obliquely.  Frei pointed out that he 
has been elected to office before and hasn't vacillated the 
way Insulza has.  (Note:  Insulza served as Foreign Minister 
and Minister of the Presidency under Frei, and then served as 
Interior Minister under Frei's successor Lagos, but has not 
held elected office.  End Note.)  Insulza rejected claims 
that he could not appeal to the center as well as Frei and 
claimed--contrary to some conventional wisdom--that he was 
actually the most electable because polls show that he has 
the lowest/lowest number of voters who say they would "never" 
vote for him. 
 
Comment 
------- 
 
¶7.  (SBU) Perhaps the only surprise in this weekend's 
political developments was the apparent warmth of Alvear's 
endorsement of Frei.  Alvear's hopes for a presidential bid 
died after DC's disastrous showing in the October municipal 
elections, so Frei was the only viable DC choice.  Insulza 
remains unwilling to take the political risk of stepping down 
from his OAS post without the firm backing of the PPD, and it 
is not yet playing their hands.  (The small PRSD's support or 
not is not a deal breaker for him.)  Meanwhile, his claim 
that he is electable because fewer voters would never vote 
for him is faint praise indeed.  UDI's endorsement of Pinera 
only solidifies the popular perception that Alianza is united 
and organized, while Concertacion remains riven with 
divisions both between and within parties.  End Comment. 
SIMONS