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C O N F I D E N T I A L PANAMA 000061 
 
SIPDIS 
 
E.O. 12958: DECL: 01/13/2019 
TAGS: PGOV PM
SUBJECT: PANAMA POST:  THE SHAKE-UP EDITION 
 
Classified By: Classified by Deputy Chief of Mission David Gilmour for 
Reasons 1.4 (b) and (d) 
 
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SUMMARY 
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¶1.  (SBU)  Welcome to the third edition of the Panama Post, a 
collaborative effort between Embassy Panama's Political 
Section and the Open Source Center (OSC).  Having last left 
our readers before the holiday season lull, the Panama Post 
is happy to report that the politicians and those who care 
about them are back in force and ramping up for three months 
of non-stop general election campaigning.  Candidates are 
defying conventional wisdom, allies are lining up with 
perceived winners and juicy nuggets of political information 
have been flying across our desk blotters.  In this edition 
of Panama Post, our headlines are: 
 
- Martinelli's VP-from Patriotic Union (UP), but not the one 
you expected 
- MOLIRENAs drop Varela to save themselves 
- Balbina Herrera - It's all about me 
- Torrijos drags Balbina down - in more ways than one? 
- PRD:  How to pin down Martinelli? 
 
If you haven't yet created your Open Source account, log on 
to www.opensource.gov and set up an account for daily updates 
on issues, regions or countries of your choice.  OSC analysts 
provide not only daily translations of timely news stories 
but also analysis of open source media. 
 
--------------------------------------------- ---- 
Martinelli's VP-from UP, but not who you expected 
--------------------------------------------- ---- 
 
¶2.  (SBU) Ricardo Martinelli, Democratic Change (CD) 
presidential candidate and current front-runner announced 
January 12 that he had picked Leopoldo Benedetti, a Patriotic 
Union (UP) National Assembly delegate from Colon, as his 
Vice-presidential running mate.  The CD board is expected to 
rubber stamp this nomination, thereby fulfilling Martinelli's 
promise to the UP to select one of its own for VP. 
 
¶3.  (SBU) Martinelli's pick of Benedetti surprised political 
observers, most of whom had expected him to pick a 
high-profile party member such as UP President Jose Raul 
Mulino, former Panamanian First VP Guillermo (Billy) Ford or 
UP VP Anibal Galindo.  There was also talk of Martinelli 
picking an independent, such as TV personality Lucy Molinar. 
Benedetti, 65 years old, has served two non-consecutive terms 
as a low-profile but well-respected member of the National 
Assembly representing Colon.  Benedetti, who in his 
legislative career has either been in opposition or a minor 
alliance partner of the governing party, has no legislative 
accomplishments to his name, and no national following. 
Benedetti has, however, been a stalwart advocate through 
thick and thin for the national government to complete the 
Panama City-Colon highway, perhaps the top political issue 
for Colon province.  Benedetti does have an impressive 
political machine in Colon, which could help Martinelli to 
draw votes in the populated, but often overlooked, Caribbean 
city.  His machine is built upon the support of 21 
representatives, precinct or circuit-level local politicians. 
 
 
¶4.  (C) COMMENT:  Rumors abound that Martinelli will try to 
further consolidate the UP alliance by supporting Billy Ford 
as Panama City Mayor.  These rumors that have been sparked by 
cryptic comments from Martinelli during the UP convention 
that he "had a surprise" for Ford and that Ford's "political 
career is not over."  The UP already has an official 
candidate for PC Mayor - Ivan Blasser - though he is not 
doing well.  Panama City is also rife with rumors that a 
"rift" has opened inside UP.  Don,t believe the hype!  Ahead 
of PRD Presidential candidate Balbina Herrera by at least 13 
point and benefiting from a powerful bandwagoning effect that 
is drawing opposition leaders to his cause, Martinelli is in 
the cat-bird seat.  Mulino and Galindo are likely annoyed and 
irked, but have nowhere else to turn at this point.  By 
selecting Benedetti, Martinelli fulfills his commitment to UP 
to name a UP member as his running mate and outflanks Mulino 
and Galindo.  By holding out the prospect for a "surprise" 
for Ford, Martinelli keeps Ford in the fold as well. 
Additionally, by naming UP candidate for a National Assembly 
seat Guillermo Ferrufino as his "social policy" tsar, 
Martinelli harnesses a bit of this former model and current 
TV personality,s aura and demonstrates his commitment to 
integrate UP into his team. 
 
¶5. (C) Just in:  Martinelli and Panamenista Party 
presidential candidate Juan Carlos Varela engaged in detailed 
discussions, sequestering themselves in the sun room of the 
Ambassador's residence during the Embassy's Inauguration Day 
event.  The Panama Post understands that a tentative 
agreement was reached under which Varela would become 
Martinelli's VP running mate, Benedetti would step aside, and 
a united opposition slate -- minus Moral Vanguard of the 
Party (VMP) -- would present a consolidated front against the 
governing Revolutionary Democratic Party (PRD).  Ermerging 
from the sun room, Martinelli and Varela acknowledged that 
they had achieved a rapprochement (this was their first 
meeting in public in a few months) and prounced their 
commitment to bring real change to Panama.  Benedetti, also 
present at the reception, noted that he was not an 
"egotistical man" and was prepared to do what was necessary 
to foster that change.  Former Panamenista primary 
presidential nomination contender Alberto Vallarino noted 
privately in an aside that he had been tapped to serve as a 
"bridge" to bring together the Panamenista and CD parties. 
Parties and candiates must make formally declare their 
intention to run for office with the Electoral Tribunal by 
February 2.  Stay tuned. 
 
-------------------------------------------- 
MOLIRENistAs drop Varela to save themselves 
-------------------------------------------- 
 
¶6. (C) Members of the National Liberal Republican Movement 
(MOLIRENA) overwhelmingly confirmed their leadership's 
decision to join Martinelli's alliance at its convention on 
January 11, with 562 of 569 delegates voting in favor.  This 
confirms the decision made by its National Executive 
Committee (CEN) on December 23 to leave the Panamenista 
alliance, headed by candidate Juan Carlos Varela, and join 
instead to the surging Martinelli.  The MOLIRENAs, who have 
59,693 members, are the Panamenistas traditionally ally, 
though they had been formally allied with the Panamenistas 
for only a month before abandoning them.  Varela's team 
publicly dismissed the importance of this move, but rumors 
are flying that Varela is being pushed by the old-line 
leaders to change strategy immediately to reverse his 
precipitous fall in the polls. 
 
¶7.  (C) "Both Alberto Vallarino and Mireya Moscoso are 
working behind the scenes" to get Varela to step down, 
according to MOLIRENA leader Olimpio Saez, a former 
legislator and Ambassador told the Panama Post on January 6. 
Saez characterized  Varela as a "stubborn" candidate who 
refuses to step aside, despite the fact that he has known 
since November that his candidacy was going nowhere.  Saez, 
who was an early proponent of the MOLIRENA-Panamenista 
alliance, called publicly for the MOLIRENAistas to switch 
their allegiance to Martinelli's CD in order to save the 
party.  Roberto Henriquez,  Vice-president of CD, echoed this 
fact in a January 7 conversation with POLOFF, in which he 
said that 80% of MOLIRENA would eventually support 
Martinelli.  The MOLIRENA members switched their allegiance 
to Martinelli to save their party, asserted Henriquez. 
(NOTE:  According to electoral law, a party must receive 4% 
of votes cast during an election to remain an officially 
recognized party.  MOLIRENA needs to be allied to a popular 
candidate to have any hope of getting that many votes, and 
remain a party.  END NOTE)  Though MOLIRENA does not bring 
much to Martinelli's alliance, MOLIRENA's departure from its 
alliance with the Panamenistas is more than symbolic. 
Polling agency Unimer reported on January 12 that 58 percent 
of its total sample believed that MOLIRENA's break with the 
Panamenistas would negatively affect Varela and a whopping 
60.4 percent of Panamenistas themselves believed the same. 
 
---------------------------------- 
Balbina Herrera - It's all about me 
---------------------------------- 
 
¶8.  (C) Democratic Revolutionary Party (PRD) Presidential 
candidate Balbina Herrera, despite also being party 
president, had created a "parallel structure" of 
"inexperienced PRDs" and was ignoring other PRD candidates 
further down on the ticket, said Leandro Avila, popular San 
Miguelito National Assembly member and former PRD majority 
leader in a January 7 conversation with the Panama Post. 
According to Avila, Herrera was stoking dissension in the PRD 
by refusing to campaign for anyone but herself, and has made 
it clear that other PRD candidates were on their own 
financially and politically.  In response, the PRD's "petit 
committee" of San Miguelito met December 29 and decided not 
to campaign for Herrera, but to focus their energies on 
getting at least 7 of 9 National Assembly members elected. 
(Note:  San Miguelito. Panama's second largest municipality, 
is a heavily populated, electorally important district that 
is overwhelmingly poor and pro-PRD.)  San Miguelito PRD 
members were also planning to "retrench" in the face of a 
likely Martinelli victory.  "If by February 15 she doesn't do 
any better in the polls, Martinelli will be President," said 
Avila. 
 
¶9.  (C) COMMENT:  Herrera's primary contender and now VP 
running mate, Juan Carlos Navarro, though he lost the 
nomination, was more successful at securing victories in the 
PRD primary for his candidates further down the ticket. 
Indeed, Herrera's primary coattails were practically 
nonexistent.  Navarro assiduously used his presidency of the 
Panama Mayors Association and advocacy for greater 
decentralization to build a nationwide base of support.  It 
is not clear that Navarro will or is even inclined to 
mobilize this network of down-ticket PRD candidates to 
Herrera's cause. 
 
--------------------------------------------- ------- 
Torrijos drags Balbina down - in more ways than one? 
--------------------------------------------- ------- 
 
¶10.  (C) Balbina Herrera's "continuity" message is killing 
her, because the people are very dissatisfied with the 
Torrijos government, said Roberto Henriquez told POLOFF. 
According to Henriquez, Herrera lacks a "coherent message" 
and has, along with Torrijos, been dragged down in the public 
mind by stagnant wages, the high cost of food and 
electricity, and the decline in public services.  According 
to Avila, there is more to this story than just the factthat 
Herrera and Torrijos are members of the ruling party. 
Torrijos was "doing everything he could to ensure that 
Herrera would lose and that Torrijos would control the 
National Assembly," Avila asserted.  Ostensibly, Torrijos 
wanted to control the National Assembly so that a PRD 
majority would be able to "amend the law for him to come back 
in five years instead of ten." 
 
¶11.  (C) COMMENT:  Panamanian law requires a former President 
to wait ten years (two terms) before running for president 
again.  Avila asserted that Torrijos was buying National 
Assembly votes by allowing companies involved in highway, 
bridge and other government projects to overcharge the 
government.  Presumably these companies are either owned by 
National Assembly members, or their family members, or their 
supporters, although Avila did not say this directly.  Post 
has no independent confirmation of Avila's assertions.  To 
change the Constitution, Torrijos would need the current 
National Assembly and the next National Assembly to approve 
the same constitutional amendment. 
 
--------------------------------- 
PRD:  How to pin down Martinelli? 
--------------------------------- 
 
¶12.  (C) "The PRD is terrified of Martinelli, they don't know 
what to do against him," according to Saez, noting that the 
PRD had not been able to drive the debate in recent weeks. 
Herrera and the PRD have accused Martinelli in several forums 
of trying to "buy" the election, and have posted anonymous 
posters in Panama City touting that claim.  Martinelli 
responded aggressively, turning this theme back on Herrera by 
taking out full-page ads in most leading newspapers stating 
"Balbina Herrera:  You cannot buy decent Panamanians." 
Further, the CD has filed a complaint with the Attorney 
General on behalf of a person who claims that the PRD 
threatened her and offered her cash for information about 
Martinelli. 
 
¶13.  (C) COMMENT:  Henriquez told POLOFF that the key with 
negative attacks was to immediately and aggressively respond, 
something that the CD publicity machine is clearly doing. 
Henriquez noted that  Varela had failed to follow this rule 
when CD attacked him, and that had led to his fall in the 
polls. 
STEPHENSON