Promoting Polyarchy: Globalization, U.S. Intervention, and H

"Science," the Greek word for knowledge, when appended to the word "political," creates what seems like an oxymoron. For who could claim to know politics? More complicated than any game, most people who play it become addicts and die without understanding what they were addicted to. The rest of us suffer under their malpractice as our "leaders." A truer case of the blind leading the blind could not be found. Plumb the depths of confusion here.

Re: Promoting Polyarchy: Globalization, U.S. Intervention, a

Postby admin » Mon Apr 11, 2016 6:51 am

Part 2 of 3

The shift from the CIA to the NED

What little political aid the United States has attempted in the past 35 years has been more or less covert, largely financial and most often administered through the CIA. It did not take long for most policymakers to realize that such covert operations were inappropriate, awkward, and embarrassing.

-- Project Democracy consultant [29]


Political aid programs were sporadic and underdeveloped in the post-World War II period. Those programs that did exist were managed by the CIA. The Truman administration created the CIA out of its World War II precursor, the Office of Strategic Security, as a covert branch of the US state in the Cold War. Since its inception, the CIA has carried out thousands of covert operations; overthrown countless governments; and contributed to the death, directly or indirectly, of millions of people as a result of its actions.30 Alongside intelligence gathering and paramilitary campaigns, a major component of CIA intervention has been political operations involving the creation, covert funding and guidance of allied political groups and individuals in target countries -- media, political parties, trade unions, businesses, and associations.

At the height of the Cold War in the 1950s and 1960s, despite occasional scandals and failures like the Bay of Pigs, the CIA enjoyed the respect of much of the US public, and the full extent of its activities remained hidden from the international community. But during the 1970s, as many of its seamy covert operations became public, it fell into disrepute. In 1974-5, congressional investigations revealed the sordid underworld of CIA covert activity at home and abroad. Top-level CIA officers defected and exposed the history of overseas intrigues, and investigative journalists uncovered unsavory details of US secret activities.31 After the US defeat in Indochina and the delegitimization of foreign intervention, the CIA by the late 1970s was badly discredited. In the United States, bipartisan and constituent support crumbled. In target countries abroad, association with CIA programs meant instant repudiation. In addition to the stigma, there were other problems. The CIA had proved adept at staging coups, assassinations, and installing dictators. It achieved its stated goal in 1973 in Chile, for instance, when it orchestrated the military overthrow of the democratically elected government of Salvador Allende. In Guatemala, it was impeccably efficient in organizing the removal in 1954 of the elected government of Jacobo Arbenz. The CIA showed similar proficiency in operations in Brazil, Iran, the Congo, the Philippines, Iraq, and dozens of other countries.

Yet there was something clumsy about these operations. The political aftermath of covert operations seemed to create new, more complex problems over the long term. The CIA could destabilize quite well, but, its detractors argued, it was not good at creating stability. Nearly four decades after the CIA overthrew the Arbenz government, Guatemala remained a cauldron of guerrilla insurgency, gross human rights violations and social instability. The Pinochet regime lasted sixteen years but was an international pariah. Iran's nationalist prime minister, Mossadegh, was ousted in the CIA-led coup of 1954, which installed the Shah and recovered Iranian oil fields for Western petroleum companies. But, despite twenty years on the throne, the Shah was unable to sustain himself in the face of a rising Islamic fundamentalist movement and popular struggles against his policies. CIA operations seemingly lacked sophistication and long-term vision. The CIA was not able to create stable governments or to mold structures in civil society itself that could provide long-term protection for a core-dominated market economy and a pro-US political program. Here, the capable hands of a political surgeon were needed, not the heavy hand of a paramilitary assassin.

The new, post-Vietnam breed of political professionals lobbied for the transfer of crucial aspects of the CIA's political operations -- namely, "political aid" -- to a new agency. They lobbied for the establishment of an institution that would use sophisticated techniques, including elections, political aid, and other political operations, to achieve lasting results. Two of the original NED founders noted: "Since the advent of the Cold War, the United States has worked abroad politically, mainly covertly, with direct government action and secret financing of private groups." This US political intervention capacity "is necessary for protecting US security interests," but efforts to date have proven inadequate: "[The] various covert means for filling the political gap in US policy solved some short-term needs, but did not provide effective long-term solutions. Covert political aid provided directly by the US government is limited in its effectiveness."32 Thus, while CIA intervention has continued, a more specialized, sophisticated entity with a focus on political operations, a long-term vision, and a strategic agenda came into existence with the creation of the NED in 1983. This new entity would not only play the role of skillful political surgeon, but it would overcome the taint associated with the covert political operations that the CIA had been carrying out abroad. Specifically, NED would take over much of the funding and political guidance for political parties, trade unions, business groups, news media, and civic organizations that the CIA had traditionally supplied. The NED is a "combination of Government money, bureaucratic flexibility and anti-Communist commitment. .. which mixes public funds and private interests," noted the New York Times shortly after the Endowment's founding. The NED's work "resembles the aid given by the Central Intelligence Agency in the 1950s, 60s and 70s to bolster pro-American political groups."33 Former CIA director William Colby commented in regard to the NED program: "It is not necessary to turn to the covert approach. Many of the programs which ... were conducted as covert operations [can now be] conducted quite openly, and consequentially, without controversy."34 The idea was to create a further division of labor within the organs of US foreign policy. The NED would not replace the CIA, whose programs have continued and even expanded in the 1990s.35 Rather, it would specialize in the overt development through political aid programs of political and civic formations, supplementing CIA covert activities in synchronization with overall US policy towards the country or region in which it operated.

The NED, with its ideological underpinning of "promoting democracy," was well equipped for rebuilding US domestic consensus for political operations abroad. The name National Endowment for Democracy conjures up an apolitical and benevolent image not unlike that of the National Endowment for the Arts or other humanitarian societies. The efforts to project such an image are, in fact, part and parcel of the ideological dimensions of the new intervention, and have been remarkably successful. Standard university texts perpetuate such an uncritical image. "The National Endowment for Democracy, launched by the Reagan administration in 1983, is a recent manifestation of a tradition with a long heritage," states American Foreign Policy: Pattern and Process, one of the staple US college texts on foreign policy. "Its purpose is to encourage worldwide the development of autonomous political, economic, social and cultural institutions to serve as the foundations of democracy and the guarantors of individual rights and freedoms."36 Yet the NED was created in the highest echelons of the US national security state, as part of the same project that led to the illegal operations of the Iran-Contra scandal. It is organically integrated into the overall execution of US national security and foreign policy. In structure, organization, and operation, it is closer to clandestine and national security organs such as the CIA than apolitical or humanitarian endowments as its name would suggest. The NED has operated in tandem with all major interventionist undertakings in the 1980s and 1990s.

The NSC's Project Democracy

Efforts to create "political development" programs date back to the 1950s, at the height of the Cold War, when Congress discussed, but declined to approve, several bills to establish a "Freedom Academy" that would conduct party-building in the Third World. The passage of the Title IX addition to the Foreign Aid Act in 1966 spurred renewed interest in such an agency. The Brookings Institute, one of the most important policy planning institutes, undertook an extensive research program on political development programs in coordination with the AID and other government agencies.37 In 1967, President Johnson appointed the three-member Katzenback Commission which recommended that the government "promptly develop and establish a public-private mechanism to provide public funds openly for overseas activities of organizations which are adjudged deserving, in the national interest, of public support."38 A bill was introduced in Congress in 1967 by Rep. Dante Fascell (D.-Fla.) to create an "Institute of International Affairs," but it was not approved.39 Meanwhile, the public outcry against intervention abroad in the early 1970s as a result of the Indochina war and the revelations of CIA activities, as well as the Watergate scandal, put these initiatives on hold for much of that decade.

Then, in 1979, with reassertionism taking hold, a group of government officials, academicians, and trade union, business, and political leaders connected to the foreign-policy establishment, created the American Political Foundation (APF), with funding from the State Department's United States Information Agency (USIA) and from several private foundations. The APF brought together representatives of all the dominant sectors of US society, including both parties and leaders from labor and business. It also brought together many of the leading figures who had been developing the ideas of the new political intervention, many of them associated with the transnationalized fraction of the US elite.40 Among those on the APF board were Lane Kirkland of the American Federation of Labor-Congress of Industrial Organizations (AFL-CIO), former Republican National Committee chair William Brock, former Democratic National Committee chair Charles Manatt, international vice-president for the US Chamber of Commerce Michael Samuels, as well as Frank Fahrenkopf, Congressman Dante Fascell, Zbignew Brezezinski, John Richardson, and Henry Kissinger. The APF was chaired by Allen Weinstein, who would later become the first president of the NED. The names of APF activists and the composition of the APF board are revealing. They fall into three categories. One is members of the inner circle of second-generation post-World War II national security and foreign policymakers, such as Kissinger, Brezezinski, and Richard Allen, all former National Security Advisors. Another is top representatives of the four major constituencies that made up the post-World War II foreign-policy coalition -- the Democratic and Republican parties, labor and business. The third is operatives from the US intelligence and national security community. These intelligence and security operatives include people associated with the CIA and dozens of front organizations or foundations with which it works, as well as operatives from the USIA.

The prominence of the USIA is significant, since this is an agency with a long track record in political and psychological operations. It was created by the Eisenhower administration in 1953 as an agency within the NSC at the recommendation of a top-secret report issued by the President's Committee on International Information Activities. Its explicit purpose was to conduct propaganda, political and psychological operations abroad in conjunction with CIA activities.41 A National Security Action Memo in 1962 stipulated coordination among the USIA, the AID, the CIA, the Pentagon, and the State Department in waging political warfare operations, including civic action, economic and military aid programs.42 Based on research programs it conducts directly or commissions governmental and non-governmental agencies to conduct, the USIA selects propaganda themes, determines target audiences, and develops comprehensive country plans for media manipulation and communications programs. As part of Project Democracy, USIA activities were greatly expanded in the 1980s.43

The APF recommended in 1981 that a presidential commission examine "how the US could promote democracy overseas." The White House approved the recommendation for Project Democracy. At its onset, Project Democracy was attached to the NSC, and supervised by Walter Raymond Jr., a high-ranking CIA propaganda specialist who worked closely with Oliver North, a key player in the Iran-Contra scandal, on covert projects.44 "Overt political action," explained Raymond, could help achieve foreign-policy objectives by providing "support to various institutions [and]... the development of networks and personal relationships with key people."45 Raymond explained that the creation of the NED as a "vehicle for quasi-public/private funds" would fill a "key gap" in US foreign-policy -- it would be a "new art form."46 Raymond and his staff at the NSC worked closely with Democratic Congressman Dante Fascell of Florida. Fascell chaired the House Foreign Affairs Committee which would draft the legislation creating the NED and organized support for the project within Congress.47

In June 1982, in a speech before the British parliament considered the symbolic inauguration of the new policy, Ronald Reagan announced that the United States would pursue a major new program to help "foster the infrastructure of democracy around the world."48 A secret White House memo on the minutes of a Cabinet-level planning meeting to discuss Project Democracy held two months later, in August, set the agenda: "We need to examine how law and Executive Order can be made more liberal to permit covert action on a broader scale, as well as what we can do through substantially increased overt political action."49 Then, in January 1983, Reagan signed National Security Decision Directive 77 (NSDD 77), which laid out a comprehensive framework for employing political operations and psychological warfare in US foreign policy. At least $65 million was allocated by the administration to underwrite the activities and programs contemplated in the NSC directive.50 NSDD 77 focused on three aspects of Project Democracy.51 One aspect was dubbed "public diplomacy" -- psychological operations aimed at winning support for US foreign policy among the US public and the international community -- and involved an expansion of propaganda and informational and psychological operations. The directive defined "public diplomacy" as "those actions of the US Government designed to generate support for our national security objectives." An Office of Public Diplomacy (OPD) operating out of the White House was established.52 The General Accounting Office ruled OPD an illegal domestic propaganda operation in 1988. Another aspect set out in the NSC directive was an expansion of covert operations. This aspect would develop into the clandestine, illegal government operations later exposed in the hearings on the Iran-Contra scandal of the late 1980s. Parallel to "the public arm of Project Democracy, now known as the National Endowment for Democracy," noted the New York Times, "the project's secret arm took an entirely different direction after Lieut.-Col. Oliver I. North, then an obscure National Security Council aide, was appointed to head it."53

The final aspect was the creation of a "quasi-governmental institute." This would engage in "political action strategies" abroad, stated NSDD 77.54 This led to the formal incorporation of the NED by Congress in November 1983. While the CIA and the NSC undertook "covert" operations under Project Democracy, some of which were exposed in the Iran-Contra investigations, the NED and related agencies went on to execute the "overt" side of what the New York Times described as "open and secret parts" of Project Democracy, "born as twins" in 1982 with NSDD 77.55 But while the Iran-Contra covert operations that grew out of Project Democracy were exposed and (assumed to be) terminated, the NED was consolidated and expanded as the decade progressed. With the mechanisms in place by the mid-1980s, the "reassertionists" turned to launching their global "democracy offensive." "The proposed campaign for democracy must be conceived in the broadest terms and must weave together a wide range of superficially disparate aspects of US foreign policy, including the efforts of private groups," noted one Project Democracy consultant. "A democracy campaign should become an increasingly important and highly cost-effective component of ... the defense effort of the United States and its allies."56 The countries in which the NED became most involved in the 1980s and early 1990s were those set as priorities for US foreign-policy. "Such a worldwide effort (a 'crusade for democracy'] directly or indirectly must strive to achieve three goals," one Project Democracy participant explained. "The preservation of democracies from internal subversion by either the Right or the Left; the establishment of new democracies where feasible; and keeping open the democratic alternative for all nondemocracies. To achieve each of these goals we must struggle militarily, economically, politically and ideologically."57

In countries designated as hostile and under Soviet influence, such as Nicaragua and Afghanistan, the United States organized "freedom fighters" (anti-government insurgents) in the framework of low-intensity conflict doctrine, while the NED and related organs introduced complementary political programs. Those countries designated for transition from right-wing military or civilian dictatorships to stable "democratic" governments inside the US orbit, including Chile, Haiti, Paraguay, and the Philippines, received special attention. By the late 1980s and early 1990s ,the NED had also launched campaigns in Cuba, Vietnam, and other countries on the US enemy list, and had also become deeply involved in the self-proclaimed socialist countries, including the Soviet Union itself. While these first programs were tied to the 1980s anti-communist crusade, the NED and other "democracy promotion" agencies made an easy transition to the post-Cold War era. As the rubric of anti-communism and national security became outdated, the rhetoric of "promoting democracy" took on even greater significance. Perestroika and glasnost highlighted authentic democratization as an aspiration of many peoples. But US strategists saw in the collapse of the Soviet system an opportunity to accelerate political intervention under the cover of promoting democracy. In the age of global society, the NED and other "democracy promotion" organs have become sophisticated instruments for penetrating the political systems and civil society in other countries down to the grassroots level.


Structure of the "democracy promotion" apparatus

Constitutive documents describe the NED as an "independent" and "private" organization. "Non-governmental" is its juridical status. In any political or practical sense, such a classification is meaningless; structurally and functionally it operates as a specialized branch of the US government. The NED is wholly funded by Congress with funds channeled through the USIA and the AID, both entities of the Department of State. From its inception in 1983 to its financial year 1992 allocation by Congress, it has received approximately $210 million in monies allocated by Congress.58 According to the NED's public documentation, these allocations account for some 99 percent of its funding. However, it is clear from the study of its operations abroad that NED spending is so interlocked with other direct and indirect, secret and public US government spending, that talk of fixed budgets is not all that meaningful. All NED grants are submitted to the State Department for approval, and US embassies abroad frequently handle logistics for and coordination of NED programs. The State Department and other executive agencies regularly appoint personnel to participate in NED programs.59 The decision to make the NED a quasi-private entity was based on several considerations. First, this would make it easier to insulate its operations from public scrutiny and accountability. For instance, the NED would not be subject to congressional oversight, as is the CIA. Second, a "private" organization would not be subject to the same bureaucratic encumbrances as a formal government agency, and therefore would be afforded greater flexibility in its operations. Third, formally separating the NED from the State Department would eliminate apparent or potential conflicts between government-to-government diplomacy and partisan interference in the political systems of other countries.

The NED operates overtly, at least on paper, as opposed to the CIA's covert activities. Its assistance to groups and individuals in other countries is conducted publicly -- above board -- according to the NED charter. This shift from covert to overt is a product of several practical and ideological concerns held by policymakers. Overt political intervention described as "democratic, nonpartisan assistance" is more difficult to discredit than "CIA bribes," "covert payoffs," or "secret intervention." Similarly, it is easier and more ideologically convincing to sell intervention as "democracy promotion" than as national security, and thus this assists in legitimizing foreign policy. Transferring political intervention from the covert to the overt realm does not change its character, but it does make it easier for policymakers to build domestic and international support for this intervention. It also provides policymakers with greater flexibility and options in pursuing their country-specific objectives. Despite its officially overt character the NED also engages in extensive covert operations. In fact, "overt" appears to be more an aspect of the "democracy" rhetoric than actual NED policy. NED activities are often shrouded in secrecy, and NED officials operate more often in the shadows than in the open, much like an agency dedicated to covert operations. Revealingly, NSC and other governmental documents of the early 1980s spoke almost interchangeably of "political action" and "covert action," and one secret White House planning document on Project Democracy referred to "covert action on a broad scale" to promote public and private "democratic institutions" abroad.60 Clearly those involved in Project Democracy were not yet clear how covert and overt aspects of the new political intervention would be portioned out.

The NED functions through a complex system of intermediaries in which operative aspects, control relationships, and funding trails are nearly impossible to follow and final recipients are difficult to identify. Most monies originating from the NED are first channeled through US organizations which, in turn, pass them on to foreign counterparts, who are themselves often pass-throughs for final recipients. Dozens of US organizations have acted as conduits for NED funds. Financial accounting becomes nearly impossible, facilitating all sorts of secret funding, laundering operations, and book-keeping cover-ups which allow for unscrutinized transactions. Through the multi-tiered structure of go-betweens, it is difficult to establish the links between US government operations on the one hand, and seemingly independent political activities in other countries on the other. In this Alice's Wonderland of political intervention, things are not what they seem, at first blush, to be.

The first tier in this system of intermediaries consists of what are known as the NED core groups. These groups handle the bulk of appropriated NED funds and programs. They are: the National Democratic Institute for International Affairs (NDI) and its counterpart, the National Republican Institute for International Affairs (NRI, whose name was later changed to International Republican Institute, or IRI), which are the "international wings" of the Democratic and Republican parties; the Center for International Private Enterprise (CIPE), a branch of the US Chamber of Commerce; and the Free Trade Union Institute (FTUI), an international branch of the AFL-CIO (the AFL-CIO also operates abroad through three regional organizations, the AALC, for Africa, the AAFLI, for Asia, and the AIFLD, for Latin America). These core groups carry out programs in target countries with those sectors considered strategic pillars of society: labor (FTUI), business (CIPE) and the political parties and organizations (NDI and NRI). A host of other US "private" organizations enmeshed with foreign policy, such as Freedom House, the Council on the Americas, the Center for Democracy, and US universities, foundations, think-tanks, and even the YMCA, handle programs for "civic" sectors. In this structure, the US state foments direct linkages between the organs of US civil society and their counterparts in other countries.

Another characteristic of the NED is its fusion of the public and the private domains in its operations. In "democracy promotion" operations, "congressional testimony, agency budgets, speeches for department heads, planning and programming have been routinely farmed out to private firms rather than done internally by the responsible bureau," candidly explained one Project Democracy counselor. "In some cases, these 'private' agencies are really just fronts for the departments they serve; the agency may prepare a report or a research project that it then gives to the private firm to attach its letterhead to, as if it were really a private activity or initiative."61 The lines of funding in leadership which originate at the highest levels of the formal state apparatus and filter down through public and "private" networks ostensibly unconnected to the government obscures the linkage between many on-the-ground activities in intervened countries and the US state. Although they are projected as non-governmental organizations (NGOs -- or in official AID terminology, private voluntary organizations, or PVOs), the "private" groups which actually manage many "democracy promotion" programs in intervened countries form part of an extended US state apparatus. Obscuring this linkage means that the governmental identity of these groups and the function of their activities in the service of US foreign policy are almost universally unrecognized by US and foreign publics, and may even be unrecognized by other branches of the state apparatus (e.g., members of the US Congress), by many of their own employees, and by governments and publics in intervened countries. (However, the leadership of these quasi-private groups, top-level policymakers and field operatives, quite fully recognize their status as instruments of US foreign policy.) This blurring of "public" and "private" in US foreign policy was exposed in the 1980s during investigations into the Iran-Contra dealings. However, this was mistakenly seen as an aberration limited to that scandal. It is actually a structural feature of foreign policy in the current era. In this process, the US state oversees and guides the application of the overall resources of society to foreign policy objectives. This means tapping the technological, intellectual and organizational expertise of those not formally in the government in which diverse interests are merged and the distinction between state activity and private activity disappears. For instance, US intervention in the Nicaraguan elections involved the coordinated actions of the White House, the National Security Council, the CIA, the Department of State, the Pentagon, the USIA, the AID, Congress, the Democratic and Republican parties, the AFL-CIO, the US Chamber of Commerce, and dozens of "private groups," ranging from Freedom House and the Cuban American National Foundation, to the National Association of Broadcasters and sectors of the US Catholic Bishops Conference (see chapter 5). In theoretical terms, this should be seen as a feature of transnationalization. The US state acts to combine and fuse the actions and resources of elites operating in synchronization in civil and political society, and then project them into a transnational setting, through which cross-national politics are conducted and efforts are undertaken to construct hegemony.

A striking feature of the NED structure is the system of interlocking directorates. The boards of the "core groups" and the host of other "private" groups in US civil society that participate in "democracy promotion" programs, such as Freedom House, the Council on the Americas, and so on, heavily overlap with government and "private" organization officials who promoted Project Democracy and who sit on the NED board itself.62 In turn, this is an exact mirror of the institutional structure of power in the United States, in which the top leadership of the corporate world, government, and civic groups is thoroughly interlocking -- what Dye has analyzed as the "oligarchic model" of power and national policy-making. This oligarchic model has its flip side in the intervened country, where the United States promotes a string of civic, political, labor, and media organizations whose leadership is remarkably interlocking. Through US intervention programs, this leadership is brought together, trained and groomed by the United States in the art of polyarchic political processes, the ideological and other dimensions of consensual domination, and is expected to cohere into a society-wide elite exercising effective institutional power. This elite becomes responsive to the concerns of their US mentors and to the transnational agenda. The goal is to construct a functioning oligarchic model of power and a polyarchic system which links local elites to the transnational elite.

This interlocked core group of political warfare specialists strategizes on and actually conducts these "democracy promotion" projects as agents of the US elite, but does not constitute a unified group in terms of domestic US politics or affiliation. They do not represent any specific sector or ideological strain in mainstream US politics, and include right-wing Republicans and moderate Republicans, liberal Democrats and conservative Democrats and even social democrats, representatives of labor and representatives of business, and so forth. The new political intervention is less a creature of the right-wing Republican presidencies of the 1980s which actually oversaw the shift in policy than of dominant groups in the United States as a whole, and underscores the importance of Project Democracy for the restoration, beyond the specific program of anyone administration, of bipartisanship in foreign policy which had collapsed in the aftermath of the Vietnam and Iran debacles. Behind its mere restoration, those who developed the new political intervention sought the reconstitution of consensus among the major sectors of US society (political parties, government, labor, and business). "One byproduct" of the creation of the NED "may well be the restoration of bipartisanship to its central place in the American foreign-policy-making process," noted the principal Project Democracy report. "Not since the post-World War II consensus broke down during the debates over American involvement in Vietnam has this missing ingredient -- bipartisanship -- been present."63 This bipartisanship represented a consensus among the US elite on the political aspect of the transnational agenda (promotion of polyarchy), reflecting the hegemony that the transnationalized fraction had won.

The NED is only one of several new agencies and programs established to undertake "democracy promotion." The Reagan administration reorganized US foreign aid programs in the 1980s to make them more responsive to the needs of the transnational agenda. This reorganization involved establishing four new "pillars," including "private sector initiatives" and "institution building."64 It led to the establishment by the State Department in 1984 of the Office of Democratic Initiatives (ODI) attached to the AID "to support and strengthen democratic institutions... [in a) capacity complementary to the strengths of other US government and private agencies, and in coordination with them."65 The ODI originally specialized in financing electoral processes abroad and spent over $25 million between 1984 and 1987.66 After 1987, the NED assumed some of these operations. In the division of labor, the NED conducts such overtly political activities as "party-building," whereas the ODI manages government-to-government "democracy enhancement" programs, such as sponsoring judicial system reforms, training legislators of national parliaments, and financing electoral tribunals in intervened countries. In financial year 1990 alone, the AID spent over $93 million through the ODI. 67


Communications are another component in promoting polyarchy. In 1981 the Reagan administration expanded US government capabilities in the area of "international communications." This was described by one NSC member as a "general category ... encompassing international information and international educational and cultural affairs."68 In March 1983, President Reagan signed National Security Decision Directive 130, which stipulated international communications as "an integral part of US national security policy and strategy." The directive called for an expansion of US radio and television broadcasting abroad, the development of a long-term strategy for "communications assistance" to Third World countries, and increased research on foreign public opinion. It also sanctioned an expansion of US military peacetime psychological operations.69 This communications component pursues the informational dimensions and the ideological discourse of the transnational elite agenda via the web of global communications established through the communications revolution.

The NED is thus only one component of "democracy promotion," and often merely an auxiliary instrument of foreign-policy operations. Its magnitude should not be exaggerated since it is quite small (sometimes dwarfed) relative to other organs and does not engage directly in policy formation. However, it undertook the crucial function in the 1980s as the midwife of the new political intervention, bringing together centrifugal forces in a cohesive new policy orientation, and its importance should be seen in how it symbolizes the new intervention and its strategic insertion into broader intervention undertakings. Moreover, it has come to coordinate a good portion of the intellectual thinking and promote the ideological permeation of the new intervention. This involves funding and coordinating academic research and scholarly exchanges around the world, including the sponsorship and dissemination of studies, conferences, and seminars which bring together people involved in NED programs and representatives of elite sectors in Third World countries. It also involves publication of a pseudo-academic journal, the Journal of Democracy (articles are commissioned by the NED staff rather than being submitted, manuscripts are not sent out for peer review and the journal is not attached to any scholarly institution but is run out of the NED's Washington D.C. headquarters by the Endowment staff 70). The NED acts as a clearinghouse for the exchange of ideas and debate among intellectuals and public and private sector officials around the world. Seminars and conferences, ongoing informal gatherings, the production and circulation of books, journals, and bulletins, and so forth, bring these officials together, integrate them into transnational elite circuits, and help them develop ideological affinities and political cohesion. These circuits put elites in the South in touch with one another and also attune them to the ideology, discourse, and program of the transnational elite. While there are other, more important forums for developed core elite cohesion (such as the Trilateral Commission at the informal level and the Group of Seven at the state level), the NED, in tandem with other US programs designed for these purposes (e.g., AID-funded programs of study at elite US universities), plays an important integrative function in transnational class formation, and especially in South-North elite linkage.

The shift in US policy from backing authoritarianism to promoting polyarchy, and the development of new policy instruments and agencies it entails, accelerated dramatically in the 1990s. Total federal government spending through the AID, the Departments of State and Defense, the NED, and the USIA under the rank "assistance for democratic development" increased from $682 million in 1991 to $736 million in 1992 and to $900 million in 1993.71 On assuming office, the Clinton administration defined three overarching priorities in foreign policy: (1) promotion of free trade and international economic integration; (2) preservation and modernization of the US military capacity, and (3) "promotion of defense of democracy and human rights."72 The new administration increased the 1993 NED budget by nearly 40 percent, from $35 to $48 million and proposed an eventual increase to $100 million annually, announced plans to expand USIA media programs and to introduce "democracy promotion" programs in other branches of the federal government, and replaced the ODI with a new division, the Center for Democracy and Governance, to "centralize and globalize all democratization policies and programs," with a budget of $296 million.73 It created several new cabinet and sub-cabinet offices in the Departments of State and Defense dedicated specifically to issues of "democracy promotion" and globalization themes. The administration also created an Inter-Agency Working Group on Democracy in the NSC, the nerve center of the US state apparatus.74 The United States will "take the lead around the world" in the 1990s, declared Assistant Secretary of Defense for Democracy and Peacekeeping, Morton Halperin, not only in assisting, but in "guaranteeing" the results of "free elections" and in defending "constitutional democracies," including through "military action when necessary."75 Along with the development of low-intensity warfare doctrines and unconventional capabilities, the US military theater shifted from Cold War Europe to the Third World, where new military technologies and highly trained special units would be deployed in place of conventional units. Promoting polyarchy had become a long-term and institutionalized aspect of foreign policy, but one which would be synchronized with, rather than replace, US military intervention.
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Re: Promoting Polyarchy: Globalization, U.S. Intervention, a

Postby admin » Mon Apr 11, 2016 6:53 am

Part 3 of 3

Modus operandi of the new political intervention

The modality of "democracy promotion" is a complex transnational political practice. In the typical operation, the State Department, the NED, or some quasi-private agency funded by the US government will commission reports on local conditions in the target country. Often, teams from the NDI, the NRI, professional consulting agencies, or another branch of the "democracy network" will be sent to the country for on-site research, interviews, and meetings with local leaders, "democratic" political parties, civic groups, and government officials. Assessments are made of each sector and its needs -- political parties, trade unions, peasants, youth, women, civic groups, etc. In distinction to the clumsy interventionism of the past, these operations seek flexibility and workable strategies based on a careful analysis of country-specific circumstances and the requirements of developing a polyarchic elite with political action capabilities. The extent to which outside political professionals actually understand the system and the local political figures with whom they deal is often questionable. Outsider accounts are often self-serving and deluded. However, as part of the new techniques, the US teams employ local operatives who can provide a more accurate reading of indigenous conditions. A concrete strategy is drawn up, in synchronization with overall US policy towards the country or region. Later, funding is approved by the NED, the State Department, or other organs, and channels for coordination with the US embassy in the target country are set up. Often a new high-level ambassador is sent in. The core groups and other intermediaries, as well as the recipient groups in the target country, are instructed to draft program proposals and request funding. Then the flow of money and operatives begins. Once the "democracy program" is fully underway, the movement of funds and personnel between Washington and the target country becomes ubiquitous. The case studies confirm this pattern.

Organizing and advising mass political parties ("party-building") is a central component of these programs. The task is usually assigned to political professionals commissioned by the NDI or the NRI. The emphasis is on training leaders, setting up party structures, and devising political and electoral strategies honed to the particular conditions of each intervened country.76 "Building social and economic institutions without building political parties is like building an automatic factory but omitting the computer," according to Douglas. "Building mass movements requires trained leaders, skilled organizers, and comprehensive thinkers. Such persons are in short supply [in developing nations] ... Even if fitting programs can be devised, the political skills needed to build mass organizations are lacking. Modern political skills obviously cannot be learned in traditional societies, and therefore will be absent unless taught from outside."77 More to the point theoretically, political parties provide mediating links between the state and civil society and reconcile and aggregate the different interests of dominant class fractions, articulate cross-class aspirations, and incorporate subordinate class demands into larger hegemonic projects. "Precisely because [dominant elites] are not solid, congealed economic and social blocs, they require political formations which reconcile, coordinate and fuse their interests, and which express their common purposes as well as their separate interests," notes Ralph Miliband. "These purposes and interests also require ideological clothing suitable for political competition," clothing which modern political parties are ideally suited to provide.78 Parties thus create what Talcott Parsons called a "national supra party consensus" based on "higher order solidarity [read: hegemony]."79 A polyarchic political system, by its nature, requires a functioning political party system. The construction of such a system, or its penetration and transformation where parties already exist, is generally a top priority of political intervention programs.

Labor is another strategic sector because of its economic importance and because of its real and potential political influence.80 Programs focus on promoting moderate and compliant trade unionism and on assisting allied unions to develop political action capacities in competition with more militant tendencies among workers. Major goals are to control potential worker unrest in response to economic restructuring and to cultivate a trade union movement receptive to US penetration and the activity of transnational capital. Moreover, trade unions are springboards for penetrating wider political sectors. Often, unions are key access points to political parties and social groups and function as "agents of influence" within national labor organizations. "Governments and political parties have used the international labor movement as one of the principal vehicles for their covert interactions with political parties and governments in foreign nations," noted one former AFL-CIO official. "The international trade union movement has been, and continues to be, a vital tool of governments in shaping the political destinies of foreign political parties and states and is an important part of most nations' foreign-policy systems."81 In their trade union operations, US officials employ a double standard. In those countries where "democracy promotion" programs are designed to stabilize pro-United States regimes, the United States encourages allied unions to practice an apolitical "business" unionism focusing on bread-and-butter issues at the level of individual employers, and to recognize the overall legitimacy of the social order. But in countries targeted for destabilization, such as Nicaragua, Poland, and Panama in the 1980s, allied unions were encouraged to mount explicitly political actions, and to mount them against governments, not business management.

In addition, most "democracy promotion" programs involve penetration of the target country's media, the nurturing of women's and youth movements, and, in agrarian countries, peasant organizations.82 Each of these sectors, for one or another reason, has been identified by US specialists as exhibiting specific sectoral characteristics and social linkages that require addressing individually within overall interventionist projects. A 1986 CIA report, for instance, noted that the "youth factor" in the Third World is crucial because young people tend to be "receptive to recruitment by extremist politicians." Another specialist argued: "The youth of a growing population may very well play a major role in pressing for change. They are among those who are actually disproportionately disadvantaged; they have less at stake in the existing structure of authority, more idealism, more impatience."83 And programs targeting the business sector are usually designed to disseminate free-market values and the ideology of neo-liberalism, in synchronization with restructuring. Moreover, these programs seek to assist the technocratic "New Right" business community in intervened countries to become politicized and develop the skills necessary to participate in internal political processes (to develop what is referred to as a "political action capability"), to develop private sector policies, and to have these policies incorporated into government policy.

There is a strong reciprocity between economic globalization pressures and the activities of transnational capital, and the particular character of "democracy promotion" programs that political operations specialists will mount in each of these target sectors. For instance, just as transnational capital has proved deft at appropriating local, often pre-capitalist patriarchal social relations and cultural patterns into its economic activity, "democracy promotion" programs which target women in intervened countries also appropriate and utilize for the purposes of social control existing gender relations. There has been a proliferation of research into the new sexual division of labor being brought about in many countries by the disruption of traditional "female" activities through capitalist penetration and globalization, and the subordinate incorporation of women into new activities linked to the global economy, such as assembly work in maquilladora export zones and farm labor in agri-business enterprises.84 "Democracy promotion" programs targeting women, in turn, attempt to channel and control the diverse forms of political and cultural mobilization that women in the Third World have undertaken, at the level of feminist organizations, trade unions, political parties, and other multi-sectoral organizations. The US effort is not to thwart women's mobilization per se, but to counter the popular content of national feminist projects and to bring them under the hegemony of women from the elite and of female representatives of transnational pools in intervened countries. In a similar manner, programs targetting labor will give special emphasis to workers in internationalized manufacturing zones, and programs targeting peasants will concentrate on the agro-export sector.

Media programs are also of special importance. Two Project Democracy consultants noted: "The inventory of US work abroad with the various sectors of democratic pluralist societies reveals that the biggest gap is in party-building and the next obvious lack of effort is in working with news media."85 The communications revolution reached nearly all parts of the Third World in the 1980s, and has turned radio, television, and print media into crucial instruments for penetrating the "political animal" of a nation. The communications revolution has provided new means of informing and manipulating public opinion, educating a mass public, influencing the culture of a general population and providing various demonstration effects. It thus makes a major contribution to the shifts in power and social relations in an intervened country, to the relationships between leaders and masses, and between parties and social groups, and to the political behaviour in general of the population. In almost every political intervention project, the media has become a key target of US operations. The objective is to place a polyarchic elite cultivated by the United States into a position where it is able to utilize the communications networks so as to exercise its influence and achieve its hegemony over the internal political system.

Such sectorial specialization in political intervention is designed to lead to the creation of a society-wide network of political, social, cultural, business, and civic organizations in the target country - as the counterpart in civil society to elite power in political society - dependent on and responsive to US direction, or at least sympathetic to the concerns of the transnational agenda. The goal is to establish and consolidate the polyarchic model of power in the intervened society, predicated on the view that direct power is deposited in institutions and exercised by those who wield influence in, or control, governmental, political, labor, social, and civic institutions. The aim is to construct in intervened countries an exact replica of the structure of power in the United States. This is done by strengthening existing political parties and other organizations identified as congenial to US interests, or by creating from scratch new organizations where ones do not already exist. With few exceptions, the leaders of these organizations are drawn from the local elite and their efforts are aimed at competing with, or eclipsing, existing broad-based popular organizations and neutralizing efforts by popular sectors to build their own organizations in civil society, as we shall see in detail in the case studies.

At the same time, the shift from promoting authoritarianism to promoting polyarchy often involves a change in Washington's previous political alignments. Promoting authoritarianism usually meant supporting the right; promoting polyarchy often means supporting the center to center-right, or sometimes even the center-left. The strategists of the new political intervention emphasize developing a flexible political center. The recipients of US support are more progressive and enlightened in the target country's political landscape than the earlier autocrats, and may include Christian Democrats, Social Democrats, and even self-proclaimed Socialists. For instance, in Nicaragua's 1990 elections, Washington betrayed the most right-wing elements of the anti-Sandinista opposition, to which it had earlier given steadfast support, and backed the more moderate candidates. In Cuba, as NED style "democracy promotion" programs got underway in the early 1990s, US backing for the most rabidly right-wing and extremist opponents of the revolutionary government began to wain and support began to shift to more moderate and centrist elements of the Cuban internal and exile forces. For many years these elements had opposed the extremism of the far-right and had advocated - despite US opposition - a more sophisticated strategy for undermining the revolution, not through crude destabilization but by more subtle political, diplomatic, and ideological means. In Chile, given the circumstances in the late 1980s of a right-wing dictatorship and an opposition polarized between centrist and leftist camps, the United States opted to promote a center-left alliance under the hegemony of moderate centrists. In South Africa, Washington chose to support both the militant African National Congress and the conservative Inkatha movement.86

"Party-building" and other activities for grooming an elite and for organizing the population of a target country into the society-wide networks employ multi-tiered structures and a "multiplier" system of training and control.87 Top leaders are recruited, trained, advised, and funded by US political professionals (or, as is sometimes the case, by third country activists indigenous to the region who are sent in by US mentors). A pyramid structure is established, in which these top leaders set up offices and a staff with US funds. In turn, the national staff supervise regional offices and staff, which supervise provincial and local leaders the next level down. And so on. In this way, US political operatives, working with the top leadership in the intervened country, are able to foment and control a vertically organized nationwide structure for political intervention. US influence and lines of patronage gradually ripple out through foreign parties, trade unions, and civic groups.

The actual content of programs ranged from education and training to institution-building, social projects, information dissemination and visitor exchanges, and political action. These activities are monitored by ubiquitous US advisors and supervised by US embassy personnel, in close coordination with other aspects of US policy towards the target country, including the judicious use of aid programs, formal diplomacy, military exchanges, "civic action," and so on. These activities groom leaders and supply them with financial and material resources. They are also designed to build up patronage networks around local leaders and institutions. Such programs transmit a generally positive view of US foreign policy, of the world order the United States is promoting, and through such images they shape the general attitude of members of parties, civic organizations, and trade unions towards politics and economics. The FIUI's former director Eugenia Kemble was quite candid in this respect: "The basic point [of US support for foreign unions] is to build interest groups capable of shaping public policy in other countries."88 Apart from imparting actual skills and material resources for political action, the provision of money itself, in the form of salaries and stipends, provides opportunities for personal income and status unlikely to exist in the target countries. Eventually, the leaders and organizations cultivated by the United States become effective transmission belts for US and transnational interests.

According to former Secretary of State George Shultz, a participant in Project Democracy, the actual content of "democracy promotion" activities involves five closely related and often overlapping areas: 89

(1) "Leadership training." This involves a wide range of activities to select, groom, and train a broad-based polyarchic leadership in the target country, ranging from in-country party-building seminars to scholarships for special training programs at US universities.

(2) "Education." This means inculcating "the principles and practice of democracy [read: polyarchy] and ... the character and values of the United States in the educational systems of other nations." It also involves penetrating the educational and mass media systems in the intervened country.

(3) "Strengthening the institutions of democracy." This is the core category, and involves organizing, funding, and advising parties, unions, the media, business, and civic groups in intervened countries. "Here again, we will rely on American nongovernmental organizations to carry most of the load."

(4) "Conveying ideas and information." This involves the creation of ideological spaces and assistance programs intended to develop the work of organic intellectuals within intervened countries. It has two aspects. One is organizing activities such as publications and forums whose target audience is the elite. The purpose is to facilitate elite cohesion around the broad contours of the transnational agenda but attuned to the specific conditions and requirements of legitimacy in the intervened country. The other is programs aimed at establishing the ideological hegemony of that agenda among the popular classes of the intervened country, including the dissemination of ideas through the media, the educational system, and public cultural activities.

(5) "Development of personal and institutional ties." "Perhaps the most important results of all our programs will be the development of lasting ties and working relationships between American individuals and organizations and their foreign counterparts." In the broadest sense, this refers to the transnationalization of political structures and civil society, in which local and transnational elites merge their activities in a cross-national setting.

All of these programs areas target two dimensions simultaneously: intra-elite relations, and relations between dominant and subordinate groups. Diverse intellectual and cultural exchanges and the types of linkage that develop among different dominant class fractions and elite clusters are critical components of Gramscian consensus-building processes among elites in intervened countries, and are at the same time important mechanisms for constructing elite hegemony, as we shall see.

The role of electoral processes and electoral assistance

Gershman has categorized US political intervention programs into those aimed at securing a "democratic transition," that is a change of regime, and those aimed at "long-term democratic political development." 90 The latter category signifies programs to consolidate polyarchic political systems (and US influence) in societies already considered "democratic" by bolstering elite forces in political and civil society, and by inculcating what the theoreticians of the new political intervention consider to be the "political culture" of polyarchy.

The first of Gershman's categories, "transitions," usually hinges on interference in foreign electoral processes, or electoral intervention. Since a transfer of formal state power is at stake in elections, electoral intervention is a pivotal component of the new political intervention. US policymakers identify two types of transitions: from "authoritarian," or right-wing dictatorships, to elitist civilian regimes; and from left-wing, popular, or nationalist regimes considered adversaries, to elitist regimes allied with the United States. Chile and the Philippines were of the first type, Nicaragua of the second. Haiti fell under the first in the effort to remove the Duvalier dictatorship, and then shifted to the second type after Father Jean-Bertrand Aristide won the presidency in 1990. Interference in the electoral processes of other countries is not a new feature of the foreign policy of the United States or other core powers. The United States since World War II has intervened in elections in dozens of countries around the world, from Italy and Greece, to the Congo, Vietnam, Guatemala, Chile, and Jamaica, in support of US foreign-policy goals in the target countries or regions.91

The United States, in conjunction with local allies, has grown adroit in staging "demonstration elections," as a mechanism for installing groups Washington deems favorable to its interests, or legitimizing internal social orders and US policies through a "free" vote.92 This was the case in Vietnam in the 1960s and El Salvador in the 1980s, among other instances. The flip side has been intervention in elections to prevent "adverse" groups from coming to power through the vote. Thus the CIA gave clandestine funding to centrist parties in the Italian elections of 1948, and in the same period it began working to destroy the political left in Greece. When "adversaries" did come to power through elections despite US efforts, then the United States turned to withdrawal of support and clandestine destabilization campaigns to remove constitutionally elected governments, as in Guatemala and Chile in 1954 and 1973, respectively, or through outright invasions, as in the Dominican Republic in 1965.

However, the new electoral intervention is more sophisticated. In the post-Cold War reconstruction of world order, the role of the electoral processes in US foreign policy has changed. The process tends to be less a crude product exported from Washington than a careful blend of indigenous political factors with US policies. Washington became encouraged by the prospects for such a convergence after repressive military regimes in several Latin American countries (Argentina, Uruguay, and Brazil) turned over power to elected civilian governments. The key distinction between the so-called "transitions to democracy" in these Southern Cone countries, and the US-promoted regime changes later in the decade (Philippines, Chile, Panama, Paraguay, etc.) is that in the former US intervention was marginal or even extraneous to endogenous processes, whereas in the latter endogenous developments deeply intersected, or were actually transformed, by external intervention. In such electoral processes, as in the Philippines and Chile, sectors of the local elite joined forces with the United States as a mechanism for transition from military dictatorships to more stable polyarchies.

These became controlled transitions, managed jointly by local elites and US operatives. The key analytical variable in these cases is how endogenous processes and external intervention become interwoven in highly complex situations which do not lend themselves to simplification or predetermined outcomes. There is not a crude US imposition of elections. Rather, in interacting with indigenous political processes, the United States penetrates foreign electoral processes in operations that are many times more elaborate and extensive than before. Electoralism in the new political intervention is thus more than mere public relations. Formal electoral processes become what William Douglas referred to as a "transplanting mechanism": they allow for transplanting viable polyarchic political systems into intervened societies, that is, stable, electorally legitimized institutions that at least resemble US or Western analogies, which are apparently national but are pliable to US and transnational direction and control. In the US construct, these should be the characteristics that define (and circumscribe) all, or almost all, the competing groups in a pluralist political system. Moreover, controlled electoral processes provide the United States with the opportunity to permeate the institutions of civil society and the political structures of the target country, and to try, from that vantage point, to bring about long-term stability around free-market economies and social orders tied to transnational interests.

To undertake this new form of electoral intervention, the United States has created an elaborate machinery for "electoral assistance": "get out the vote" drives, ballot box watching, poll taking, parallel vote counts, civic training, and so on. In this new elections industry, the United States despatches specialized teams to carry out everything from "party-building seminars" to "civic training" and "international monitoring," and employs the tools of mass psychological manipulation and the new means of communications developed over the past fifty years. In these undertakings, the US teams attempt to shape and manage (and, under certain circumstances, to hijack) indigenous political processes and to latch them on to transnational political processes. The substitution of the NED for the CIA and the introduction of overt "political aid" has helped Washington to legitimize electoral assistance. Said one Project Democracy counselor:

In most countries, foreign financing of campaign activities is viewed as an extreme form of interference in internal affairs. Neither the donors nor the recipient groups want the existence of the funding known. Typically, the funds flow through the intelligence agencies of foreign governments ... Ironically, it is often more politically effective to provide the money openly. The most obvious advantage to overt transactions is that if one is not hiding anything, one is not subject to exposure ... [p]rocedural secrecy [should be) maintained only to protect recipients working clandestinely.93


Despite all the rhetoric on "electoral democracy" and emphasis on "free and fair elections," the United States is only concerned with assuring procedurally clean elections when the circumstances or results favor US interests. In official rhetoric, the United States holds that a country is a democracy when it has a government that comes to power through reasonably free and fair elections, and that a process of democratization in a country is synonymous with organizing a national electoral process. But this rhetoric is easily cast aside. For instance, in Nicaragua, the Sandinista government won, hands down, the 1984 elections, which were judged by the international community to be free and fair yet the United States continued to claim that the Sandinista government was undemocratic and pressed ahead with its war against Nicaragua. Similarly, when United States-backed candidates lost hands down in free and fair elections in Angola in 1992, Washington refused to recognize the winning Popular Movement for the Liberation of Angola, which had been the target of US destabilization campaigns since the mid-1970s, and instead pressed the electoral victors to negotiate "power sharing" with the losers and to convene a new vote.94 On the other hand, governments came to power in Latin America and elsewhere in the 1980s and 1990s through elections that were marred by fraud, such as the 1984 elections in Panama, the 1988 and other elections in Mexico, numerous elections in El Salvador, and the 1994 elections in the Dominican Republic. Yet the United States recognized these governments as "democratic." The United States thus held a country to be democratic either when US allies came to power through reasonably free and fair elections, or when US allies came to power in elections which were not free and fair, but which nonetheless required recognition because of broader policy concerns.

In sum, US policymakers claim that they are interested in process (free and fair elections) and not outcome (the results of these elections); in reality, the principal concern is outcome. The objective of political intervention is not to organize or impose free and fair elections on a nation (in which the left, or traditional autocrats, might win) but rather, to organize an elite and to impose it on the intervened country through controlled electoral processes. The mistake in merely promoting free and fair elections regardless of the outcome, pointed out former CIA Director William E. Colby, a strong advocate of the new intervention, is:

It assumes that, if the revolutionary forces were to join the elections and win them, the outcome would be quite satisfactory. It also ignores the prospect that the most oligarchic and brutal forces may win elections, even free ones. The first outcome gives power to those hostile to the United States. The second ensures repudiation by American public opinion. The United States must have a better choice than a brutal dictator or a hostile terrorist. The missing dimension must be vigorous support of decent, responsible, centrist leadership and political forces in these countries ... rather than pretending neutrality among the potential winners of free elections.95


Electoral intervention as one component of "democracy promotion," and "democracy promotion" as one component of overall foreign policy

To recapitulate: exercising influence, and even gaining control, over foreign electoral processes is an increasingly important component of the new political intervention, although the objectives might vary from changing a regime considered undesirable ("electoral coups" or electoral destabilization), to installing a regime considered more favorable or stable, to simply heightening the presence and strength of transnational pools and other allied constituencies in political and civil society. However, the new intervention is not limited to electoral involvement, and takes place before, after, and often irrespective of, elections. This intervention functions in coordination with overall US policy, and that NED activity is coordinated with the full panoply of US policy instruments. Specific foreign-policy operations can only be understood in the context of US policy as it has evolved towards specific countries and regions over a period of years and decades. In other words, electoral intervention is only one component of the new political intervention, and "democracy promotion" is only one component of overall, multidimensional US foreign-policy undertakings.

A caveat must be stressed. US preference for polyarchy is a general guideline of post-Cold War foreign policy and not a universal prescription. Policymakers often assess that authoritarian arrangements are best left in place in instances where the establishment of polyarchic systems is an unrealistic, high-risk, or unnecessary undertaking. "Authoritarian regimes are not all the same," noted Howard Wiarda. "Some are of such overwhelming strategic importance (for example, Saudi Arabia) that we are probably best advised not to tamper with their internal political structure."% Washington continues tacitly to support authoritarian regimes even when they remain in power by obstructing electoral processes or breaking with polyarchic procedure, if a withdrawal of support is seen as running too much of a risk by opening space for popular or other forces opposed to the transnational agenda or generating unmanageable instability. This was the case, for instance, with continued tacit US support for authoritarian regimes in Kenya and Algeria following fraudulent elections in 1992, Nigeria in 1993, and several Middle Eastern and Asian countries in the early 1990s. As a general rule, authoritarian regimes are supported until or unless a polyarchic alternative is viable and in place. This makes perfect sense, once it is understood that the US objective is to promote polyarchy and oppose authoritarianism only when doing so does not unacceptably jeopardize elite rule itself.

The case studies to follow all show how the typology of the new political intervention laid out in this chapter is actually operationalized. In both the Philippines and Chile, the goal was to remove US allies, brought to or maintained in power by earlier US interventions, whose continuation in office no longer served US or transnational interests. The US effort in these two countries intersected with indigenous and broadly based movements against dictatorial governments. In Nicaragua, the goal was to remove a designated enemy, the Sandinista government, and restore elite rule. In Haiti, as in the Philippines and Chile, a dictator supported for decades by the United States had generated a mass popular ferment and therefore came to represent a threat to US interests. In distinction, however, the United States was unable to control a transition in Haiti despite massive political intervention. Haiti was thus a unique case where the United States succeeded in imposing the process, but lost control over the outcome. In the former Soviet bloc, the objective was not specifically to bring about the demise of communist regimes (that was a goal actively pursued on all fronts since 1917). Rather, it was to accelerate that demise and, more significantly, to assure, in elections and in subsequent programs, that those forces most closely identified with the interests of the transnational elite came to power in place of discredited communist parties, or that those forces, at the minimum, spread their influence and positioned themselves strategically in the emerging societies of the former Soviet bloc. In South Africa, the goal was to bring under control and maintain within limits the struggle against apartheid so as to prevent a popular outcome, substituting, in effect, white minority rule by inter-racial polyarchic minority rule.

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Fig. 1. Conceptual-methodological model of the promotion of polyarchy in U.S. foreign policy. (Note: Social forces and class struggle are fields that imbue and undergird all levels of the model.)

Case study selection was based on several considerations. First, the four countries underwent high-profile "transitions" in which the United States was heavily involved. They thus provide a wealth of empirical data in which to examine the new policy of the promotion of polyarchy. Second, the "transitions" in all four were touted by policymakers, and praised by journalists, supportive scholars, and public commentators, as "success stories" in which the United States broke sharply with earlier support for authoritarianism and dictatorship and contributed in a positive way to "democracy," and therefore as "models" for future US interventions of this type. Third, as becomes clear in the narrative, the temporal dimensions of these four cases paint a cogent portrait of how the new political intervention and its instruments emerged in the early 1980sand had become consolidated by the early 1990s.The Philippines was the first high-profile "success story." Chile was the second, and so on. It becomes clear that in each subsequent case, policymakers incorporated the lessons from, and modified techniques developed in, the preceding cases. Fourth, these four cases provide sufficient diversity with which to draw some comparative conclusions whose generalizability is strengthened by the examinations of the former Soviet bloc and South Africa. In the Philippines and Chile, the "transitions" were from right-wing dictatorships to elite civilian regimes. In Nicaragua, it was from a revolutionary left-wing regime to a conservative elite regime. In Haiti, it was a combination of both within a brief six-year period. "Democracy promotion" programs unfolded in these four countries in the context of overall US policy which differed sharply in each country. For example, intervention in Nicaragua combined counterrevolutionary military actions with political actions. In the Philippines it combined counterinsurgency military actions with political actions. In Chile the "transition" involved heavy doses of coercive diplomacy but not US military operations, and in Haiti it involved all aspects, culminating in a full-scale US invasion and occupation. Since the circumstances in each country and of US intervention in each were quite distinct, a comparative summation of these cases allows us to identify general patterns and tendencies not particular to the specific national circumstances of intervened countries. The combination of this particular set of case studies, combined with the two briefer studies, provides a comparative perspective with which to critique implicit and explicit assumptions regarding "democracy promotion." Among other things, a comparative perspective reveals not a sharp discontinuity in US policy towards these countries but a remarkable historical continuity in underlying policy along with modifications in accordance with changing circumstances.
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Re: Promoting Polyarchy: Globalization, U.S. Intervention, a

Postby admin » Mon Apr 11, 2016 7:09 am

Part 1 of 2

Chapter 3: The Philippines: "Molded in the image of American democracy"

I walked the floor of the White House night after night until midnight; and I am not ashamed to tell you, gentlemen, that I went down on my knees and prayed Almighty God for light and guidance more than one night. And one night late it came to me this way - I don't know how it was, but it came: (1) that we could not give them back to Spain - that would be cowardly and dishonorable; (2) that we could not turn them over to France and Germany - our commercial rivals in the Orient - that would be bad business and discreditable; (3) that we could not leave them to themselves - they were unfit for self-government - and they would soon have anarchy and misrule over there worse than Spain's was; and (4) that there was nothing left for us to do but to take them all, and to educate the Filipinos, and uplift and civilize and Christianize them, and by God's grace, do the very best we could by them, as our fellow-men for whom Christ also died.

-- William McKinley, President of the United States, 1899 [1]


From a colony to a dependent nation in the periphery of the world system

It was with great irony that Ronald Reagan, after making his famed June 1982 speech before the British parliament at Westminster on a "worldwide campaign for democracy," traveled on to the Philippine capital of Manila, where he announced in a public homage to the dictator, Ferdinand Marcos, that "the Philippines has been molded in the image of American democracy."2

The US conquest of the Philippines, an aftermath of the 1898 Spanish-American War, took place at a moment when the United States was emerging as a modem imperial power. The United States, driven by Manifest Destiny, spent much of the nineteenth century in western territorial acquisition, involving the annexation of one-half of Mexico and the systematic extermination of the indigenous populations of North America. In 1892, the Census Bureau declared the "Indian wars" over. The severe economic depression that began in 1893 convinced US rulers that the problem which they had identified as overproduction at home could only be resolved with the conquest of markets overseas, to be opened by military force. The passage to empire required promoting political stability and a military presence in those areas where the United States had established commercial interests. With attention turned from westward expansion to overseas intervention, the possessions of a feeble and declining rival, Spain, became the most suitable new acquisitions. Spain's remaining colonial possessions in Latin America, Cuba and Puerto Rico, became important platforms for expansion in the Western Hemisphere, the US traditional "sphere of influence." On the other hand, the conquest of the Philippines established the United States as an Asian power for the first time. The Philippines became the springboard for expansion throughout Asia via the Pacific, and particularly, to the vast and lucrative Chinese market.

After enduring 300 years of Spanish colonialism, Filipino nationalists were at the point of defeating Spanish forces and had already proclaimed their own sovereign republic when the US navy, as part of the 1898 Spanish-American War, defeated Spain's flotilla in Manila harbor. The US forces then proceeded to turn their guns on the Filipino nationalists, with the objective of transferring the country from Spanish to US colonial control. The ensuing war of conquest, from 1899 to 1902, known as the Philippine-American War, was a protracted and bloody exercise in colonial conquest involving over 70,000 US troops.3 "It may be necessary to kill half of the Filipinos in order that the remaining half of the population may be advanced to a higher plane of life than their present semi-barbarous state affords," explained one US commanding officer, General Shafter.4 In the end, up to one million Filipinos lost their lives.

The conquest and subsequent colonization established a pattern of US intervention in the country's affairs. The US colonial administration cultivated an upper-class elite of wealthy landowners, exporters, administrators, and later, commercial and industrial groups - the same elite, known as the ilusfrados, that had been the junior partners of the Spanish colonialists in an earlier era. This Filipino oligarchy readily collaborated with the Japanese occupation force during World War II, and were then restored to power by the United States following liberation. Brought up under colonial tutelage, this elite was handed the reins of power in 1946, when the US conferred formal independence on the Philippines and the country moved from a colony to a neo-colony.

Over the following decades, a series of elite civilian regimes ruled the Philippines through a vice-ridden political culture of corrupt party machines, back-room deals and competition over the economic largesse that came with political office. Elections were held on a regular basis, checkered by routine vote-buying, fraud, and violence by the private armies of the elite. The fragile post-colonial political system rested on enough of an inter-elite consensus for functional civic competition between ruling groups and effective control over the popular sectors - a protopolyarchic political system which was ill-equipped to deal with the pressures of the early neo-colonial period. Contending elite factions from the two major parties, indistinguishable in terms of ideology, the Nacionalista and the Liberal, rotated in and out of office. "The firmly established two party system is a strong asset," noted with satisfaction one CIA report in 1965. "The similarity of the parties, while depriving the voter of clear choices between programs, nevertheless encourages moderation, readiness to compromise, and lack of dogmatism in the political elite." [5]

The basis of a tenuous Philippine stability during the 1950s and 1960swas the alliance between this elite and the United States, which exercised external domination through a myriad of informal mechanisms, ranging from military aid and counterinsurgency programs to economic aid programs, covert CIA operations, and outright political imposition. The Philippines became a key client regime in the post- World War II US empire. Washington set up the Clark Air Base and the Subtic Naval Base, which became the largest US military facilities outside the US mainland, and were key staging points for US military interventions in the Pacific. The Pentagon also created, supplied, and trained the Philippine military as a repressive guarantor of "internal security," under the direct supervision of a permanent US military advisor group. The US military advisors and the CIA designed and led the bloody suppression of the nationalist Hukbalahap (or "Huk") uprising in the 1950s.6

Notwithstanding Cold War ideological musings, the real threat to US and elite interests in the Philippines in this period was not external aggression but the demands of the impoverished Filipino masses for social change and democratization of Filipino society, as one secret 1950NSC assessment openly acknowledged:

External threats to the Philippines appear to be relatively remote ... a sound Philippine military policy justifies maximum emphasis on effective forces required for internal security and, under existing conditions, minimum expenditure for defense against external invaders ... The United States has as its objectives in the Philippines the establishment and maintenance of: a) An effective government which will preserve and strengthen the pro-US orientation of its people. b) A Philippine military capability [sic) of restoring and maintaining internal security. c) A stable and self-supporting economy. [7]


Meanwhile, the Philippines became an appendage of the US economy under trade agreements and economic aid programs imposed by Washington. The United States demanded, and was granted, trade treaties providing it with "equal access" with Filipinos to Philippine natural resources and utilities, and "parity," or unrestricted entry to Filipino markets. In accepting US aid packages, explained Secretary of State Dean Acheson, the Philippines "will accept American advisers throughout their Government. We will come up to Congress with an aid program, which will be modest in dimensions but which lays the foundation for American technicians and American advisers all through their Government."8 Military and economic aid were thus used quite effectively, and they remained key elements of US policy in the 1980s and 1990s. Political aid was still handled by the CIA, which conducted widespread covert operations, among them, stage-managed elections to assure the preferred US outcome, payoffs to government officials, financing for favored business and civic groups, pro-US propaganda campaigns among the population, the supply of intelligence on dissidents to the Filipino security forces, and so on.9

As United States and other foreign investment poured in, the economy grew to the benefit of US capital and the Philippine elite simultaneously with the increasing impoverishment of the majority and deep social polarization. In 1974, the International Labor Organization reported that the country's development model "nurtures and sustains trends in the structure of earnings that result in steadily increasing inequality [and] cannot expect to continue for very 10ng."10 By the early 1970s a popular movement was snowballing, based in trade unions, peasant groups, students, grassroots neighborhood organizations in the cities, and the clergy. Nationalism and radicalism spread throughout the country. The desperate social and economic conditions also spawned a growing insurgency, led by the New People's Army (NPA), the military arm of the Communist Party of the Philippines. Repression, mass jailings, systematic human rights violations, street conflict and rural insurgency became the order of the day. Ferdinand Marcos, who had assumed the presidency in 1965 in questionable elections and was then "reelected" in 1969, declared martial law in September 1972. Although martial law was also a means for Marcos to perpetuate his personal hold on power (new elections were scheduled for 1973), it was foremost a means for the Philippine elite and the United States to face the crisis-level challenge of a popular rebellion against the status quo.

Shortly before he imposed martial law, Marcos met secretly with US Ambassador Henry Byroade to seek endorsement of "stronger measures" to deal with the unrest sweeping the country. Byroade delivered to Marcos a confidential State Department message promising US support.11 A 1972 US Senate report on the declaration of martial law noted that the United States was "altogether uncritical of what occurred in the Philippines." It continued:

We found few, if any, Americans who took the position that the demise of individual rights and democratic institutions would adversely affect U.S. interests. In the first place, these democratic institutions were considered to be severely deficient. In the second place, whatever U.S. interests were - or are - they apparently are not thought to be related to the preservation of the democratic process... U.S. officials appear prepared to accept that the strengthening of presidential authority will... enable President Marcos to introduce needed stability; that these objectives are in our interests; and that military bases and a familiar government in the Philippines are more important than the preservation of democratic institutions, [12]


The report went on to note that Marcos was drafting a new constitution which Washington considered to be highly favorable to foreign investors, and that US business welcomed martial law prohibitions on strikes and lockouts, the lifting of work restrictions on Sundays and holidays, and other presidential decrees favorable to foreign capital. At the time, Business International reported that "the overwhelming consensus of the foreign business community in the Philippines was that martial rule under President Marcos was the best thing that ever happened to the country."13

As the tenuous post-colonial order thus crumbled, the United States sustained its support for Marcos and authoritarianism as the preferred instrument of social control. As with such strongman and dictatorial regimes in other countries, the US relationship with Marcos was a two-way street. Marcos proved adept at manipulating Washington for his own ends as much as Washington utilized the dictatorship as an instrument in its policy (just as the Philippine elite utilized the dictatorship to preserve its interests and in turn granted special privilege and authority to the dictator's inner circle). But the two found a symbiotic meeting place in the preservation of the social order. Although President Jimmy Carter had declared human rights the centerpiece of his foreign policy, his administration provided the Marcos regime with nearly half a billion dollars in economic and military aid, and when Marcos lifted martial law Carter advised the Philippine opposition to accept Marcos's action as a "generous offer" and to forswear violence. 14 The incoming Reagan administration applied the same kind of "quiet diplomacy" it had developed towards the Latin American Southern Cone dictatorships to the Philippines, expanding support for the Marcos regime. President-elect Ronald Reagan personally received Marcos's wife, Imelda, on the eve of his inauguration, and advised against a too-hasty lifting of martial law. Six months later, in August 1981, Vice-President George Bush raised a toast to Marcos during his visit to Manila, declaring "We love your adherence to democratic principle and to the democratic process." [15]

Nonetheless, enthusiasm among the Philippine elite and the United States for the crackdown gradually tapered, as Marcos converted his rule into the most vulgar form of "crony capitalism," similar to that of the Somozas in Nicaragua or the Duvaliers in Haiti. Corruption and the spoils of state, which in an earlier period had been "equitably" distributed among the upper and middle classes through the competition of different factions and rotation in office, now became monopolized by Marcos and his own family and clique. Beyond being a political liability, "crony capitalism," by disturbing free markets, eventually became a hindrance to transnational capital and neo-liberal restructuring in the Philippines as the global economy emerged. Far from resolving the crisis of elite rule, authoritarian political structures ended up rupturing minimal inter-elite consensus and accommodation necessary for stability. Meanwhile, the crackdown, rather than suppressing the popular movement, gave further impetus to it. The NPA, a minor force in 1972, grew rapidly after the imposition of martial law. The National Democratic Front, formed in April 1973, brought together the Communist Party, the urban poor, radical youth, and clergy influenced by liberation theology. By the early 1980s, observers began to speak of the coming Philippine revolution.

A key turning point came in August 1983 with the assassination by Marcos henchmen of the most prominent leader of the elite opposition, former senator Benigno Aquino Jr. For over a decade, the poor and the popular sectors had been fighting the dictatorship. Now, the Aquino murder had galvanized the non-Marcos elite - the business community, the Catholic Church hierarchy, the politicians, and the middle classes - into active opposition. By rendering the inter-elite split irreversible, the Aquino murder marked the beginning of the end for Marcos. The middle classes soon joined the popular sectors in massive street demonstrations and a burgeoning nationwide movement for democracy ensued. A convergence between a radicalized elite opposition and a radicalized popular opposition became a real possibility. The Aquino murder also hastened debate in Washington over support for Marcos. Behind this debate loomed the larger issue of the merits of authoritarian versus polyarchic methods of transnational social control, as analyzed earlier.

In theoretical perspective, developments from Philippine independence after World War II to the early 1980s reflected a gradual process of transition from a formal colonial relationship with the United States to a country's entrance into the emergent global economy as a dependent and peripheral country, with concomitant social and political repercussions. From a mere narrow appendage of the US economy, the Philippines was becoming a haven for transnational corporate capital which poured into the country from the 1960s on. The earlier colonial relationship was based, for the most part, on feudal and semi-feudal production relations in much of the Philippines, and on the provision on the part of the Philippines of raw materials for the US metropolitan power. In the theoretical discourse of world system and dependency theory, a largely pre-capitalist social formation in the periphery was articulated to a capitalist social formation in the core. The penetration of transnational capital, starting in the 1960s, disrupted rural communities, forged new solidarities, and led to mobilization among subordinate classes in these communities and in expanding urban communities.16 The internal political structure of authoritarianism, and the "crony capitalism" tendencies which authoritarianism tends to generate, had served the purpose of social control in the first few decades of this process. But as this process unfolded, authoritarianism proved unable to respond to the twin challenges of containing popular pressures from below generated by capitalist penetration and of providing mechanisms for intra-elite accommodation.

Shifting from this structural analysis to behavioral analysis, US policymakers were witness to a dual crisis in the making in the early 1980s: an irreconcilable inter-elite split alongside a burgeoning mass popular movement and armed insurgency. It was the same type of prerevolutionary situation that had developed in Nicaragua and led to the Sandinista triumph in 1979. As US policy began to shift in the first half of the 1980s, Washington's challenge became: (1) to transfer support from Marcos to the anti-Marcos elite (2) to assure that the anti-Marcos elite would gain hegemony over the anti-dictatorial struggle, and (3) to reconstruct consensual, polyarchic behavior among the elite as a whole.

Managing the transition

The shift in policy was checkered by a fierce debate and infighting among policymakers. This reflected a surface split between "hardliners" who argued for staying the course and "pragmatists" who argued for active intervention in the Philippines to redirect the antidictatorial struggle, and behind it, the deeper debate between authoritarianism and polyarchy in the Third World. US policy became ambivalent and contradictory from 1983 to 1985, as this debate was played out.17 However, sufficient consensus emerged following the Aquino assassination that continued economic and military aid should be made conditional on steps by Marcos towards reform. Thus, while military involvement in the counterinsurgency campaign escalated, overall policy shifted from unqualified support for the dictatorship to active and critical intervention in the country's political affairs. At this point, explained Ambassador Stephen Bosworth in a 1984 speech to the Philippine Rotary Club, "it is not a question of how to avoid change; it is rather a question of how change can best be managed."18 By 1985, US state managers had entered a stage of managing a highrisk transition from dictatorship to polyarchy.

In November 1984, a secret NSC Study Directive made the call for a concerted US intervention in the Philippines to facilitate a transition. "The United States has extremely important interests in the Philippines. .. Political and economic developments in the Philippines threaten these interests," stated the directive. "The US does not want to remove Marcos from power to destabilize the GOP [Government of the Philippines]. Rather, we are urging revitalization of democratic institutions, dismantling 'crony' monopoly capitalism and allowing the economy to respond to free market forces, and restoring professional, apolitical leadership to the Philippine military to deal with the growing communist insurgency." "These efforts," it went on, flare meant to stabilize [the country] while strengthening institutions which will eventually provide for a peaceful transition." The directive concluded by recommending "an occasional presidential letter, regular visits by administration officials, close Embassy contact, and regular one-on-one meetings between President Marcos and Ambassador Bosworth."19 In particular, the directive proposed the visit of a high-level US emissary and a presidential letter.

These recommendations were implemented. In May 1985, CIA director William Casey visited Marcos in Manila's Malacanang Palace, the presidential residence, to press for an early presidential election. Five months later, in October, Reagan dispatched his close friend, Senator Paul Laxalt, to Marcos with the same request, and in addition to deliver a personal letter from the US president. A fanfare of publicity accompanied Laxalt's mission in order to maximize public perceptions in the Philippines and in the United States of an imminent change in US policy.20 Following the Laxalt visit, Marcos called for "snap" elections, to be held in February 1986. During this same period, in a track parallel to the pressures on Marcos, the United States began to develop broad contacts with the elite political and military opposition as a counterweight',to the popular sectors, a strategy detailed in the 1984 NSC directive. In July 1985, the CIA, DIA, and the State Department prepared a joint study on the situation in the Philippines. It predicted a growth in the left-wing military insurgency over the following eighteen months, but, more significantly, it estimated that left-wing and popular political influence and sentiment among the masses would spread if the dictatorship remained in place until the scheduled presidential elections of 1987 (these elections were subsequently moved up when Marcos called "snap elections"). Washington turned to facilitating Marcos's removal under circumstances which it could control.

The opposition forces were diverse and well organized, ranging from the NPA insurgency, to the mass, left-of-center civic movement BAYAN (New Patriotic Federation, which went by its acronym in Tagalog), which brought together millions of Philippine citizens, to numerous parties and groups of the center, center-right and right. Perhaps the weakest among the opposition were the center and conservative sectors which, as in Nicaragua and other authoritarian Third World regimes, had vacillated during many years between support for, and opposition to, the dictatorship. It was precisely these sectors that the United States had set about to develop in the mid-1980s through new political aid programs targeting civil society. Between 1984 and 1990, Philippine organizations received at least $9 million from the NED and other US sources. These included: the Philippine Chamber of Commerce and Industry (PCCI), which mobilized the business community against Marcos; the Trade Union Congress of the Philippines (TUCP), a minority, conservative union federation affiliated with the International Confederation of Free Trade Unions (ICFTU) and which competed with more radical and leftleaning labor organizations; Philippine "youth clubs" established under the guidance of US organizers to mobilize Philippine youth; the KABATID Philippine women's organization (KABATID is the Tagalog acronym for Women's Movement for the Nurturing of Democracy), also established under the guidance of US organizers; and the National Movement for Free Elections (NAMFREL).21 I analyze below the significance of this political aid, both before and after the transition.

Washington was becoming increasingly concerned over the prospects for the coalescence of a nationalist and independent-minded bloc within the moderate opposition. In late 1984, at a meeting in the home of Corazon Aquino, the wife of the assassinated Benigno, a declaration that became known as the Convenors' Statement was drafted and signed by twelve of the most important leaders of the opposition to Marcos, among them prominent business executives and nationalist politicians, most of whom were regarded as possible presidential candidates in a future election. The document spelled out a nationalist-oriented program of social reform and development and also called for the removal of US military bases from the Philippines.22

As the "snap" elections approached, Cory Aquino and Salvador "Doy" Laurel emerged as the two favorites in the field of opposition candidates. Both were members of the Philippine elite. Aquino, from a wealthy landholding family, also enjoyed genuine popularity as an anti-Marcos symbol. The leader of the right-wing opposition was Salvador "Doy" Laurel, a long-time Marcos loyalist who finally broke with the strongman in 1980.He maintained close contacts with the US embassy, and had refused to sign the 1984 Convenors' Statement. As the head of the opposition UNIDO party, he had a well-oiled political machine at his service. On the other hand, Aquino had won the backing of many in the center-to-left opposition, who were exercising important influence in her coalition. Fearing the possible emergence of a left-center popular alliance, Washington thus set about to forge a center-right alliance and to minimize popular and leftist influence in the anti-Marcos ticket. The State Department despatched a team of officials to Manila to meet with Aquino and Laurel and convince them to run under a united ticket that would stress anti-communism and refrain from opposing US bases in the Philippines (Laurel subsequently became Aquino's running-mate as candidate for vice-president). US Embassy Charge d'Affaires Philip Kaplan began assembling key leaders of the anti-Marcos political parties and, according to a confidential embassy cable, "emphasized the need for the [US assembled] opposition to get its act together given the limited time left before a campaign starts."23

In the weeks leading up to the elections, on voting day and in the days that followed, the Philippines were swept by what became known as "people power." The Philippine people voted en masse for Aquino and then launched a popular insurrection when, in the face of widespread fraud, Marcos declared himself the winner. "People power," it should be stressed, was not a creation of US political intervention; to the contrary, it was what Washington had hoped to avoid. However, faced with the inevitability of a mass, popular .uprising, US actions sought at all times to control its development and minimize its effects, and to bolster simultaneously the positions of those institutions and leaders most allied to US interests. The State Department sent at-large ambassador Philip Habib to Manila to urge Aquino to keep her followers off the streets and to convince Marcos to step down. In the weeks before the elections, reported the Far Eastern Economic Review, "the US Embassy, which had been augmented by dozens of officers with some Philippine expertise, was engaged in intense secret contacts with the opposition, Marcos' ruling party, and the military in an effort to bring about a reconciliation of the two political groups, without Marcos."24

At the same time, Washington sought to assure an important role for the Armed Forces of the Philippines (AFP), having developed extensive contacts with key AFP officers and supporting a loosely organized reform movement within the AFP that had been established in February 1985. The goals of this reform movement were not to democratize the Philippines but to "professionalize" the armed forces, improve the counterinsurgency campaign, and preserve the institutional integrity of the military in the face of the crisis of the dictatorship. The reform movement secured the support in mid-1985 of the Defense Minister, General Juan Ponce Emile, and the acting Chief of Staff, General Fidel Ramos, both right-wing and long-time Marcos loyalists who switched sides in the dictator's final hour. Emile and Ramos led a military reformers' revolt against Marcos's attempt to steal the elections, an event which was crucial in convincing Marcos, on February 23, to step down and leave the country.

Although the military revolt against Marcos was clearly crucial in the dictator's overthrow, it was also crucial to the US strategy for managing the transition and preserving the social order in the post- Marcos period. In the days following the vote, Aquino had announced a campaign to protest Marcos's efforts to steal the elections, which included an economic boycott and a general strike. Such actions would have greatly enhanced the labor movement, with its militant base and left-wing tendencies, in both removing Marcos and in shaping the post-Marcos government and policies. The military revolt not only assured the preservation of the repressive AFP in the post-Marcos period, but left Aquino more indebted to, and dependent on, the conservative military than to the labor movement. US military aid and involvement in the counterinsurgency expanded dramatically in the Aquino period and the military gained major influence in the new government. The preservation of the coercive apparatus and military impunity and the active role played by the "armor of coercion" during and after the transition placed clear limits on social transformation and demands for equity in the post-Marcos period.

Meanwhile, the Philippine left and sectors of the mass, popular movement made a serious tactical mistake in boycotting the elections, with the reasoning that Marcos would steal them anyway and then legitimize his dictatorship. However, the population overwhelmingly wanted to partake in these elections as an act of rejection of Marcos and an expression of its desire for democratic change. The left boycott thus facilitated the concentration of both popular and elite support around Aquino and helped the United States push through its own agenda.

In backing Aquino, the United States latched on to her popularity and posited itself as the firm champion of a new "democratic" government in the Philippines. Although the US claimed for itself a pivotal role in organizing the Aquino victory, it is difficult, in the general context of Philippine politics and the special circumstances attending to the demise of a moribund dictatorship, to measure the influence of US intervention in the Philippine political process on the outcome of the anti-dictatorial movement. This became a hotly debated issue in both Washington and Manila. But whether or not US intervention was itself the determining factor in the overthrow of Marcos obscured a much more significant issue: US intervention was decisive in shaping the contours of the anti-Marcos movement and in establishing the terms and conditions under which Philippine social and political struggles would unfold in the post-Marcos period.

By 1983 it had become clear that the dictatorship's days were numbered; from that point on, for all actors involved, including those seeking a polyarchic outcome and preservation of the social order and those seeking a project of popular democracy and basic change in the social order, the underlying issue was not whether Marcos would go but what would take the dictatorship's place. The underlying struggle shifted from democracy versus dictatorship to the terms and outcome of the anti-dictatorial movement and the reach of the Philippine democratization process. US intervention in the transition was crucial in limiting the extent of popular democratization in the post-Marcos era. By accelerating the removal of Marcos before further polarization could take place, by helping to supplant popular with elite leadership in the anti-Marcos movement, by preserving the integrity of the armed forces, by bolstering those constituencies responsive to elite and US interests, and so on, the United States was able to channel the anti- Marcos movement into a less threatening outcome, and then to win more favorable circumstances for shaping the post-Marcos period. This new period involved heightened US political and military intervention aimed at diminishing left and popular influence in the new government, reconstructing consensus within the dominant groups around a polyarchic political system, and building up allied constituencies in Philippine civil and political society.
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Re: Promoting Polyarchy: Globalization, U.S. Intervention, a

Postby admin » Mon Apr 11, 2016 7:10 am

Part 2 of 2

The role of "political aid"

Political aid and the new modalities of intervention analyzed in chapter 2 began to play an important role in US policy towards the Philippines from 1984.After helping to bring to power "a government with legitimacy and democratic commitment," the NED and other US agencies set about, following Aquino's election, to ''build and consolidate a new democratic system."25

The United States gained important experience in electoral intervention in the 1986 Philippine elections, particularly in giving the character of a plebiscite to elections, in which political forces are polarized into two camps, a "democratic opposition" (which US aid and advisors ensure will be dominated by moderate, pro-United States elites) and dictatorship. This tactic of turning elections into a polarized referendum was subsequently developed and adroitly applied in Chile and Nicaragua. In particular, the creation of an observer apparatus for the 1986 election, and for subsequent ones, gave US officials important experience in the use of electoral observation as part of overall policy. In 1951, the NAMFREL was set up by a former civic affairs director of the Philippine army with the help of US government funds and officials. This "good government" organization played an important role in the political-electoral aspects of the massive counterinsurgency underway at that time against the Huks. In particular, NAMFREL became the vehicle for building a political machine that could deliver the 1953 electoral victory of the CIA-backed candidate, Ramon Magsaysay.26

In 1984, the NED renewed US funding for the NAMFREL, which then played an important role in denouncing Marcos's attempted fraud. Money for the TUCP also went to finance the participation of some 7,000 TUCP members in NAMFREL's observer program. In addition, the NED funded a joint delegation from the NDI and the NRI, which also denounced the attempted fraud. On the eve of the election, President Reagan appointed Senator Richard Lugar to lead a congressional team to monitor the vote. Lugar then commissioned Allen Weinstein, head of the Center for Democracy (CFD), to organize the delegation. Weinstein was one of the original organizers of Project Democracy, which led to the formation of the NED, and was the Endowment's first president, a post from which he resigned after setting up the CFD in 1984. His observer delegation played an important role, upon its return from Manila, in advising US policymakers on how to proceed in the tense days of the transition from Marcos to Aquino.

International electoral observation is not equivalent to foreign intervention in a nation's internal political process, and such observation may play an important role in democratization processes. However, the United States has developed international observation into an instrument for achieving its objectives in each target country, in close synchronization with US policy and political intervention programs. First, electoral observance places the United States in a position to decide when an election is "free and fair" and who the victor is. Second, with the broad publicity they achieve, electoral observer groups financed and organized by the US government are in a position to set the international public relations agenda in accordance with overall US goals. Third, in distinction to neutral or impartial observation, the new political intervention has utilized electoral observation as an instrument for penetrating foreign electoral processes and manipulating them. Under the guise of "observation," US operatives become deeply involved in the activities of the groups and candidates being promoted by the United States. In the case of the 1986 Philippine elections, US and other observer delegations did contribute to exposing and denouncing Marcos's attempt to steal the election. Although this coincided with the Philippine people's efforts to defeat Marcos, the US denunciation was intended to serve not the aspirations of Filipinos but concrete US policy objectives. Following the Philippine experience, electoral observation became an important component of political intervention projects in Chile, Nicaragua, Haiti, and elsewhere.

Similarly, the NED set up an assistance program for the PCCI, channeled through the CIPE. "The overall goal is to support the restoration of private enterprise values in place of the 'crony capitalism' system as a key element in the overall transition to democracy," stated a NED report.27 Funds went for the PCCI to build a nationwide business federation, with local chambers all over the country, to "assist in generating active programs to reach local businessmen and opinion leaders." The purpose of this program was to cultivate consensus within the Philippine private sector, and elites in general, around the project of neo-liberalism, and to provide transnational kernels within the Philippine elite with a capacity for developing concrete neo-liberal policy reform proposals and interacting with the Philippine government so as to have these proposals adopted.

Washington also funded and promoted the creation of a new women's organization, the KABATID.Funds went to pay for a headquarters in Manila, regional offices and equipment, the publication of a monthly magazine (KABATID Express), and salaries for paid staff, among other items. Why would Washington create an entirely new women's movement in the Philippines, a country that could boast by the early 1980s of having the broadest and most vibrant feminist movement in Asia? Women form a significant portion of the 20 million Filipino workers. Women became highly active in the trade union movement and constituted a major force in the anti-Marcos and democratization struggles. In the late 1970s, women's organizations proliferated. In 1984, many of these groups came together in a coalition, the General Assembly Binding Women for Reforms, Integrity, Equality, Leadership, and Action (GABRIELA). GABRIELA brought together poor women workers with middle-class professionals, and also attracted the support of some women from the elite. The organization enunciated four objectives: the restoration of democracy; the attainment of a genuinely sovereign and independent Philippines, "where women will be full and equal partners of men in developing and preserving national patrimony"; support for "the struggles of women workers, peasants, and urban poor settlers to attain their economic well-being"; and "women's liberation" as an integral component of "national liberation."28

The existing women's movement thus put forth a program of popular democracy that threatened the transnational agenda for the post-Marcos period - an agenda which the KABATID would promote.29 The purpose of the NED program was not to help poor Filipino women to democratize their society; if this were the intent there already existed dozens of active women's groups which Washington could have supported. Instead, KABATID was to compete with the existing women's movement, undercut its progressive tendencies and popular leadership, and at the same time organize women from the elite around the efforts to stabilize a polyarchic political system. The KABATID,as is the case with similar civic groups created and/or funded by the United States abroad, did not envision itself as a mass women's movement. US funds, provided in relatively small doses, were intended not to finance a large-scale operation, but to deliver the resources necessary for a small group of women from the country's elite to network and become mobilized. The KABATID was to be a club to groom women leaders well placed in the country's civil and political society. The KABATID's newsletter, for instance, was not published for mass distribution or for news-stand sales, but for exclusive circulation to "KABATID members, the Executive and Legislative Branches of government, major media outlets, and other nongovernmental organizations."30 The magazine was intended to link, organize, and provide strategy guidelines to core constituencies around the US-transnational agenda, including neo-liberal restructuring, the continued presence of US military bases (for which the KABATID lobbied unsuccessfully), and opposition to legalization of the Communist Party and to negotiations with the insurgency, and to "counteract the powerful propaganda machine of the Left forces."31 A glance at the KABATID trustees indicates that the organization was led by middle- and upper-class professionals, business women, and government officials from state agencies, the private sector, and the educational system, and that all were drawn from the transnationalized fraction of the elite.32 Four of its five top officers were also NAMFREL leaders. The KABATID's chairperson was Oette Pascual, who also served on the board of NAMFREL and was that organization's director for external affairs until she resigned to head the KABATID.

In turn, the KABATID was to gain hegemony - in the Gramscian sense, not of domination, but of leadership - over the mass women's movement and help influence the contours of post-Marcos society along the agenda of the transnational elite. One KABATID document warned that the economic crisis in the post-Marcos period "makes the lower income masses susceptible to ideological solutions," and that, therefore, the organization should "develop a core of women citizen leaders who can respond effectively to the needs of their community ... Since women are the traditional nurturers and transmitters of family traditions and values, KABATID members will be catalysts in their community, and [will] sustain an effective middle force group that will serve as role models to the young and impressionable." 33 The idea was to cultivate core constituencies of leaders which could become public opinion makers, simultaneously competing with popular sectors and inculcating in the elite as a whole the virtues of consensus-building and polyarchic procedure. This was part of the broader efforts to cohere a "political center" and have it exercise hegemony in the organs of civil society and the internal political system. The KABATID documents stressed "the creation of a visible middle force," the "bonding together of women" around "a visibly moderate force," the creation of "circles of influence" around the country, training for KABATID members in "leadership skills and value orientation," and exercising a "catalyst function" in the formation of public opinion over national issues.34 The core of "women citizen-leaders" cultivated by the KABATID was expected to reach out to women in the TUCP trade unions, the Philippine "youth clubs," business groups, and elsewhere, in tandem with US political aid programs in those areas. In this way, the leaders of the NAMFREL, the TUCP and the KABATID sat on each other's boards and came to constitute a national network, with interlocking directorates as discussed in chapter 2. The KABATID also used the "multiplier effect" analyzed in chapter 2 to set up regional offices and local leadership structures.35

Seen from a more structural level, the penetration of the global economy from the 1960s and on had thoroughly disrupted the traditional sexual division of labor, had thrust millions of women into the capitalist sector of the economy, particularly in to the external sector tied to transnational capital. The peculiar gender dimensions of the shift in the labor-intensive phases of international production to the South are the concentration of female labor in these externally linked sectors, and notorious export-assembly platforms (maquilladoras), where labor is largely female, although management remains male. This new sexual division of labor - springing from pre-capitalist divisions and patriarchal social relations and cultural patterns - provides advantages to transnational capital in the form of wage differentials between male and female workers, an alleged "docile" and "dexterous" workforce, and the creation of new hierarchies among oppressed strata that deflect challenges to exploitation. But the disruption of traditional gender roles, the new experiences of capitalist exploitation superimposed on gender oppression, and the subjective experience of broader gender, group, and class solidarities which develop, often catalyze and politicize women to challenge their exploitation as laborers and to challenge residual and new types of patriarchal relations. US political aid programs, such as those in the Philippines, were designed precisely to contain mass mobilization among women displaced from traditional roles and to utilize, and even strengthen, patriarchal social relations, as part of the broader strategy. In this way, transnational political and economic practices conjoin to sustain relations of class domination in a process properly conceived as the reproduction of social order during the integration of national societies into an emergent global social formation.

Philippine youth were also identified as a key sector, given young people/s rapid politicization and radicalization in the anti-Marcos struggle, especially those in the militant high-school and university student movement. In 1986/ the NED began its Youth Democracy Project in the Philippines, channeling funds through the International Division of the YMCA for "seminars on democratic procedures" with thousands of high-school students around the country.36 Also in 1986, the NED provided the NDI and the NRI with funds to conduct "training courses" for Philippine congress members.37 US officials conducted the courses with the Evelio B. Javier Foundation, a Philippine think-tank whose trustees included many leaders of the KABATID, the TUCP and the PCCI.

Probably the most important plank in the political aid program was support for the conservative TUCP. Post-World War II industrialization generated a 20-million-strong urban workforce by the late 1970s, and labor had become a central component of the democratization movement by the end of the decade. In an effort to curtail labor militancy, the Marcos regime, with the assistance of the AAFLI, set up the TUCP in 1977, under the operating principle of tripartite cooperation among labor, management, and government. Established when the country was under martial law, it was the only legally recognized union during the Marcos years. Right up to his downfall, the TUCP maintained friendly relations with the dictator, who, until 1984, was the regular featured speaker at the TUCP's annual May Day Breakfast.38

Meanwhile, eight union federations dating back to the previous two decades, disenchanted with the TUCP's pro-government program, had set up the Kilusang Mayo Uno (May First Movement), or KMU, in 1981. The KMU spread throughout Manila and other urban centers and became the largest anti-Marcos union center. Branded as "communist" by US officials, the KMU was, in fact, a multi-tendency labor federation, uniting workers of communist, Christian, social democratic and other political persuasions, and controlled by its membership, not by any outside organization, whether of the left or the right. Following the overthrow of Marcos, the KMU continued to grow. It became the largest labor federation in the country, and one of the most dynamic in the world. The KMU waged campaigns in the late 1980s for national control over natural resources, the removal of all US military bases, a comprehensive agrarian reform (the TUCP supported the Aquino program - see below), for worker participation and improvements in wages and benefits. The real threat to US interests posed by the KMU was clearly its program of nationalist political demands and popular democratization.39

In 1984, the NED took over funding for the TUCP and supplied neaerly $7 million between 1984and 1991, channeled through the FfUI to AAFLI field offices in the Philippines.40 "A major effort to strengthen democratic unions is being undertaken in the Philippines, where democratic forces have been stymied by martial law, the turbulence following the Aquino assassination and the growth of Marxist-oriented organizations," explained the NED, in inaugurating its Philippine program in 1984.41 US policymakers were particularly concerned about the dramatic decline in worker support for the TUCP, whose ranks had dropped from 2 million when it was formed to 1.2 million workers in 1985.42 The NED report made clear that the main objective of the program was not to bring down the Marcos dictatorship, but to counter left-wing unionism. The purpose of the TUCP funding is to "strengthen pro-democratic unions in the Philippines so that they will become the preeminent representatives of workers under the umbrella of the TUCP," according to the NED. Funds went for the purchase of office and press equipment, staff salaries, the maintenance of regional offices, "training in democratic ideology" and in "technical organizational skills," and a "media relations and communications program" to "counteract left-wing propaganda."43 With the massive infusion of funds, the TUCP was able to set up a nationwide patronage network. "Some of the regional [labor leaders receiving AAFLI money] are becoming powerful politically," explained Bud Phillips, AAFLI's administrator in the Philippines. "Imagine if you have $100,000 to give out to families in $500 chunks: Your stock goes way up, faster than the stock of any of the militant labor groups" (at the time, per capita annual income was $790). Phillips went on to explain: "If people hadn't had immediate assistance then, the success of the political left in the trade unions would have been phenomenal. It would have been a Waterloo. Our help saved the free trade union movement here."44

One of the reasons for such emphasis on Philippine labor was the challenge from the militant KMU and the importance of labor in national political struggles. However, another reason was that, with its already-existing infrastructure and leadership, the TUCP was in a good position to develop what NED documents described as "sectoral linkages" with women, youth, political parties, religious, and civic groups, and thus act as the centripetal nucleus for the cultivation of a nationwide network of "agents of influence" endowed through US assistance with a "political action capacity," that is, with the skills and resources to mobilize distinct constituencies.45 Thus, the FTUI funded specific programs designed to "strengthen organizational relations" between the TUCP and the women's, youth and church groups and to eclipse popular leadership in all areas. "Such relationships serve to establish bulwarks against Communist front groups," explained a FrUI document. In addition, AAFLI funds went to NAMFREL programs, including the training of thousands of TUCP members to staff NAMFREL offices and conduct poll-watching.46 Ernesto Herrera, TUCP's Secretary-General, was also a member of the Executive Council of the NAMFREL. Similarly, NED funds, passed through FTUI, on to the AAFLI, and from there to the TUCP, were used in 1988 to establish the Workers-Student Forum (WSF) as "a counterweight" to the left-leaning Filipino Federation of Students and League of Filipino Students.47

Between 1984 and 1990, the TUCP became the second largest recipient of FTUI funds worldwide, surpassed only by Poland's Solidarity. The objective became an all-out war against the KMU. The primary goal of the KMU, warned one FrUI document, was not "to bargain with employers or work through the country's fragile democratic institutions," but to "radically change the country's entire political system." It explained: "A variety of approaches will be used to reach disparate groups of workers. These efforts will directly address KMU attempts to bring workers in specific industries in key economic sectors under their control [sic] ... [and] will allow the TUCP to supplant the KMU as the spokesman [sic] for working men and women in the Philippines."48 The NED also funded a TUCP thinktank, the Center for Social Policy and National Issues.49 AAFLI officials working at this center helped the TUCP to "develop a formal capability to lobby the Philippine Congress" and ran "training and education projects designed to provide every union with political action capabilities." 50 The center endorsed Aquino's conservative agrarian reform and advocated approval of a referendum to endorse the continuation of US military bases in the country (see below).

Through these efforts, the TUCP garnered a working-class base of support in urban areas for a gradual realignment of the Aquino coalition from the center-left towards the center-right. The TUCP leadership established close working relations with Vice-President Laurel and the right wing of the Aquino administration. US funding also went to the TUCP's affiliated rural unions, grouped into the National Congress of Farmers Organizations (NCFO). The NCFO, in its competition with militant groups from the National Peasant Union (KMP), which was founded in June 1985, lent support to the traditional rural oligarchy and agri-business in their efforts to reestablish authority in the countryside following the turbulence of the mid-1980s. Most chilling was TUCP and NCFO collaboration with landowners who had begun organizing politically and militarily, forming private armies and "vigilante groups" (death squads) with official government sanction.51

US allied groups and "agents of influence" cultivated with political aid pushed the US post-Marcos agenda. Apart from the general program of polyarchy and neo-liberalism, the specific points on this agenda of concern to US policymakers included the renewal of the 1947 Military Bases Agreement, which was set to expire in 1991. The TUCP, the KABATID women's organization, the PCCI, and other US-funded groups all endorsed a renewal of the lease.52 Despite the efforts of constituencies cultivated through US economic and political aid programs, mass sentiment, expressed in a 1992 referendum, opposed the bases and the treaty was allowed to expire. While the loss of the Philippine bases was a setback for US geo-political concerns, policymakers were able to link the base closings to the transnational agenda for the Philippines: the AID designed and financed a program for the conversion of the Philippine military bases into a duty-free zona franca for transnational corporate investment, as part of the country's neoliberal program.

Conclusion: Consolidating polyarchy and neo-liberalism in the Philippines

Although Filipinos were genuinely elated by the overthrow of the dictatorship, different political projects had been masked by broad national and international convergence around the removal of Marcos and under the generic term "democracy." These now became manifest in new conflicts as the country entered a highly fluid political situation. 53 Mass constituencies pushing diverse programs of popular democratization contended with the efforts by the United States and much of the elite to achieve a conservative stabilization. Aquino's assumption to the presidency was followed by institutionalization of the post-Marcos order. A new constitution was approved in a February 1987plebiscite by over 75 percent of those voting. Legislative elections in May 1987 and local elections in January 1988 consummated the efforts to legitimize the new regime.

After six years in power, amidst a precarious period of mass mobilization, attempted coups, and the ebb and flow of insurgency and counterinsurgency, Aquino left office in 1992 in national elections which brought General Fidel Ramos to the presidency. The 1986 "revolution" had been effectively divested of its popular promises and polyarchy seemingly institutionalized. On the one hand, there was electoral competition and constitutional rule, including a separation of powers, formal respect for civil and political liberties, and so on. Although still factionalized, the elite had apparently reached consensus on the rules of polyarchic competition, which became quite intense, with a thriving press and a plethora of political parties. On the other hand, after six years, social and economic structures remained frozen and the formal political system continued to be a domain of the rich and powerful, as closed as ever to meaningful popular participation. A series of studies conducted by Philippine and foreign scholars in different rural and urban locations around the Philippines in the late 1980s on the actual extent of social, economic, and political change since 1986 concluded: "The overwhelming evidence shows that what was achieved by Aquino replacing Marcos is much more modest than what is suggested by the notion of 'a transition from authoritarianism to democracy' ... no decisive reform of iniquitous social structures has taken place."54

As noted earlier, the unfolding of events in the Philippines before, during, and after the Marcos-Aquino transition cannot be reduced to the results of US policy. Rather, US policy interacted with distinct Philippine sectors in seeking preferred US outcomes. These sectors included the Philippine military, civilian elites, and the left. One State Department official commented several weeks after Aquino's inauguration: "Our objective was to capture ... to encourage the democratic forces of the center, then consolidate control by the middle and also win away the soft support of the NPA. So far, so good."55 US objectives in the new period were to marginalize the Philippine left, consolidate and gain leverage over a center-right alliance, and "professionalize" the military, which meant achieving its subordination to civilian elites (an "apolitical" military leadership) but also preserving its repressive capacity. Political aid was not a crucial determinant, but one of several factors, affecting the outcome of the anti-Marcos movement. Along with economic and military aid, it played an important role in the consolidation. Gradually, a transnational kernel was gaining control over the state and positioning itself to exercise hegemony in civil society, in consort with US economic, political, and military aid programs, and in consort with transnational capital and international financial agencies.

Shortly after Aquino's inauguration, the US Congress approved the Assistance for Democracy Act of 1986, and several supplemental appropriations, involving some $700 million in economic and military aid for the Philippines for 198~7. The objectives were to keep the Philippine economy open and closely tied to foreign capital, promote free-trade and neo-liberal reform programs along the lines of the export-oriented development model, and also to keep US military facilities open.56 "Crony capitalism" was not to be replaced by any popular economic program but by free-market reforms and deeper integration of the Philippine economy into the global economy. Also, high in the minds of foreign creditors was assuring that the Philippines would continue to repay its $30 billion foreign debt. "[An] important test for the government is its ability to pre-empt the insurgents' promises of nationalized industry and radical redistribution of land and wealth, which have fallen on fertile ground, especially in the rural areas where 70 percent of Filipinos live," warned Sandra Burton, a fellow at the US Council on Foreign Relations.57 US officials organized the Multilateral Assistance Initiative consultative group, which brought together international financial agencies, private banks, government donors, and the AID. The group conditioned the flow of several billion dollars in external resources in the late 1980s on privatization, deregulation, currency devaluations, the lifting of trade barriers and restrictions on foreign capital, and so on. In this way, the AID, a US government agency, acted on behalf of transnational capital and its interests in the Philippines.

Of particular concern was promoting to positions of authority local Philippine counterparts of the transnational elite. Between 1986 and 1989, cabinet positions and economic policy were arenas of struggle in Manila among diverse fractions. ''There are powerful dissenters, vocal elements in the democratically-elected Congress vociferously oppose key elements [of the neo-liberal reform program], and the 1992 elections loom over the entire process," cautioned an AID document. The US "role is to mobilize its resources to support, encourage, leverage, and assist, where possible and as most likely to ensure success, in this absolutely vital undertaking" of continued reform.58 By 1990, the job was accomplished with the "purging" of "leftists" and "protectionists" from the cabinet, and the appointment of the technocratic finance minister Jesus Estanislao to head the government's economic team. Under Estanislao's New Economic Program, sweeping neo-liberal restructuring was launched. The transition to polyarchy involved the ascent to internal leadership of a transnationalized fraction of the Philippine elite over the elite as a whole, and the ideological and political incorporation, or at least neutralization, of enough of the popular sectors to restore social order in the wake of the Marcos crisis. The ascent of the transnationalized kernel, linked organically to the transnational elite, tied internal hegemonic order in the Philippines to emergent transnational hegemony.

Following the ouster of Marcos, Washington lifted the ban on military aid to Manila applied in 1985, and allocated $50 million in fresh military aid, to what was now known as the New Armed Forces of the Philippines (NAFP). Although Washington opposed any new military takeover, it adopted a strategy of penetrating and gaining leverage over the military. The NAFP had an important role to play in creating a new post-Marcos environment. Philippine specialists Walden Bello and John Gershman described this new environment as "politically sanitized - in which anti-elite candidates with radical political programs have been driven from the electoral arena by the threat of force - so that even intense electoral competition would not be too destabilizing."59 Between 1986 and 1991, factions within the NAFP launched six coup attempts. Although all were put down (the one in November 1989 by US air force jets and the threat of direct US military intervention), each plot helped expand the military's autonomy and influence. The military won not only a blank check to conduct the counterinsurgency unscrutinized and as it saw fit, but also power of veto over vital areas of national policy. The coup attempts forged an accommodation between the civilian and military elite, and more importantly, imposed a consensus among the elite that any substantial social or economic reform was outside the accepted parameters of the new "democracy." While the spate of abortive coups had provided Washington with greater leverage over Aquino (who survived the military revolts thanks to US support), it also gave Washington influence over the NAFP.

Containment of the insurgency remained a key US goal in the post- Marcos period. The Pentagon expanded a large-scale training program that it had first introduced in 1982, and used its influence in the NAFP to isolate reformist and populist currents in the military. These elements had grouped together into the Young Officers Union (YOU). "YOU's leaders look towards a 'coup cum revolution,' meaning a military seizure of power associated with a 'people's uprising'," cautioned political scientist Carl H. Lande in the NED's Journal of Democracy. "Critical of the present political system, they hope to replace it with a reformist military regime. Thus YOU, like the NPA, represents a populist reaction to the elite-dominated democracy now presided over by Corazon Aquino. Were YOU and the NPA ever to join forces, they would become a formidable threat to the state."60 By the early 1990s, the Pentagon and the CIA were assuming an ever-deeper role in the design and command of counterinsurgency. Following the ouster of Marcos, US officials set about to transform the NAFP into an effective counterinsurgency force that would integrate military, political, economic, and social initiatives, including broad "civic action" campaigns, psychological operations, military aid and training, and so on. In the 1980s and early 1990s, the Philippines became a key staging ground of low-intensity warfare.61

This effort involved pressuring Aquino to back down from her policy of "reconciliation" with the NPA, and the left in general, similarly to US pressuring of the Chamorro government in Nicaragua and other post-authoritarian elite regimes in the 1980s and 1990s to marginalize popular and left participation in new polyarchic political systems.62 Policymakers did not want to see a radical left integrated into the country's political and civic structures, pushing a program of popular reform. Upon coming to office, Aquino released political prisoners from jails, and in September 1986, after a month of negotiations, the government signed a temporary truce with the guerrillas. But under intense pressures from Washington, the military, and the rural oligarchy, peace talks broke down in November. A month later, Assistant Secretary of Defense Richard Armitage publicly lashed out at Manila for pursuing reconciliation. Aquino apparently got the message; shortly afterwards, she declared in a speech at the Philippine Military Academy that "the answer to the terrorism of the left and the right is not social and economic reform but police and military action."63

The struggle over agrarian reform is a clear example of how US intervention intersected with complex local struggles with the aim of controlling social change, as James Putzel documents in his study on the subject.64 The Philippines is the fourteenth-largest food producer in the world, yet hunger and poverty are endemic in the countryside. In the mid-1980s, a mere 20 percent of the population owned 80 percent of the land. The remaining 80 percent either worked as landless laborers or subsisted on tiny plots, often rented at exorbitant prices in usury arrangements with landlords.65 Behind this system was an alliance between Philippine landowners and foreign agri-business, based on lucrative cash crops for export and a ready pool of cheap rural labor. At the time of her 1986 victory, Aquino made agrarian reform the centerpiece of her promise of broad social and economic change, and the new constitution specified that ownership of land should be transferred to those who tilled it.

Following the ouster of Marcos, a coalition of popular organizations, the Congress of Peoples' Agrarian Reform (CPAR), was formed with the aim of mobilizing for a comprehensive agrarian reform. The CPAR included the KMU trade union federation and its rural counterpart, the KMP peasant association, numerous civic organizations, political parties, and a plethora of clerical groups. It called for the abolition of absentee landownership, the redistribution of lands usurped during the Marcos years, and the legalization of landholdings by peasants who actually tilled the land. At the other end of the spectrum, the US-backed TUCP and the NCFO, which had publicly endorsed what Aquino described as the hub of her economic program, a "partnership between labor and capital," drafted their own position on land tenure under a US-funded and advised program.66 Between 1986 and 1990 diverse groups struggled in civil and political society to shape the contours of an agrarian reform. The AID set up its own agrarian reform office, working out of the TUCP's Manila offices. The AID's objective was to design an agrarian reform that would not disrupt the agro-export sector and that could be synchronized with the counterinsurgency program and could diffuse peasant unrest.67

With the help of the AID, the endorsement of the TUCP, and the backing of a Congress dominated by large landowners and business interests, Aquino drafted a bill, approved in 1988,which was blatantly biased in favor of the traditional, politically powerful families, agribusiness corporations and large landowners (for instance, 75 percent of all lands remained exempt from reform). In the first three years of the law, only 7 percent of the total land area which the legislation was intended to cover had actually been distributed to farmers. The agrarian reform subsequently sputtered to a standstill.68 In addition to resistance from traditional landowners, the exporting commercial elite, transnational agri-business and multilateral lending agencies did not want to see a disruption of the country's agro-export sector, which, along with zona franca labor-intensive manufacturing, linked the Philippines to the global economy. Blocking authentic agrarian reform resulted in heightened social polarization, which fueled rural unrest, the simmering NPA guerrilla movement, counterinsurgency and militarization of the countryside. As a result, the human rights situation, after having shown an improvement in the first few years of civilian government, dramatically deteriorated. By the early 1990s, international human rights groups were once again documenting widespread and systematic human rights violations and government repression.69

To be sure, US policymakers did want to see a social reform process in the Philippines. But it had to be a process which could be carefully managed, and under elite hegemony. For instance, Washington, along with the international financial agencies, expressed support for their own version of an agrarian reform, one that would preserve and expand the capitalist agricultural export sector and also divert the assets of landlords into urban, export-oriented industry, as had taken place earlier in Japan, Taiwan, and South Korea. However, such a scheme was simply not applicable to the particular social, political, and economic conditions of the Philippines. And when push came to shove, the first priority was to avert fundamental transformation of the social order. Moreover, political intervention specialists viewed consolidation of "democracy" in the Philippines not in terms of socioeconomic reform but of strengthening polyarchic political culture and institutions,70 In 1991, Washington allocated $12 million in new "democracy enhancement" funds, via the State Department's aDI and the NED, not for social reform but explicitly for "democratic institution building [in conjunction with) a strong free-market private-sector orientation." [71]

The left, seemingly unable to adapt to the post-Marcos circumstances, contributed to US endeavors.72 The boycott of the 1986 elections allowed the centrist elements to seize the political initiative from the left. Ambivalence towards electoral participation persisted in subsequent elections, which contributed to isolating the left from mass constituencies that viewed electoral politics as a legitimate arena of political struggle. The armed and unarmed left remained a vital - even ascendant - force in the national equation. Yet it seemed unable to find a formula for operating effectively in the new political-ideological terrain - a challenge posed for much of the left internationally in the post-Cold War world and which is closely related to the lack of any viable programmatic alternative to integration into global capitalism. However, it should be pointed out that serious attempts by the left groups, such as the Partido ng Bayan (People's Party), to run candidates in elections ran up against repression and the vastly superior resources of the elite. One specialist writing in the NED's Journal of Democracy acknowledged, for instance, that in the 1992 elections "it cost $25 to $50 million to run for president, $1 to $5 million to run for senator, and anywhere from several hundred thousand to $1 million to run for the House," a barrier "which narrowed the field to people from (or supported by) the middle and upper classes."73

The democratic aspirations of the masses of Filipinos might have been further away than ever from fulfillment, but, in the view of the State Department, the Philippine government since 1986 had "brought about fundamental political change," involving "a strong free-market, private-sector orientation," and "human rights" and "social justice."74 Washington assessed that the Philippine political system was consolidated enough by the 1990s to stand on its own and that the 1992 elections posed little threat to transnational interests. In April 1992, a month before the vote, US ambassador Frank Wisner told a group of business leaders that the United States expected the vote to be "decisive and not contested, and that you can get on [with] the job of governance ... [the US] took an active role in putting [sic] a return of an election process in 1986... what matters to us is that there is a democratic system in place."75

In summary, the mid-1980s Philippine "transition to democracy" gave a crucial impetus to the new political intervention. The successful outcome of the crisis of dictatorial rule there, and the contribution made by novel US political operations to that outcome, proved decisive in consolidating consensus in Washington around the new strategy. Thus, as crisis brewed in Chile, there was little debate in Washington, as well as valuable accumulated experience, on the course of action to be taken by the United States.
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Re: Promoting Polyarchy: Globalization, U.S. Intervention, a

Postby admin » Mon Apr 11, 2016 7:46 am

Part 1 of 3

Chapter 4: Chile: Ironing out "a fluke of the political system"

Mr. Minister, you come here speaking of Latin America, but this is not important. Nothing important can come from the South. History has never been produced in the South. The axis of history starts in Moscow, goes to Bonn, crosses over to Washington, and then goes to Tokyo. What happens in the South is of no importance. You're wasting your time.

-- Henry Kissinger, speaking to Chilean Foreign Minister Gabriel Valdes, June 1969 [1]


From dictatorship to "redemocratization" and the US role

"1 don't see why we need to stand by and watch a country go communist because of the irresponsibility of its own people," declared National Security Advisor Henry Kissinger in June 1970.2 Kissinger was referring to the election that year of Salvador Allende as president of Chile. For Kissinger, the election of a self-declared socialist "represented a break with Chile's long democratic history," the result of "a fluke of the Chilean political system."3 What followed was one of the darkest chapters in inter-American relations: a massive US destabilization campaign against the Allende government, culminating in the bloody 1973 military coup. For fifteen years, successive US administrations propped up the dictatorship of General Augusto Pinochet. Then, in the mid-1980s, on the heels of the "success" in the Philippines, policymakers switched tracks and began to "promote democracy" in Chile.

The coup in Chile was part of a general pattern in Latin America of military takeovers in the 1960s and 1970s, in the face of mass struggles against ubiquitous social and economic inequalities and highly restricted "democracies." Similarly, the "return to democracy" in Chile in the late 1980s was part of a hemispheric pattern, referred to in US academic literature as "redemocratization." There is more than semantics behind this term. Underlying specific terminology is the debate over a contested concept. If democracy is considered power of the people, then there is little basis, intellectually and theoretically, to speak of "redemocratization," whereby, in regular cycles, power is held, then lost, then held again by the people. If, however, democracy is limited to its institutional definition, then the formal structures of polyarchy - civilian government, elections, etc. - can, in fact, be established, dismantled, and established again in regular cycles. When scholars speak of the "breakdown of democracy" and a "redemocratization," they are therefore utilizing the hegemonic version of an essentially contested concept, and what they really mean are cycles in the breakdown and restoration of consensual mechanisms of domination.

US policy towards Chile from the 1960s to the 1990s involved four successive stages: (1) covert support for centrist and rightist groups against the Chilean left in the 1960s (2) destabilization of the left once it came to power through free elections (3) support for military dictatorship until the mid-1980s, including its program of decimation of the left and economic restructuring (4) intervention in the anti-dictatorial movement from the mid-1980s to bring about a transition to polyarchy. The United States had spent millions of dollars in the 1960s in Chile in covert intervention to marginalize the left and bolster its favored parties,4 particularly the Christian Democratic Party (POC), which was headed by Patricio Aylwin. Two decades later, Aylwin and his party again became the recipient of US assistance, this time channeled through the NED and the AID, which would help Aylwin become the Chilean president. It was with telling irony that the return to power in early 1990 of the same Aylwin and the PDC that openly participated in the 1973 military coup was projected around the world as the culmination of a "democratic revolution" that swept Latin America.

United States-Chile relations must be seen in the context of the evolution of post-World War II US policy towards Latin America, from open support for dictatorship, to a period of "rethinking" and then to "democracy promotion." Washington launched a hemispheric campaign to isolate the left following the declaration in 1947 of the Truman Doctrine, which initiated the Cold War. This included the development of close ties between the United States and Latin American militaries, and the supply of $1.4 billion between 1950 and 1969 in military assistance.5 The Cuban revolution in 1959 constituted a dangerous rupture in traditional inter-American relations and a hemispheric threat to US domination. The Kennedy administration's Alliance for Progress aimed to prevent repeats through a combination of United States-led counterinsurgency and reform efforts.6 The breakdown of that effort led the Nixon administration to commission the Rockefeller Report of 1969.7 This blueprint for Nixon-Ford policy towards Latin America claimed that the "new militaries" - armed forces and security apparatuses that had been "modernized" through US military and security assistance and training programs - were the "last best choice" for preserving social order and traditional inter-American relations, and coincided with the turn to military dictatorship in many Latin American countries. The Rockefeller Report was followed by the Trilateral Commission's report The Crisis of Democracy, which argued that "democracy" had to be reconstituted to assure that it did not generate its own instability, both within states and in the international system.8 A year later, the Linowitz Report, which provided guidelines for Carter administration policies, highlighted the conclusions of the Trilateral Commission and stressed that military dictatorship and human rights violations threatened to destabilize capitalism itself and undermine US interests.9 It also recommended a US policy thrust of "redemocratization" in order to avoid crises and preserve the hemispheric order. The triumph of the Nicaraguan revolution in 1979 demonstrated to US policymakers the need for such an undertaking. The 1984 Kissinger Commission report stated that promotion of civilian regimes was an essential requisite of US policy and should be coupled with greater linkage of the Latin American economies to the world market as well as with a political, military, and ideological offensive against leftist forces in the region.10

Transnational economics, transnational politics, and military rule in Latin America

South American politics changed from the 1960s to the 1990s concurrently with the emergence of the global economy. In theoretical abstraction, we see most clearly in South America how movement in the "base" (globalization) intersected in a highly interactive and complex manner with movement in the "superstructure" (political and social changes). During the 1960s and 1970s repressive military regimes took over in Brazil, Argentina, Chile, Uruguay, and elsewhere. Authoritarianism was an instrument of local elites, acting in conjunction with the United States, for suppressing an upsurge of nationalist, popular, and leftist challenges to the status quo. There was an "elective affinity" between these authoritarian regimes and US domination in the hemisphere, corresponding to the exercise of domination through coercive mechanisms in the inter-American arena. The relation between the military and the social order is complex. Mechanical reduction of the military regimes to "guardians of imperialism" denies any autonomy to politics and institutions and to endogenous national dynamics. However, the argument common to much mainstream "democratization" literature that the military was an independent institution merely seeking to preserve its own "institutional interests and prerogatives" in the face of social turbulence is equally fallacious and particularly misleading. [11] It theoretically separates a coercive apparatus from the function of coercion in reproducing a social order, and hence extricates the military from its structural location in the socioeconomic organization of society and from the broader international setting. This separation is grounded in structural-functionalism, with its functional separation of the different spheres of the social totality and their respective institutions, and an internal logic assigned to each institution such that movement may occur independent of the totality. The following discussion is intended to provide the historical background and a theoretical framework for the Chile case. But beyond that, it is also an attempt, in contradistinction to the structural-functional approach associated with "democratization" theory, to substantiate essential theoretical issues raised in chapter 1, including how politics and economics intersect and evolve over time and how they correlate to globalization.

The military coups of the 1960s and 1970s responded to threats to social orders resulting from the breakdown of the prevailing model of dependent capitalist development, known as import-substitution industrialization, or ISI,12 This model provided the economic basis for populist political projects that prevailed throughout much of Latin America in the post-World War II period. Populist projects were multiclass alliances under the dominance of local elites and foreign capital that undertook state-sponsored income redistribution, social welfare, and the promotion of local capital accumulation. The ISI model and the populist program were the form that Keynesian capitalism took in the periphery and semi-periphery. Taking place prior to globalization, it subordinated national economies in the periphery to the core, but hinged on local accumulation processes at a time when these economies enjoyed a measure of autonomy and "inward-oriented" development programs were viable. Populist programs were often led by national elites whose interests lay in local accumulation and who often clashed with foreign capital and core country elites. But globalization, by undermining the ability of any nation to pursue an autonomous development path, led to the breakdown of the ISI model by the 1970s, which in turn undermined the economic basis for populist programs. Chronic inflation and macro-economic instability, a decline in local and foreign investment, and the fiscal crisis of the state made it increasingly impossible to sustain these programs. Economic crisis thus begat political crisis as the social structure of accumulation unravelled. Leftist alternatives and mass movements clamoring for more fundamental social change threatened local elites and US interests. In Chile, there was even more at stake: an avowedly socialist coalition had actually assumed the reins of government.

The military takeovers had dual objectives: (1) to crush popular and revolutionary movements through mass repression and institutionalized terror, and (2) to launch processes of economic adjustment and deeper integration into the world market in response to the exhaustion of the ISI model and in concurrence with the emergence of the global economy. The military regime's economic model- a regional prototype of the full-blown neo-liberalism of the 1980s and 1990s - was antipopular, involving a compression of real wages, the opening of markets, lifting state regulations, price and exchange controls, reallocating resources towards middle and higher income groups in the external sector, and deepening ties with transnational capital. These tasks could not be carried through under formal "political democracy," which became, in effect, a fetter to the restoration of capital accumulation under globalization. Military dictatorship provided the political conditions for economic restructuring, bringing about an entirely new correlation of national and regional forces in South America. By the 1980s, the militaries, having launched restructuring and having accomplished the destruction of popular and leftist movements, could "safely" withdraw.

"Redemocratization" must thus be seen in light of globalization. The military regimes provided the political conditions for initiating the restructuring of social classes and of productive processes reciprocal to the changes taking place in the world political economy. Restructuring generated new economic and political protagonists with distinct interests. A critical variable in this conjuncture was the debt crisis. Latin America's foreign debt went from some $50 billion in 1974 to over $300 billion in 1981 and over $410 billion in 1987. This massive borrowing spree responded in immediate terms to chronic balance-of-payments crises associated with the exhaustion of the ISI model. But structurally it was rooted in long-term movements in the world economy, particularly the emergence of transnational finance capital as the hegemonic fraction in the global economy.13 The massive infusion of capital into Latin America in the 1970s, linked to the concentration of economic power in transnationalized finance capital in the center countries, had profound effects on existing groups and class constellations. This point is crucial: the need to earn foreign exchange to pay back the debt requires that nations restructure their economies towards the production of exports ("tradables" in official neo-liberal jargon) in accordance with the changing structure of demand on the world market.14 Debt leads to the reinsertion of these countries' economies into a reorganized world market. Over an extended period, debt contraction and subsequent reservicing has the consequence of strengthening those sectors with external linkage, redistributing quotas of accumulated political and economic power towards new fractions linked to transnational finance capital. Two new social agents appear: a transnationalized fraction of the bourgeoisie tied to external sectors; and regrouped popular sectors displaced from traditional peasant and industrial production. Each agent becomes politically active and articulates its own project: the former, a return to polyarchy and the consolidation of neo-liberalism; the latter, projects of popular democratization pushed through "new social movements." Each agent, for its own reason, mounted opposition to the military regimes and this opposition coalesced into national democratization movements.

During the 1980s, the transnationalized fractions of the bourgeoisie (the "New Right") came to the fore and achieved hegemony within their class. Sociologist Ronaldo Munck has documented the emergence of "a lucid bourgeois technocracy, based on the internationalized sectors of the capitalist class with the strong backing of global capitalist agencies such as the International Monetary Fund." There was "a felicitous blend between global economic transformations - the era of finance capital hegemony was arriving - and the international class struggle which had thrown up a decisive bourgeois leadership committed to ending the populist cycles and reasserting a new order."15 In other studies, political scientists Eduardo Silva and Alex Fernandez Jilberto show how new capitalist coalitions emerged in Chile between 1973 and 1988 dominated at all times by transnationalized fractions, drawn from financial, extractive export, internationally competitive industrial, and commercial sectors, all linked to the global economy, and how these fractions linked with the military regime and shaped state policies.16 After the military dictatorships created conditions for its emergence, this New Right swept to power in the 1980s and early 1990s in virtually every country in Latin America, especially through electoral processes in "transitions to democracy." In power, it set about to deepen neo-liberal restructuring and to stabilize new patterns of accumulation linked to hegemonic transnational capital.

In sum, by the 1960s the ISI model and populism had lost their dynamism simultaneously with increased political activation among popular sectors. The social order faced a crisis of accumulation and of political legitimacy. The military regimes sought to resolve both the economic impasse and the political challenge. The authoritarian form ·of the political system achieved these objectives, yet resulted by the 1980s in a situation of disjuncture between the economic and political spheres of the social order, whereby the economic rearticulation of society had proceeded more rapidly than the political. A synchronization of the two was required. "The State is the instrument for conforming civil society to the economic structure, but it is necessary for the State to 'be willing' to do this," states Gramsci, "i.e., for the representatives of the change that has taken place in the economic structure to be in control of the State."17 The New Right had to retake formal control of the state as an economic and a political requirement. In the civilian government to dictatorship to "redemocratization" cycle, new transnational fractions among the dominant classes entered the political stage and vied for hegemony, calling for "democratization" so as to regain direct political power, carry forward neo-liberalism, and create the "democratic" mechanisms for managing the conflicts associated with restructuring.

Ironically, in the ten to twenty years from the turn to dictatorship and the return to "democracy," polyarchy started out as a fetter to new patterns of capital accumulation, only to later become a necessity for continuing neo-liberal restructuring. This is because, on the one hand, the dictatorships were blocking the further development, both political and economic, of the new fractions among the bourgeoisie linked to transnational capital accumulation. On the other hand, they had engendered anti-dictatorial social movements by the 1980s that threatened to burgeon out of control and pose an alternative of popular democratization. The relative autonomy dominant classes granted military regimes was based on their fear of the threat from below. When the dominant groups felt they could work within civil society, they began to feel constrained by the shackles of an all-powerful military state. A reactivated civil society played a major role in the rearticulation of the state and the dominant classes.

The military regimes preserved the capitalist social order. But they could never achieve legitimation or a political-juridical formula for consensus in the exercise of power. The dictatorships could not establish institutional mechanisms for harmonizing the interests of dominant classes under the hegemony of the newly emerging transnationalized fraction. The establishment of legitimation through the return to polyarchy became a necessity for the reproduction of capitalism. However, "redemocratization" provided all social classes with access to the political arena. Fractions within dominant groups competed with each other as well as with other social groups. In Chile, "redemocratization" became not the struggle of anyone class but a majoritarian social struggle, in which the primary contradiction shifted from society versus military dictatorship to which social classes would lead the democratization process.

Chile: a "long tradition" of polyarchy

Sealed off from the rest of the South American mainland by the Andean cordillera, Chile was a secondary center for the Spanish empire, valued largely as a backwater producing agricultural and mineral goods for neighboring colonies and the metropolis. As in much of Latin America, with independence from Spain in 1818, an oligarchy of landlords and a small class of urban aristocrats seized control of the new nation. The government apparatus was controlled by an indigenous elite which coalesced through the nineteenth and twentieth centuries, made up of the landed oligarchy, mine-owners, merchants and nascent manufacturers. Unlike the case in neighboring countries, this elite, whose members overlapped extensively through family and commercial ties, developed a high level of cohesion. This allowed for relative stability and intra-elite consensus, notwithstanding brief civil wars in 1859 and 1891.18 The early formation of a polyarchic system among the elite was a central factor in the country's subsequent social and political development, and would lead US and Chilean political observers to extol Chile's "long democratic tradition." What these observers fail to mention is that this "democracy" was the exclusive reserve of a tiny elite, an imprimatur on the feudal hacendado system in the countryside that kept the mestizo-Indian majority in virtual peonage and disenfranchised the vast majority of the population until the second half of the twentieth century. What these analysts are really applauding is not democracy but the viability and stability of elite consensus and cooperation in ruling Chile. In reality, Chilean "democracy" developed much like US polyarchy - restricted exclusively to the elite until well into the twentieth century, when mass pressures gradually opened up the formal political system. By enfranchising only literate, male property-owners, the political system successfully prevented the overwhelming majority of Chileans from participating.

In the 1840s, only 2 percent of the nation's one million citizens were allowed to vote. The figure rose to about 5 percent late in the nineteenth century, and to only 14 percent in the 1940s. A repressive patronage system prevailed in the countryside, where 40 percent of the population resided at mid twentieth century. Instead of providing peasants with ballots, the government authorized rural landowners to "collect" the votes from their inquilinos (serfs or squatters), thus assuring political control by the landed oligarchy. In 1958, women were enfranchised, but the illiterate were still barred from voting, so that in national elections that year only 20 percent of the adult population could actually cast a ballot. With gross socioeconomic inequalities and limited educational opportunities, especially in the countryside, the natural functioning of this electoral system was enough in itself to assure the elite's political power. It was not until the 1964 national elections that the inquilinos were allowed to vote freely, and not until the 1970 elections that illiterates were finally granted voting rights.19

Because of the relative unity of the Chilean elite, an established polyarchic system, and the growth of a militant working class, Chilean social conflict was characterized from the outset less by the intra-elite feuding that predominated in much of Latin America than by class conflict and demands from subordinate groups, first for integration into the political system, and later for fundamental change in the entire social order. By the early twentieth century, workers in the mining enclave, railroads, ports, and manufacturing had begun to organize. The growth of labor strength worried the oligarchy and the emergent middle sectors, which responded in the early decades of the twentieth century with a combination of systematic repression, economic concessions, and the gradual integration of urban workers through suffrage into the formal political system. Anarcho-syndicalist movements gave way to two organized left parties, the Communist, founded in 1921, and the Socialist, formed in 1933, and popular support for the left rose. Chile entered a period of equilibrium, or relative stalemate, among social classes in the post-World War II period, against the backdrop of industrialization and development, a dynamic political party system, and growing conflict between popular sectors, on the one hand, and a complex convergence of local elites and foreign interests, on the other. This laid the basis for a strong tradition of populist programs and fierce party politics.

The major political parties in this period were: the traditional Conservatives and Liberals dating back to independence (which merged into the National Party in 1966), representing the right and the traditional oligarchy; the Radical Party (which dated back to 1863) and the PDC, representing the center and anchored in urban middle sectors; and the Communists and Socialists, representing the left, the working classes and the poor. This three-way division of political forces lent itself to an unusual and highly unstable situation of a strong right, a strong left and a strong center, without any decisive hegemony among them. The three-way left-right-center balance resulted in a political equilibrium for several decades, but also constituted a cleavage which later opened space for popular classes to utilize politics to challenge elite hegemony.

US penetration of the Chilean economy and political system

Great Britain, as the premier imperial power of the nineteenth century, had eclipsed the Spanish crown as the foreign "hegemon" after Chilean independence. Foreign, mostly British, capital came to control some two-thirds of Chile's nitrate, silver and copper mining concerns, the lifeblood of the nineteenth-century economy. But in the final decades of the nineteenth century, US capital also steadily penetrated the Chilean economy as part of the broader process of the displacement of other imperial powers by the United States and the definitive establishment of US domination over the Americas as its "natural" sphere of influence. "The United States is practically sovereign in this continent and its fiat is law upon the subjects to which it confines its interpositions," declared Secretary of State Richard Olney in 1896.20

In the early 1900s, US capital quickly came to dominate the Chilean economy. By the 1920s, the mining industry was dominated by three US companies: Anaconda's Andes Copper and Chile Exploration Company, and the Kennecott Corporation's Braden Copper.21 US banks, utility companies, and industrial concerns also poured in. US domination of the mining industry, which in turn dominated the Chilean economy, had major ramifications for Chilean society and laid the basis for US-Chilean relations. Following World War II, copper came to dominate the economy, accounting for over half the country's exports, and taxes on the US companies' profits yielded one-fifth of the government's entire revenue. Resentment over US domination and intervention grew throughout the twentieth century. US domination over Chile intermeshed with and helped shape the local social structure. The rural sector contained a traditional landowning elite, a peasantry tied by labor obligations to the estate where they lived, and a small but mobile workforce that provided wage labor for the large commercial estates which produced for the foreign, principally US, market. There was a mining, industrial, and commercial elite, many of whose members had kinship ties to the landed oligarchy, and which became thoroughly subordinated to US capital that dominated these sectors of the economy. There was also a relatively large middle class and urban working class.

As US economic interests in Chile grew, so did its political involvement. As in the Philippines, Washington used a judicious combination of military and economic aid, and it also introduced large-scale, covert "political aid" programs as early as 1953, including founding and funding "friendly" media outlets, intellectual and political figures, under the aegis of the CIA, the AID, the USIA, and various nongovernmental organizations.22 Meanwhile, the left grew in strength in the 1950s and 1960s. In the 1958 elections, Allende, running as the candidate for an alliance of Socialists and Communists under the Popular Action Front (FRAP), won 28.9 percent of the vote. A FRAP triumph appeared likely until a defrocked radical priest, Antonio Zamorano, encouraged by the US embassy and by reported CIA payments, entered into the presidential campaign. The former cleric siphoned enough votes from Allende to allow the conservative Jorge Alessandri to win a narrow victory.23 As the 1964 elections approached, US officials and corporations with large investments in Chile became increasingly concerned over a possible move to the left. The Kennedy administration set up a secret Chile electoral committee in 1961, operating out of the White House and composed of top-level State Department, White House and CIA officials.24 As many as a hundred CIA agents and other US operatives were covertly despatched to Santiago to carry out the program, whose purpose, according to a US Senate investigation committee, was to establish "operational relationships with key political parties and [create) propaganda and organizational mechanisms capable of influencing key sectors of the population." Projects were undertaken "to help train and organize 'anti-communists'" among peasants, slum-dwellers, organized labor, students, and the media, "disinformation and black propaganda" campaigns were conducted, and so on.25

Three candidates eventually entered the 1964 race: Allende for the FRAP alliance, Eduardo Frei of the PDC as the centrist candidate, and Julio Duran representing a right-wing coalition. Pre-electoral polls indicated an even split between Frei and Duran, with the FRAP winning by a small but significant margin. Washington thus pressured for a united center-right ticket, and this included channeling funds directly to Duran's coalition for him to withdraw from the race and unite under the Frei ticket.26 The task was made easier by the Chilean elite's own recognition of the threat from below, including the rapid rise in support among the rural population for the left, following the dissolution of the traditional patronage networks among landlords and peasants. Some $20 million were then spent in US covert assistance for Frei's 1964 presidential campaign, which amounted to over $8 per voter and constituted 50 percent of Frei's total campaign expenses.27 These US political operations were crucial in influencing the elite as well as the general electorate. Allende won 39 percent of the popular vote, but lost to the center-right alliance, which together pooled 56 percent of the vote.

Once in office, Frei's government was selected by Washington to be a model for the Alliance for Progress. Alliance objectives were to bolster political centers and promote limited reforms in Latin America in order to undercut radical change and stabilize the hemispheric status quo. "In supporting the Alliance, members of the traditional ruling class will have nothing to fear," explained Kennedy official Teodoro Moscoso.28 Frei's government received over $1.3 billion from US government agencies and private creditors during its six-year tenure (1964-1969), as well as several billion more from other foreign and multilateral sources - by far the largest per capita US aid program in Latin America.29 Parallel to this overt assistance from Washington, the Christian Democrats and other center and right groups were recipients of massive covert funding and advisement aimed at helping them to challenge the left at every level in civil and political society, including battles for control over unions, student associations, cooperatives, professional groups, and so forth. The Senate committee listed some of the specific projects:

Wresting control of Chilean university student organization from the communists; Supporting a women's group active in Chilean political and intellectual life; Combatting the communist-dominated Central Unica de Trajabadores (CUTCh) and supporting democratic labor groups; and, Exploiting a civic action front group to combat communist influence within cultural and intellectual circles. [30]


Although the Christian Democrats developed a significant support base, their reform program was unable to resolve the plight of an impoverished majority. Only 28,000 families benefitted from their agrarian reform and income inequality continued to grow. By 1968, 2 percent of the population still controlled 45.9 percent of the national income, at least half of all Chileans were considered malnourished, and half of all workers earned wages below the subsistence level.31 The failure of the reform program had the effect of radicalizing popular sectors and weakening the Christian Democratic center. In 1969, leftist dissidents representing some 30 percent of the PDC membership, based in the trade union and youth wings, broke off from the party, formed the Movement of United Popular Action (MAPU), and announced their intention to seek an alliance of all popular forces. Both the left and political polarization grew.

The extent of US business involvement was a constant debate in Chile, and had become a critical political issue by the late 1960s, pitting the right, with its support for US (and their own) profit-taking, against the left, which organized increasingly fractious labor strikes and public demonstrations against US firms. On the eve of Allende's victory, foreign, mostly US, corporations controlled virtually every sector of the economy, including the mines, where US corporations controlled 80 percent of copper production and 100 percent of processing. Foreign capital also controlled machinery and equipment (50 percent); iron, steel, and metal products (60 percent); petroleum products and distribution (over 50 percent); industrial and other chemicals (60 percent); automotive assemblage (100 percent); tobacco (100 percent); office equipment (nearly 100 percent); and advertising (90 percent). US direct private investment in 1970 stood at $1.1 billion, out of total foreign investment of $1.7 billion.32 Profits for US firms were enormous: during the 1960s Anaconda earned $500 million on its investments in Chile, whose value the company had estimated at only $300 million, yet it reinvested back into Chile only some $50 million.33

As the 1970 elections approached, the US NSC's "Forty Committee," an interagency group set up to oversee all US covert operations abroad, supervised a full range of intervention activities. But the right, having lost confidence in the Christian Democrats, ran its own candidate this time, Jorge Alessandri. With the split in the elite, Allende, running on the Popular Unity (UP) coalition ticket, won the September 1970 election with 36.3 percent of the vote.

Allende ran on a platform of popular democratization and radical socioeconomic changes, including nationalization of key areas of the economy (especially the mines), a far-reaching agrarian reform, redistribution of income, judicial reform, direct popular participation in government structures, and worker participation in management. The UP program aimed to create conditions for a transition to socialism while respecting Chile's constitution. The economic plan was for a mixed economy, rather than a statist model, involving a public sector, a private sector, and a mixed sector.34 The fear in Washington was that for the first time in Latin American and world history, a declared Marxist assumed the reigns of government within the established constitutional process to initiate a transition in Chile from polyarchy to popular democracy.
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Re: Promoting Polyarchy: Globalization, U.S. Intervention, a

Postby admin » Mon Apr 11, 2016 7:48 am

Part 2 of 3

From covert operations to all-out destabilization

The US destabilization campaign against the Allende government and its contribution to the 1973 coup has been amply documented.35 It was in this campaign that the word "destabilization" entered world currency for the first time. Coined by then-CIA director William Colby, it means studying the myriad of factors that constitute the basis of a society's cohesion and then using that knowledge to literally undo the fabric of society and bring about internal collapse, through overt programs of socioeconomic and diplomatic harassment and covert programs of political, psychological, and paramilitary terror.

In the weeks leading up to the October 1970 ratification by the Chilean Congress of Allende's appointment, Washington scrambled to prevent him from taking office through a host of covert operations, including unsuccessful attempts to have him assassinated, to organize a pre-inaugural military putsch, and, by lobbying in the Chilean Congress, to have it veto Allende's investiture.36 After Allende's inauguration, the destabilization program moved into high gear. Kissinger himself chaired weekly interagency meetings on Chile in the White House, attended by high-level officials from State, Treasury, the Pentagon and the CIA. The leaders of US businesses in Chile, among them ITT, PepsiCo, the mining companies, W. R. Grace Co., Bank of America, and Pfizer Chemical, worked closely with the US government in destabilizing the Allende government. Under the aegis of ITT, US corporations formed an Ad Hoc Committee on Chile to urge on the US government in its campaign. [37]

The program included an "invisible blockade." National Security Council Memorandum 93 was issued prohibiting economic aid to Chile.38 As US ambassador to Chile Edward Korry put it, "not a nut or bolt [will] reach Chile under Allende ... We shall do all within our power to condemn Chile and the Chileans to utmost deprivation and poverty."39 To this was added a myriad of economic sabotage activities and training and support for the paramilitary terrorist activities of the ultra-right Patria y Libertad organization. The high levels of dependency on the United States, including direct corporate investment, reliance on US financing, and a huge debt owed to US creditors, left the Chilean government extremely vulnerable to US economic sanctions. As they sought to do later in Nicaragua, US strategists set about to finance and mobilize those sectors in Chile most adversely affected by the hardships created by US economic sanctions, and then to channel their political energies against the popular government.

The CIA penetrated all major political parties, supplying funds to organize and sustain every major anti-government strike, demonstration and boycott between October 1971 and the September 1973 coup. Among recipients were the Christian Democrats, headed by Aylwin, who represented the conservative wing of the POC. The POC leadership participated actively in the destabilization efforts. Aylwin himself, as head of the Chilean Senate during Allende's administration, urged continued armed repression of the militant, but peaceful, popular mobilization that escalated under the UP government, and all but called publicly for a military coup. He was the architect of what became known as the "white coup d'etat" strategy, which called for placing increasingly broad sectors of public administration under military control and the progressive militarization of government and society to put the brakes on the UP program.40

Another program conducted by the CIA and the DIA was penetrating and courting the Chilean military. The difficulty in gaining influence over the military was described by the CIA as a problem of overcoming "the apolitical, constitutional-oriented inertia of the Chilean military."41 In a secret memorandum early in 1971, US ambassador Nathaniel Davis emphasized that a military coup would only occur when public opposition to the Allende government became "so overwhelming and discontent, so great that military intervention is overwhelmingly invited."42 The economic sanctions and political intervention created internal conditions propitious to a coup. US penetration of the military prompted it to go forward.

While economic aid was cut off, Washington actually increased its military assistance to the Chilean armed forces and training for select military personnel in the United States and Panama. Military aid, after dropping to less than $1 million in 1970, reached an all-time high of $15 million in 1973.43 A flood of US military advisors poured into Chile, and a long list of "intelligence assets" in the three branches of the military was drawn up. Following the September 11 coup, intelligence information collected by the CIA's Santiago station such as "arrest lists, key civilian installations and personnel that needed protection, key government installations that would need to be taken over, and government contingency plans which would be used in case of a military uprising," according to the US Senate report, guided Pinochet and his cohorts in their takeover.44

The overall US response to the Allende government was twofold, note James Petras and Morris Morley:

A combination of severe economic pressures whose cumulative impact would result in internal economic chaos and .a policy of disaggregating the Chilean state through creating ties with specific critical sectors (the military, political parties, etc.) and supporting their efforts at weakening the capacity of the state to realize a nationalist development project. This sustained policy of direct and indirect intervention culminated in a general societal crisis, a coup, and a military govemment.45


The US-instigated coup was the bloodiest in Latin American history. At least 20,000people were killed in the first few months of the military takeover.46 This was a veritable totalitarian regime, one of the most vicious in twentieth-century history, and one that was warmly embraced by the United States. A year later, President Gerald Ford declared that what the United States had done in Chile was "in the best interests of the people of Chile and certainly in our own best interests."47

Defending "our own best interests" in Chile was not seen by US policymakers as a Cold War fight against Soviet influence. State Department analysts assessed that "Soviet overtures to Allende [were] characterized by caution and restraint ... [the] Soviets desire to avoid" another Cuba-type commitment.48 A CIA study three days after Allende's electoral victory concluded that "the US has no vital national interests within Chile, the world military balance of power would not be significantly altered by an Allende regime, and an Allende victory in Chile would not pose any likely threat to peace in the region." The study made clear what was under threat in Chile: the Allende triumph would fragment "hemispheric cohesion [and] create considerable political and psychological problems" for the United States in Latin America.49 Petras and Morley note: "The changes envisioned by the Allende government not only restricted the capacity of US capital to expand in Chile but threatened to disarticulate the economic and trade patterns within the region. Changes in Chile potentially laid the basis for modifying and redefining Latin America's external economic relations." 50 The only threat of the Allende government was as a potential challenge to international assymetries by modifying Chile's internal system through popular democratization, as discussed in chapter 1. In the wake of the coup, one US official declared: "We are now in a position to take a much tougher position toward other [Latin American] countries now that we have eliminated a major problem." [51]

US intervention in Chile does not provide a total explanation of events in that country, neither before, nor during, nor after the Allende period. US destabilization of the Allende government played a crucial role in its overthrow. But it was only effective in conjunction with a host of internal factors, including the local elite's determination to preserve its own historic privileges, as well as the grievous miscalculations, failures, and fierce infighting in the UP government, which should not be downplayed, and which US strategists were able adroitly to exploit.52 In jeopardy in Chile was the ability of the dominant groups to preserve the social order under a polyarchic system. This threat firmly united Washington and the Chilean elite, above and beyond any differences within the local elite or between it and Washington.

The Christian Democrats had signed a formal unity pact with the right-wing National Party against the Allende government and in favor of the destabilization program, and Frei, Aylwin and other POC leaders voiced their unqualified support for the COUp.53 Given that the Christian Democrats, under Aylwin's personal leadership, would later be projected as the bulwark of the "democratic forces" in Chile and the steward of the anti-Pinochet democratization movement, it is important to recall the party's long history of linkages to US political, security, and intelligence organs and its alliance with the Chilean military during the Allende government and after the coup. It was only in 1977, when it became clear that the military was not a mere caretaker government that would shortly hand over power to the Christian Democrats - as the military had promised to Frei and Aylwin before the coup - that the PDC moved into full opposition.54

From counterrevolution to restoration of polyarchy

The Chilean case provides for rich theoretical abstraction regarding relations between states, political systems, and social classes. On the heels of a century and a half of polyarchic tradition, the UP government proposed to implement the project of popular democratization for which it was elected within the legal, constitutional framework, that is, to put "liberal democracy" to a test of its own rules. Allende was overthrown when his coalition attempted to use the legal and constitutional instruments of polyarchy itself to transform the socioeconomic structure of society.

This seems to confirm the thesis which Nora Hamilton developed on the basis of her study of post-revolutionary Mexico of "the limits to state autonomy." Hamilton shows how the Mexican state exhibited the maximum degree of autonomy which states may enjoy, but that such autonomy falls short of the ability of states to actually realize a revolutionary transformation of the social order. Such a transformation would signify a "structural autonomy" of the state, which it does not possess. This transformation would have to come from within the womb of the social order itself, beyond the boundaries of the state power and the state itself (hence the "limits" of state autonomy).55 As regards Chile, the UP government, having captured a portion of the state on behalf of the subordinate classes, attempted to carry through what Hamilton referred to as "structural autonomy," to utilize the state to actually transcend capitalism. This experiment ran up against the "structural boundaries" of the social order. Previously fragmented interests and segments among the dominant classes quickly achieved internal unity, coherence, and class consciousness. The "structural relations" between the legislative, judicial, and military apparatus were such that they became organs penetrated and influenced by the dominant classes, and at the same time both the Chilean state and the dominant classes became closely linked to internationalized organs of the US "imperial state." At the same time, the formal rules and the legitimizing boundaries of polyarchy placed institutional constraints on any UP effort to transcend the social order, while the world economy placed structural constraints on that effort. We will see a similar pattern in Nicaragua and Haiti.

In Chile, polyarchy was ruptured by authoritarianism in order to preserve the social order. Allende's UP moved to challenge capitalism utilizing the very procedures and institutions (i.e., the political-juridical superstructure) of its legitimacy. This situation placed Chile apart from other revolutionary ruptures with existing social orders, whether in the United States (1776), France (1789), the USSR (1917), or Nicaragua (1979), which challenged social orders from outside of their own legitimizing institutionality and created their own, new legitimacy. When a self-declared socialist government came to power, the dominant classes - conceived here as a convergence of dominant groups in Chile and in the United States - were forced to stave off the challenge to their domination from within their own institutions of legitimacy; their only alternative was a rupture with legitimacy in order to preserve the capitalist social order. The Pinochet regime rescued the social order at the cost of legitimacy. Restoration of such legitimacy required reorganizing the political system and restabilizing class domination prior to "redemocratization." The restoration of polyarchy involved a three-step process: first, the brutal destruction of the popular movement and the left; second, the complete restructuring of the Chilean political economy; third, a tightly controlled "transition to democracy," under a new correlation of political, social, and economic forces that would assure a polyarchic, rather than popular, outcome to the anti-dictatorial movement.

The first step, the suppression of the left and the mass social movements and the reversal of the popular structural transformations of the late 1960s to 1973, was swift and brutal. In addition to the reign of terror, expropriated properties were returned to their former owners or auctioned off (all US corporations reclaimed their investments, with the exception of the copper companies, which were paid compensation), peasants who benefitted from the agrarian reform were thrown off their land, trade unions were abolished by junta decree, popular organizations and the UP parties were outlawed (all other parties were placed in temporary "recess"), twenty-six newspapers and magazines were closed, and society became militarized at every level.

"Conditions in Santiago's slums had deteriorated markedly since the military coup, with a reappearance of delinquency, heavy liquor traffic, and disease," reported Le Monde newspaper in January 1974. "Left-wing leaders who helped organize the shantytowns, eliminating crime and improving health and housing conditions, have either disappeared or been arrested or killed since the coup," continued the report. "Local clinics have been dismantled, leading to a reappearance of diarrhea in infants, and the price of public housing has been raised so high that members of the shantytowns could no longer afford it."56 Workers organized into trade unions dropped from over 40 percent of the workforce before the 1973 coup to about 10 percent in the late 1980s. One observer points out: "The smashing of Chilean democracy by the military in 1973carried with it - not a byproduct of the coup but as a strategic objective - the destruction of organized labor and the imprisonment, torture, exile and murder of thousands of union activists." 57 Some one million opponents of the regime were sent into exile, and tens of thousands murdered or imprisoned.

Only after this first step was completed - the destruction of the popular movement, the decimation of the left, and thus the achievement of a completely new correlation of forces favoring elite hegemony and dominant foreign interests - was the next step undertaken. Structural adjustment began with the "Chicago Boys" team, a group of Chilean New Right technocrats provided with scholarships by the AID to be schooled in the free-market ideology of neo-liberalism. At least 150 Chileans, drawn from the upper class and recruited mostly from the conservative Catholic University of Santiago, were sent to the University of Chicago to study economics under Milton Friedman and Arnold Hargberger before returning to Chile to take the reins of the economy and become the technocratic interlocutors between the military dictatorship and international finance capita1.58 In this process new class fractions and social groups came into being with political interests that eventually crystallized around a return to polyarchy. Valenzuela points to the emergence of "a powerful new breed of dynamic business leaders who flourished with the opening of Chile's economy to the world market."59

The third and final phase was restoring legitimacy via a return to polyarchy - but now under the new conditions of globalization. The dictatorship turned over the government to a civilian regime only after that task of anti-popular economic restructuring had been accomplished and only after the left and the popular sectors had been decimated.

In all three phases, the United States was intimately involved, playing a key role as the dominant power under which Chilean classes and groups fought with each other and political and socioeconomic processes unfolded.

Although the new military regime became an international pariah, Washington established cordial relations with the junta. US corporations with interests in Chile and the CIA drafted blueprints for dismantling the social transformations of the Allende period.60 In the two years following the coup, US economic aid, systematically denied to Allende, cascaded into Chile. Washington provided Santiago with $324 million in direct aid and assisted the junta in securing an additional $300 million through multilateral sources. Chile received almost half the foodstuffs authorized by the Food for Peace program for Latin America. The United States also increased aid to the military to an all-time annual high of $18.5 million in 1974, and the CIA provided technical assistance to the newly formed secret police, the National Directorate of Intelligence.61 This aid was crucial in restabilizing the Chilean economy and putting into motion a long-term, neoliberal program. "The disparity between state and corporate involvement is evident in post-coup Chile," note Petras and Morley. "Heavy imperial state involvement is not matched by the multinationals: for the immediate foreseeable future, the imperial state and its financial network is the major political-economic prop for the junta. Only after a substantial and prolonged commitment by the state can we expect the insertion of private capital, despite the junta's policies of 'opening' the country to unrestrained foreign exploitation."62

By 1976, these conditions had been achieved, and foreign private capital substituted US bilateral aid. From 1975 to 1978,nearly $3 billion in foreign private capital flowed in, while US government aid dropped to $25 million.63 Military aid remained at record high levels - $107 million from 1973 to 1977, and then another $20 million from 1978 to 1982, despite the Carter administration's professed human rights policy. And the Carter White House provided Pinochet with $114 million in loans, grants, and donations, and also approved further lending by the international agencies.64 Jimmy Carter himself, following Nixon's and Ford's lead, refused to acknowledge any US complicity in Allende's overthrow.65 After several years of massive economic aid to reorganize and reactivate the economy, Washington thus used military aid to preserve the junta's repressive capacity, which secured conditions congenial to the operation of transnational capital in Chile.

From the mid-1970s to the early 1980s, "political aid" programs in Chile were phased out, partly because of the scandal over CIA involvement against Allende and the shift underway in Washington to Project Democracy and the NED, but mostly because such aid, covert or overt, was neither necessary nor appropriate for US objectives in that period. On the one hand, the dictatorship was effectively using direct mass repression against the popular sectors and their organizations, and on the other hand, traditional civil and political society had been dramatically disarticulated and was still in an early process of reconstitution. This would change in the mid-1980s.

Washington turns to "democracy promotion" in Chile

We believe that a restoration of democracy is the best way of assuring Chile's political, social and economic stability. Terrorism, human and civil rights violations, a substantial Communist party committed to the violent overthrow of the government, the national debt crisis, are only a few of the current obstacles to be overcome in achieving genuine political stability. Perhaps the most difficult challenge of all is forging a broad consensus on the institutional means of rebuilding a stable democracy.

-- US Senate resolution on Chile, 1985 [66]


By 1985, given the demise of military regimes in other Southern Cone countries and mounting unrest inside Chile, the Reagan administration had concluded it was time to phase out the Pinochet regime. Between 1985 and 1988, the United States shifted its support from the dictatorship to the elite opposition.67 The shift came quite abruptly. Between 1981 and 1985, the Reagan administration strengthened relations with the dictatorship under the policy of "quiet diplomacy" towards the South American military regimes. Then, in November 1985, Washington sent to Santiago a new ambassador, Harry Barnes, to replace James Theberge, a one-time CIA consultant whom the Chilean opposition had nicknamed the military junta's "fifth man." Barnes's instructions were twofold: to signal to Pinochet that the United States was shifting tracks; and to develop ties with the elite opposition that was to replace the dictatorship.68 A month later, Undersecretary of State for Inter-American Affairs Elliot Abrams articulated the shift: "The policy of the United States government toward Chile is direct and unequivocal: we will cultivate the transition toward democracy."69

Apart from the general shift to promoting polyarchy, there was a specific Chilean imperative behind the sudden shift: a mass protest movement against the dictatorship had emerged and was gathering steam, encompassing a broad spectrum of groups whose confidence and militancy steadily grew from 1983 to 1987. During this period, leadership of the anti-dictatorial struggle was disputed between popular groups and the elite opposition. If it did not intervene in support of the latter, Washington risked opening space for a popular or leftist outcome to the anti-Pinochet movement, as had happened a decade earlier in Nicaragua. "The challenge is how to support democratic change," said Abrams. "This challenge creates a genuine dilemma because change in friendly countries may, in the short run, entail some risks... But we know that the risks will become larger - unacceptably large, in the long-run - if there is no opening toward a democratic political order." For Abrams, the risk was that "Chile remains a special target for foreign Marxist-Leninists"70 (read: the left is strong in Chile).

Despite the harsh repression, by the late 1970s there had been a gradual recovery within the popular movement, particularly among the pobladores, or residents of poor neighborhoods, and the trade unions, which had been two of the most active sectors before the coup. In mid-1983, the popular opposition initiated a series of jornadas de protesta (days of protest) across the country. The protest movement, although it enjoyed the active support of the Communists, Socialists, and other organized left groups, was initiated not by political parties but by the labor unions and the community-based grassroots popular movement. It caught the elite and US policymakers by surprise as much as it did the dictatorship. The regime, badly shaken, responded by declaring a state of siege and unleashing a wave of repression. Political arrests, which had subsided to an annual number of fewer than 1,000 between 1976 and 1982, climbed to 5,000 by 1984.71 The protests stirred concern in Washington that the dictatorship was becoming vulnerable and that events might slip out of US control.

Two positions emerged between 1983 and 1987, the years in which the direction of the democratization movement hung in the balance. The left and the grassroots popular movement took the lead, arguing for mass mobilizations to bring down the dictatorship. In October 1984, these sectors called a successful national protest strike based on the slogan "Without protest there is no change." As protests increased, so too did the strength of the movement. In March 1986, a new umbrella group, the Civil Assembly (Asemblea de la Civilidad), emerged, encompassing 300 organizations ranging from labor unions, to student, women's, professional, and civic organizations, community groups in the poblaciones, and political parties. Events were snowballing towards an uprising in civil society under popular forces.

The political parties, and particularly the traditional center and right groups, passive and disorganized, were marginal to the rapidly developing movement. A prime objective of US political intervention became to reactivate and unify the traditional political parties, and simultaneously to bolster, or help organize from scratch, moderate groups in civil society to compete for leadership with the popular forces. Once the elite opposition organized, it began its own mobilization and set about to try to gain control of the burgeoning opposition movement. Its strategy, designed in collaboration with US policymakers, was to eschew mass mobilization and instead open a process of direct negotiation with the dictator and seek a pact - behind the back and to the exclusion of the popular movement - for a transition to civilian rule. The popular sectors, in the elite scenario, would constitute "bargaining chips," called upon for disciplined and controlled actions to apply pressure on the regime at key moments in the negotiations.72

Between 1983 and 1985, there was a flurry of low-profile diplomatic activity between Washington and Santiago, as US emissaries tried to open a quiet dialog between Pinochet and the elite. In late 1984, US officials conducted a month-long inter-agency policy review. As a result of the review, said one official, Washington decided to "increase high-level contacts with Chileans in the government and in the opposition to try and bring about a compromise." The US goal was "to get the military and the civilians to realize that the growing split only helps the radical left," and could make Chile "another Nicaragua," said the official.73 However, these efforts amounted to little, because mass popular opposition had seized the initiative and because the elite opposition itself was highly divided; desirous on the one hand to regain direct political power, yet fearful, on the other, of putting too much pressure on Pinochet lest a weakened dictatorship open further space for the popular sectors. These fears were shared by Washington, and the State Department maintained a strict policy of not pressuring the regime publicly and not vetoing any of its loan applications.74

After a new wave of mass protests broke out in November 1984,US officials began to implement the "democracy promotion" program announced by Abrams, which, as we shall see, proved to be a crucial factor in the direction the democratization movement would take. Following the 1985 shift, Washington applied the same combination of coercive diplomacy and carrot-and-stick pressures toward Pinochet as it had done so skillfully toward Marcos. For instance, in June 1985, Washington blocked a $2 billion loan package from the World Bank that Chile had requested. Secretary of State George Shultz stated that the purpose was to demonstrate US "concern" over Chile's domestic situation. If Santiago wanted the loans, it would have to meet certain "conditions" which the State Department had relayed to Pinochet, among them, a lifting of the state of siege so that the elite opposition could mobilize. Two days later, Pinochet lifted the state of siege and the World Bank approved the loan.75 Then, in December 1987, Washington abstained from supporting - rather than vetoing - a new World Bank loan to Chile. "Many argued that the Pinochet regime would collapse if Washington vetoed these loans," one observer noted. "The White House, however, did not want Pinochet to fall unless a moderate democratic government took his place."76

Massive external financing for the regime was not suspended, but sustained by Washington during the entire transition, parallel to the introduction of political aid for the elite opposition. The economic aid was used to keep the regime afloat at the same time as Pinochet was being prodded by a combination of internal and external pressures. In contrast, one month before the $2 billion was released for the Chilean dictatorship, in May 1985, Washington imposed a full economic embargo on Nicaragua, simultaneously with an increase in political and military aid to the anti-Sandinista opposition. The comparison is important: in Chile, the United States wanted the dictatorship to survive, as a bulwark against popular forces, while it carefully nudged power from its hands to the civilian elite; in Nicaragua, the United States wanted to destroy the revolutionary government by any means possible and transfer power to the elite opposition.

Meanwhile, encouraged by the grassroots upsurge, political parties by the mid-1980s had become reactivated and two major contending coalitions were formed, one of the left and the other of the center. One, the Popular Democratic Movement (MDP), was led by the Communist Party and included the main Socialist faction (the Socialist Party, having never recovered from the 1973 coup, had splintered into several factions) and several other left groups. It was promptly banned by the regime. The second was the Democratic Alliance (AD), headed by the Christian Democrats. While the MDP joined the burgeoning protest movement (as did much of the AD rank and file), the AD leadership sought to open a "gentlemen's" dialog with the regime.77

A querulous hodgepodge of new parties and party factions also sprang up, as part of a continuous, and confusing, process of opposition regroupment during the mid-1980s.78 One of these was the Humanist Party, formed in 1985 and attracting urban middle-class youth, another was a Green Party, and a third was the Pro-Democracy Party (PPD), founded in late 1987 out of the second main Socialist faction headed by Ricardo Nunez and Ricardo Lagos. These middle-of-the-road groups, especially the PPD, which attracted middle classes and a portion of the popular sectors, were important in the subsequent formation of a centrist bloc under Christian Democratic hegemony (see below) and in helping shift the correlation of forces in the period 1987-1989 towards a unitary center. With the "democracy program" now underway, Washington's objective became twofold: first, to transfer leadership of the democratization process from the mass movement to the political parties; and second, to isolate the left within the cluster of political parties, bolster the center, and wean the right away from support for the dictatorship.

The shift in policy in Washington was little understood by the Chilean left and the popular sectors, which assumed that the United States would continue unswerving support for the dictatorship. The new US strategy thus contributed to popular disorientation. At the same time, the left seemed unable to find an effective formula for translating the social mobilizations into a viable political strategy. One left faction tied to the Communist Party formed the Manuel Rodriguez Patriotic Front (FPMR) as an underground guerrilla wing (the Communists, after fifty-eight years of peaceful, legal struggle, had endorsed armed struggle as legitimate in 1980). This development caused considerable tactical debate and division within the left.79 In September 1986, an FPMR commando ambushed Pinochet's motorcade, but the General emerged unharmed and promptly reinstated the state of siege that had been lifted a year earlier. The action (or rather, its failure) quieted mass protests and strengthened the moderate opposition's alternative strategy.

The divisive debate over anti-dictatorial tactics also led to the dissolution of the MDP in June 1987.Shortly afterwards, the Communist Party renounced the armed struggle strategy (the FPMR broke away and become an independent group). The left parties regrouped into a new coalition, the United Left (IV). Although the United Left brought together many of the old UP groups - the MAPU, the Christian Left, Communists, Socialists, a sector of the Radical Party, the MIR, and so on - it clearly represented a waning of leftist influence in the democratization movement and enhanced conditions for the elite to vie for the initiative. Following the abortive ambush on Pinochet, the Christian Democrats declared that, because of the Communists' support for violence, any joint action with them was incompatible with a struggle for democracy - quite a hypocritical position, given that the Christian Democrats had championed the violent overthrow of the Allende government after they could not attain their goals through peaceful means. With the active backing of Washington, they set about to shape an opposition that excluded the left.

Meanwhile, the junta had drawn up a new constitution - approved in 1980 in a national plebiscite widely viewed as fraudulent - that laid out an ambiguous program for a return to civilian rule. It called for a plebiscite to be held in 1988, in which voters could simply confirm or reject a candidate put forward by the armed forces. According to the plan, if the military candidate was rejected, power would be turned over to the winner of competitive elections by March 1990. At first, the IV and sectors within the AD advocated a boycott of the plebiscite, fearful that Pinochet would resort to fraud and legitimize his rule. Other groups in the AD, including Christian Democratic factions, argued that, if conducted skillfully, a combination pact-plebiscite strategy could provide for a "safe" transition. These sectors argued that exhaustion and disillusionment had been gradually setting in among the popular sectors, which could be harnessed and channeled into a pact-electoral formula. US funds and policymakers were deeply involved, behind the scenes, in ongoing discussion and analysis with the elite on the most promising "democratization" formula (see below). In November 1987, the IV groups and the Civic Assembly organizations, with the support of many AD sectors, joined together for massive street demonstrations against the Pinochet plebiscite. At this point Washington intervened decisively to press an increasingly united opposition not to oppose the plebiscite, but rather to participate massively in it. The strategy in Washington was to combine its own tough coercive diplomacy toward Pinochet with massive intervention to organize and advise an elite-led opposition to defeat Pinochet in the plebiscite, and then to proceed, on the basis of more political intervention, to guide subsequent national elections. [80]

In December 1987, the State Department released an unusually strongly worded statement calling for a fair plebiscite followed by a "legitimate electoral process."81 For its part, the conservative but influential Roman Catholic Bishops' Conference, which had supported the 1973 coup and for many years had provided ideological and symbolic legitimization for the dictatorship, came out vocally against the regime when the elite opposition began to mobilize. By the 1980s it was leading the cause of human rights. In contrast to the increasingly radicalized grassroots base of clergy and lay workers within the Church, the hierarchy established close ties both with US policymakers and with the elite opposition. Archbishop Francisco Fresno of Santiago worked with US emissaries in brokering a dialog between the elite and the regime.82 In April 1987 Pope John Paul II made a visit to Chile during which he both rebuffed Pinochet and called for "constraint" and "nonconfrontation" among the population, making clear the Church's preference for an elite-led return to civilian rule. Several months later, the Chilean Bishops' Conference called publicly for the plebiscite to proceed under fair conditions, a call which was particularly persuasive with the Christian Democrats.

The combination of US pressures (on both the regime and the opposition), the Church's influential position, and changes in the balance of forces between 1983 and 1987, eventually brought the opposition into a united front to participate in the plebiscite. This same combination of pressures led the regime to agree to lift the "recess" on moderate opposition parties ("Marxist" parties remained outlawed), end the state of emergency, allow exiled opposition leaders to return, establish electoral registries, and provide the opposition with access to the communications media. Genaro Arriagada, a top PDC leader, noted that "the political situation had undergone a change by 1987," such that "the notion had taken hold that the decisive confrontation between Pinochet and the democratic opposition would be an electoral contest. The theme of free elections now began to dominate the debate."83 The conditions were propitious for a broad national antidictatorial front, which crystallized in late 1987 in an agreement to organize a "no" vote in the plebiscite and under the banner of a coalition known as the "Command for the NO." Pre-plebiscite polls funded by the NED and supervised by the NRI indicated that 70 percent of Chileans wanted an end to the regime, but nearly 60 percent were convinced that, through fraud, opposition errors or a new coup, the military would manage to stay in power.84 The goal thus became to build public confidence in the plebiscite and to channel mass energies into the electoral-institutional process.

The baton had passed fully to the elite. By then, the PPD had attracted members of the right-wing Republican Party, the Radical Party, factions of the MAPU and individual Communists, as well as a number of Chilean celebrity figures (artists, singers, and actors). It became an odd grouping, embracing factions from the center-left to the center-right, solidly subordinated to an emergent bloc under Christian Democratic hegemony. By 1988, the entire "democratic" opposition and a significant portion of the left in Chile had united under the hegemony of the Christian Democrats to square off against the dictatorship. This was not a predetermined outcome. The Christian Democrats emerged as the hegemonic party of the opposition only after the crucial 1983-1987 period, and taking into account that the left, already decimated politically and militarily after fourteen years of military rule, continued to suffer intense repression. Apart from generalized repression against the popular sectors, the Communist Party, most Socialist factions, and other left groups remained illegal throughout this period, under a law banning "the advocacy of Marxism." PDC leader Genaro Arriagada noted frankly that, during the long years of dictatorship, the Christian Democrats had the advantage of "less risk of violent repression" than the Communists or the Socialists. "The greatest personal risk for Christian Democrats was exile, while for the communists, it was death." [85] The decline of left and popular hegemony was due to a synchronization of three factors: US political intervention activities, now conducted under the rubric of "promoting democracy"; the regime's repression; and, just as during the Allende period, the left's own sectarian infighting and inability to develop an effective alternative strategy.

This combination of factors laid the basis for the gradual transfer of hegemony over the anti-dictatorial struggle from the left to the center-right. However, the elite opposition was also quite fractious, and US political intervention played an important role in instilling discipline and unity in its ranks. Strengthened by NED funds, political advisors, organizers, and other forms of US support that began to pour in, the elite would take the reins of a tightly controlled transition that would preclude popular democratization from the national agenda.

Ironing out the political system through political operations

Between 1984 and 1991, Washington allocated at least $6.2 million through the NED, and another $1.2 million through the AID's ODI for an array of programs in support of moderate political parties, labor unions, and women's, youth, business, academic, and civic groups. These same groups were also incorporated into regional US programs involving another $5 million.86 Given the long history of CIA and other forms of intervention in Chile's political process, US officials were able to rely on an infrastructure and a broad network which were already established. This US political intervention performed three closely related tasks: (1) reconstituting elite consensus (2) unifying and organizing the elite opposition on the basis of this reconstituted consensus, and (3) competing with the popular sectors at the grassroots level.

Step 1: Reconstituting elite consensus

The first step involved cultivating ties with moderate and conservative political, civic, and business leaders and tapping the talents and knowledge of leading intellectuals. It involved funding several elite thinktanks in Chile to recruit and train these leaders and intellectuals, and draw upon their resources and constituencies. One was the Center for Development Studies, a center-right policy planning institute focusing on political issues. Its director was Edgardo Boeninger, a {DC leader who had been a cabinet minister in the Frei government and had participated actively in the 1970-1973 anti-Allende campaign.87 Boeninger lobbied heavily within the PDC against the social mobilization line, and in 1986 he personally drafted the blueprint for the alternative pact-plebiscite strategy. The PDC was seriously split from 1983 to 1987. The progressive wing supported the social mobilization line in alliance with left and popular forces. The conservative wing, led by Aylwin, Boeninger, and Arriagada, supported the pact-plebiscite line. In this intra-party struggle, US backing for the conservative faction assured its predominance. The strategy sought to win over the middle and upper classes from support for Pinochet, and to demobilize the poor and leave them with no other option than the pact-plebiscite line under elite leadership. (Other NED programs at the grassroots, discussed below, targeted the poor and workers for this purpose.)88 Another think-tank was the Center for Public Studies, run by businessmen and women and focusing on economic affairs. The NED also gave monies for research projects to the Chilean branch of the Latin American Social Sciences Faculty (FLACSO).89 As part of these programs, analysts from NED core groups, the AID, the Department of State, US think-tanks, and universities were sent to Chile to participate and, reciprocally, Chileans from the think-tanks were brought to the United States. These programs included diverse intellectual and cultural exchanges, seminars, training courses, research projects, and so forth.

The objective was to investigate the social and political conditions in Chile under which the democratization process was unfolding and with which US political intervention programs could intersect, and to undertake consensus-building processes around a transnational strategy and on the transnational agenda for Chile in the posttransition period. Collecting precise information on the specific social, political, and cultural conditions in target countries has become a standard feature of these programs. Academic studies in the service of "democracy promotion" may be objective, and often recruit reputable and virtuous intellectuals. However, these academic undertakings enlist Gramscian organic intellectuals to do political and theoretical thinking for dominant groups. As became quite clear in Chile, where many of those who prepared reports through the thinktanks were simultaneously key political actors in the transition, such organic intellectuals are tied directly to contending groups in social struggles and serve key intellectual-ideological functions in those struggles. Information produced through "academic" investigations conducted under "democracy promotion" programs serves to guide US policymakers and their local allies. Chilean and US organic intellectuals and policymakers worked together closely in devising and then implementing an elite transition. The Council on Foreign Relations, for instance, established a special Chile Study Group in 1987. This group brought together representatives from the State Department, the NED groups, private US corporations with major interests in Chile, and key Chilean politicians and academicians involved in the US "democracy promotion" program. Study group participants included Georgetown University professor Arturo Valenzuela (who in 1993 became a high-level Clinton official for Latin American policy), Gershman, Ambassador Barnes, William Doherty of the AIFLD, Edgardo Boeninger and other PDC leaders, leaders from other Chilean political parties, and so forth.90

In Chile, these projects helped to strengthen local elite consensus, cohesion, and unity of purpose, and to orient the elite democratization strategy. The goal, according to a NED document, was "to collect objective empirical data on the political attitudes and behavior of Chileans to serve as a basis for the formulation of a more realistic and consensual set of political strategies of a transition to democracy." Another NED document explained that activities by these policy planning and research centers sought "to conduct an open, pluralistic project of study and dissemination of the basic values of democratic theory to different organized social groups, such as unions and professional associations, and create objective conditions for dialogue among individuals and institutions of diverse democratic political leanings, with democratic theory as the field of analysis."91 Conferences, seminars, and studies conducted by the think-tanks were followed by "outreach activities," including "lectures, conferences, publications, [and] radio programs," to disseminate the results in order to "inform political elites, social and civic leaders as well as the public-at-large." [92]

The NED also developed exchanges between the Catholic University in Chile and US academic institutions, particularly the conservative Georgetown University. The Catholic University was a major base for the Christian Democrats in the 1960s and a key organizing center for opposition to Allende. Campus-based student and professional groups received AID and CIA funds as part of the destabilization program.93 One NED-sponsored symposium on "problems of democracy" held at the Catholic University brought US academics and policymakers together with their Chilean counterparts, and was "a major step in an ongoing effort to foster dialogue among individuals and institutions of diverse democratic political orientations within Chile."94 Subsequently, the Catholic University sponsored a slew of meetings and forums of the elite opposition and became a clearing-house and organizing headquarters for its political activities.

The US organization Freedom House was given several hundred thousand dollars for the Editorial Andante publishing house in Santiago. Freedom House, a Washington-based clearing-house on foreign policy issues, has been closely tied since its inception in 1941 to the US national security and intelligence apparatus. Its principal officers sit on numerous boards of the interlocking political intervention network.95 It specializes in informational and communications aspects of political intervention, such as the circulation of "democratic theory" literature, funding international speaking tours of NED recipients in intervened countries, and funding media outlets in target countries. The Andante program included "the production of books that promote the spread of democratic values ... and the best methods for producing a stable democratic future for this country."96 Representatives of five political parties were chosen to participate in the project: one from the right-wing and four from the center.97Andante, although it was technically a publishing house, functioned throughout the transition period as a policy planning institute and as a clearing-house for disseminating information to public opinion makers in the news media, political parties, and civic groups.

The importance of these "academic" undertakings in Chile in building a Gramscian consensus and in devising technical solutions as the basis for a hegemonic project should not be underestimated. Out of the think-tanks, research centers, and U5-Chilean political and academic exchanges came a steady flow of policy planning and academic literature analyzing the strategies and tactics of a "democratic transition" and providing an intellectual and ideological compass for reconstituting elite consensus. They set the discourse of the democratization agenda and the tone and parameters of public debate. They also contributed to the development of a network of prominent political and civic leaders with a public projection and a political action capacity. "Experts" from these same Chilean think-tanks and research centers were recruited by the NED groups to assist the opposition political parties - together with teams of US advisors - in the plebiscite and elections of 1988 and 1989.98 And after Aylwin came to power in 1990, these policy planning institutes had already drafted concrete social and economic programs for the new government and provided a ready pool of organic intellectuals and technocrats to fill cabinet posts. These NED programs thus helped groom the leadership of a broad and interlocking civic opposition network in Chile of US-allied parties, labor, youth, academic, and neighborhood organizations, and the communications media (see below).

The overall conclusions that emerged from this US-sponsored research was that the popular classes had earlier been able to challenge elite hegemony from within the framework of constitutional legitimacy as a result of a poorly structured polyarchic system. A weakened center and heightened divisions between the center and the right had paved the way for the ascent of the left. If properly organized, a polyarchic system involves a series of functional mechanisms and organizational forms for structuring politics in such a way as to assure precisely that social and political struggles are resolved or defused without any challenge to hegemony itself. Valenzuela, in a NEDfunded study, went to great pains to show that a better mechanistic and institutional organization of the political system in Chile would have prevented subordinate groups from utilizing the state for their own project. Such a better organized polyarchic system would include more parliamentary power vis-a-vis the executive, a less fractious center and right party structure, and stronger institutional links between the state and civil society (with less autonomy for popular sectors operating in civil society).99 This conclusion is echoed in the reports that came out of the US-funded think-tanks.100 Constant themes in the conferences and studies funded by the NED were "the relationship between institutional forms of governance and democratic stability in Chile," "party building for political leaders of the democratic center and center-right," and "strengthen[ing] the Congress' policy-making role in a democratic Chile." [101]

In sum, the "flukes of the Chilean political system" referred to by Kissinger, which had facilitated a legal and constitutional opening for a project of popular democratization, had to be ironed out. This ironing out required reshaping the political landscape so as to achieve a strong center, a strong right and a weak left. The tripolar historic left-right-center stalemate had to be replaced by a bipolar system and a greater fusion of right and center in a stable and solid hegemonic bloc, under centrist leadership. The US objective in Chile was to bolster the center forces - primarily a renovated Christian Democracy - to strengthen a "democratic" right under centrist hegemony, and to wean away the most "moderate" element of the left and subordinate it to the center. As we shall see below, Christian Democratic leaders were placed at the head of every organization and project supported by the NED. The goal was not just to manage the transition from dictatorship to polyarchy, but also to assure that there would be no future "flukes" in the Chilean political system. One 1990 NED document, reflecting back on the successful "democracy promotion" program in Chile, noted:

With their victory [the PDC electoral triumph), it is clear that the Christian Democrats have a key role to play in the transition process that will unfold over the next four years... it is crucial that the Christian Democratic party be able to maintain itself as a buffer between the newly elected president, Pinochet, and pressures from the left. The next four years are very important for Chile's democratic future, because after this transition period, new elections will take place. A repeat of 1973 [sic: the document probably meant 1970) where three distinct political positions emerged - the right, a weak center, and the left, creating a polarized society between two extremes - would have drastic consequences. There are many barriers to be overcome before Chile's democracy is firmly installed but the first steps have been taken to laWlch the COWl try in that direction.102
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Re: Promoting Polyarchy: Globalization, U.S. Intervention, a

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Part 3 of 3

Step 2: Unifying and organizing the elite

Endowment programs helped reactivate political parties, forge a bloc with the center-right at its helm, and have this bloc gain leadership of the democratization movement. Abrams and others in Washington had stressed marginalizing the left and the groups from Allende's Popular Unity coalition in a post-dictatorial period. The NDI and the NRI received some $2 million to work with the Chilean parties between 1984 and 1990.103

Chilean opposition leaders were brought to Venezuela in 1985 to hold meetings with US organizers at the School for Democracy that the NED had set up there in 1984. This "School" was intended to replace an "Institute for Political Education" that the CIA had secretly established in San Jose, Costa Rica in 1960. The purpose of this institute had been to recruit peasant, labor, and political leaders from Latin America and turn them into "assets." The institute was closed after its CIA links were exposed. But the idea was revived as part of Project Democracy, and then reactivated as the School for Democracy in Caracas, now under the auspices of the NED rather than the CIA.104

Also in 1985, the NDI brought leaders of Chile's centrist and rightwing parties to a conference in Washington on "Democracy in South America."105 The conference, declared NDI vice-president Ken Wallock, was "pivotal in promoting unity within the Chilean opposition." On the heels of the conference, the NDI, working in tandem with the Catholic Bishops' Conference in Chile, and particularly with Archbishop Francisco Fresno of Santiago, brokered an agreement among eleven of Chile's moderate political parties on working collectively for a "democratic transition." The agreement, known as the National Accord for the Transition to Democracy, called for constitutional reforms and elections, and explicitly excluded the Chilean left, as did the conference in Washington.106

Pinochet's negotiator with the elite opposition, Interior Minister Sergio Onofre Jarpa, gave his blessing to the accord when it was first signed since it explicitly excluded the left and because, in his view, it provided a good strategy for diffusing the groundswell of popular protest.107 That groundswell, however, did not dissipate, and in the face of continued mass protests, the accord quickly crumbled. The right pulled out over fear that its participation would help fuel the anti-Pinochet ferment beyond elite control, since in 1985 the left still had the initiative. In addition, the Pinochet regime did have a significant support base beyond an inner circle of cronies, including sectors of the technocratic business community that had flourished under neoliberal restructuring and sectors of the traditional political right that felt more secure under authoritarian rule than in risking any popular resurgence in an uncertain transition.

It became a top priority of US strategists to convince these sectors to cast their lot not with the dictatorship but with a return to polyarchy.108 For this purpose, the NRI and the CIPE conducted programs with respective right-wing political and business constituencies in Chile. The big-business community and the traditional right were represented politically in two major parties, the National and the National Renovation parties. The NRI worked with "conservative and moderate political parties... [which] have traditionally suffered from a sense of isolation, and in local political battles they have regularly faced well-financed leftist and totalitarian forces," stated one NED report.109 Meetings and forums conducted by the NRI focused "on those institutions and actors who are not currently as active as they could be in the difficult politics of opposition to the military government."110

The CIPE was put in charge of programs with the pro-Pinochet business community, with the goal of bringing it into the democratization movement and simultaneously imbuing the overall movement with the neo-liberal free-market ideology. The democratization program would thus be committed to free-market neo-liberalism, and in turn the business community would be committed to the democratization program. One CIPE program, conducted through the Chilean businessmen's think-tank, the Center for Public Studies, for instance, involved "a series of seminars on privatization for academics, journalists, government leaders, and the business community ... By building support for a competitive private enterprise economy, CEP seeks to enhance the economic role of the individual and encourage the inclusion of private enterprise principles in the democratic transition process."111 Another CIPE program in 1989, conducted through the Catholic University's Foundation of Economics and Administration, focused on educating the public "on the importance of a free enterprise system in fostering economic growth and supporting stable democracies." The program included designing "courses on free market economics" which were imparted to the leadership of the NED-funded parties, trade unions, and youth, neighborhood, and other civic groups.112 Subsequent activities conducted by both the NRI and the CIPE included the preparation of economic policy documents and their distribution among the political parties and the entire overlapping network of national political, business, and civic leaders being cultivated by Washington.113

The efforts of the NRI and CIPE were largely successful. Although they did not actually join a unitary opposition, much of the business community and the political right did eventually come out in favor of a restoration of polyarchy and of the post-Pinochet political order under construction. Thus the right became, in the words of US officials, a "democratic right." Seen theoretically, the objective - successfully achieved - was gradually to forge a transnational nucleus made up of political, civic, and business elites, and later, to have this nucleus fuse with state managers through a transition from the military to a civilian regime. The new polyarchic state would advance the economic aspect of the transnational agenda, neo-liberalism, through a polyarchic political system, in contrast to the military regime's implementation of neo-liberalism through authoritarianism, which generated too many cleavages to achieve elite consensus and too much social conflict to bring about hegemonic social control. Forging a Gramscian consensus among the elite around neo-liberalism and polyarchy in this way involved three dimensions: converting sectors of the elite formerly committed to ISI inward-oriented and statist development to neo-liberalism; converting the new business elite tied to the global economy to polyarchy; and bringing the two together around the transnational agenda for Chile.

For its part, the NDI took responsibility for encouraging a solid center-left to center-right anti-Pinochet coalition among a broad range of political parties, under the hegemony of the Christian Democrats, and for supervising its campaign activities. It sponsored a follow-up meeting of Chilean parties in 1986 in Venezuela,114 and then transferred activities to inside Chile. US assistance was made conditional on opposition unity. In 1987, as the opposition was beginning to form a single bloc, the NED provided the NDI with several grants to form the Committee for Free Elections as a formal coalition of opposition parties.115 The NDI described the Committee as a "non-partisan and independent group of prominent Chileans,"116 but the Committee was a virtual front, in fact, for the top POC leadership. Its head was Sergio Molina, a POC leader, former government minister in the Frei administration, and a confidant of Patricio Aylwin. Aylwin himself became the Committee's official spokesperson. The Committee's second-incharge was Genaro Arriagada, a member of the PDC Central Board who became the Executive Secretary of the Command for the NO. Arriagada was also head of the Christian Democrats' Radio Cooperativa, one of the most important media outlets in the country and a mouthpiece for the elite strategy. The Committee's fourteen-member board was dominated by POC leaders and, in fact, brought together much of the top leadership of the "civic opposition front" that US political operatives were weaving together. Among them were Christian Democrats Eduardo Frei (son of the former president and the winner of the 1993 presidential elections), Monica Jimenez, who helped run the Catholic University programs and also directed another NED program known as Participa, and Oscar Godoy, Director of the Institute of Political Science at the Catholic University. [117]

In 1988, the NDI sent a team of specialists to Chile to work directly with the political parties. Under the watchful eyes of the ubiquitous US advisors, sixteen opposition parties, including those that had originally signed the National Accord and the newly created Pro-Democracy Party, formed the Command for the NO. Simultaneous to NDI's work with the opposition coalition, both it and the NRI spent over half a million dollars conducting a series of nationwide public opinion surveys from 1987 to 1989, in conjunction with the think-tanks and research institutes.118 The surveys were judiciously used to design campaign themes and strategies and to guide the coalition's activities. "The findings [of the surveys and polls]," explained the NED, "clearly achieved their objective of guiding democratic leaders in planning their strategies for attaining widespread public support."119 For instance, an early poll indicated a split three ways in the plebiscite, with one-third undecided.120 "The undecided vote became the key," said one NDI polling analyst. "They had ambiguous feelings about the policies and plans of the opposition." On the basis of this poll, NDI media consultant Frank Greer drew up a Madison Avenue-style media blitz for the Command for the NO, specifically targeting the undecided.

Another NED program conducted in tandem with the work of the NDI and the NRI was known as Crusade for Citizen Participation, or simply as Participa. Headed by well-known PDC leader Monica Jimenez, Participa carried out a variety of projects intended to cohere the different political parties through consensus-building activities among the elite. These activities included convening several seminars among political parties, government officials, policy planners, and the media on future social policies in the country, as well as conducting a series of broadly publicized "debates" among political party leaders, and designing specific activities to target women. In these activities, Participa was guided by full-time US "trainers," and the materials for its programs were sent to Chile from the United States through Partners of the Americas (which ran NED-funded US-Chilean exchange programs), the NDI, and the Delphi organization, another US-based conduit for NED funds.121

Through Delphi, the NED provided support to La Epoca, a newspaper launched by the Christian Democrats in 1987 which quickly became one of the country's main dailies. La Epoca proved to be a refreshing alternative to the tightly censored media outlets that functioned under the dictatorship, including El Mercurio. The latter had been a major recipient of CIA funds in the 1960s and had played a key role, through its psychological operations, in the anti-Allende destabilization activities,122 but after the coup it refused to switch loyalties from Pinochet to the opposition. La Epoca provided a broad outlet for the opposition's public projection and for fostering discussions conducive to consensus-building and unity around the centrist bloc under formation.123

US intervention in Chile's internal political process reached a pinnacle in 1988, the year of the plebiscite. Washington allocated approximately $4 million through the NED and through the AID's ODI to organize and guide the Command for the NO,124 The AID granted $1.2 million to the Costa Rican-based Center for Electoral Assistance and Promotion (CAPEL), an organization formed in 1982 at the behest of US policymakers as a conduit for US political operations in Latin America, and whose board members were drawn from the same sources as the interlocking directorates of the other NED groups.125 The CAPEL sent a team to Chile to work with the Catholic Church-sponsored Fundacion Civitas and with Participa for "voter education" campaigns.

In the division of labor, the NDI guided the political parties in the campaign, while CAPEL supervised such activities as highly successful voter registration drives, door-to-door canvassing, distribution of electoral paraphernalia, and poll monitoring. A US trainer was selected to prepare step-by-step manuals and other materials for Chilean organizers, and other US advisors managed the "national forums" that Participa and the Fundacion Civitas conducted.126 Meanwhile, NDI advisors designed the coalition's campaign and even produced its media advertisements, exporting US campaign techniques, particularly those which took full advantage of new communications technology and the use of television. "In Chile, we went in very early," said one consultant sent down by NED. "We literally organized Chile as we organize elections in precincts anywhere in the United States."127 And as in the Philippines, US pressures on Pinochet, along with the presence of some 6,000 foreign electoral observers and quick-count tallies on voting night conducted by US advisors, were crucial in preventing fraud and assuring that the dictator would respect the outcome of the vote.

Following the plebiscite, the Command was transformed into a coalition of seventeen political parties, known as the Concertacion, which nominated Aylwin as its presidential candidate. Aylwin was more concerned during the brief campaign with containing popular enthusiasm for change than with squaring off against his electoral opponents. The NO victory generated "enormous expectations among the common people," he said during a campaign interview. "These sectors will press for popular demonstrations and protests. The biggest challenge that we political leaders face is controlling such pressures." 128 Pinochet's followers nominated Heman Buchi to the promilitary Independent Democratic Union (VOl) ticket. The traditional right decided to run its own candidate, Francisco Havier Errazuriz, a prominent businessman from the National Renovation Party. Aylwin's coalition, with more NED support, won the December 1989 election with 55 percent of the vote (the two right-wing candidates garnered 45 percent of the vote between them).129 This was the first election in modem Chilean history in which the left had no candidate of its own and no conspicuous or autonomous participation in the political process. US efforts had largely succeeded in completely reconfiguring the Chilean political landscape, and in particular, in restructuring three blocs (left, center, right) into two blocs, the center (with left and right elements at its fringe) and the right. By the late 1980s, even before the 1990 transfer of government to Aylwin, US political operatives were referring with great satisfaction to "two major political currents" in Chile, the center and the right.130 This new political configuration appeared to have stabilized in the early 1990s. The 1993 national elections were a contest between two presidential candidates, Arturo Alessandri, candidate for a coalition of rightist parties, and Christian Democrat Eduardo Frei, candidate for the Concertacion coalition - both sons of former right and center presidents in the pre-Allende period.

Step 3: Suppressing popular mobilization

If step I was defining the contours of a controlled transition and step II was unifying and organizing the elite, the third step was competing with, and displacing, existing popular leadership and initiative at the grass roots level. There were two priority target sectors: the poblaciones and labor. The sprawling poblaciones had historically been hotbeds of radical political activism, and were bastions of support for the Allende government. Following the 1973 coup, the junta made an unsuccessful effort to pacify the poblaciones by replacing leftist community leaders with junta supporters, in many cases Christian Democrats.131

In mid-1985, the NED planned a program for funding and advising the Neighborhood and Community Action (AVEC) group, a civic organization that targeted poblaciones in Santiago and other major Chilean cities. A NED summary document in May 1985, titled "Democratic Action in Slum Areas," stated:

The political, social and economic crisis inside Chile is being used by the Communist party to penetrate the "poblaciones" through an effective campaign to incorporate the poor into their ranks. Moreover, the restrictions and prohibitions imposed by the military regime on democratic political parties have smoothed the way for the Communist party, accustomed as it is to working under clandestine conditions... In an effort to counter the predominance of the Communist party in the "poblaciones"... [the AVEC project] is designed to support the activities of the avowedly democratic organizations, focusing on the country's most densely populated areas; in order to counter the Marxists' intensive activities in these areas, the proposed program... would initiate professional training and indoctrination programs particularly for Chilean women and youth. (Courses would include sewing, children's fashions, hairdressing, knitting, cooking, first aid and arts and crafts.) Democraticeducation would place great emphasis on the value of representative democracy, and would stress the proposers' [sic]opposition to the popular democracies advocated by Marxism.132


The AVEC program was administered by the Delphi International Group, a self-described multinational consulting and management firm. Since the early 1980s, Delphi had functioned as a large-scale contractor for the USIA and the AID. With the NED's creation in 1984, Delphi became one of the principal contractors for its projects in Latin America, especially those involving the communications media, and women, youth, and community groups. In late 1987, Delphi assigned its staff member Henry "Hank" Quintero to coordinate its Chile programs.133 Quintero was an intelligence community veteran who, together with Richard Miller and Carl "Spitz" Channel, had run the Institute of North-South Issues, which was exposed in the Iran-Contra scandal as an Oliver North front group.134

The AVEC was actually founded in 1964 under the auspices of the Santiago archdiocese as a "self-help" charity-oriented program. It was run by Christian Democrats, with US support, as one of their "communitarian" projects in the 1960s campaigns to develop a social base and counter the left. In the late 1970s, Christian Democratic organizers reactivated AVEC. Its president was Sergio Wilson Petit, a PDC leader and a lawyer involved in the early and mid-1980s negotiations between the elite opposition and the dictatorship. Another AVEC leader was Hernol Flores, also a PDC leader. In 1973, Flores had come out vocally in support of the coup.135 Not surprisingly, simultaneously with his leadership in the AVEC and militancy in the PDC, Flores was also the Secretary-General of a US-funded trade union federation (see below).

Using the "multiplier effect" method, and manuals, audiovisual, and other materials supplied by Delphi, the AVEC conducted leadership training seminars for several thousand local leaders, who then spread out and organized the poblaciones zone by zone. Activities focused on weaning the poor neighborhoods away from leftist influence and radical sympathies, and channeling political energies into the plebiscite, and later into the 1989 presidential elections. "These programs were active in organizing residents in their communities to either challenge established leaders or assume the presently unoccupied role of community leaders," reported Delphi. "Discussions [in NED-AVEC seminars] held in the poblaciones centered on the concept of heritage and the concept of rights residing with the individual and not with the state."136 Another document cautioned: "the urban slums and shantytowns are centers of acute social conflict. .. due to the permanent nonsatisfaction of their demands, it is urgent to address this situation and incorporate them into the redemocratization process." There is "intense opposition in the poblaciones to the regime," it warned: "This intense social mobilization has generated repression [from the regime] and has also opened up new space for some of the historic political parties of the center to restructure their work" in the poor neighborhoods. It then listed the specific objectives of the NED-AVEC program: "mount a democratic alternative that undercuts the process of communist and fascist penetration of the marginal sectors in our country"; and "conduct intense promotional work so as to penetrate the organizations that currently exist, and to incorporate these actively into the objectives of this project."137 A NED report on the program stated that "the project with AVEC directly filled a void within poor community organizations in Chile. AVEC is one of the few Chilean organizations working with the poor to enhance both socio-economic well-being and political and social awareness."138 In reality, there was no such void in the poblaciones - both the organized left parties and the communities themselves were highly organized, and politically and socially aware. The objective was not to fill a void but to compete with existing organizational forms and to try and displace their leaders.

An important aspect of the AVEC, and all NED and AID "democracy" programs in Chile and elsewhere, is the propagation of specific ideological messages associated with capitalist polyarchy and consensual domination, including a highly individualist and atomized conception of "individual rights and responsibilities," in contradistinction to competing concepts of collective mobilization, demands, and rights. The objective is to defuse and destructure autonomous mass constituencies. "AVEC's civic education programs were closely linked to the socio-political situation in the targeted communities and were aimed at supporting momentum for the return to democracy," explained the NED. "[NED] grants enabled AVEC, during a critical juncture in Chilean politics, namely the pre- and post-Plebiscite periods, to provide a viable alternative." Through the NED program, "AVEC has gained the loyalties of its constituencies, and has effectively encouraged a self-help approach in the targeted organizations."139 At a time when mass mobilization was sweeping the poblaciones, placing collective political demands on the dictatorship for democratization and also collective socioeconomic demands for public resources for food, housing, and employment, the AVEC propagated its alternative approach of community "self-help" and "individual participation" in the political process. Explained another NED report: "At the communal level, AVEC's main area of emphasis, civic education efforts, continued to address the individual's rights, obligations, and participation in a democracy."140

The NED program targeting the second priority sector, labor, was conducted by the FTUI.141 As in the Philippines, the United States backed a minority labor federation with the aim, not of defending workers, but of tempering the revival of labor militancy. In 1983, in the heat of the renewed protest movement, a broad new labor federation was formed, the National Workers Command (CNT), described by one informed observer as "the most representative labor coalition since the United Workers Central (CUT) was abolished by the military in 1973."142 Chile's trade unions have a long history of militancy and of genuine pluralism in their own ranks.143 Before the coup, over a million workers in some 10,000 workplaces - more than 40 percent of Chile's workforce - belonged to the CUT. Labeled by Washington as a "communist front," the CUT, formed in 1953 out of diverse federations, brought together trade unionists of differing ideologies and political affiliations, including Christian Democrats, Socialists, Communists and Radicals, into a single body, and was perhaps unique in Latin America in its commitment to labor unity.144 Now, once again, in 1983, the CNT mushroomed into the largest and most representative federation. Its leadership included Communists, Socialists, Christian Democrats, and others under a program of broad labor unity and militant opposition to the dictatorship.

In 1984,a year after the CNT was formed, the FTUI began funding a small grouping, the Democratic Workers Union (UDT). The UDT had grown out of the "Group of Ten," a small club of trade union leaders led by Christian Democrats from the right-wing of the POC and financed by the AFL-CIO since 1976.145 As in the Philippines, the "Group of Ten" was for the most part unmolested by the dictatorship and even collaborated openly in the mid-1970s with the junta, which continued to brutally repress unionists from the banned CUT.146 According to the NED, the UDT received support because its "development has been severely curbed by government restrictions and threatened by communist-subsidized rivals."147 Briefly, in 1983, the UDT joined the CNT, but in 1984,the same year that it began receiving NED funds, it broke off, and subsequently renamed itself the Democratic Workers Confederation (COT). US funds enabled the COT "to establish youth and community services, to distribute an information bulletin and to conduct a media outreach campaign," explained a NED report. "Regional offices have been established and seminars have been held" by FTUI specialists to train local leaders. The NED also financed a COT campaign to gamer workers' support for the abortive National Accord signed by the moderate parties in 1985.148

Thus, between 1984 and 1988, the crucial period in which the leadership and direction of the democratization movement was being fought out, there were two principal labor organizations, the pluralist and militant CNT, which advocated continued social mobilization against the dictatorship, and the minority COT, which called for an "orderly return to democracy" and the exclusion of Communists, Socialists and other left groupings from the labor movement.149 But pressures were mounting in Chile for a unitary labor federation. A convention was planned for late 1988 to form a new labor central out of the CNT and other groupings, to be called the Unified Workers Central (CUT, with the slight change of name meant to get around the regime's ban of the defunct United Workers Central). The US-sponsored COT had remained a minority grouping, but clusters from its rank and file had steadily broken off to join the CNT under the banner of labor unity. In that year, the NED described the minority group as "the embattled Chilean trade union federation," meaning that it was losing ground to the CNT. Thus, in 1988, US strategy shifted from trying to bolster the parallel unionism of the COT to trying to gain as much influence as possible within the soon-to-be-formed CUT, eclipse leftist influence and counter the social mobilization line. The NED continued funding its parallel federation, but at the same time advised the group to join the new CUT as a constituent member. Then, starting in 1989, the NED simultaneously funded the COT and began to penetrate and fund the CUT. As with the political parties, the strategy was to try and achieve the overall hegemony of pliant, moderate and pro-US forces within the national democratization movement. This dual funding - for the COT as a small, constituent member of the CUT, and for the CUT overall - continued into the 1990s. [150]

The CDT, affiliated to the ICFTU, became the Chilean representative to that body. CDT Secretary-General Hemol Flores, a Christian Democrat and also an AVEC leader (the CDT central offices in Santiago also housed the AVEC national headquarters) endorsed Aylwin early on and campaigned actively for labor support for the Aylwin ticket. In addition Hemol Flores was interviewed regularly in the television programs sponsored by the Catholic University, in La Epoca, and in the other public forums and media outlets of the US-promoted civic opposition front, as "the representative of labor."

In targeting labor, the FTUI sent in several dozen AIFLD field organizers to train top-level Chilean union leaders, who then, through the multiplier effect, branched around the country with the dual agenda of organizing labor into the anti-Pinochet, pro-centrist bloc then under formation, and competing with more radical and leftist labor tendencies.151 Following Aylwin's inauguration, funds went for CDT recruitment drives and stepped-up activities to counter leftist opponents. "The democratic sector of CDT needs reinforcement in several important provinces of the country, as the antidemocratic sectors of the organization have mounted vigorous recruitment campaigns among workers in these areas."152 Beyond seeking to marginalize militant tendencies, US activities also sought to gamer workers' support for the neo-liberal program. NED funds sponsored the drafting by the CDT of a forty-point program for labor-management relations (the program was presented to, and adopted by, Aylwin's administration), and a series of forums to promote "dialogue and cooperation" between labor and the business sector.153

A third sector targeted by US operatives was Chilean youth. "Political education has been tragically neglected in Chile during the past fourteen years, weakening the ability of centrist forces to consolidate popular support and posing a serious obstacle to the reemergence of a stable democracy," warned a 1987 NED document. "Given the dearth of democratic education, youth, in particular, are highly susceptible to the 'idealistic' rhetoric of Chile's Marxist parties."154 Delphi took charge of a program with the Institute for the Transition (ISTRA), which subsequently changed its name to the Center for Youth Development (CDJ). Another NED document noted: "The US Embassy in Santiago reports that ISTRA is the moderate wing of the Christian Democratic Party's youth organization ... ISTRA is described as markedly pro-US and dominated by moderates."155 Under Delphi advisors, Miguel Salazar was named CDJ president. Salazar at the same time held the post of PDC National Advisor. Another top CDJ leader was Sergio Molina, also a Christian Democratic activist and a personal advisor to Aylwin.

Young people were considered a strategic sector because the anti- Pinochet strategy devised by Chilean activists and US advisors was based on registering a vast bloc of the population to vote. Through a voter registration campaign, they hoped not only to assure a high turnout and an electoral victory, but also to reach a major portion of the population with the elite political message. "Among the nearly 5 million citizens who have not registered" of an estimated 8 million eligible voters in Chile, noted a 1988 NED document, "the CDJ estimates that sixty-five percent are between the ages of eighteen and twenty-eight, mostly from the poorer sectors of the population."156 Thus a huge proportion of the electorate had reached maturity under the dictatorship, when politics was illegal and civil society suppressed. According to CDJ president Salazar, "we must do something to orient and channel the conduct and attitudes" of this youth generation. "The idea is to be able to make this new line of work [among youth) complementary to our other work in the doctrinaire and political areas."157 The youth program implemented the multiplier method: 2,500 university, labor, peasant, and community youth leaders were trained by US advisors. "Each individual trained will reach an additional 15-30 young people over a two-year period," explained the NED.158 The youth leaders were oriented, following their training, to liaison with the political parties that had signed the U5-brokered National Accord.159 The CD] also established an "academic committee" to liaise with the political parties and the think-tanks being funded by Washington. The flood of literature and paraphernalia from the think-tanks, research centers, and publishing outlets thus supplied the US-funded civic groups with political orientation and materials to conduct their work.

The new modalities of US political intervention in Chile did not cease with "redemocratization" but shifted focus, from guiding a transition to further penetrating Chilean political and civil society and consolidating an emergent polyarchic system and elite hegemony. The same groups funded during the transition, many of them now in government, continued to receive political aid from Washington, and new programs focused on fine-tuning the mechanisms and institutions of Chilean polyarchy. As PDC leader Sergio Molina stated in a late 1989 report to the NED: "Now that the elections are over, what is needed is to provide for administrative functioning under the new institutionality, as regards the process of decision making and the system of relations between state powers, especially executive-legislative, and between the state and the social organizations and private entrepreneurs." 160 New programs in the early 1990s focused on strengthening the center and the right, fostering polyarchic political culture in the parties and civic groups, and maintaining consensus for the neo-liberal program.161

Conclusion: Neo-liberalism and polyarchy: the dialectics of transnational economics, politics, and social order

The changes in work patterns [resulting from economic restructuring] have had a significant impact on social relations .. , The fragmentation of the social relations of the workplace has obscured the sense of collective fate and identity among Chile's working class. The transformation of the workplace has been complemented by the transformation of the political system... The fragmentation of opposition communities has accomplished what brute military repression could not. It has transformed Chile, both culturally and politically, from a country of active, participatory grassroots communities, to a land of disconnected, apolitical individuals. The cumulative impact of this change is such that we are unlikely to see any concerted challenge to the current ideology in the near future. -- Cathy Schneider, scholar on Chile [162]


As in the Philippines, Chileans were genuinely elated over the opportunity to rid themselves of a dictatorship. Participation in the NO campaign and the 1989 elections as a means of removing Pinochet was genuine and mass-based. But there are important differences between the two countries' democratization movements. By 1988 the anti- Pinochet forces were well organized, the hegemony of the elite opposition over the anti-dictatorial movement was already achieved, and the transition from authoritarianism to polyarchy was proceeding considerably more smoothly than in the Philippines. Yet in both countries there was a convergence between popular sectors, the left, the elite opposition, and US interests in getting rid of dictatorships, and simultaneously a contention between popular and elite alternatives to the authoritarian regime.

Through its ubiquitous and multi-layered intervention in Chilean society, ranging from influence over international lending agencies to state-to-state relations with the Pinochet regime, Ambassador Barnes's influential diplomatic activities inside Chile, political assistance and advisement of the opposition parties, and grassroots intervention in civil society, the United States was able to foster a well-oiled "democratization" machine that latched on to the Chilean masses' authentic democratic aspirations and helped to channel the entire process into an elite outcome. Protagonists of the new political intervention could boast of consecutive "success stories" in the Philippines and Chile. US intervention synchronized with internal Chilean factors and the macrostructural context described at the outset of this chapter to determine the outcome. US intervention in the transition must be seen as part of an uninterrupted process of intervention in Chile's internal political process over some twenty-five years that was crucial in shaping the dynamic of "democratization." Following the transition a torrent of academic works published in the United States on this "democratic miracle" argued that "democracy" had been successfully "restored" to Chile and that the United States played a remarkably constructive role - a position which has uncritically been taken for granted, indeed, a position which has achieved intellectual hegemony.163

Just as in the Philippines, the reach of the democratization process in Chile became severely curtailed, and was contained comfortably within the prevailing social order, as a result of the manner in which the anti-dictatorial movement unfolded. But unlike the Philippines, where left and popular sectors enjoyed sufficient strength and autonomy in the climax of the anti-Marcos movement and the first part of the Aquino administration to force the government to launch an authentic reform program (which was subsequently undermined), the new Chilean rulers were explicit in stating that there would be no fundamental changes in the socioeconomic order. The entire Chilean elite, historically divided over development models, had achieved consensus during the twenty-year overhaul of the Chilean economy and society in the context of globalization.

And as in the Philippines, the preservation of the repressive military apparatus and its impunity remained an instrument of blackmail against popular claims for deeper social transformations. Virtually all military institutions remained intact, Pinochet himself was scheduled to remain the head of the armed forces until 1998, the constitution stipulated that the military appoint eight non-elected representatives to the Senate, and the Supreme Court upheld an amnesty for human rights violators decreed in 1978. Edgardo Boeninger, who helped design the elite democratization strategy through the NED-funded think-tanks and went on to become Aylwin's chief of staff, made clear: "Should a government attempt to make drastic changes in the socioeconomic system - as was the case of Chile under Allende - the threatened sectors [that is: the dominant minority] will decide that democracy is no longer able to protect their basic values and interests. A 'coup mentality' is the likely result."164 Such reasoning was shared by the entire coalition that backed Aylwin. Socialist deputy Camilo Escalona asserted: "We think ... that the greatest threat to the democratic process isn't Pinochet. The greatest threat is that the people will not see its demands satisfied, that the people will be disenchanted with democracy, that millions of persons will turn their backs on the democratic process because it is not capable of responding to their enormous demands."165 The "threat" to Chile's new "democracy" thus became, not the specter of a new coup by a privileged military caste, but potential demands by an impoverished majority for changes in the socioeconomic system that might improve their lot.

In his first year in office, Aylwin increased the military budget. In November 1990, the Bush administration lifted an earlier ban on the sale of military equipment to the Chilean armed forces and resumed military aid. An intact and autonomous military and security apparatus functioned to keep the left and popular forces in fear and in check in the post-transition period and to further circumscribe democratic participation. Human rights organizations reported a spate of continued violations despite the end of systematic repression.166 As part of the "negotiated transition," the military and the incoming civilian government agreed that the military budget could not fall below the 1989 level of $1.4 billion out of a total of $7.7 billion. In 1989, the military budget was $432 million higher than the housing, health, and education budgets taken together.167 By guaranteeing the military such huge resources, there was little surplus to attend to the pressing needs of the impoverished majority. Thus, even if the new government had the will to undertake basic social and economic reforms affecting wages, housing, health, and education, it could not do so without challenging the military's preeminent role in political life. Why the new civilian government remained so beholden to the military, beyond the latter's own threats, is explained by the dynamics of polyarchy and neo-liberalism.

Chile provides a clear example of the fusion of "promoting democracy" and promoting free markets in US foreign policy. Chile has been held up to the world as a model of "successful redemocratization" and as an "economic miracle" which demonstrates the virtues of global capitalism, from which other Third World countries should take inspiration. In this view, uncritically adopted by a host of academics, journalists, and policymakers, Pinochet is criticized for his authoritarianism but credited as a hero for the "economic success story," and "redemocratization," as a matter of course, meant a return to civilian rule without any change in the socioeconomic order. Alejandro Foxley, a leader of the elite opposition to Pinochet, declared following his appointment by Aylwin as the new finance minister: "A country shows maturity when it is capable of taking advantage of the positive experiences which others have implemented, even when one doesn't like the government which implemented these measures. I respect technically and professionally those who were in the previous government." 168

However, a cursory empirical glance at the actual structure and performance of Chile's economy reveals the real "miracle" was (and continues to be) a "success story" for a minority of the Chilean upper and middle classes together with transnational capital operating in Chile's free-market environment, but a burden for the broad Chilean majority. The mass of Chileans have sunk into ever deeper impoverishment. What took place between 1973 and 1993 was a severe, and still continuing, regression in democratization of the economy and in the well-being of the mass of Chileans. During the military regime, poverty levels increased by 100 percent, and by 1990, 45 percent of the population were living in poverty.169

Petras and Vieux show that in four key areas touted .as "success stories" - poverty management, growth, privatization, and debt management - Chile's performance under the dictatorship does not stand up to an empirical test. As for what neo-liberal jargon calls "poverty management," what took place in Chile was just that: the management, not the decrease or elimination, of poverty. As wealth continued to concentrate in the 1970s and 1980s, overall poverty levels increased. Real wages fell 40 percent during the first decade of military rule. By 1987, GDP per capita barely equaled that of 1970, while per capita consumption was actually 11 percent lower than the 1970 level.170 Contagious diseases spread as health expenditures fell from $29 per capita in 1973 to $11 in 1988. Typhoid cases, for instance, more than doubled between 1970 and 1983,and in the 1980s, Chile accounted for 20 percent of all reported cases of typhoid in Latin America. While 45 percent of the population dropped below the poverty line, nearly one million families were homeless out of a population of some twelve million people.171 Modern shopping malls rivalling the most luxurious found in the developed countries sprang up in Santiago's plush upperclass neighborhoods in the 1980s and 1990s, at the same time as shantytowns spread like wildfire in the outskirts of the capital and other Chilean cities, fed by the growing army of those marginalized and excluded from the "miracle."

As for growth, GDP grew by an average of 3.9 percent in the period 1950-1972, dropped to 1.4 percent from 1974 to 1983, and averaged only 1.2 percent during the 1980s,the years of the alleged "miracle." 172 Moreover, given the cyclic nature of this growth, it being interrupted by several economic crashes, including a 1982 collapse which brought unemployment to over 30 percent and shrank the GOP by an incredible 14 percent, "these rates didn't contribute to growth at all, properly speaking, but to the recovery of previously achieved levels."173 In another study, Chilean economist Pedro Vuskovic points out that economic growth rates between 1974 and 1989 were considerably below the overall Latin American average of 4 percent for this same period.174 "Far from advancing," he notes, "Chile receded with respect to Latin America as a whole." Even if one were to disaggregate growth rates and point to high rates from the mid-1980s into the early 1990s, the more important question is not whether total output has increased, but what impact an increase in the total production of wealth has meant for the Chilean majority. Increased wealth has not meant an improvement in the living conditions for the majority - it has meant "poverty amidst plenty," has brought a concomitant increase in the drainage of wealth out of Chile, and a concentration of that wealth remaining in Chile into the hands of a minority.

Pinochet's regime's alleged dexterous "debt management" is based on its successful renegotiations in the late 1980s and on its perfect debt-servicing record. Chile's perfect record in its foreign debt-service payments is without doubt a "success story" for the international banks, which recover loans and earn interest, as is privatization for local investors and transnational capital. But the regime was forced to manage a debt which it accumulated in the first place, mostly to increase imports of consumer goods destined for luxury consumption under the neo-liberal lifting of trade controls, and which totalled $20 billion by late 1987, the highest per capita level in the world. Renegotiations amounted mostly to exchanging bilateral debts with commercial banks for new debt with multilateral lending institutions. Most important, debt-servicing has meant a permanent drainage from the country of whatever increased wealth was actually produced. In the late 1980s debt-servicing consumed a full 5 percent of the country's annual economic output. Compared with average annual growth in this period of 1.2 percent, we are left with a dramatic net outflow of wealth, well beyond new growth, as a result of debt-servicing. 175 Privatization has brought the government temporary and non-sustainable revenues, used mostly for debt-servicing, and at the same time has resulted in a dramatic concentration of capital and the transfer of a huge portion of the Chilean economy from local hands to transnational capital. The much-touted inflow of foreign investment in the 1980s did not constitute, in its majority, new productive investments, but foreign purchases of existing Chilean assets through debt conversion programs.176 The bulk of productive foreign investment which did enter the country was in the form of agri-business, which accelerated a process of proletarianization of the Chilean peasantry and increased urban and rural unemployment. [177]

The "miracle" involved the successful rearticulation of Chile to the world market, and a dramatic expansion of exports, at a time when the global economy was emerging. Exports as a proportion of GDP soared from 19 to 32 percent from 1984to 1988,178 due to a pattern of dynamic growth confined to a narrow range of "non-traditional" primary goods exports, particularly seafoods, timber, and fruits, which, together with the traditional mining sector, accounted for nearly 90 percent of exports.179 Historic dependence on primary exports has dramatically increased in an entirely unsustainable model. Overexploitation of maritime resources, which are expected to be depleted by the next century, has already led to the extinction of several marine species. As timber reserves become depleted, overexploitation has triggered an ecological disaster - rapid soil depletion, a decrease in precipitation, and an incipient process of desertification. Moreover, given heavy foreign participation, much of the wealth produced in these dynamic export sectors is sent abroad through profit remittance. By way of example, two-thirds of the increase in export earnings produced in 1990 was transferred abroad (of that remaining in Chile, 85 percent corresponded to capital profits and only 15 percent to that retained by the wage sector).180

This is a general Latin American pattern - a crucial point simply ignored by the proponents of neo-liberalism, yet one which belies the very basis for legitimizing the model. Both the volume and the value of Latin American exports grew in the 1980s and early 1990s - a central goal of restructuring - yet these "gains" merely resulted in net capital transfers abroad in the form of debt servicing and profit remittances. Benefits from the generation of greater surplus as a result of increased production for export are canceled out by the permanent drainage of surplus from Latin America. Pointing to increased export-oriented production as an isolated variable therefore conceals the reproduction, and intensification, of relations of dependence and domination and of real social inequalities. The Chilean "success story" also includes macro-economic equilibrium (low inflation, balanced budgets, stable and "realistic" exchange rates, etc.) - another factor which, when seen as a variable isolated from a larger totality, serves to mystify real relations of domination and inequalities. The importance of equilibrium is contingent and relative to concrete interests. It is a "success" to the extent that it provides transnational capital with the stability required for its incessant and diverse operations within and between nations, and thus helps reproduce and stabilize patterns of capital accumulation whose immanent outcome is the polarization and concentration of wealth and of political power that wealth yields. Macroeconomic stability, in itself, tells us nothing about the actual well-being of the broad majorities in Chile and in the Third World. In short, success and failure are not mutually exclusive; some have benefitted and many have lost out from Chile's neo-liberal program.

Chile's new polyarchic rulers were, if anything, more committed than their authoritarian predecessors to neo-liberalism. The new regime declared that its mission was to continue neo-liberal restructuring under "democratic" managers. "The main economic challenge facing Chile is to consolidate and expand its integration into the world economy," explained Boeninger.181 Social unrest is the objective consequence of the anti-popular character of the model. Thus there is more behind the new civilian regime's relation to the military than a delicate effort to consolidate the "transition to democracy." As Petras and Vieux note: "Managing the model also means taking political responsibility for defending it with the armed power of the state. This is a task the Aylwin government has equipped itself to face, in part by increasing the Carabineros [militarized police] by 4,400 slots... It also reflected a long term commitment by the Aylwin government to expand the size and better equip the national and political police, who were also carefully nurtured during the dictatorship."182 By the early 1990s, Aylwin's honeymoon was over and a new cycle of strikes, popular protests and government repression had set in - hegemony remained consensus protected by the "armor of coercion."

Transnational economics and transnational politics converged as a new hegemonic bloc was forged in Chile through a "transition to democracy." The achievement of center and right consensus around a free-market economy overcame the historic split in the dominant groups between two alternative strategies, one of free-market, externally linked development (the right's historic program), and the other of nationally oriented dependent capitalist development with a measure of state intervention (the centrists' historic program). These different strategies had, in the past, resulted in different political programs and in elite splits that opened space for the left. The unification of elite criteria over the country's economic model, linked to the global economy and the reconfiguration of Chile's dominant groups, thus also resolved the political stumbling bloc, or "fluke," of the Chilean political system. The neo-liberal model of structural adjustment as the "grease" for the operation of the global economy leaves little room for maneuver or for minor alterations. The constraints it has imposed on Chile, with its concomitant implications for the political system, go beyond the control of local Chilean sectors, whether dominant or subordinate. What is required is the development of strategic alternatives in the interests of, and implemented by, broad majorities who have gained hegemony in a transnational setting.
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Re: Promoting Polyarchy: Globalization, U.S. Intervention, a

Postby admin » Mon Apr 11, 2016 9:32 am

Part 1 of 3

Chapter 5: Nicaragua: From low-intensity warfare to low-intensity democracy

Preventive diplomacy and preemptive reform can reduce the risks of extremist political infection and radical contamination. When confronted with such situations, the United States must define its interests early on and then develop strategies in cooperation with regional friends that will promote the likelihood of peaceful change and successor governments compatible with our own.

-- Henry Kissinger and Cyrus Vance [1]


Washington believes that Nicaragua must serve as a warning to the rest of Central America to never again challenge US hegemony, because of the enormous economic and political costs. It's too bad that the [Nicaraguan] poor must suffer, but historically the poor have always suffered. Nicaragua must be a lesson to others.

-- Richard John Neuhaus [2]


Preventative diplomacy and preemptive reform

In May 1989, on the eve of the opening of the Nicaraguan electoral process, one of President Bush's national security advisors observed: "Since Manila, the United States has gotten into this; we have been brandishing this new tool of giving support to electoral processes. The Plebiscite in Chile was analogous, where we saw we could shake an entrenched regime by [getting involved in] elections ... We are learning these techniques, and they should be applied to Nicaragua."3

In the Philippines and Chile, the United States applied "preventive diplomacy and preemptive reform" as part of shifts in policy to "democracy promotion." The shift and the concomitant introduction of new forms of political intervention came precisely when society-wide anti-dictatorial movements were reaching a critical mass under the leadership of popular forces. The objective of US intervention moved from trying to shore up these crumbling dictatorships to seizing the initiative from popular leadership and aiding the local elite in an effort to redirect anti-dictatorial movements.

As in the Philippines and Chile, the United States had exercised its domination over Nicaragua through authoritarian arrangements for nearly half a century. The Somoza dictatorship was the amalgamated product of US domination and the structure of social classes and elite rule since that country's independence from Spain in 1821. As in the Philippines and Chile, Washington undertook preventative diplomacy and preemptive reform in Nicaragua as the Somoza dictatorship crumbled in the late 1970s. Here, however, the effort failed and popular forces seized and retained leadership of the anti-dictatorial movement. The triumph of a popular revolution in 1979 led the United States to launch its "undeclared" war against Nicaragua in an effort to destabilize the new government and restore the old elite to power.

US strategy towards Nicaragua from the 1970s into the 1990s can be divided into several successive phases: (1) efforts throughout the 1970s to prop up the Somoza dictatorship via military, economic, diplomatic, and other forms of support (2) an unsuccessful undertaking, after the dictatorship had entered into an irreversible crisis, in preventative diplomacy and preemptive reform (3) a strategy of destabilization following the 1979 revolution, culminating in political intervention in the 1988-1990 electoral process under the banner of "democracy promotion," and (4) consolidating a transition from popular democratization to polyarchy and neo-liberalism following the 1990 electoral defeat of the Sandinistas.

All four of these phases are linked to each other in a process that flowed from policy reorientations underway in Washington in the wake of the US defeat in Indochina. The "democracy promotion" programs were not a departure from, but an integral part of, the war launched in 1980.This demonstrates that "democracy promotion" and other less "benign" forms of US intervention, such as military aggression, are not exclusive; they are complementary and mutually reinforcing. If the destabilization campaign was intended to destroy the Sandinista experiment in popular democracy, electoral intervention from 1988 to 1990 was designed to facilitate a transition to a regime of "low-intensity democracy." Both were phases in a single strategy, involving the defeat at the polls of the Sandinista National Liberation Front (FSLN) in February 1990 and subsequent undertakings to construct a neo-liberal state and reconstitute an elite social order. US involvement in Nicaragua in the 1970s and 1980s was crucial in shaping the transnational shift from authoritarian to polyarchic systems of social control. Nicaragua has been and remains a laboratory for the new political intervention and a battleground in the struggle for hegemony, and thus sheds a great deal of light on the theoretical issues at hand.

From US filibusters and marine occupations to the Somoza dynasty: Nicaragua's strategic importance

When the Monroe Doctrine staked out the US claim to the Western Hemisphere in 1823/ top in the minds of statesmen was the strategic importance of the Caribbean Basin for eventual empire-building. With its system of rivers and inland lakes, only twelve miles of land in Nicaragua separate the Atlantic and Pacific oceans. The country was therefore strategically located for an inter-oceanic canal. By linking the two oceans, such a canal would provide a crucial worldwide commercial advantage to that capitalist power that controlled Nicaragua. Christopher Columbus, it should be recalled, had set out from Spain not to "discover" the New World but to find a passage from the West to the Orient. On his last voyage, he spent three weeks exploring the Atlantic coast of Nicaragua. He was followed by the conquistador Gil Gonzales de Davila, whose forces killed thousands of Indians in pacification and colonization campaigns in Nicaragua and sent another 500/000to other parts of the Spanish empire as slaves.4

Under colonial rule, Nicaragua became a stagnant tributary of Spanish mercantilism, based on the encomienda system, in which land and Indian labor were parceled out to the conquistadores. The history of Nicaragua from independence in 1821 to the 1930s is a story of endless feuds, intrigues, civil wars, temporary truces/ and pacts, between the two rival groups that took over from Spanish administrators, Liberals and Conservatives. This conflict originated less in strategic or ideological differences than in rivalries among networks of extended oligarchic families, descendants of the original conquistadores, and their tussle for control of a central government and the spoils that this provided.5 This endemic infighting made impossible in Nicaragua the development of a viable polyarchic system among the ruling class, such as had developed in Chile on the basis of a more united post- independence creole elite. The weakness of Nicaragua's post-independence ruling class lent itself to manipulations and rivalry by Great Powers. Reciprocally, elements of the Nicaraguan elite were eager to seek the intervention of outside agents, mostly from the United States, to shift the balance of power within Nicaragua. Louis Napoleon once claimed Nicaragua for the construction of a French canal,6 but it was Britain and the United States that competed for domination over the country. With the US annexation of the northern half of Mexico in 1848, expansion westward was now contained by the Pacific Ocean, and increasing commercial interest in Asia made the construction of an inter-oceanic canal in Central America a US imperative.

Cornelius Vanderbilt, one of the richest men in the United States, had set up the Nicaragua Transit Company to shuttle California goldrushers from the US East Coast to the West Coast via Nicaragua, and simultaneously to explore the possibilities of constructing a canal. In 1855, the US filibuster William Walker, bankrolled by Vanderbilt's Transit Company and invited by Nicaraguan Liberals in their latest civil war with the Conservatives, landed on Nicaraguan shores at the head of a mercenary army. Over the next two years, Walker and his mercenary forces, supported by the southern slave aristocracy as well as northern merchants and admiring politicians in the United States, turned against both Liberals and Conservatives to conquer the country. Walker had himself "elected" President of Nicaragua, declared English an official language, reinstituted slavery, and took measures to expropriate and transfer to US planters and settlers large portions of Nicaraguan land. Almost overnight, Walker became the agent of Manifest Destiny in the region. His regime was recognized by the administration of President Franklin Pierce. And when the mercenary was finally rooted from the country by a combined Central American patriotic army (at the cost of 20,000 Central American lives), he was rescued by the US Navy, given a hero's welcome upon his arrival in New York, idolized by the press, and then received at the White House by President James Buchanan.

Meanwhile, the completion of the transcontinental railway in 1869 ended interest in overland passenger transit through Nicaragua. But plans for a canal were resumed in the aftermath of the US Civil War. With rapid industrialization, the growth of global commerce, and large-scale penetration of the Caribbean by US capital, the main interest of the post-civil War class of wealthy US merchants, industrialists, and reborn planters lay in the competitive advantage that a base in the Caribbean would provide. The centerpiece of a new expansionist foreign policy was the construction of a canal across the Isthmus. The canal was eventually constructed in Panama, a shift due in large part to the maneuvering by the pro-Panama lobby among business and political interests in Washington. But it also had to do with Great Power rivalry, and with the rise in Nicaragua of a nationalist regime, headed by Liberal president Jose Santos Zelaya, who sought a greater measure of sovereignty and modernization for the country in the face of foreign domination. Zelaya took measures to bring Nicaragua into the modem capitalist era, including curbing clericalism, expanding public education and opening it to the lower classes for the first time, modernizing and professionalizing public administration and the military, and improving infrastructure. Most importantly, he wrested from the British dominion over the Atlantic coast region, in this way unifying the country for the first time since independence and also, as an unintentional side-effect, putting an end to US-British rivalry and scaling US domination. Zelaya was no radical; these measures spurred on a nascent process of proletarianization and capitalist production relations, benefitting Nicaraguan as well as foreign capital, which was now pouring into the country as part of the large-scale export of US capital into the Caribbean.7

Zelaya, however, went too far in asserting Nicaraguan sovereignty and nationalist interests over US prerogative. "Nothing effective... can be accomplished in accordance with our policy of friendly guidance of the Central American Republics as long as Zelaya remains in absolute power," wrote US minister to Nicaragua John Coolidge to President Roosevelt in 1908, adding that the ouster of Zelaya would also have a "salutary effect" on the isthmanian countries in demonstrating US resolve.8 In his correspondence, Coolidge said that Zelaya's plans, such as establishing a chemical laboratory to analyze and regulate imported US foodstuffs and medicines, imposing tariffs on US and other foreign imports, contracting with a German company to build an Atlantic- Pacific railway line, and the rumored offering of canal concessions to Britain and Japan, all violated the Monroe Doctrine. A year later, Conservative leaders, bankrolled by US companies in Nicaragua, aided by foreign, mostly US, mercenaries, and enjoying the tacit support of the incoming Taft administration, launched an armed revolt against Zelaya. The two leaders of the Conservative uprising were Emiliano Chamorro and Adolfo Diaz, both members of powerful oligarchic families and agents for leading US firms in the country. In December 1909, US Secretary of State Philader Chase Knox, who held shares in several of these firms, sent a letter to Zelaya, known as the Knox Note, which severed diplomatic relations with Nicargua and called on Zelaya to resign. Although Zelaya bowed to this US hostility, marines nevertheless landed in the country under order to oppose any attempts by Zelaya loyalists to resist. With that, the Zelaya forces relinquished the presidency to Adolfo Diaz, and Nicaragua was plunged into another round of debilitating Liberal-Conservative civil wars.

The overthrow of Zelaya strengthened an internal social and class structure propitious to US penetration and domination, yet highly detrimental to Nicaragua's own national development. The Zelaya era represented a belated attempt at nation-building, including the beginning of a modern, national consciousness that included both elites and the Indian and mestizo masses. By stifling a nationalist-oriented bourgeoisie and fomenting for its own purposes the divisions that had plagued the dominant groups since independence, Washington contributed in a decisive manner to a truncated elite and to a process of dependent capitalist development in Nicaragua. Both the Walker affair and Zelaya's overthrow underscored the essential dynamics in US Nicaraguan relations. The fragmentation and weakness of the elite in Nicaragua called forth US intervention as much as the US intervention - serving the immediate interests of sectors of the dominant classes in both countries - aggravated this fragmentation and weakness.

The Conservative oligarchs that replaced Zelaya achieved recognition from Washington in exchange for the dismantling of many of Zelaya's nationalist reforms, including the promulgation of a new constitution that "guaranteed the legitimate rights of foreigners," the placing of Nicaragua's customs in US receivership, and the turning-over of Nicaragua's central bank, railroads and steamships to US corporations. In 1917, a High Commission was established, composed of one Nicaraguan and two US citizens appointed by the Secretary of State, to supervise the entire financial life of the republic and arbitrate in all political matters. While Nicaraguan presidents rotated in and out of office, this High Commission virtually governed the country until the mid-1920s.

Meanwhile, US marines returned in 1912, and stayed on as an occupation force almost continuously for the next two decades. No fewer than ten uprisings were suppressed by the marines between 1912 and 1924, and Nicaragua remained under martial law for virtually this entire period. The country's first modem labor unions also emerged, and strike activity spread on US-owned mining, lumbering, and banana operations. Inter-elite feuding gradually give way to mass agitation against US domination and the wholesale giveaway of the country. Both Washington and the Liberal and Conservative oligarchs began, for the first time, to feel the heat of nationalist popular sentiment and social stirrings from below.

The backdrop to the US marines' occupation was the importance of the Caribbean Basin as the most proximate overseas market and outlet for surplus US capital. Opening up the "Yankee lake" required direct military interventions, including a series of expeditions by marines in Nicaragua, the Dominican Republic, Haiti, Cuba, Panama, Honduras, Puerto Rico, Mexico, and elsewhere. This, President Teddy Roosevelt's doctrine of the "Big Stick," was followed by President William Taft's doctrine of "Dollar Diplomacy." Expanding US interests and establishing protectorates required political stability in its "strategic backyard," which was to be achieved through President Woodrow Wilson's "civilizing mission." This early twentieth-century attempt to construct quasi-polyarchic political systems in the region via elite pacts aimed to achieve political stability can be considered an historical predecessor to "democracy promotion." However, these earlier efforts focused exclusively on achieving accommodation among elites in political society, while masses were either ignored or repressed outright by occupying US marines. In contrast, the current strategy focuses on achieving - parallel to elite accommodation - the organization of the popular sectors in civil society and their incorporation into hegemonic blocs.

Wilson dispatched US envoys who, with military and financial muscle firmly behind them, "offered" their good offices to mediate disputes, arrange truces, forge pacts, and hammer together elite coalitions around US-managed elections. It was in this context that Washington organized a spate of "elections" in Nicaragua over the next few years, which rotated rival Liberal and Conservative factions in and out of power, all under marine occupation and the supervision of US ministers. These elections were not intended as exercises in democracy. In the 1913 balloting, for instance, which placed Adolfo Diaz in the presidency after marines had crushed an anti-United States rebellion, all those who supported the uprising were disenfranchised, US marines manned polling places and counted the votes, and there was but one candidate - Diaz himself. All told, only 3-4,000 people were allowed to vote, yet Secretary of State Knox immediately recognized the results and expressed US satisfaction. The purpose of these charades was strictly to hammer out accommodations among the elite factions and to simultaneously legitimize rapidly expanding US control over the country. The US occupation forces organized subsequent elections in 1916, 1920, 1924, 1928, and 1932.9

From the Sandino rebellion to the Somoza dictatorship

In early 1926, Liberal-Conservative feuding broke out into civil war again, prompting a new US military intervention and another round of Liberal-Conservative mediation, this time by President Calvin Coolidge's special envoy, Henry Stimpson. In 1927, Stimpson organized a pact between the two bands, according to which the rebellious Liberals would surrender their weapons to US forces and partake with Conservatives in new elections in 1928.The only Liberal general to reject the pact was Agusto Cesar Sandino, who declared that his troops would continue to fight until the marines were expelled and US interference in the country brought to an end. In this way, Sandino converted what started out as just one more feud among the ruling cliques into a national rebellion against US domination, in defiance of both the local elite and Washington.10 Sandino's struggle inspired, and was supported by, many members of the lower classes, whose fight became a popular national movement incorporating peasants, miners, workers, and artisans. Over the following six years, Sandino waged a guerrilla resistance movement against US marines, who launched Washington's first counterinsurgency war in the Hemisphere.

In 1929, Sandino publicized a peace proposal, in which the Sandinistas promised to lay down their weapons and recognize the government installed by Stimpson and the marines in 1928 in exchange for a series of social reforms, including measures to favor small peasants, an eight-hour work day for all workers, abolition of wage payments in scrip, equal pay for equal work for women, the regulation of child labor, and the recognition of workers' rights to organize. "Only the workers and peasants will go all the way, only their organized force will attain victory," concluded the declaration. The entire focus in Nicaragua had shifted from the search for forumulas to end intra-elite conflict to a contest between the elite and the country's emergent popular sectors. US Charge Willard Beaulac cabled to Washington his "fear that the movement has attained a revolutionary character." [11]

Sandino's movement never managed to change the social system, but it did force the marines to withdraw in 1933. In their place, they left behind a new Nicaraguan military force, the National Guard, which was first set up in 1927 under the command of US officers. The newly created National Guard went on to become an effective instrument for safeguarding the elite social order in Nicaragua, and the represssive and despised mainstay of the Somoza dictatorship.12 Anastasio Somoza Garcia, who had been the personal interpreter for several US envoys, maneuvered his way into the position of Guard commander. From his new position, Somoza personally ordered the execution in early 1934 of Sandino, who had come to Managua for further peace talks, in a crime which might have involved the US embassy,13 Two years later, Somoza overthrew the civilian government and then had himself elected "president" in a fraudulent vote - one of a spate of such electoral farces conducted over the next forty-five years. Neither the coup nor the fraudulent elections produced many objections in Good Neighbor Washington. The dictator was recognized by President Franklin Roosevelt, who received Somoza personally in a pompous state visit in 1939. The dynasty continued to rule for nearly half a century, with US support, until it was overthrown in 1979 by the Sandinista movement.14

The collapse of the Wilsonian project in Nicaragua is particularly important because it came through a mass, popular rebellion from below. Sandino's rebellion was largely responsible for an entire rethinking of US policy in Latin America. Sandino's threat from below demonstrated to Nicaragua's dominant groups that the very survival of elite rule depended on a united effort to subdue the popular classes. It thus forged a collective class consciousness among the elite for the first time, demonstrating vividly how class formation and historical outcomes are as much a result of class conflict between subordinate and dominant classes as they are of intra-elite conflict among dominant classes. After a century of internecine feuding, the dominant groups finally subordinated their squabbles to their common self-interests in the face of the poor and newly awakened majority, and entrusted the Somoza dictatorship and the National Guard with safeguarding. the social order as a whole. This intra-elite accommodation converged remarkably with conclusions being reached at the time by Washington. In a 1930 report summarizing policy options for Nicaragua, the State Department concluded that a dictatorship would be the most expedient means of securing the long-sought stability: "The third alternative [that which was adopted among several policy options] is a policy whereby the United States would merely guarantee stability in Nicaragua, regardless of whether this involved the maintenance of unrepresentative or dictatorial government. .. This policy would have the merit of simplicity - it would be the easiest policy for the United States to apply."15

Over the next half-century, Washington shored up the Somoza family dictatorship through military and economic aid and a close diplomatic alliance. Nicaragua became the bastion of US domination throughout the Caribbean Basin. The country was a launching pad for the 1954 CIA-organized coup d'etat in Guatemala and for the aborted 1961 Bay of Pigs invasion of Cuba. Despite the democratic rhetoric of the Alliance for Progress, Somoza enjoyed the support of the Kennedy White House, which provided $30 million in Alliance economic funds and military aid while counseling the dictator to "legitimize his government by receiving a clear popular mandate" through another round of fraudulent elections, held in 1962.16 Between 1946 and 1978, Nicaragua received $23.6 million in military aid for the National Guard and thousands of Guardsmen passed through US military training programs. No other country in Latin America had so many of its troops trained by the Pentagon.17

The Somoza family dictatorship created a hospitable environment for the Nicaraguan elite and for foreign capital, while US policymakers found an ideal ally in the dictatorship. Just as with Marcos, this was a fractious three-way marriage of convenience. Much of the elite shunned the dictatorship but was indebted to it for its containment of the popular threat. The Somozas and Washington policymakers manipulated each other at different moments and for each one's convenience. Yet all three - dictatorship, the elite, and Washington - found a common meeting ground in defense of the social order. The historical function of the dictatorship was the exercise of local state power on behalf of the alliance between the dominant groups in Nicaragua and the United States.

During the post-World War II years, the large-scale penetration of US capital firmly tied Nicaragua's economy, along with the rest of Central America, into the US economy as an appendage based on agroexports, and it led to massive displacement of the peasantry and local artisanal production.18 The inflow of foreign capital to Central America accelerated in the 1960s and 1970s, integrating the region into the emergent global economy and laying the structural basis for the social upheavals that shook the Isthmus. The stimulation of agro-exports by the United States produced in Nicaragua one of the most extreme concentrations of land and wealth in the world. In 1978, some 50 percent of all arable land was owned by just 0.7 percent of the population, while more than half of the rural population was crammed onto just 2.1 percent of the land. Per capita income was less than $805 for 80 percent of the population. For two-thirds of these, it was a mere $286.19 Gross inequalities, poverty, and political repression spawned a growing popular movement in the 1960s and 1970s. In 1961, several survivors of Sandino's army and a younger generation of Somoza opponents had formed the FSLN, which conducted sporadic guerrilla actions in the 1960s but was largely contained with the help of US counterinsurgency assistance. But by the early 1970s, a restive population began to turn to the Sandinistas for alternatives, as the FSLN stepped up its rural and urban organizing.

The failure of preventative diplomacy and preemptive reform in Nicaragua

[What is] at stake is not just the formula for Nicaragua, but a more basic matter, namely whether in the wake of our own decision not to intervene in Latin American politics, there will not develop a vacuum ... In other words, we have to demonstrate that we are still the decisive force in determining the political outcomes in Central America...

-- Zbigniew Brzezinski, addressing an emergency 1979 NSC meeting on an imminent Sandinista victory [20]


The Christmas Eve earthquake .that leveled Managua in 1972 marked the beginning of the end of the dictatorship. It simultaneously shattered elite consensus around the dictatorship and accelerated the process of social polarization and political radicalization among the popular sectors. Following the earthquake the Somoza clique, through its control of the state and the National Guard, monopolized the massive reconstruction assistance that poured in from abroad. With its rampant corruption and patronage networks, the dynasty implemented the same brand of "crony capitalism" that Marcos had practiced in the Philippines, locking much of the capitalist class out of the reconstruction bonanza and unraveling the basis of accommodation among the dominant groups. At the same time, the earthquake considerably heightened the hardships endured by the poor majority. The FSLN grew from a sporadic insurgency to a national force, and Somoza responded with a wave of repression, imposing a state of siege, rounding up hundreds of opponents, and launching new counterinsurgency campaigns. International human rights groups, US congressional committees, and religious representatives in Nicaragua denounced before the world systematic and widespread tortures, rapes, and disappearances. The crisis of the dictatorship had become irreversible, but it was not until 1977 that Washington ceased to view authoritarianism and its agent in Nicaragua - the Somozas - as the best instrument of US domination. This led to an initial schism between a growing anti-Somoza faction of the elite and the United States. The lack of support from Washington for the anti-Somoza elite paved the way for an incipient alliance between the Nicaraguan elite and the popular forces, led by the Sandinistas, in a situation remarkably similar to the Philippines in the early 1980s. On this basis, a sector of the elite acknowledged Sandinista legitimacy (and even leadership), thus helping to undercut the effort, when it was finally launched by Washington, at preventative diplomacy and preemptive reform.

The elite found itself caught between a mass movement that was threatening the entire structure of domination and a dictatorship which was no longer capable either of representing its interests or of holding back the popular upsurge.21 The anti-Somoza elite turned to political organizing, forming several new business, civic, and political associations. "The dominant classes," wrote FSLN leader Jaime Wheelock in 1983, "began the task of seeking a substitute, [which] appeared as a struggle against Somocismo when in reality it was an effort to sustain Somocismo without Somoza."22 Thus throughout the 1970s, two anti-Somoza blocs coalesced: one was the conservative opposition; the other was the popular movement, led by the FSLN and by trade union, peasant, and other grassroot organizations. In October 1977 the FSLN launched its general offensive, with widespread popular backing. It became clear that Somoza's ouster was only a matter of time; in dispute was who would hold the reins of the antidictatorial movement and what would follow the fall of the regime. This struggle was fought out during 1978.23 In January of that year, Pedro Joaquin Chamorro, the most prominent member of the elite opposition, was gunned down by Somoza henchmen as he drove to work. Just as with the Aquino murder in the Philippines five years later, the Chamorro assassination galvanized the non-Somoza political and economic elite. But in distinction to the Philippines, the poor and popular sectors, considerably unified around the FSLN, held the initiative. By 1978, these events prompted US policymakers to switch policies, to a strategy of encouraging a dialog between Somoza and the conservative opposition as the first step in its effort to mediate a gradual transfer of power from Somoza to his elite opponents, and to preserve the National Guard as an institution so as to prevent a popular Sandinista victory.

In February 1978, the business community called its own general strike, hedging its bets on the judicious use of carefully controlled mass mobilization. The strike was broadly supported by workers (managers even payed their wages during the strike) as part of their own anti- Somoza struggle. But Somoza refused to budge. In May, the Carter administration released $12 million in economic aid to Somoza as a carrot, simultaneously urging the dictator to negotiate with his elite opponents. In August 1978, Assistant Secretary of State Vyron Vaky recommended, in the first meeting of a special interagency group set up in the NSC to address the mounting Nicaraguan crisis, that the United States assemble a coalition government in Nicaragua. Vaky feared that "otherwise, the situation would polarize even further, increasing the probability of a Marxist victory."24 Just days later, a Sandinista command dressed in National Guard uniforms seized the National Palace in downtown Managua and took Assembly members hostage. With world attention riveted on Nicaragua, Somoza was forced to cede to the insurgents' demands, including a release of political prisoners and safe passage out of the country for the command. The daring action sparked nationwide protests. Opposition leaders declared a national strike, and spontaneous insurrections erupted throughout the country. These events proved the decisive point at which the anti-dictatorial movement passed fully under the leadership of the FSLN.

With Nicaragua in insurrection, Congress approved $3.1 million in new military aid to Somoza. Although this and subsequent military aid was conditioned on an improvement in the human rights situation in Nicaragua, the military pipeline from Washington stayed open from then until Somoza's final days.25 Behind this seemingly incoherent US policy was a touch-and-go game. Washington needed to maintain the National Guard to prevent a Sandinista victory, yet also needed to place enough pressure on Somoza to force him to relinquish power to the elite opposition. With the September insurrection suppressed, Carter's special envoy to Nicaragua, William Bowdler, arrived in Managua in October under instructions to facilitate a transition that would preserve the National Guard. In a remarkable replay of Stimson's mission fifty years earlier, Bowdler was sent to defuse a popular rebellion and organize an elite pact. "If the Guard collapsed as a result of US pressure, the United States would be responsible for eliminating the only barrier to a Sandinista military victory, or it would have to intervene militarily to prevent that," explained Robert Pastor, a member of the special NSC group. The administration "emphasized again that the unity of the Guard was an important objective for US policy. There was no disagreement [in Washington] on this latter point as everyone recognized that a post-Somoza government that lacked a firm military base could be overrun by the FSLN."26

Working now in day-by-day coordination, Washington and the elite tried desperately to regain the initiative, but ultimately failed. In February 1979, the elite called another general strike, intended specifically to pressure Somoza to resign. Its failure led to a last-ditch effort to prevent a revolutionary triumph through closed-door U5-brokered negotiations between elite opposition leaders and Somoza over the dictator's departure. As an incentive, US officials approved, in May 1979, a $65.6 million emergency IMF loan to the disintegrating regime.27 Carter's NSC group also drew up a series of contingency plans, including an attempt to have the OAS endorse a US-led military intervention, all to no avail. In June the FSLN, which had now achieved a true Gramscian hegemony among the Nicaraguan population in their anti-dictatorial struggle and recognition in the international community as the legitimate alternative to Somoza, launched the "final insurrection" against the dictatorship. The U5-brokered negotiations between Somoza and the elite collapsed and most of the elite watched the final act of the liberation war from the sidelines - from Miami, Caracas, and other Latin American capitals.

All these Carter administration efforts to maintain a "Somocismo without Somoza" and to preserve the brutal National Guard appear on the surface as contradictory to Carter's stated "human rights policy." But they should be seen as part of a logical and consistent strategy of preventative diplomacy and preemptive reform. It was clear that Carter's "human rights policy" was a precursor to the full-blown "democracy promotion" strategy that emerged a decade later. The policy sought to regenerate ideologically US interventionism (albeit in new forms) following its post-Vietnam delegitimation and to imbue the embryotic transnational elite agenda with moral purpose. Much later, in early 1994,US Assistant Secretary of State Alexander Watson, explained: "Human rights was the big task of the 1970s, elections was the task of the 1980s, and in the 1990s the big task is... making democracy work."28

Why, then, did the administration's efforts to effect a transition fail? They failed, in part, for historic reasons - the deep historical weakness of the elite, its half-century-long reliance on dictatorship, and the hegemony won by the FSLN through its own deft revolutionary strategy. But they also failed because they were based on traditional interventionist tactics, principally state-to-state diplomacy, military and economic aid as carrots and sticks, and repression, rather than incorporation, of the mass of the population. The Nicaraguan revolution began to brew a decade before the change in Washington from promoting authoritarianism to promoting polyarchy, and before the machinery and institutions of the new political intervention could actually have been mobilized to facilitate a transition. The ingredient that led to success in the 1980s in the Philippines and Chile, but which was lacking in Nicaragua in the 1970s,was a sophisticated program of political aid and intervention that could have cultivated a polyarchic alternative to the Somoza regime and incorporated the popular sectors under the hegemony of this alternative. The option of a non-Somocista "Third Force" strong enough to achieve hegemony over a transition process was simply non-existent. This weapon of political intervention was missing from the US arsenal, and together with the general post- Vietnam weakness of US interventionism, created sufficient space for the Sandinista victory - a momentary political "opening" in the world system for the Nicaraguan revolutionaries.
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Re: Promoting Polyarchy: Globalization, U.S. Intervention, a

Postby admin » Mon Apr 11, 2016 9:35 am

Part 2 of 3

From Somoza to the Sandinistas: low-intensity warfare against high-intensity democracy

The Sandinista revolution ushered in a socialist-oriented program along the lines of the model of popular democracy and the "logic of the poor majority." The redistribution of economic and political power challenged not only the legitimacy of the old elite but of US domination in the region. The structure of property ownership was radically democratized in favor of poor peasants in the countryside and the urban poor.29 The Sandinista experiment in "high-intensity democracy" combined representative with participatory democracy, and was as different from polyarchy as it was from Soviet-style bureaucratic "socialism."30 The constitution drafted in the mid-1980s provided traditional political rights and civil liberties, such as freedom of speech, assembly, and movement, and the right to due process. It legally proscribed racial, ethnic, religious, and sexual discrimination, established the traditional separation of powers in a presidential system, and mandated national elections every six years, thus establishing the alternatability of power. But it also included economic, social, and cultural rights - e.g., health care, education, agrarian reform, decent housing, women's emancipation, a healthy environment - as constitutional rights in themselves, restricted only by the material limits of society. The document stated that "the basic needs of the poor have a prior claim on scarce resources in relation to the wants of those whose basic needs are already satisfied." It enshrined the structures of participatory democracy alongside representative democracy, mandating that the population has the right, and the duty, to participate in decision-making at all levels of society. At the theoretical level, this model overcame the "liberty versus equality" divide by institutionalizing the structures of representative democracy alongside those of participatory democracy. In contrast to other revolutionary parties that came to power through arms, the FSLN institutionalized the election of national authorities in multi-party, periodic, secret elections. The first of these competitive elections was held in 1984, with the participation of seven parties from the left, center, and right, and the next one was scheduled for 1990. The 1984 elections were won by the FSLN and judged to be free and fair by the international community, despite Washington's decision to encourage a boycott among its Nicaraguan allies and not to recognize the results.31

With the revolution, the Nicaraguan \p1ajority became organized, from civil society, in mass organizations, trade unions, and peasant, women, student, and neighborhood associations of all kinds. The "subaltern classes" began to ·participate in local and state decision-making through numerous formal and informal mechanisms and structures, in a manner envisioned by Gramsci, and in conjunction with the structural transformations of the state, the political system, and the economy. Nicaraguans for the first time began to gain some real control over their lives and their destiny, a sensation probably not that different to what traditional ruling classes are accustomed to feeling. "Despite the poverty of democratic examples in both the capitalist West and socialist East, Nicaragua had set about the process of constructing real democracy within a socialist state," note political scientists Harry Vanden and Gary Prevost. "The Sandinista revolution had rediscovered Nicaragua's popular history and thus its popular consciousness; it had indeed unleashed the power of the masses. Unlike other revolutionary experiences, there was enough understanding among the Sandinistas, members of the popular church, Nicaraguan and internationalist youth, and others involved with the revolutionary process to set up institutional structures that included and channeled mass participation."32

To be sure, there were limitations in democratization and legitimate grievances under the revolutionary government, and the Sandinistas committed numerous mistakes while in power. As in the Philippines and Chile, left and popular forces in Nicaragua faced contradictions in their project and weaknesses internal to their own logic. In implementing the popular program, the Sandinistas turned to control over the state apparatus and "top-down" political verticalism ("vanguardism"). The Sandinistas also faced problems of bureaucratism and arrogance in the use (or abuse) of power. While the population engaged for the first time in direct grassroots decision-making, inside the FSLN party structure, decision-making became concentrated in the top leadership echelons, and this leadership increasingly utilized the state to implement decisions in a way that retarded the bottom-up influence of civil society that flourished in the early years of the revolution.

Vanden and Prevost describe three types of democratic political practice under the Sandinistas: at the level of the state (formal representative); at the level of society and the grassroots (participatory); and at the level of the FSLN party structures ("Leninist vanguardism"). They argue that the overwhelming pressures imposed on the country by the US war and the economic crisis, combined with the legacy of an authoritarian political culture, "vanguardism," and the excessive emphasis on the formal, representative structures of democracy, in which the old elite could regain institutional leverage, acted to gradually dilute popular power in the mass organizations and weaken the participatory side of the mode!.33 Operationalizing my discussion in chapter 1 that polyarchy acts to institutionally constrain popular sectors, they show that the Sandinistas' drive to construct the formal, representative side of the model gradually constricted participatory democracy. But there are deeper theoretical issues. First, the structural power of transnational capital obliges states and political forces to seek survival within the parameters of a global system and its external dictates. Linking to the global economy in order to survive implies the penetration of free-market forces into the internal system with definite social consequences, and international legitimacy made contingent on the establishment of polyarchic political institutions. The contradiction between representative and participatory democracy identified by Vanden and Prevost was less internal to Nicaragua - that is, a consequence of "options" selected by the Sandinistas - than a result of contradictions located in the global system. This point is often lost upon those who inflate the real power of states under globalization and harshly criticize the Sandinistas for their policies of seeking alliances with "patriotic" factions of the propertied classes and of implementing in the late 1980s anti-popular economic adjustment policies.34 Second, Vanden and Prevost theoretically limit democracy to the political sphere and describe polyarchy as "Western democracy," a variant - or in their words, a "style" or "preference" - of democracy alongside the variant, or "style/preference," of participatory democracy. In contrast, I argue that "Western democracy" is not "democracy" but a political system corresponding to the capitalist mode of production and distinct from authoritarianism insofar as it rests on social control of subordinate groups through consensual mechanisms.

Despite the Sandinistas' own deficiencies and the contradictions internal to their model, the proposition that Nicaragua under the Sandinistas was undemocratic was little more than a convenient ideological prop for US policy. The US objective in Nicaragua was to subvert the Sandinista experiment in popular democracy, to prevent any transition to a democratic form of socialism, and to restore the old elite to power. The campaign against Allende in Chile was conducted under the banner of anti-communism, but the real motive was the threat to US domination in Latin America that a socialist Chile posed. Similarly, the real threat from a Sandinista Nicaragua was less "Soviet penetration" than the threat of an independent and nationalist-minded regime in the Caribbean Basin and the potential success of an alternative model of political and economic development in the Third World. The revolution empowered dispossessed majorities that, in neighboring countries closely allied with the United States, remained locked out of political power. A more equitable redistribution of wealth, agrarian and urban reform, and broad programs to favor the poor, violated individual property rights and free-market principles. The burgeoning of mass organizations among women, youth and students, small farmers, and others, was a dangerous threat to US domination and the traditional elite.

The United States responded to this threat by launching a destabilization campaign against Nicaragua that was even more extensive than the campaign against Chile, and constituted the most far-reaching intervention abroad since the Indochina war.35 Carter's initial "neutralization" strategy, which sought to bolster the conservative political and business groups that had worked desperately with the United States to prevent the revolutionary triumph, gave way to Reagan's full-blown destabilization campaign. Its centerpiece was the Contra army, initially drawn from the remnants of the National Guard. Between 1981 and 1990, the United States spent $447.69 million in official aid for the Contras, although estimates approach $2 billion if unofficial and informal transfers, donations from "private" US groups, and other forms of logistical support are inc1uded.36 By 1986, the Contras had become a powerful armed force, more numerous and with better weapons and training than the National Guard had enjoyed under Somoza. US forces trained and advised the Contras, and played a more direct role in key logistical and intelligence operations and, on several occasions, in the execution of attacks, such as the mining of Nicaragua's harbors in 1984, carried out by US Navy SEAL special forces units. These US forces also conducted countless covert and paramilitary operations, ranging from organizing internal military fronts in Nicaragua's cities to such bizarre incidents as an attempted poisoning of Nicaragua's foreign minister, Father Miguel D'Escoto.37

The original Reagan plan sought a quick military victory over the Sandinistas. However, these plans changed in conjunction with the development of low-intensity warfare doctrines in Washington and the gradual shift to "democracy promotion." By late 1983 the US aim was no longer the military overthrow but the political defeat of the Sandinistas through a complex war of attrition - a campaign of low-intensity warfare tailor-made to Nicaraguan conditions. This strategy sought to impose on Nicaragua a process of attrition using multiple, well-synchronized military, economic, political, diplomatic, psychological, and ideological pressures against the revolution. The Contras ground away at economic and social infrastructures and paralyzed production in the countryside. Washington imposed an economic embargo and blocked multilateral financing. The constant threat of a direct US invasion was effectively used to force Nicaragua to maintain high levels of defense mobilization and expenditure, to impose a war psychosis on the population, and to modify the behavior of different actors - the Nicaraguan government and population, the international community, the US public - in ways conducive to the continuation of the attrition process. The war of attrition adroitly exploited mistakes made by the Sandinista government and the weaknesses and objective limitations in the revolutionary model, manipulated raised expectations, and capitalized on legitimate grievances to generate and mobilize anti-Sandinista constituencies. It aimed to isolate, delegitimize, and suffocate the revolution to the point where it was no longer considered a viable political option in the eyes of the population, or of other populations that might take inspiration from it. The goal was to undermine the hegemony of the new historic bloc that had been galvanized in the war against Somoza and consolidated, under Sandinista leadership, in the years immediately following the revolution.

Years of low-intensity warfare shattered the economy and tore the social fabric, leaving 50,000 casualties and $12 billion in damages in a society of barely 3.5 million people and with an annual GNP of some $2 billion. These direct and indirect losses to the economy represented 4,400 percent of annual export earnings and 600 percent of GNP. Proportionally equalvalent figures for US society would be approximately 5 million casualties and economic losses of $25 trillion.38 The crux of the strategy for breaking Sandinista hegemony was to foment an economic crisis through the hemorrhaging of the country's productive infrastructure, to convert this economic crisis into a social crisis, and in turn, convert a social crisis, through complex new forms of US political intervention, including "democracy promotion" programs, into a political crisis in which the Sandinistas lost their legitimacy and were displaced from power.

With the old order shattered, much of Nicaragua's traditional elite, both agents and beneficiaries of the US destabilization campaign, turned to the task of regaining political power under the guidance of US war strategists. The elite divided, roughly, into two camps. (Apart from these two camps, a significant minority of the old elite chose to forsake their historic privileges and support the revolution.) One group went into exile, where its members often became leaders, political spokespeople, and financial supporters of the armed counterrevolution. Another group chose to remain inside the country, where they formed a legal right-wing opposition to the Sandinistas. Within a calculated division of labor, the purpose of this internal opposition was to act in tandem with the overall US destabilization campaign as a sort of "fifth column," complementing the military, economic, diplomatic, and other operations.39

A series of events led the war of attrition to take an increasing "democracy promotion" focus from the mid-1980s and on, in the context of the broader changes underway in US foreign policy at this time. These events included the controversy over military support for the Contras, the International Court of Justice's 1986 ruling that US policy towards Nicaragua was in violation of international law (the ruling was ignored by Washington), the Iran-Contra scandal, and the signing by the Central American countries of a regional peace accord in 1987 which called for electoral and democratization processes and an end to all insurgencies in the area, including the Contras. Thus, while the attrition process against Nicaragua continued year after year, by the late 1980s strategy began to shift from the Contras and a siege waged from abroad, to the internal "civic opposition" and deep penetration of Nicaragua's civil society and political system. This shift meant deploying against Nicaragua, on a hitherto unseen scale, the newly formed apparatus of political and electoral intervention which was simultaneously proving so dexterous in the Philippines and Chile. It required transforming CIA, NED and other "political aid" programs directed toward the internal civic groups from an adjunct of the Contra effort to the very centerpiece of a redefined anti-Sandinista strategy.

The overall goal became to create in Nicaraguan civil society a counter-hegemonic bloc, in the Gramscian sense, to the hegemony won by Sandinismo in the anti-dictatorial struggle. The war of attrition was a powerful, ongoing weapon of destruction. It was not enough to destroy the revolution; a viable alternative had to be constructed. The new forms of internal political intervention brandished by US operatives would develop just such an alternative. Between 1987 and 1990, the crucial battle for hegemony was waged in Nicaraguan civil society between the Sandinistas and a transnational alliance led by the United States and a reorganized Nicaraguan elite. This battle climaxed in the electoral defeat of the Sandinistas as the culmination of the war of attrition. As the 1990 elections approached, the goal was to "harvest" ten years of attrition into an anti-Sandinista vote. The process of attrition laid the groundwork for the electoral intervention project, which was itself a complex and multi-dimensional undertaking in political warfare.

The anti-Sandinista elite and the role of US political aid [40]

Following the Sandinista triumph, the CIA continued a program of covert assistance to conservative anti-Somoza elements that it had begun in 1978.41 Six months after the triumph, Carter signed a topsecret presidential Finding authorizing an expansion of this covert funding, including funds for Violeta Chamorro's conservative newspaper, La Prensa, anti-Sandinista political parties, trade unions, business groups, and the conservative Roman Catholic Church hierarchy, "intended to build ties for the agency [CIA]... to keep an opposition alive and insure that the agency would have contacts and friends among the leaders of a [post-Sandinista] government."42 This CIA funding expanded under the Reagan administration, and helped piece together an alliance of political parties, minority trade unions, and the big-business umbrella group, the Superior Council of Private Enterprise (COSEP).43 With the formation of the NED in 1984, much of this funding for the internal opposition was gradually transferred from the CIA to the Endowment. The NED became the principal US agency that managed the 1988-1990 electoral intervention project. The NED spent some $16 million between 1984 and 1992, of which some $1.5 million were spent from 1984 to 1987, when internal political intervention took a back-stage to the Contra military effort. This spending swelled to an imposing $13 million during the 1988-1990 electoral period.44

Given their history of infighting and factionalism, the traditional elite, including the exiled and internal wings, spent as much time in the wake of the 1979 revolution squabbling among themselves over petty issues and personal rivalries as they had spent engaged in anti- Sandinista activities. The US largesse exacerbated divisions because money was made available for any professed opposition group, and it became quite profitable to set up one's own party, no matter how tiny or uninfluential. By 1989 there were no fewer than twenty-one different opposition political parties and several additional factions. The anti- Sandinista forces were "centrifugal in dynamic, fratricidal in outlook," bemoaned one report by US consultants sent to Nicaragua in 1987 to begin organizing the internal opposition. Another observed that the opposition was "bureaucratic, static, atomized, with low credibility in the population."45 Overcoming the truncation and underdevelopment of the Nicaraguan elite would not be an easy task. The US plan called for mobilizing two main bodies: a political coalition to oppose the Sandinistas, and a network of mass civic organizations, or what US strategists referred to as a "civic opposition front," and it also called for the large-scale use of transnational communications.

Step 1: Creating and funding a political opposition coalition

Forging the first body, the political coalition that eventually became the Nicaraguan Opposition Union (UNO), began in 1987 with formalized and systematic contacts between US organizers and the opposition. The NDI and the NRI organized a spate of seminars with opposition leaders in Managua and abroad to "provide training in how to formulate organizational strategy and tactical planning to the civic opposition ... [the seminars] were designed around three core themes: party planning and organizational strategies, constituency building, and coalition formation." The training efforts also stressed "recruitment and development of resources, constituency support. .. and the development and delivery of a coherent message. These sessions [were to] focus on methods for identifying and expanding a base of support and on communication techniques which are compatible with the political culture."46 The NDI and the NRI also sent US consultants and "international experts" to Nicaragua to analyze the opposition's strengths, weaknesses, and needs. Reports were produced which laid out a concrete, multi-thematic agenda for the US organizers. The workshops and inflow of funds and advisors succeeded in bringing together top-level and mid-level leaders from more than a dozen political parties. Bickering and rivalries continued, but US political tutelage put into motion centripetal forces. In late 1987, two multi-party coalitions formed, and in 1988, the NDI and the NRI encouraged the two groupings to come together as the Group of Fourteen (fourteen parties in all were involved), which later coalesced into the UNO coalition.47

In mid-summer 1988, officials from the State Department, the White House, the NED and its core groups met in Washington to evaluate the initial efforts and to map out a more comprehensive course of action. The anti-Sandinista forces "need political and financial support from multiple sources" and "should be encouraged to mobilize and channel popular discontent" inside Nicaragua, argued one NED official, pointing out that, according to polls, a majority of the Nicaraguan electorate was undecided. An abstention from this undecided bloc would favor the FSLN. So US strategy should be to provide would-be abstainers with incentives for casting their lot with the opposition.48 Following the meeting, the NED contracted the Delphi International Group, which was already involved in Chile and elsewhere, to merge different opposition factions under a larger opposition umbrella. Delphi's report on the program noted that the group "has been able to implement its principal objective of... promoting cooperation and dialogue leading to a broader-based united civic opposition. The organization [Delphi] is now involved in getting the 14 political parties and the various private sector organizations to come together."49 In February 1989, a NED team headed by Gershman arrived in Managua. In a strategy session at the US Embassy, Gershman and US Charge d' Affaires John Leonard spoke of creating a formal electoral coalition: "What should the procedure be to organize the opposition around a single candidate? It should include as many parties as possible, COSEP and the labor movement, women and youth." The opposition, they agreed, would have to be instructed "to postpone any announcement of a presidential candidate. To do so now would provoke divisions in the fledgling movement. First [we must] successfully negotiate [with the Sandinistas] the conditions for the elections, the rules, and then they can squabble amongst themselves over the candidates."50

US officials inundated Managua over the next several months. These visitors, according to another NED document, brought one overriding message: "It is essential that the opposition understand that failure to unify jeopardizes external assistance."51 In May, US officials convened two plenary meetings at the US Embassy compound with the opposition leadership. An assembly was scheduled for July to bring the UNO into formal existence. This July assembly was attended by NED and US Embassy officials and analysts and consultants whom NDI and NRI brought in from around the Americas to offer concrete advice on how to mount the electoral campaign. Several of these "experts" had previous experience in US political intervention programs, including the Panamanian opposition leader Plutarco Arrocha and the coordinator of the anti-Pinochet coalition that the NED had brought together in Chile, Genaro Arriagada.52

Following the formation of the UNO, Washington acted as the power-broker to diffuse sharp disputes in the UNO over candidate selection that nearly split the fragile coalition. Under heavy pressure from US officials, the opposition chose Violeta Chamorro as its presidential candidate, and Virgilio Godoy, president of the Independent Liberal Party, as her running mate. The sixty-year-old housewife from the traditional aristocracy had little personal experience in politics, and was not knowledgeable on domestic or international affairs. She was chosen to head the UNO ticket as a figurehead, a symbolic "unity candidate" who could attract the votes of would-be abstainers.53 She was the widow of the martyr Pedro Joaquin Chamorro, and respect for his memory would maintain opposition unity and win popular support. Chamorro's US and Nicaraguan campaign strategists leaned heavily on psychological images of motherhood, Christian devoutness, unity, and so on, in synchronization with the main themes of the UNO campaign. Religious symbolism was particularly important in this devoutly Catholic country. Chamorro had long maintained a close relationship with conservative Catholic leaders, particularly Cardinal Miguel Obando y Bravo, the archbishop of Managua and the premier anti-Sandinista symbol. The Cardinal had received millions of dollars from the AID and private US religious and conservative groups in the 1980s,54 and the AID gave his archdiocese another $4.166 million during the electoral campaign.55

The US strategists propagated a parallel with Aquino, whose husband was also a martyr. The White House arranged for a state visit to Washington by Aquino to coincide with a visit by Chamorro and for a photo-opportunity of the two together. Creating Chamorro's international image did not stop with the Aquino parallel. Washington planned flashy meetings between Chamorro and other world leaders, including Pope John Paul II, British prime minister Margaret Thatcher and other European leaders, and President Bush.56 The purpose of these visits, in which photo-opportunities were stressed and statements kept to a minimum, was to have the image of Chamorro beside world leaders reverberate in the minds of the Nicaraguan electorate. What was important was that Chamorro be seen as capable of securing the political and economic support of the developed capitalist world at a time of severe crisis in Nicaragua and diminishing options for its resolution. The photos were splashed across La Prensa and repeated each night in the UNO media outlets.

Having achieved the paramount goal of political unity, US officials provided this unified political bloc with the financial and material resources necessary to organize and sustain a nationwide electoral campaign. In addition to "private" and secret funding, the Bush administration made a massive "overt" investment in the opposition using NED and AID as the conduits. In October 1989, Congress approved a $9 million "electoral appropriation" for Nicaragua, which allocated $5 million for the UNO and other anti-Sandinista groups, $2.9 million for discretionary NED spending, and $1 million for observer groups, including Jimmy Carter's organization, and the CFD, which had observed the Philippine vote.57 Publicly, the United States spent $12.5 million through NED on the elections. Washington also spent at least $11 million in two CIA authorizations, one in April 1989 involving $5 million in UNO "housekeeping expenses," and a second in October 1989 involving $6 million for "regional programming" for the oppositon.58 If we add circuitous spending, the figure approaches $30 million, or some $20 per voter.59 In contrast, George Bush spent less than $4 per voter in his own 1988campaign.60

Since the NED charter technically prohibited direct campaign support for the UNO, US strategists set up a conduit for the coalition, the Institute for Electoral Promotion and Training (IPCE). Instead of providing funds directly to the UNO, the NED channeled them through the IPCE as "non-partisan" spending on a "multipartisan organization." However, IPCE's five-member board of directors were all top UNO leaders: Alfredo Cesar was Chamorro's chief campaign advisor; Luis Sanchez was the UNO's official spokesperson; Guillermo Potoy was a leader of the UNO-affiliated Social Democratic Party; Silviano Matamoros led a faction of the Conservative Party belonging to the UNO; and Adan Fletes was a leader of the Democratic Party of National Confidence, also a member of the UNO coalition. In fact, the record shows that the IPCE was conceived entirely in Washington by US officials who hand-picked its five-member board and brought them to Washington to set up its structures and arrange funding.61

Step 2: Consolidating a "civic opposition front"

Unifying and organizing the political parties was a staging point for a broader effort to penetrate (or create from scratch) the institutions of Nicaraguan civil society and to orient their activities. Washington had already been supporting a host of such institutions. As the US strategy shifted from the Contra to the electoral phase in the war of attrition, the effort was vastly expanded and the second body, the "civic opposition front," was assembled. "The topic of the form a united civic opposition should take in the upcoming pre-electoral period received considerable discussion," the Delphi International Group reported after a meeting its officials held with anti-Sandinista leaders in Managua in March 1989. "The idea discussed included a movement that was coordinated by a commission of political party, private sector, and labor union representatives ... It also was determined that it would be important to have the youth organizations represented, as well as the women's movement."62

According to the US strategy, labor was particularly crucial because the Sandinistas enjoyed strong support among workers and this had to be eroded. Exploiting economic hardship was critical to anti-Sandinista organizing. In distinction to the youth and women's sectors, where the NED organizers had virtually to start from scratch, the United States had a long history of trying to create a pliant trade union movement in Nicaragua, as in the Philippines and Chile, and since 1979,Washington had been actively promoting anti-Sandinista trade unions. The NED channeled support to the opposition trade unions through the FTUI, which in turn operated through the AIFLD. The FTUI relied on a complex of third country mechanisms for sending human resources to the opposition unions. NED and the AIFLD created a Nicaraguan Labor Solidarity Office in Costa Rica and funded a group in that country, the Center for Democratic Consultation, known by its Spanish acronym, CAD, whose tasks included sending Latino union organizers into Nicaragua. In addition, they brought in a team of twenty organizers from the AIFLD-funded Venezuelan Federation of Workers.63 With these international structures in place, US officials worked inside Nicaragua for labor unity in the opposition. Embassy officials held a series of meetings with anti-Sandinista trade union leaders in 1988, urging them to work at unifying all the unions in order to confront the government under one banner. Later in 1988, the FTUI sponsored several trade union seminars in Managua, from which emerged the Permanent Congress of Workers (CPT) umbrella organization. By the time the electoral process began, the CPT was working as an homogeneous entity, the trade union parallel of the UNO.64

An August 1989 FTUI document described plans to spend another $1 million, recently approved as part of Congress's special appropriations, for the electoral mobilization of workers and their families. The plan involved the "multiplier" system to organize 4,200 activists. After being trained and put on FTUI salary, each activist operated in one of the 4,200 administrative zones in Nicaragua where voting boards were set up. These activists were "to mount an effective nation-wide effort to register workers and their families and then see that they vote." The FTUI needed to "motivate these activists for their roles," as well as "provide transportation and communications support" for the network, stated the document.65 A trained Managua headquarters staff supervised an elaborate network reaching down to ten-member voter teams in towns and villages. The national headquarters was staffed with Venezuelan and Costa Rican teams and top CPT leaders under the supervision of FTUI officials. At the next level down, provincial organizers were sent out to each of the country's sixteen provinces. Directly under their supervision, were a hundred district organizers, "whose first responsibility was to recruit and train about 400 labor activists for the next level down."66 And so on. In this way, the NED created and controlled a vertically organized nationwide structure for intervention in the political system and the electoral process via the trade union sector. Between August and December 1989, FTUI held a total of 130 local training seminars, sixteen departmental and one national, with the NED funds. The newly trained activists were sent around the country with NED salaries and per diems.67

Youth was also considered a strategic sector. Demographically, Nicaragua is a youthful society. Some 50 percent of the population is under thirty years of age, and the voting age was set at sixteen years. Youth was the core of the revolutionary energy that overthrew the Somoza dictatorship. On the basis of the Nicaraguan experience some social scientists even developed new theories of youth as a third revolutionary sector, after workers and peasants.68 Delphi was assigned to launch the youth project, and, with NED funds, created and advised the Centro de Formacion Juvenil (CEFOJ) as a new "civic youth organization."69 Seminars were held throughout 1988 to train and organize a core group of salaried youth leaders from opposition political parties. This group formed a national leadership paid from NED funds. In turn, they were to select regional leaders who would oversee local activists working in secondary schools, communities, and recreational centers to organize an anti-Sandinista political youth movement.70

Women were identified as another special sector. Many women had become empowered through the revolutionary process, particularly by their participation in mass organizations such as the women's associations, neighborhood groups and trade unions. US organizers concluded that women as a group needed to be separated from Sandinismo, were susceptible to US psychological pressures through the manipulation of traditional gender roles and of motherhood, and could playa critical role in the electoral intervention project. Targeting women, the backbone of most Nicaraguan families, would be a way to penetrate the very nucleus of society - the family. The draft of young men - itself a measure enacted as a defensive response to US military aggression - was particularly unpopular among mothers as heads of households, who saw their sons shipped off to war fronts and often returned maimed or dead. The traditional sexual division of labor meant that women predominated in the informal economy, including market networks and household economies. Sandinista economic policies in favor of formal sector labor, producers and consumers, rather than traders and others in the informal sector, had a positive effect on the poor overall, but they antagonized the "market women" and others in the informal sector who made up sizeable constituencies. And those women who were homemakers bore the brunt of food shortages and other economic hardships.

While this reflects, in part, a carry over of pre-revolutionary gender relations, and in part, Sandinista weaknesses in incorporating gender issues into overall programs, US operatives were keen on exploiting factors that made women susceptible. Delphi designed a "women's project" focusing on organizing efforts in the market-place and in households. The NED provided Delphi with a grant to form the Nicaraguan Women's Movement (MMN) in April 1989 by bringing together female leaders from several UNO parties and creating a board of directors.71 "Nicaraguan women have begun to speak of the decisive role they must play in organizing rallies and protests," explained one document, which prescribed "seminars and workshops tailored to train 'multipliers' to train and motivate their peers to participate.72 Another Delphi document explained: "Women ... see themselves as victims of the state's exploitation, having suffered from the lack of food and poor education. They now realize that it is in their obligation to help liberate the country through civic opposition." The document concluded: "As the [Delphi] program advances, women will playa significant role in the electoral process as never before seen in the history of Nicaragua. As they transform absenteeism into participation and negative votes into positive ones, they will have the potential to attract more votes and will be seen as a decisive force in the electoral process. "73

By mid-1989, the opposition had become unified and was developing a national profile. NED officials analyzed overall progress:

There are three main centers of activity in this election. One is the politicalparties grouped in UNO. Another is the labor group in CPT. Each of these has come together fairly well and there is a good working relationship between them... The third group is a civic group which has yet to solidify. Conceptually, this is a vital part of the democratic process... The civic group needs to be independent and non-partisan, but it should also coordinate with the other two main groups and avoid duplication of effort.74


Shortly afterwards, the NDI sponsored a seminar in Managua between US organizers and opposition representatives to set up this "civic component," and then to "arrive at an agreed-upon division of labor among the three components." 75

Among those attending this Managua meeting was Henry Quintero, the intelligence operative who had managed several programs in Chile and had also helped run Delphi programs in Nicaragua. This time he was representing yet another US-based organization, the International Federation for Electoral Systems (IFES). This group, formed just months before the Nicaraguan electoral process opened in order to "support and improve the process and management of free elections in emerging democracies throughout the world," was put in charge of running a Via Civica program. Its board of directors heavily inter-locked with the other NED groups.76 At a press conference after the meeting "civic leaders" announced the formation of Via Civica. This new organization, they proclaimed, was "a non-partisan grouping of notables" which would press its cause "through ballots, not bullets." Via Civica, without any interest in promoting one or another political position, would merely help register the voting age population and promote civic values. "Just think of it as a League of Women Voters," was how Quintero put it.77 However, all ten directors of this new group were prominent UNO activists. Three were leaders from UNO political parties, five were COSEP leaders, and two represented the CPT unions. With Via Civica established, the three separate components of the US program were in place, and were expected "to function during the election as a single unit," one NED document concluded.78

The broader strategy behind the trade union, women's, youth, and Via Civica projects was to face the Sandinistas at every level of society - social, political, and cultural - where Sandinismo held influence. US funds, political training, and guidance were instruments to erode Sandinista hegemony and construct an opposition hegemonic bloc. What US rhetoric referred to as "building the institutions of democracy" in Nicaragua meant creating or strengthening a series of parallel pro-US groups led by representatives of the traditional elite, achieving vertical and horizontal linkages among them, and providing them with an effective political action capacity to compete with mass organizations in which Sandinismo held sway.

Step 3: Utilizing transnational communications

US policymakers targeted the communications media as another critical element in the strategy. An examination of this program provides a case study in the use of transnational communications in "democracy promotion" programs. Symbolic manipulation was meant to influence the US public (creating a domestic constituency for the war), the international community (mobilizing transnational resources against the Sandinistas and isolating Nicaragua internationally), and inundating the Nicaraguan population with a host of messages conducive to the overall objectives of the war. Several US agencies became deeply involved in the communications and propaganda efforts, among them the CIA, the NED, the State Department, the Office of Public Diplomacy, and the USIA.79

Covert and psychological operations aimed at influencing the coverage of Nicaragua in the US and international media involved calculated "leaks," manipulating and even paying off journalists, planting disinformation and black propaganda, and designing public relations blitzkriegs. This "war of images" was complex and multidimensional. It sought to "demonize the Sandinista government," as one US official admitted, in order to "turn it into a real enemy and threat" in the eyes of the US public and international community.80 The themes of a lack of democracy in Nicaragua, political repression, persecution of the church, economic disaster, militarization, the export of revolution, and so on, were projected on a daily basis during the course of a decade. The flip side of the strategy was to inculcate the image of the Contras, and even more so, of the internal opposition, as the democratic alternative.

Another part of the propaganda campaign was actually creating communications media for the anti-Sandinista forces. The USIA and the CIA set up several radio stations in neighboring countries that transmitted into Nicaragua sophisticated anti-Sandinista messages.81 The USIA also expanded Voice of America transmitters in the Caribbean Basin region so as to inundate Nicaraguan airwaves. The Contras also had several shortwave radio stations targeting specific Nicaraguan communities, and in addition published propaganda newsletters and magazines, assisted by the USIA and funded out of general budgets provided by the CIA.82 The NED also financed anti- Sandinista publications published outside of Nicaragua. The group that managed most of these programs was Freedom House, which also participated in the Contras' public relations efforts.83 With approximately one million dollars in NED funding, Freedom House created an anti-Sandinista publishing house, a think-tank, and a scholarly quarterly journal in San Jose, Costa Rica, run by prominent personalities and intellectuals from the Nicaraguan elite.84

Of the internal opposition media outlets, the most important was La Prensa, which became a leading symbol of the anti-Sandinista campaign. Although the United States projected an image of La Prensa as a struggling "independent" news outlet, it was funded by the United States and functioned as an important outlet inside Nicaragua for the US war and the unofficial organ of the internal opposition. La Prensa began to receive covert CIA subsidies (through third-party "cutouts") as early as 1979 to enable it to play a counterrevolutionary role, particularly through psychological warfare, just as El Murcurio had done in Chile under Allende.85 In addition to covert funding, the NED began overt funding for the newspaper in 1984, and in 1986 placed the La Prensa operation under Delphi supervision. With the shift from the military to the internal political track, the United States bolstered the media outlets of the internal opposition. The NED launched a Nicaraguan Independent Media Program under Delphi supervision, involving a huge expansion of both funding and direct political guidance for the creation and expansion of the opposition media, including La Prensa and several radio stations. In 1988, Delphi initiated an Independent Radios Project with the objective of equipping and advising opposition radio. The program funded four radio stations during the campaign, including training radio journalists and programmers, and coordinating opposition radio programming with the UNO and the youth, women's, civic, and other groups.86

Washington also sent in experts in video and image propaganda to guide and fund UNO's television media strategy. US media and public relations experts were contracted to manage a fully equipped production facility which the NED and USIA officials opened in Managua to prepare a half-hour programs, a "fast-paced, entertaining and aggressive show that could be a hybrid between a regular newscast and a news magazine." The slick UNO television segments and vignettes began airing in September 1989. The segments were highly professional, and played heavily on a mixture of sound, image, and core themes to which the Nicaraguan population would be sensitive - religious sentiment, childhood, contrast between misery in the present and hope for the future, and so on - themes which reinforced the psychological content of the US intervention strategy. NDI consultant Peter Fenn designed a television vignette that showed the Berlin Wall falling and Solidarity head Lech Walesa. "Now Nicaragua has the opportunity to choose democracy," it concluded.87 Other television spots juxtaposed scenes of economic and social misery with a bright UNO future, with a backdrop of heavy religious symbolism. The "civic opposition front" worked in close conjunction with UNO/US media strategy. Via Civica, the CEFOJ, and the MMN plastered advertisements each day in the US-funded media outlets.

Another aspect of the communications program was polling. Polls and pollsters have become a methodological and systematic component of political and electoral processes. Surveys on voter behavior and political preferences serve both to guide parties and candidates, and to shape public opinion itself. Images of the strength, weakness, and prospects of candidates can be projected and reinforced through the dissemination of survey results. Beyond its own political system, the US has developed the use of polls as instruments in its machinery for political intervention abroad. The NDI and the NRI, for instance, relied on polling extensively as part of the NED programs in the Chilean elections. Polls are easily manipulated for the political motives of pollsters, and were used by both sides in the Nicaraguan elections as part of broader campaign strategies. Some dozen Nicaraguan and foreign organizations - pro-Sandinista, pro-UNO, and neutral - conducted voter surveys during the electoral process. Independent polls conducted in the final weeks of the campaign, among others the ABC-Washington Post, showed the Sandinistas winning by a significant majority. Polls conducted by several regional pollsters contracted by UNO, showed UNO winning by margins similar to the actual voting results, Given the highly polarized and politicized environment of a country tom by war, as well as the methodological difficulties that abound in Nicaragua, it was no wonder that analysts were often unable to interpret contradictory survey results. Nevertheless, polls taken in the pre-campaign period agreed on the existence of a core of FSLN supporters (some 25-30 percent) and a committed anti-Sandinista opposition (some 20-25 percent), with the majority, probably 40 percent or more, being undecided and potential abstainers.88

Political opinion polling served two essential, yet contradictory, purposes in US-UNO strategy. The first was propagandistic. The polls became an important instrument in Washington's international campaign to cast doubts upon the electoral process, tarnish the Sandinistas' image, apply pressures on the Nicaraguan government, and influence the electorate. Polls showing the UNO way ahead and the Sandinistas trailing by wide margins would reinforce arguments that the only way the FSLN could win would be through a fraudulent election, and give UNO an image of strength in the eyes of Nicaraguan voters. Second, polling became an important medium for assessing the extent to which the attrition process had advanced over the years. US strategists used internal polls as a guide in assessing the direction of the undecided majority and the real prospects for converting would-be abstainers into opposition votes. Thus, polling was an instrument to obtain information necessary for US operatives to carry out more effectively and precisely their work among the Nicaraguan electorate.

In conjunction with media manipulation, international observation has become an instrument for penetrating and manipulating foreign electoral processes, obscuring in the process the distinction between neutral or impartial observation and partisan intervention, as discussed in the Philippines chapter. The 1990 Nicaraguan elections were probably the most closely scrutinized by observers in world history, observed by thousands of representatives from the UN, the OAS, the European Parliament, countless governments, and human rights, political, and religious groups. Many of the groups had a presence in Nicaragua for the duration of the campaign period. Washington saw both problems and opportunities in this flood of observers. Should the Sandinistas win under the watchful eyes of the international community, the US would find it difficult to discredit the voting or to deny legitimacy to the Sandinistas. On the other hand, the window of international observation provided US operatives with numerous opportunities for manipulating the electoral process and influencing observer views and conduct.

Most of the groups from the electoral intervention network sent US-funded "observer" teams. These included the AIFLD, which was advising the UNO trade unions, the CAD from Costa Rica, the NDI and the NRI, and Freedom House. US "electoral observers" were a way for Washington to set itself up as sole judge and arbiter of the electoral process. Had the Sandinistas won the elections, many of these partisan observer groups would have been in a position to issue reports questioning the results and influencing international opinion. Another US-funded observer team was sent by the CFD, an organization which had been involved in anti-Sandinista activities throughout the 1980s, including awarding its annual "Sentinel of Freedom" award to Violeta Chamorro in 1987.89 With $325,000 granted to it by Congress and the NED, the CFD was sent to "observe" the Nicaraguan elections. With these funds, the CFD conducted a host of questionable activities, ranging from distributing paraphernalia resembling the UNO logotype, to carrying out its own "get out the vote drives" as if it were a Nicaraguan civic organization, preparing "press packets" on the elections for distribution to other observer groups in Managua, and proposing that the Contras, who were still active militarily, remain armed until after the elections so as to see if the vote was "really fair."90
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Re: Promoting Polyarchy: Globalization, U.S. Intervention, a

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Part 3 of 3

Electoral coup d'etat: the making of a Faustian bargain

Along with coercive diplomacy, the United States skillfully wove military aggression and economic sanctions into the project. In April 1989, Congress approved a new aid package of nearly $67 million for the Contras, intended, in Secretary of State James Baker's own words, to "keep the Contras alive, intact and in existence throughout the electoral process." Baker stated that by keeping the Contras intact, the United States would have "an insurance policy until after the February elections are certified as free and fair" so that the Contras would be available "for their possible or potential use further down the road."91 This aid allowed the Contras to remain mobilized and active for the duration of the electoral campaign. This was particularly significant, since in the year leading up to the electoral campaign, the military war had wound down considerably as a result of the Central American peace accords and international mediation efforts, and there was a general mood throughout much of the country that real peace was not too far off. With fresh US funds, Contra officers were given a course in Honduras to help them strengthen their military structure.92 At least $4.5 million was spent on electoral propaganda training, including "courses in civic action, in basic democratic processes, forms of government and Nicaraguan history and geography," said one State Department report.93 One Contra participant said the courses taught the virtues of UNO and how Contra electoral campaign activities in the rural areas could contribute to the "civic defeat" of the Sandinistas.94

In August 1989, the month in which the electoral campaign officially opened, the Contras began a redeployment into Nicaragua of 8,000 to 12,000 troops that had been inactive, stationed in Honduran base camps. The US aid program had permitted a quick deployment. Contra actions, which averaged about fifty per month in 1988, increased in the first half of 1989 to about one hundred, and then, following the August redeployment, jumped to an average of three hundred per month, a rate sustained right through to the voting. The Contras took up the task of armed propaganda and intimidation in favor of the opposition, becoming in effect an armed wing of the UNO. Contra armed propaganda teams distributed huge quantities of pro- UNO leaflets. "Our infiltration into Nicaragua has nothing to do with combat," explained one Contra commander of a twenty-person "electoral unit." "Our only goal is to maintain a presence in our fatherland and alert the people about the elections and who they can vote for."95 The Contras also carried out a highly selective campaign of terror against Sandinista campaign workers and designated rural communities known for their Sandinista sympathies. No fewer than fifty FSLN rural campaign activists were assassinated. Several large-scale massacres of civilians and hundreds of incidents of military harassment were reported. This Contra military activity underscored the fact that the electoral process unfolded in the midst of war. Voting was literally under the gun. Some 42 percent of the electorate resided in rural areas, and of these, over 50 percent directly in the zones of military conflict. In other words, approximately 25 percent of the electorate were directly affected by Contra military activity.96

The objective of the Contra redeployment was much more than electoral propaganda or garnering UNO votes among peasant communities. It was the cornerstone of a sophisticated psychological warfare operation aimed at sending a powerful message to the entire electorate: the Sandinistas are not capable of ending the war. By reinfiltrating the Contras and having them engage in enough visible activity so as to make their presence an issue in the media, and thus have the image of ongoing Contra activity reach the entire population, it was possible to prevent the Sandinistas from claiming to be able to bring peace to Nicaragua. The electorate as a whole had to contemplate the consequences of their vote. The message was simple: because the Contras support the UNO, and because the United States sponsors both UNO and the Contras, an electoral victory for UNO will mean an end to the war, and therefore a vote for UNO is a vote for peace. The use and the threat of the use of military aggression were thus employed as political trump cards. "When we examine coercive diplomacy and limited military actions as forms of psychological warfare," said one US strategist, "we should bear in mind that [their] effectiveness depends on our enemy's perception of what will happen to him if he fails to do as we wish."97

As noted earlier, ten years of US war had shattered the fragile Nicaraguan economy. The war forced Nicaragua to transfer huge quantities of material, financial, and human resources from production to defense. Between 1979 and 1981, defense accounted for 15 percent of the national budget. By 1985 the defense effort was consuming 60 percent of the budget, 40 percent of material output, 25 percent of the GNP and 20 percent of the economically active population.98 The Nicaraguan revolution won international awards for its literacy campaign and broad praise for its great strides in improving the basic health and living conditions of the people. However, the war gradually eroded the government's capacity to finance these programs - exactly what the attrition process was intended to do. The grueling economic crisis included a 33,000 percent inflation rate in 1988, a fall in the GNP for every year from 1984, and damages as a result of the war exceeding $12 billion.

Policymakers sought to assure that the hardships would continue and there would be no tangible improvement in the economy during the electoral campaign. Preventing any shift from defense to social spending by keeping the Contras mobilized became a top priority. "The economic situation in Nicaragua is very bad, and the resistance forces remain an element in the equation," said Luigi Einaudi, the US Ambassador to the OAS. "So there are reasons for which to believe that the Sandinistas [can be removed]. That is our operating assumption. That is the situation we are trying to induce."99 In addition Bush renewed the trade embargo twice during the electoral process, first in May 1989 and then again on October 25, at the height of the campaign. In November, Chamorro was brought to the White House for a well-publicized photo session with Bush, after which the US president released a statement, reproduced under splashy headlines in La Prensa and in the other UNO media outlets, declaring that if Chamorro was elected, the USwould lift the embargo. 100

US officials also blocked international assistance for Nicaragua. In 1988, Nicaraguan authorities requested that the World Bank send a team to explore renewed lending to Managua, cut off in 1982. The Bank agreed. However, Baker sent a letter to Bank president Barber Conable, voicing US opposition to any attempt to mend relations with Managua. 101 Bank authorities eventually succumbed to the pressure, reversing their decision to send the team, "due definitely to very strong pressure" from the United States, according to a senior Bank official. In May 1989, President Ortega made a three-week tour of Western Europe in search of emergency economic assistance. The tour culminated in an international donors' conference in Stockholm which the Swedish government sponsored in order to explore ways to secure international aid. The Bush administration pressured the World Bank, the IMF, and the IDB not to send delegates to the meeting. At the time of the conference, Baker was in Europe, making phone calls to European government officials in last-minute attempts to dissuade them from participating, or from providing Nicaragua with assistance.102

As with the Contra military activity, sustaining the economic crisis sent a clear psychological message: a vote for the FSLN means the United States will continue economic destabilization, and is thus a self-punishing vote for continued economic hardship. A vote cast for UNO will lift the economic sanctions, open the spigot of international aid, and bring economic respite. Surveys conducted one month before the vote revealed that the economy was the most important issue for 52 percent of the electorate, and the Contra war was the most important for 37 percent; 87 percent of all voters identified the war and economic crisis as the paramount issues in their voting decision - issues in which the United States exercised the decisive levers.103 Equally as revealing was a post-election survey: presented with the statement, "If the Sandinistas had won, the war would never have ended," 75.6 percent of those surveyed agreed, and this percentage included 91.8 percent of those who voted for the UNO. 104

Essential to the US strategy was converting the vote into a referendum, a simple plebiscite-type decision by the people: "war - yes," or "war - no." A vote for the Sandinistas meant a continuation of hostility from the US, and thus continued poverty, hardship, war, and isolation. A vote for UNO, to the contrary, would bring respite, an immediate end to the US aggression, a definitive cessation of military hostilities, and millions of dollars in foreign aid. The US electoral intervention project can only be understood when seen in its entirety: the skillful combination of military aggression, economic blackmail, CIA propaganda, NED political interference, coercive diplomacy, and international pressures, into a coherent single strategy. And then, the project can only be appreciated as the culmination of ten years of war. The entire population had become exhausted from war and economic crisis. The US strategy was precisely to "harvest" this exhaustion through the elections. This "Faustian bargain" hijacked the vote into an electoral coup d'etat.

Historical outcomes, in Nicaragua and elsewhere, are not reducible to US intervention alone, and the conceptual focal point of this Faustian bargain is neither Nicaragua's internal process nor US intervention but how the two became interwoven. The incomplete fulfillment of the promises of the revolution, which ultimately eroded its legitimacy and undermined its hegemony, was a consequence of internal and external and subjective and objective factors that must be seen in their dialectic relation, in which interactive variables unfold under a macro-structural-historical framework. US intervention radically altered the political system in Nicaragua and was crucial in determining the conditions, as well as constraints, under which the electoral process, and the revolution as a whole, unfolded.

US intervention after the Sandinistas: constructing polyarchy and a neo-liberal state

It has been two years since I was last in Nicaragua and I am taken aback by the tremendous increase in indigence. For example, there is an army of children living in the streets, naked and begging. You had promised to resolve the economic crisis. How do you propose to do this when poverty is increasing month by month? - Look, my dear, here people are used to going naked in the streets because of the heat. It is true that children go about like that in the streets, that they go around begging. But it is because their mothers send them out to beg due to a lack of good manners.

-- Violeta Chamorro, 1993 interview with a foreign journalist [105]


The electoral results were a stunning success for low-intensity warfare and the new political intervention. But US intervention did not end there; it entered a new stage.106 The goals became (1) to dismantle the revolution (2) to reconstitute an elitist social order under the leadership of "technocrats" and a "New Right" attuned to the transnational agenda, and (3) to deepen the process of penetrating Nicaraguan civil society and constructing a counter- (and counterrevolutionary) hegemony therein. One side of the post-electoral strategy was to neutralize the influence of Sandinismo at every level - political, ideological, economic, and military - and to reverse the socioeconomic transformations achieved over a decade of radical change. The flip-side was the consolidation of an anti-Sandinista alternative. Ten years of revolution did not make the Nicaraguan bourgeoisie disappear, but it did further disfigure a class which, as a result of external dependency and decades of dictatorship had never fully developed. Washington set about, through the judicious use of economic and political aid allocations in the years preceding the 1990 elections, to reconstitute a propertied class and a political elite tied to the emergent global order.

The Sandinistas surrendered the formal executive apparatus. But this transition unfolded within a constitutional framework developed under the revolution, whose social, economic, and political structures remained in place. The electoral defeat plunged the Sandinista party, its social basis and legitimacy already seriously eroded during the long years of war, into a sharp internal crisis over programs, ideological orientation, and strategy. But the FSLN in 1990 was still the largest and best organized party in the country. The popular sectors remained politicized and mobilized in the old mass organizations and, even more so, in new social movements and specific interest groups which flourished after the elections.107 The vote for the UNO was not a vote of support for its anti-popular program. Nicaragua was very different from Chile, where the left had been virtually decimated and the popular sectors demobilized and largely pacified. The situation in Nicaragua was closer to that of the Philippines, where consolidation of a polyarchic political system and the neo-Iiberal project proved difficult after a successful "transition." Yet the Philippines never underwent an experiment in popular democracy that radically altered the country's social, economic, and political structures. Most importantly, neither old and new factions of the Nicaraguan elite nor the United States could count, in 1990, on a repressive military apparatus to impose their agenda, since the Sandinista People's Army (EPS) remained largely intact following the change in government. The new Minister of the Presidency, Antonio Lacayo, was forced to recognize that "what happened in Nicaragua was not a social revolution, but an electoral victory within the legal order."108

The difficulties in the US/elite project became evident in the months following Chamorro's April 1990 inauguration. The new government announced sweeping neo-liberal measures, including massive public sector layoffs, privatizations, rate increases in transportation, utilities, and other services, a sharp reduction in social spending, and the elimination of subsidies on basic consumption. The measures triggered two consecutive national strikes, in May and in July, both of which paralyzed the country and demonstrated the popular classes' willingness and ability to mount resistance. The new government was forced to compromise. Clearly, the anti-popular program would have to be implemented gradually, through a strategy of "slow-motion counterrevolution." Nicaragua entered a period of endemic social conflict, in which cycles of standoff, negotiation, and compromise alternated with peaceful or violent strikes, demonstrations, and clashes in the countryside and the cities. Chronic instability and social conflict provided the backdrop to ongoing realignments of the country's political forces and a "creeping" implementation of the neo-liberal program.

US officials were aware of the enormous challenge they and their Nicaraguan allies faced. After a year-long study, the newly opened AID mission in Nicaragua (the AID had withdrawn altogether from the country in 1981) stated in a report laying out overall US policy for 1991 to 1996, the year in which the next elections were scheduled: "The strategy presented in this document is an extremely ambitious one. It is difficult to overemphasize the degree of change in the Nicaraguan economy and Nicaraguan society which it envisions,"109 This Strategy Statement, a remarkable blueprint for the construction of a neo-liberal republic, laid out a comprehensive program for restructuring every aspect of Nicaraguan society on the basis of the economic power the United States would be able to wield over the shattered country.

Dismantling the revolution and restructuring Nicaraguan society involved "counter-reform" in every institutional and policy arena: reform of the state, sweeping economic policy reforms, reforms to the constitution, reforms in the police, educational reform, social policy reform, recomposition of the hegemony of private capital, accelerated market liberalization, and so on. Such massive economic and institutional restructuring would logically lead to a change in the correlation of internal political and social forces and thus provide a solid material basis for the more gradual, yet crucial, cultural and ideological dimensions of "slow-motion counterrevolution."

Following the elections, Washington approved a two-year $541 million assistance package for Nicaragua, including at least $10 million in political aid channeled through the ODI and $3 million in new NED funding. 110 The AID program in Nicaragua became the largest in the world, and the embassy became the most heavily staffed in Central America. Personnel increased from 78 accredited diplomats in 1989 to over 300 by mid-1990.111 Washington appointed as its new ambassador Harry Shlaudeman, a veteran diplomat who had a history of involvement in US-guided interventionist efforts in Latin America, including being Deputy Chief of Mission in Chile before and after the 1973 military coup, where he played a pivotal role in CIA covert operations against the Allende government as the in-country counterpart to Kissinger's Committee of forty at the NSC.112

Post-electoral political aid

Formal state power passed from the Sandinistas to pro-US representatives of the elite. But this elite did not enjoy hegemony in civil society. Rooting out any vestige of Sandinista influence and incorporating into an emergent transnational historic bloc the Nicaraguan masses, whose consciousness and "daily practices" had been transformed in ten years of revolution, would therefore be a long-term process. As Nicaraguan sociologist Oscar Rene Vargas noted, revival of a latent fatalism and submissiveness of the popular classes would have to rely heavily on cultural and ideological mechanisms.113 Political aid played the main role in this endeavor. Following the election, the AID immediately sent a team of international legal advisors to the Chamorro transition team and provided the CFD with funds to set up a permanent office in Managua to advise and train UNO legislators.114 The ODI sent advisors and funds: to the National Assembly, "to improve its internal operations in resolving conflict and forging consensus on national policy" and to implement "constitutional reforms"; to the Electoral Commission, "to prepare for and monitor the 1996 national elections"; to judicial institutions and to the Comptroller-General, "to install financial controls in government institutions"; and to municipal governments, to help in "implementing overall [US] strategy."115

In the view of US officials, the development of a polyarchic political culture among the elite and the legitimization of a neo-liberal social order among the population was the crucial counterpart to eroding the revolution's value system. "As the Mission has considered how best to promote democracy in Nicaragua, it has carefully reviewed a broad range of potential interventions," noted the AID report, and concluded that "transformation of the political culture is essential."116 The manipulation of religious values, patriarchal and traditional cultural patterns, and economic insecurities was central to this political-ideological endeavor. One of the first steps was the penetration and restructuring of the educational system as a key institution of ideological reproduction. The ODI allocated $12.5 million to replace textbooks used in public schools that were developed under the Sandinista government. The old texts were ordered burned by the new Minister of Education, Humberto Belli. The new "depoliticized" textbooks began with the "Ten Commandments of God's Law," referred to divorce as a "disgrace" and to abortion as "murder," and stressed the importance of "order in the family," as well as "obedience to parents and legitimate authorities." Augusto Sandino was removed from the chapter on national heroes. Catholicism was defined in the geography textbook as the world's dominant religion, "based on the preaching of Our Lord Jesus Christ." The world history text asserted that all US interventions were carried out to bring "peace and stability" to countries around the world. The AID's director in Nicaragua, Janet Ballantyne, stated that the textbooks would help "reestablish the civics and morals lacking in the last eleven years."117

While the ODI focused on government-to-government programs, the NED continued earlier programs and also introduced new ones to consolidate constituencies built up during the electoral process. One of these programs was ongoing allocations for the CPT trade unions: "[This program is] aimed at countering antidemocratic trade union destabilization during the transition period," stated one NED document. "After having suppressed strikes for years, some Sandinista trade unionists now threaten mass political strikes to 'protect the gains of the revolution.' A successful organizing drive by independent trade unions, aimed at creating a visible democratic presence in communities and industries throughout Nicaragua, is crucial to maintaining a stable transition period."118 The AID Strategy Statement was even more to the point: "Free democratic unions can offer alternatives to radicalized Sandinista unions."119 The CAD program also continued, including new "training and civic education" programs among "youth, women, teachers, professionals, cooperatives and community development organizations."120 Delphi was given nearly $1 million to continue the media program, including start-up funds for a new television station run by private businessmen.121 "The Sandinista controlled media has contributed to a generalized atmosphere of uncertainty and anxiety by constantly emphasizing the problems which lie ahead, and fomenting distrust of the new government's future economic, political and social policies among the peasants, government employees, and the general public," stated one Delphi document. 122 In 1991, the MMN changed in name to the Nicaraguan Women of Conciencia (MNC), making it a Nicaraguan branch of the Latin American network of Conciencia organizations of women from the elite set up by the NED. According to the new MNC director Francis Blandon, with US funding the MNC would be able to "rescue religion and the family from the libertine philosophy of the Sandinistas." The MNC would help women overcome misfortunes they suffered as a result of the Sandinistas - such as "abandonment by men, battery, sexual laxity, and lesbianism" - and their "contempt for Christian morals." 123 Similarly, the CEFOJ youth organization's post-electoral work focused on "the transmission of a moral and Christian orientation" to overcome the "great decadence in values" brought on by the Sandinista revolution.124

Post-electoral economic aid

The Nicaraguan case demonstrates the enormous constraints imposed by the global economy on peripheral countries. Despite systematic popular resistance to the full restoration of capitalist property relations and measures to open up the country to the unfettered operation of transnational capital, Nicaragua's desperate economic situation and extreme dependence on external financing gave the United States and international financial institutions enormous leverage. "The capitalist sectors that govern want to internationalize the country to the core, and in that option there's no space for national producers or for small and medium-sized growers or for a peasant economy or for anything else on that order," pointed out Nicaraguan economist Angel Saldomando. "The government has hedged all its bets on international accords and commitments that give it the correlation of forces abroad that it doesn't have domestically. This government has permanently held the conditions of AID, the IMF and the World Bank over people's heads like an axe: if we don't do this, the foreign resources won't come, we won't have money, there's no choice but to comply."125 In Nicaragua, the standard neo-liberal program was particularly abrasive because it involved not just free-market reform, but the reversal of prior popular and revolutionary changes.

Economic aid went to bolster the debilitated private sector, for balance-of-payments assistance, and to pay debt arrears to the World Bank and the IMF. The AID made disbursal of all assistance contingent on stringent conditions on to the Chamorro government's social and economic policies. The AID's Strategy Statement stipulated across-the-board conditionality. US assistance was aimed at "returning the country to a market economy," an AID official said. "What we are looking for is the standard orthodox stuff"126 - the privatization of industry, agriculture, and services, elimination of domestic subsidies, lifting market regulations, eliminating conditions on foreign investment, financial and trade liberalization, and a domestic austerity program. The largest portion of US aid went to pay the country's arrears to private foreign lenders and international agencies (and thus never even entered the country), which reestablished the country's credit standing and opened the spigot for new lending from the World Bank and the IMF. World Bank and IMF representatives, together with AID officials, designed a comprehensive neo-liberal structural adjustment program and made all credits, disbursements, and debt restructuring contingent on compliance with this program. After 1992, Washington began to phase out bilateral US aid and replace it with funding from the international agencies.127 US aid was a transitional mechanism for Nicaragua's insertion into international financial structures representing transnational capital.

Foreign aid inserted Nicaragua inexorably into the global economy. By 1992, Nicaragua's foreign debt stood at nearly $11 billion, one of the highest per capita debts in the world. Nicaragua paid out $495 million in that year in interest alone on this debt, and, according to government projections, was scheduled to pay $508 million in 1993, $629.8 million in 1994, $654 million in 1995, and $733 million in 1996. (In comparison, export earnings stood at $217 million in 1991.)128 Debt-servicing would clearly be a powerful mechanism for many years to come in compelling a thorough restructuring of Nicaragua's productive structure in accordance with a changing world market and the new international division of labor. Of a total of $1.2 billion in foreign aid allocated for the country in 1991, over $500 million - or 43 percent - went for debt- servicing. Another 26 percent went for imports, mostly of consumer goods. Figures for 1992 and 1993 showed an almost identical pattern. In 1991, public consumption dropped 35 percent and private consumption rose 33 percent, indicating a converse relation between the drop in government spending on social services for the popular sectors and an increase in private consumption among the tiny upper and middle classes. As a result of the sudden opening of the market to imports, Nicaragua experienced an import boom that forced thousands of small-scale industrial and agricultural producers into bankruptcy. The majority of new imports were not inputs for production but consumer goods, especially luxury items, benefitting a new high-income sector, as well as large-scale importers who began to use newly accumulated capital to purchase properties and establish financial concerns, thus contributing to the process of a reconcentration of wealth and a restoration of pre-revolutionary property relations.129

Commercial reactivation through non-productive imports was a calculated element in US strategy, conducted through a Commodity Import Program (CIP) whose stated purpose was to strengthen the private sector.130 The CIP was tied to a program to create ten private banks, for which purpose the AID spent $60 million in 1991 and 1992 alone in capitalization funds and in commodity imports by large-scale private importers financed by these private financial institutions (the importers and the members of the new banks' boards of directors often overlapped, encouraging the development of powerful new economic groups).131 In this way, private banks rather than the Nicaraguan state channeled external resources, including balance-of-payments support that flowed into the private banks from the AID and the IMF.132 A private banking system was to act as a direct link between emergent Nicaraguan entrepreneurs and transnational finance capital. The AID Strategy Statement stated that a key purpose of these banks would be to mobilize internal resources for the activities of domestic and foreign investors. Another purpose was to transfer the money supply, credits, credit policy-setting, and financial levers of the economy from the state to the private sector, thereby giving a powerful boost to the reconstitution of a hegemonic propertied class linked to transnational capital and with the capacity and resources to develop a new economic model for Nicaragua (see below).

The international economic straitjacket imposed on Nicaragua was accomplishing what direct repression had accomplished in Chile. For instance, the AID's "agricultural reform" did not propose the forcible return of lands to their prior owners. Rather, it called for privatization of the economy, the promotion of agro-exports, and the determination of property relations by free-market forces. Purely "economic" considerations applied under the banner of "efficiency" and fiscal and monetary policies to achieve macro-economic stability acted as noncoercive mechanisms that alienated peasant smallholders, undermined the peasantry as a class, reconcentrated land, and fomented anew, modernized capitalist agri-business sector. Macro-economic stability mandated a drastic reduction in bank credit to smallholders and the elimination of government price guarantees for the peasant sector. Deprived of credits, peasants were forced to sell their land. The promotion of large-scale export agriculture over food production for internal consumption also undermined the peasantry, since peasant producers accounted for nearly 100 percent of domestic food production, while export crop production was mostly in the hands of large landholders and agri-business. The credit structure and fiscal and monetary policies designed by AID and the international agencies benefitted a reorganized domestic propertied class that set about to reinsert Nicaragua into the international market. In 1993, for instance, 28,000 small farmers received no credit whatsoever, while just nine newly consolidated capitalist agri-business and export groups monopolized over 30 percent of all credits.133 This same credit structure and related adjustment policies also undermined urban workers and smallholders. US and international aid, for instance, was made conditional on the speedy privatization of 400 state enterprises, representing 40 percent of the GNP. Militant labor struggles to have public enterprises turned over to workers' collectives led to the creation of a new trade-union owned "Area of Workers Property," comprising some 25 percent of privatized firms. But the same mechanism of credit allocation began to undermine the viability of these worker-run enterprises. Privatization thus became synonymous with a reconcentration of property.

This financial structure is an example of how, in the era of the global economy, transnational capital comes to penetrate, disrupt, and incorporate into its structures sectors previously outside of (or enjoying a certain autonomy vis-Ii-vis) the global economy. Land reconcentration meant immiseration for the expanding ranks of the newly dispossessed peasantry. Simultaneously, in the first year of the adjustment program alone, nearly 20 percent of the country's salaried workers lost their jobs as a result of mass dismissals of civil servants and of workers in productive public enterprises.134 Some 70 percent of the economically active population was underemployed or unemployed by 1991.135 Yet, in the larger scheme of things, the alienation of smallholders, property reconcentration, and the contraction of public sector employment helped facilitate conditions for the new economic model for Nicaragua envisioned by transnational capital and its local representatives. In this model, Nicaragua's reinsertion into the global economy was to be based on a modernized agro-export sector emphasizing "non-traditional" exports and on maquilladora assembling activities in urban-based duty-free export zones, as part of Central America's position as the southern rump of the emergent North American free-trade zone.136 In 1990, the government set up in the outskirts of Managua the first of what was to be a series of tax-free zonas francas for transnational companies. By 1993, some dozen companies were operating mostly textile plants, paying wages of $30 a month to mostly female workers under state regulations prohibiting unionization.137 Export-oriented agri-business and maquilladora assemblage required abundant cheap labor drawn from a huge pool of propertyless laborers and the unemployed, alongside a reserve army of the unemployed keeping wages down. The neo-liberal program was creating just such a labor force through the reconcentration of rural and urban property-holdings and massive layoffs in the public sector.

These programs were part of the far-reaching process of class restructuring, including atomization of the formerly well-organized working class, proletarianization of the peasantry, and the development of a New Right elite comprising a modernized private sector and administrative technocrats. In this process, economic and social policies were reciprocal. Cheap and unskilled labor does not require advanced education, but a workforce composed of a docile majority with minimal literacy and numeracy skills, and a small group of skilled technicians and managers. It was perfectly logical that the neo-liberal project involved drastic cutbacks in the educational budget (in the first year of the new government alone, the budget was cut by 44 percent),138 the privatization of most secondary schools, and the introduction of tuition into previously free public schools. Once again education was becoming a privilege of the wealthy. US aid was used to finance several elite universities and technical institutes, including a new AID $3.1 million program in the Central American Institute of Business Administration (INCAE) to "train consultants" and place them in different government ministries as "technical and economic advisors."139 The neo-liberal program, with its distinct class bias, placed the burden of adjustment on public and formal sector wageearners and the domestic market and favored exporters, large-scale producers, and commercial and financial conglomerates tied to transnational capital. The transnational agenda advanced through US economic and political aid programs could not be realized without national actors strong enough to act as mediators and attuned to the transnational strategy, in which the relation is less that of complete subordination than of broad common interests and understanding. National histories and actors do exist in autonomy from the external milieu, but the latter imposes structures and circumstances which condition the contours and behavior of the former.

Direct US support for a reorganized private sector through the CIP, the private banks, the privatization process, and so forth, had the intent of building up a "modernizing" elite with the capacity to (1) influence state policies (2) influence civil society through predominance in the economy (3) serve as local links to transnational capital, and (4) develop its own economic power and give it the ability to promote and manage capital accumulation within the new economic model. US programs intended to build ties to local elites and challenge popular sectors sought to penetrate the state and civil society, to form a network of institutions in civil society as structures parallel to the state and able to instrumentalize the state, and to develop a nexus of state-civil society linkages displaying an interpenetration of interests and personnel between the government and "private" spheres. These linkages were developed through close coordination among, and institutional interpenetration between, the government (managing the state) and a private-sector elite hegemonic in civil society. Although the appointment of numerous US advisors in key economic, social and policy planning ministries was a requirement of US aid disbursals in the first years after the elections,140 a more important activity funded by the United States was the creation of a core of New Right "technocrats" thoroughly trained and ideologically steeped in the worldview and logic of the transnational elite - people who, in the long-term US strategy, would go on to assume the reins of the Nicaraguan state.

While economic and political aid poured into the country, military aid to the EPS was out of the question. The preservation of a popular army born out of revolution deprived the Nicaraguan propertied classes of a repressive instrument. "The military and the police currently are dominated by Sandinista supporters," stated the AID Strategy Statement. "Loyalty of these institutions and its members to the current government is questionable and their actions in response to public disturbances over the last year have raised doubts about whether they respond to the dictates of the party or the mandate of the government." It concluded: "these institutions must be 'professionalized' so they can perform their proper function in society as guarantors of security and justice."141 The Bush and the Clinton administrations applied enormous pressure in the years following the elections, including diplomatic threats and freezing US aid disbursements on several occasions, to purge the EPS leadership and to "de- Sandinisitize" both the army and the police, as part of broader pressures to push forward slow-motion counterrevolution.142

By late 1993, these pressures had registered some success. A combination of defunding, restructuring and the recruitment of new police officers from the ranks of the former Contras and right-wing political activists had gone a long way toward turning the police into a typical Latin American repressive force, routinely breaking up strikes, dispersing popular protests, and so forth. More importantly, the EPS leadership came to develop a corporate identity of its own once it was no longer tied to a revolutionary state. The EPS leadership came to view the army's institutional integrity as dependent on achieving legitimacy in the eyes of the local elite, Washington, and the international community. Achieving legitimacy meant adopting a doctrine of "constitutionality" and demonstrating its ability to repress protests by popular sectors when such protests transgressed legal or institutional channels.143 In the 1990 general strikes, the EPS ignored government orders to violently repress the protesters, arguing that its constitutional mandate was limited to defending the country's sovereignty from foreign aggression, not to use force in internal political events. But over the next several years, the EPS began more and more to violently dislodge peasants who had taken over land in the countryside, to attack striking workers who occupied factories or government offices, and to break up often peaceful street demonstrations. Low-intensity democracy acts as a centripetal force in conforming distinct political and institutional forces to the parameters of its own legitimizing logic. The fact that neo-liberalism could be implemented despite the existence of the EPS demonstrated the power of the global economy to impose its agenda through economic power, irrespective of the balance of military force itself.

Conclusion: Intent is not ability: the contradictions between polyarchy, neo-liberalism, and social stability

Exuberant over the success of the electoral intervention project, US officials originally expected post-electoral strategy to fall smoothly into place. The AID Strategy Statement stated:

Over the course of the [1991-1996) period, we anticipate a major transformation of the Nicaraguan economy and society. By the end of this period, the economy will be dominated by the private sector, traditional exports will be growing rapidly, and a variety of nontraditional agricultural exports will be well-established. By 1996, enclave manufacturing will have moved beyond an initial concentration in textiles into a wide variety of manufacturing operations. The United States will once again become Nicaragua's principal trading partner ... Civic education efforts and the spread of a wide range of ideas through the media will have helped achieve general acceptance of democratic ideas, attitudes and values. 144


But reality has proven to be less rosy than US forecasts. Social inequalities and consumption differentials, the concentration of wealth and income, and widespread impoverishment, a result of unbridled free-market forces released under the neo-liberal program, advanced at an alarming rate in the early 1990s. An austerity program had been in effect since the early years of the Contra war, and in 1988 the Sandinistas took a series of stabilization measures which proved highly controversial.145 However, there were important differences between the Sandinistas' stabilization measures and the orthodox neoliberal program introduced by the UNO government. The Sandinista program - whose frame of reference was a mixed and not a freemarket economy - did not eliminate the "social wage" that protected the most vulnerable sectors and distributed the burden of austerity, and which included hefty education and health budgets and subsidies on essential consumption. Although the Sandinistas also, sought to stimulate exports, they simultaneously p)1rsued policies such as low-cost credit, guaranteed prices, etc., and retained an important role for the state, which allowed domestic-market producers to survive.

Relative poverty for much of the population under the Sandinistas became absolute poverty under the new government. Real wages dropped 50 percent in the first year of the new government, 69 percent of the population lived in poverty in 1992, and per capita food consumption fell by 31 percent between 1990 and 1992.146 The health, educational, and other social gains of the revolution, although they deteriorated in the late 1980s as a result of the war, suffered a dramatic reversal with the change of government and the application of the neoliberal program. In 1988 the government made an annual per capita investment in health of $57.10. This had dropped by 1993 to just $16.92. Vaccination coverage of children under five years old, which was 20 percent in 1980 and had reached 80 percent in 1990, fell in 1991 to about 60 percent (only 80 percent coverage or higher can guarantee the prevention of epidemics).147 During the 1980s, cholera, malaria, measles, and other diseases had been eradicated or nearly eradicated. Between 1990 and 1993 these diseases reappeared and reached epidemic proportions. The infant mortality rate, brought to under 50 per 1,000 births in the 1980s, rose to 71 per 1,000 in 1991, and to 83 per 1,000in 1992. [148]

Widespread rural immiseration and the government's policies of squeezing the peasantry fueled renewed military conflict in the countryside. The Contra rank and file, of poor peasant extraction, had been demobilized and promised land and credit following the change of government. Similar promises were made to thousands of demobilized Sandinista troops, also drawn from the ranks of the peasantry. By 1991, many of these demobilized peasant-fighters had taken up arms again. Although the old Sandinista-Contra antagonisms played a part, the new rural conflict, including land invasions, spontaneous violent clashes, and even organized warfare in some areas, reflected the emergence of class polarization and class-based conflict in the countryside. Adding fuel to the fire was opulence amidst mass poverty that did not exist under the Sandinistas, generating a sociological relative deprivation and further heightening social conflict.

The UNO, a fragile coalition united only in its opposition to the Sandinistas and held together by US money and pressures, disintegrated in the years following the elections into numerous competing factions, as much in conflict among themselves over sectoral and personal interests as with the FSLN. At the risk of simplifying highly complex phenomena, in the post-electoral period the Nicaraguan elite divided roughly into two groups. The first was attuned to the transnational agenda of polyarchy and neo-liberalism, with a more long-term vision of capitalist modernization based on the model mentioned above. This group was clustered in the executive inner circle, in key ministries such as Finance and the Central Bank, and in the new universities, think-tanks and financial concerns set up with US assistance. The other was grounded in the old agro-export oligarchy, in the traditional politics of partisan corruption and patronage, and inclined to restore a Somocista-style authoritarian order. The struggle between and within these two groups often took the form of highly visible political infighting and personal interests. In part, this was a result of the political culture rooted in Nicaragua's history, but it also reflected a more fundamental conflict over class formation and fractional interests therein, intermeshed with the penetration and germination of the transnational project for Nicaragua.

Washington opted, in the first few years after the elections, to support both sectors against the Sandinistas and the popular organizations in its zeal to eclipse the FSLN and to resubordinate the popular classes. The intelligence of US officials should not be overestimated: the strategy of political intervention was adroit in undermining the revolution and restoring power to the elite. But gut-level anti-Sandinismo in Washington led to short-term measures that acted against the long-term project of consolidating a polyarchic political system and a neo-liberal social order. Ultra-right forces, such as Managua mayor Arnoldo Aleman and Alfredo Cesar, whose personal ambitions and agenda were closer to a restored authoritarianism and "crony capitalism" than to a modernized polyarchy, received substantial support for no other reason than their anti-Sandinista credentials. Given their self-serving agenda, Aleman, Cesar, and others became as much opponents of the executive and the New Right technocrats as of the Sandinistas; their activities might have helped to further erode Sandinista influence but they also disrupted the development of a polyarchic political culture among the elite. Success of the transnational project for Nicaragua required ensuring a cohesive elite. Yet US intervention in Nicaragua, from the Walker affair, to Zelaya's overthrow, the establishment of the Somoza dynasty, and the installation of the Chamorro government, had not resolved, but only suppressed, the historical conflict of a fractured elite.

The FSLN was a party in crisis in the early 1990s, with fierce and unresolved debates over a viable popular and revolutionary program for Nicaragua and the tactics and strategy to achieve such a program. Attempting to undertake the transformation from a party that had emerged from guerrilla clandestinity directly into state power to a legal opposition party operating within the legitimizing parameters of formal democracy proved difficult. The inability to articulate a coherent alternative to neo-liberalism meant political vulnerability, lack of definition, and incoherence in its own conduct. The Sandinistas wavered between providing critical support for the government in the name of national stability and reconstruction (in turn, such support for the government eroded the FSLN's authority among the popular classes), and opposing the government without providing an alternative program or decisive leadership to protesting popular sectors. The crisis of the FSLN reflected the challenge or the left and popular forces worldwide in the post-Cold War era: what type of a program and strategy is viable and realistic for a small, peripheral nation, given global forces which are too powerful to confront head on, the impossibility of withdrawal from the international system, and well-known limits to social change in anyone country.149 Space constraints limit discussion, but it is worth noting that, apart from personal ambitions and opportunism among Sandinista leaders, the objective conditions of free-market capitalism and the legitimizing logic of polyarchy laid the basis for coopting a sector of Sandinismo into a reconstituted Nicaraguan elite whose interests lay in the transnational bloc under the domestic hegemony of the emergent New Right and the overall hegemony of the transnational elite. Further research should explore theoretical implications from the Sandinista post-electoral experience.

As noted in chapter 1, the neo-liberal state has three functions: assuring macro-economic stability and juridical conditions (including the guarantee of property rights) for the operation of capital; providing the human and physical infrastructure necessary for capital accumulation; and maintaining social order. Only the first of these goals was met in Nicaragua in the early 1990s. The AID Strategy Statement warned:

Investors will be looking for clear indications that political turmoil will be contained and for evidence of progress toward the establishment of a free-market economy ... the government will need to demonstrate that it has developed a working legal and regulatory structure such that it can guarantee contracts, establish property rights, resolve disputes, and enforce laws which govern business and investment. It must also be able to demonstrate that law enforcement entities have the capability to maintain order in accordance with government directives and policy. [150]


Nicaragua, seen from the logic of the neo-liberal project, was in a vicious circle. Structural adjustment was to have provided the macroeconomic stability for private capital to enter and operate freely. Private foreign investment was to bring about growth and development. Growth and development was to bring about social peace and political stability. But the popular classes would not allow an antipopular project to stabilize, and thus the economy continued to sink. Although Washington and the Nicaraguan elite were fond of blaming "Sandinista destabilization" for the permanent and myriad protests of the poor majority, the truth is that, by 1994, the Sandinistas no longer exercised much control over popular sectors, which demonstrated an increasing autonomy of action. Transnational capital, literally with "the world to exploit," would hardly choose Nicaragua to invest, given the belligerence and organization of the popular classes and the inability of the dominant groups to achieve hegemony.

In comparative perspective: the United States was able to facilitate a transition from authoritarianism to polyarchy in the Philippines and Chile as a result of the conditions particular to these countries, an astute reading among US policymakers of these conditions, and the existence in Washington of an emergent apparatus for carrying out the new political intervention. Conditions in the late 1970s did not allow the United States to facilitate such a transition in Nicaragua, and so, following the revolution, the United States launched a massive destabilization campaign, including political operations conducted under the rubric of "democracy promotion." The objective of the campaign was to make it impossible to implement popular democracy, break revolutionary hegemony, regroup the old elite forces, and restore them to power. Yet the possibility of consolidating a polyarchic political system and elite social order and renewing externally oriented capital accumulation seemed bleak in 1994.The popular classes resisted being drawn into a renewed elite hegemony and became increasingly restive, putting aside political allegiances as the entire country became polarized into an impoverished mass and an affluent minority. These difficulties in Nicaragua underscore the contradictions internal to global capitalism and the transnational elite's project of "market democracy." Nicaragua demonstrated the gap between goals and outcome, between intent and ability. Nowhere was this gap more evident than in Haiti.
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