Left split in Ecuador

Ecuador--Amidst ominous signs of rightward drift, the government of Ecuador is poised to take on the world banking establishment in a way that could reverberate throughout the debt-ridden Third World.

A Commission to audit the public debt incurred between 1976 and 2006, appointed by President Rafael Correa, has released a report that alleges that a large part of the nation's external debt was entered into in either an illegal or illegitimate manner. It gives evidence of "odious debts" incurred by the military dictatorship (1970-1979), usurious debts, and corrupt debts (contracted under conditions that do not conform to the legal norms of the lender or debtor or international norms). It goes on to cite instances of illicit and hidden clauses, uncontrolled and disproportionate expenses and commissions, excessive arms sales, capitalization of interest, and fraudulent collusion between lending institutions and government officials that served individual interests at the expense of the Ecuadorian nation.

The Report provides grounds for renegotiating or defaulting on certain loans, and it names several past Ecuadorian presidents and their functionaries of being in collusion with representatives of world banking institutions such as the IMF and the World Bank to defraud the country for personal or ideological gain.

This could result in charges being laid against those Ecuadorians who are implicated; and the government already is using a 30-day grace period to determine whether it will make a payment on a bond issue that was due Nov. 15. A default could have enormous implications for the country's credit rating. If it is perceived as legitimate, it could send ripples throughout Latin America where center-left governments deeply in debt are keeping an eye on how Ecuador fares.

At the same time as the Correa government is standing up to the big lenders of the Northern Hemisphere, internally there are unmistakeable signs of a serious rift between Correa and his Alianza Pa’s party on one side, and the environmental movement, the Indigenous community, and large segments of labor and social movements on the other. The issues have been largely over the exploitation of natural resources: oil, minerals, and water, with the government being accused of allowing mega-projects and continuing the neoliberal "extractivist" strategy of previous governments (i.e. providing the world markets with raw materials and energy, supporting monoculture). The Left has also been stung by the president's characterization of their movements as being extremist and infantile and by the Alianza Pa’s influence over the Party's members in the Constituent Assembly, where the Indigenous community's demand for veto over mining projects in their lands was replaced by "consultation."

Two of Correa's most important early supporters, Alberto Acosta, the President of the Constituent Assembly until he resigned over differences with Correa, and M—nica Chuji, an Amazonian Kichwa activist who served as the President's communications secretary until she resigned to run successfully for the Constituent Assembly, have openly broken with Correa. Chuji has accused Correa of usurping the historic social and political demands of the Indigenous and environmental movements to achieve power and then moving to the right. Because of his enormous personal popularity, the left is arguing that Correa feels that he no longer needs the support of the activist movements who catapulted him to power.

This split on the Ecuadorian Left complicates the political picture in Ecuador in that the Correa government is now under pressure from both sides of the political spectrum. His ace in the hole, however, is the enormous personal popularity he has achieved throughout the country. It appears to me that Correa's idea of "socialism for the 21st Century" is looking more and more like a nationalized top-down state capitalism; another example of an avowed "socialist" taking state power and substituting personal charisma and a strong disciplined and centralized party for grassroots activism against the destructive forces of multinational corporate capitalism.

It is hard to see how anything good in the short term can emerge from Correa's having alienated Ecuador's two largest and most important progressive and potentially revolutionary social forces: the Indigenous and environmental movements. In the long run it could serve to create a genuine socialist movement in opposition to what appears to be an emergent state capitalism.

--Participant/observer, Ecuador

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