Nicaragua’s new pacto

The death of the old power-sharing pacto between Ortega and Aleman has been replaced by a new alliance between the president and big business


After a decade of tumultuous governance by a cynical power-sharing alliance between two caudillos, Nicaragua has officially entered a new phase of back-room “pacto” politics. As demonstrated by the recent round of negotiations over the Sandinistas’ new constitutional reforms, the most important decisions about the future of Nicaragua are negotiated privately between the president and COSEP, the nation’s largest private business chamber.

Unlike other opposition groups that complained about the reforms to no effect, COSEP was able to deftly negotiate a new bill that protects their own quota of power while substantially softening the Sandinistas’ assault on Nicaragua’s institutional democracy.

The negotiated constitutional reforms, which were dutifully passed in first vote by Sandinista lawmakers, will cinch Ortega’s indefinite reelection and further concentrate power in the president’s hands. Still, the reforms are far less ghastly than the Sandinistas’ original plan, which would have created a dreadful power-sharing arrangement between Ortega and his wife. Instead the first lady’s source of power, the Sandinista Family Councils, which played a central role in the first draft of the constitutional reforms, have been scrubbed from the bill. Rosario Murillo will indubitably maintain her influence over the party and government, but her power won’t be written into the constitution.

Instead the new constitution will strengthen the alliance that has formed between Ortega and COSEP. Article 98 of the constitutional reforms establishes a permanent consensus-seeking dialogue between the government, business and labor––one that, in practice, boils down to Ortega and COSEP.

While that alliance is hardly an exercise transparency or representative democracy, it is one that fosters negotiation and compromise, which is better than an unchecked autocracy. The proof is in the bill passed last week. The constitutional reforms may be a step in the wrong direction, but it’s not the running leap that Ortega and his wife wanted to make.

In any event, the reforms mark the final nail in the coffin of the old power-sharing pact between Ortega and rival party boss Arnoldo Alemán. Nicaragua is officially entering a new era.

The death of ‘El Pacto’

Under different circumstances, the death of the Ortega-Alemán pacto would be cause for celebration.

Arnoldo Alemán (photo/ Tim Rogers)

Since the nefarious entente was hatched in the waning days of the Alemán administration (1997-2002), the pacto––tweaked several times since to reflect the caudillos’ shifting shares of power––deterred political pluralism and divvied up the branches of government like the spoils of war. Alemán, originally the senior partner in the firm, was methodically outfoxed and outmaneuvered by Ortega. The Sandinista strongman ultimately became Alemán’s jailer after an ill-conceived anti-corruption crusade by President Enrique Bolaños put the PLC party boss behind bars––at least for a couple of minutes. (Ortega finally released Alemán from his cell, but continued to twirl the keys on his finger as a reminder of who held the power the relationship).

Alemán, eager to pay off his political debt for freedom, helped Ortega’s party win three subsequent municipal and national elections by dividing and befuddling the opposition. But the get-out-of-jail-free card cost Alemán all his remaining political capital. He finally abdicated his role as minority partner in the pacto and ceded full power to Ortega in 2010. Sometime earlier this year, Alemán stopped pretending to be an opposition leader; he quietly surrendered his last pawn (Congressman Wilfredo Navarro) and walked away from the chessboard. By the time he retired to his farm to look after his cows, hardly anyone noticed.

Though Ortega had defeated his rival, the political system that the two men had built together did not survive the divorce. The institutions born of el pacto ceased to function without Alemán acting as a counterbalance.

As perverse as the system was, it was a seesaw built for two. Ortega had won, but his victory led to an embarrassing and untenable political crisis; some 50 magistrates, judges, prosecutors and other top government officials are currently occupying their offices well beyond their constitutional term limitsbecause the system that brought them to power collapsed before a new system could replace it. Like a pitiful collection of pacto refugees, the de facto officials of Ortega’s government huddle together in a sad attempt to find legitimacy in numbers (This problem will be “fixed” by Article 130 of the new constitution).

Alas, the charade of normality could not continue. Nicaragua needed a new operating system to replace its crashed model.

The Sandinista Constitution

Amid loud concerns from business groups, think tanks, opposition parties, religious leaders and civil society, the Sandinistas approved their constitutional reforms in first vote on Dec. 10. The bill was approved along strict party lines, with 63 Sandinista lawmakers in favor and 26 minority party legislators in opposition. Congressman Navarro, who has made an entire career of political opportunism, pressed his Sandinista buzzer and ingratiated himself with power once more.

The bill, which needs to pass a second vote in January, will mark the sixth time Nicaragua’s constitution has been modified since 1987. But analysts say this round of reforms is the most severe yet.

The Sandinistas claim the reforms are aimed at strengthening democracy, improving national security, safeguarding sovereignty, ensuring stability, and strengthening the role of the family in society. Ortega supporters claim the reforms are “unique” because they were “widely consulted with a diversity of participants who represent a great part of the Nicaraguan population.”

But that’s a pretty bold claim considering the entire consultation process lasted less than two weeks and intentionally omitted any public information campaign. Most of the consultations were done with bobble-head institutions that are part of the Sandinista machinery. Others rejected the reforms outright. Minority political parties (PLI, PLC, MRS), the Nicaragua-American Chamber of Commerce (AMCHAM), the Nicaraguan Foundation for Economic Development (FUNIDES), the Nicaraguan Conference of Bishops, the independent media, and independent civil society groups, are all opposed to the reforms.

The U.S. government has also voiced its concern. “We are concerned that steps that concentrate power and undermine checks and balances will be harmful to democracy and could hurt the long-term economic development so important to the Nicaraguan people,” reads a State Department release published Nov. 22.

While critics complained, COSEP negotiated. The business chamber, which called the Sandinistas’ original bill an unacceptable “game changer” that would have jeopardized the country’s future, was able to convince the regime to back down on several key articles. The Sandinistas’ efforts to replace the country’s representative democracy with some vague notion of “direct democracy” was substantially diluted; the first lady’s “family councils” were left on the cutting room floor; the Sandinistas’ efforts to control the Internet were curbed; the president’s ability to govern by decree was limited; and the new role of active military officials serving in civilian jobs was restricted to executive branch posts related to matters of national defense. Even the first lady’s insistence on labeling Nicaragua as nation that identifies as “Christian, Socialist and in-Solidarity” was contextualized, defined and then rendered irrelevant by a bunch of safeguards protecting free-market capitalism and private property.

Pacto 2.0

Nicaragua’s constitutional reforms mark the beginning of a new type of governing pacto –– one that’s no longer just about political power, but economic influence. Yet the elements of social control that the Sandinistas initially tried to write into the constitution were mostly restrained.

In the end, the constitutional reforms represent an unhealthy concentration of power in the presidency, but not the insane institutionalization of Murillo’s manufactured zeitgeist. Nicaragua’s wobbly democratic process––as degenerate as it is––helped to temper the worst instincts of power. It’s not a reason to cheer, but it is an indication that all is not lost.

Nicaragua is entering a new chapter in its fitful, feverish and short democratic life. The first family’s rapid assent to power has as much to do with the failures of the opposition and the lethargy of civil society as it does with the triumph of Orteguismo. But when push came to shove, COSEP, despite all its criticism for accommodating itself to power, was the only institution that was able to get the the government to rein in its ambition and negotiate a settlement.

COSEP, of course, is an imperfect counterweight to the Sandinista politburo, which represents a newly enriched capitalist class whose interests greatly overlap those of big business. But until Nicaragua’s political opposition stops shirking its responsibilities to the nation, the plutocratic pacto is all that separates Nicaragua from the arbitrary rule of a connubial monarchy.

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  • Bayardo Gonzalez

    Great article and analysis. I think that the Aleman – FSLN “Pacto” has to be put into context of the original Aleman attempt to undo the land reform of the revolution when he first came to power. When this attempt did not work because of Sandinista protests he decided to concentrate in enriching himself. The division of the institutions of power between Aleman and Daniel allowed Aleman to steal almost unchecked but gave the FSLN control of key institutions that the FSLN used to return to power (i.e. Supreme Electoral Council, Supreme Court).
    It was a clear quid pro quo and a relfection that even though the PLC had won the elections it could not do everything it wanted. The far right of the Liberal party in the Nicaraguan diaspora in Miami was fustrated because of this but their isolation was important in moving the country forward

    The Pacto prevented the two parties from fighting and potentially moving the country to armed conflict.

    The new Pacto relfects the current balance of power in the country between the FSLN and Business regardless if its good or bad. It reflects the ability of Daniel to co opt groups that were part of the oposition to the revolution such as the old contra fighters and the inability of a “democratic” oposition to agree on a candidate and on a platform (see the inability to have Montealegre as the oposition candidate in the last election) and to garner enough popular support to have a third alternative to the FSLN and the PLC.
    The “Pacto 2.0” and the resulting muting of the constitutional changes should bring stability to the Ortega regime. As long as macro economic stability is held, investment continues to flow, jobs are created and poverty continues to go down the FSLN and principally Daniel will continue to have the largest share of the “Quota de Poder”.

    • Ken

      Very good reply. Thanks.

  • Pedro Arauz

    Siempre ha sido asi con la misma “argolla” de los 80’s y es por eso que mucha gente culpa a Antonio Lacayo de haber mediatizado el voto que derroto a Ortega en el 89 y fue luego de esta derrota que A.Montaner escribio: “La escoba nueva barre mejor” interpretando ese voto como un Mandato para “extirpar” todo lo Sandinista y/o Orteguista llamando a los Cascos azules de la ONU y desbandar al ejercito y policia, esos mismos que ahora traicionan a la Patria. Quienfuera que mantuvo a Ortega en los 80’s fue y es un traidor a menos que vayan a servir para detener a los Marcianos… –

  • Randy Power

    Brilliant article and analysis. This has to be one of ND’s best pieces of writing, laced with metaphors while avoiding the word “like” to introduce them. More importantly, its insights help to understand what’s happening, look out for the effects of the changes, and be able to discuss intelligently. I hope COSEP does not go the way of Aleman in the new pacto.

  • Ken

    For starters, let me also say that this is a great article that is colorfully written as well. Good job.

    Second, I’m tickled that Rosario’s family councils were nixed, along with some other troubling amendments.

    Thus, when judged by the outcomes, I must say that this pact doesn’t look too bad. I guess the whole issue of a pact is that it lacks transparency and is therefore not particularly democratic, but to my mind transparency and democracy are matters of degree anyway. It’s still troubling to have insiders hammering out these deals behind closed doors, but at the moment this looks like a promising pact, given that there are pacts anyway.

  • ben

    Bravo, Tim. And using GrammarCheck didn’t hurt none.

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  • Jairo Cortez

    La verdad cuando Antonio Lacayo y muy lacayo del imperio bien puesto el apellido hizo trisas a una Nicaragua degastada por la guerra financiada por estados unidos y la oposicion nicaraguense., luego aleman y bolaños no hicieron nada y ahora que ven que se esta haciendo lloran, patean, brincan de Odio pues traguenselo porque van a estar en la banca un buen rato muy buen rato.