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The Cost of Living
Henry A. Giroux
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It must have been a day of great celebration for Ricardo and Trini. On November 5, their beloved party, the National Sandin- ista Liberation Front (FSLN), won back the mayor's seat in Mata- galpa, northern Nicaragua, from the country's ruling Constitutionalist Liberal Party (PLC). I'd visited the couple about a month before the nationwide municipal elections. Ricardo, who joined the FSLN secretly at the age of 18, had said he was “99.9 percent sure” the party would win Matagalpa “because of the ten years of suffering we have endured.” Although the elderly couple's house was spotlessly clean, it was cramped and dark, with a dirt floor. They were having trouble scraping together the money they needed to buy medicine for Ricardo's heart condition.
The FSLN victory in Matagalpa will have raised the hopes of many of the town's struggling inhabitants that things could change for the better. The long list of FSLN policy goals reeled off by Ricardo included better access to drinking water and transport, more employment, a new college, the reconstruction of the regional hospital, and training for young people to keep them away from drugs and prostitution. This is an ambitious program, but it's one for which Matagalpa and many other Nicaraguan municipalities are crying out. There's no guarantee that the left-wing FSLN will be able to fulfill its promises. But the results of the municipal elections indicated that a growing number of voters in urban areas are prepared to let it try.
Overall, the PLC held its grip on the majority of municipalities, winning 97 of 151, while the FSLN tally dropped slightly to 49. However, the FSLN made significant gains in urban areas: it now controls the largest towns in 11 of the country's 17 departments. It also collected the top prize—victory in the capital Managua— which is regarded as a considerable advantage for the presidential and National Assembly elections set for November next year. However, as the London-based Nicaragua Solidarity Campaign points out, the PLC's strong showing in rural areas in the municipal contest makes it difficult to draw conclusions about what will happen in next year's ballot.
There is little doubt, though, that many Nicaraguans are unhappy with the status quo. During the last decade, their economic situation has deteriorated markedly. The radical social programs put in place after the 1979 popular revolution, including land redistribution and universal education, were abandoned in 1990, when the FSLN was ousted in favor of Violeta Chamorro's coalition government. That came after a decade of war instigated by the Reagan administration in an attempt to overthrow the FSLN. Nicaragua may no longer be at war, but ten years of right-wing policies have resulted in lower living standards for large sections of the population.
In a report published this summer, the IMF admitted that “replacement of a socialist state by a private market may have opened prospects for growth and economic opportunity, but it has left the poor with no formal safety nets to protect them…the poor see improvements in infrastructure, but they do not perceive that their access to the services of that infrastructure has improved.”
The government of President Arnoldo Aleman, in power since 1996, has done virtually nothing to improve living standards for the poor. Beside every roadside, PLC billboards declare “Works, not words.” But it's quite obvious that Aleman's policies aren't really working. According to the United Nations, nearly 70 percent of Nicaraguans lived below the poverty line in 1998, compared with 50 percent in 1993. And figures from the Nicaraguan Pro-active Lobby- ing Forum (GPC), a coalition of NGOs, show that real income per capita has dropped by 46 percent since 1990. A family of six people needs $139 a month to pay for food and services, but the average wage is $68.
Evidence of the suffering caused by poverty lies everywhere. Passing through a village in the west of the country, we gave a lift to an old man who had broken his arm. He couldn't afford the 150 cordobas ($12.50) for an ambulance to take him to the nearest hospital—about one-third of the monthly wage for an agricultural labourer. In Esteli, Nicaragua's third largest municipality further to the north, I visited a hospital that had run out of drugs—11 days before its next delivery. In a poor neighborhood in the same town, I met some kids seeking shelter in a church because October's torrential rains had flooded their homes after Hurricane Mitch. They showed me how water had risen up to their necks.
Instituto Mujer y Comunidad is a local NGO that provides credit facilities and training to rural communities around Esteli. It estimates that the municipality suffers from unemployment of 45 percent and illiteracy of 31 percent. “In rural areas, people are very marginalized,” explains director Maria Auxilliadora Chiong. “Where services—health, education—are supposed to be free, they are forced to pay. And that's money they can't afford. The government is not investing in infrastructure. Parents must pay for schooling—a single mother will often have six or seven kids at school, but she'll be forced to take them out. And patients have to pay for everything—gauze, syringes.”
October's heavy rains, caused by Hurricane Keith, further exposed the vulnerability of rural populations, which have yet to recover from the devastation of Hurricane Mitch. Mitch struck in October 1998, causing damage of at least $1.4 billion. In many places, the rebuilding of homes, bridges, and roads is still incomplete. And this year, the rain was preceded by drought.
Many of the country's NGOs believe a solution lies in cancellation of the country's external debt. According to the Nicaraguan Central Bank, the debt stood at $6.5 billion in May 2000—the largest in Central America and one of the highest per capita in the world. Jubilee 2000, the global campaign for debt cancellation for developing countries, calculates that, in 1999, Nicaragua spent $65 per person on debt repayment, but only $35 per person on education and health.
The government has completed the interim Poverty Reduction Strategy Paper (PRSP) that must be submitted to the World Bank and the International Monetary Fund before a country can qualify for debt relief under the HIPC (heavily indebted poor countries) initiative. But many civil society organizations are not satisfied with the paper's contents. They argue that their voices have not been represented, even though governments are required to consult civil society when drawing up these documents.
The GPC is putting together an alternative PRSP, which it believes will reflect more accurately the interests of ordinary Nicaraguans. “If Nicaragua doesn't reach a true national plan, we'll just continue to get further into debt, and our problems will deepen,” argues Carlos Benavente of the GPC. According to Oxfam, the structure of Nicaragua's debt means that it is unlikely to be reduced by more than half under HIPC. Yet an IMF/World Bank report of September 2000 stated that Nicaragua's debt must be cut to $1.25 billion to be financially sustainable. Another problem is the timing of the process. Nicaragua should enter the first stage of the HIPC initiative in the next few months, but many NGO workers are concerned about the proximity of next year's presidential election. They fear that Aleman could hijack debt relief for his own political ends.
With the municipal elections now out of the way, politicians and party workers can get down to the job of choosing candidates for the presidency. In an attempt to clean up its image, the FSLN recently joined forces with Social Christian Unity, the party headed by former Comptroller General of the Republic Agustin Jarquin. Jarquin is widely respected for his efforts to fight the country's widespread political corruption, and resigned from his position on the governmental auditing body in June in protest at what he regarded as political meddling. Victor Hugo Tinoco, a leading FSLN politician who is also a favorite contender for the party's presidential candidacy, pointed to a poll of supporters held shortly after the alliance was sealed that put Jarquin well ahead of long-time FSLN party leader Daniel Ortega: “This shows that people want someone who is distanced from the traditional leadership…. This alliance is good for both parties, but especially for the FSLN in terms of its anti-corruption image.” There has also been speculation that the PLC could join forces with the Conservative Party in order to ward off the FSLN.
Supporters of smaller political parties are concerned that they will be excluded for not complying with the regulations of the anti-democratic electoral pact concluded between the PLC and the FSLN at the end of last year. Subsequent changes to electoral laws meant that several parties, including a “third-way” alliance, were disqualified from taking part in the municipal elections. Only four national parties were featured on the ballot papers (except on the Atlantic Coast), and Aleman has stated his view that there are only two real choices for voters: the “dark”—the FSLN; and the “light”—the PLC.
The next president faces a tough task. In return for debt relief, it's likely that international financial institutions will continue to demand the implementation of free-market economic policies, leading to further privatization and job losses. But the government will have to make significant efforts to soften the blow and actually reduce poverty if it hopes to retain popular support. An agronomist we chatted with in a Matagalpa restaurant warned that the country is heading towards “a social explosion.” He was working on ways of obtaining credit for small farmers in the area, because the bank that originally fulfilled this role has gone bust. Other banks won't touch this kind of customer, and agricultural pro- ducers are finding it harder and harder to get the money they need for seeds and equipment. Later, walking through town, I saw that the entrance to every bank was closely guarded by security men toting large guns. It will be the responsibility of the next president to make sure that these guns are never fired. Z
Megan Rowling is a freelance journalist based in London and a reporter for Reuters. Her work has appeared in the Guardian and the Times.