The "New Era" Begins Amid Check Scams and Blank Checks

US intervention has given the new government a rare opportunity in the check scam case and a serious challenge in dealing with the man behind it. Society, too, faces an opportunity and a challenge—maintain expectations, trust, but write no blank checks.

Envío team

President Bolaños is fond of repeating that Nicaragua has entered a "new era," and every day he and his ministers try to offer some sign to that effect. In the words of the new President himself, these signs are both "principle and symbol." The governed are inclined to hang on to their expectations, an inclination that is at times a principle and symbol of something even deeper: hope. But there are reasons for people not to get their hopes up too high. The pact remains alive and, as feared, Arnoldo Alemán still wields considerable power. He is simply plotting how to exercise that power from the legislative branch rather than the presidential office.
The main players at the chessboard are the FSLN and the two-headed Bolaños-Alemán government and every day pieces are moved. Alemán’s strategy is the most defined of the three, with Bolaños still trying to get his clear and FSLN leader Daniel Ortega so far only operating tactically, sacrificing pawns along the way. The international community, with the US government in the lead, perceived the opening to this new game as so risky that they quickly leaned over and moved against one of Alemán’s knights. Can Alemán himself be checked?

"The only prize I desire"

Enrique Bolaños began his mandate on January 10 by officially ushering in his self-styled New Era and promising to garb himself in the "country’s blue and white emblem, which covers all Nicaraguans, without abandoning my own Liberal ideals or my Christian beliefs." It was a message Nicaragua’s increasingly plural society needed to hear: that he plans to administer a non-party, secular state rather than govern on behalf of the red Liberal banner, as Alemán did.
He also pledged to break with a history and tradition that he defined as "plagued with great vices, all of them equally condemnable." And as in the best of his campaign speeches, he again named three of the vices that must be defeated: "corruption, perversion in the use of power and caudillismo." He followed that with a conception implicit in his elitist business-oriented economic vision: these vices alone are responsible for the country’s impoverishment. Finally, he sealed his speech with a last promise, emphasizing his self-projected image as a stand-up, firm-handed grandfather by announcing his life’s final wish: "I promise you that in Nicaragua, working together, it CAN be done. That being the case, the only prize I desire is the honor of being remembered as the best President in Nicaraguan history and as a statesman more than a politician."
The presidential inauguration was a simple event. No FSLN leader other than René Núñez, elected the previous day to the National Assembly board of directors, attended. Fears that the thousands of Liberal supporters of outgoing President Alemán, who sported their party’s red caps and banners, would try to upstage the event proved unfounded.

Bolaños’ first move

Even before leaving office, Alemán had been repeating a simple message, with threatening undertones: "Bolaños had better not forget that it was the Constitutionalist Liberal Party that proposed and backed him, that put him in the presidency." With Bolaños now in office a month, Alemán’s supporters in the PLC, who consider themselves in the "opposition," have turned that message into a slogan in the media they control.

Voters intuitively differentiated between Alemán’s Liberalism and that of Bolaños. The appointment of Bolaños’ 17 Cabinet members was therefore awaited with great expectations. Would he be able to choose his ministers freely or would Alemán muscle in? On December 3, Bolaños announced his appointees. Although some among them had been in Alemán’s government and even his Cabinet, none is an Alemán loyalist, and many distinguished themselves at certain moments by distancing themselves from the corruption that Alemán institutionalized during his five years in office.
Although almost all of those chosen worked on Bolaños’ campaign, many have virtually no previous political experience. Except for the "political" choice of Pedro Solórzano for transport minister, in reward for having made the switch from Conservative to Liberal ranks during the election campaign, all selections were based on a public record of honest, efficient professional and governmental experience. Almost all are technocrats from private business who share a rational and national vision far from the prevailing culture of the political buddy system.

The Cabinet selection was Bolaños’ first act of independence from Alemán and sounded the bell for the opening round of a political bout, which he announced in just about those terms. The firmness with which he pulled it off led the pro-Alemán legislators, who have the majority in the National Assembly, to contemplate pushing a bill through that would establish ratification of Cabinet appointments as a legislative faculty, but there was neither time nor space to achieve this coup.

Alemán’s first move

The Ortega-Alemán pact, which had shaped last November’s elections, bequeathed President Bolaños a tangle of political appointments, corruption and complicity that he will find extremely hard to unravel. Beyond unmentionable personal benefits and initial high hopes, the pact was a failure for the FSLN and left Daniel Ortega looking ridiculous. For Alemán, in contrast, it was a complete success. He is right where he wanted to be, in the center of his reelection strategy. His determination to return to the presidency is not driven only by an egotistical, power-drunk whim. It is also fed by the corporativist needs of the political-economic power group that has been forming and enjoying utter impunity since Alemán became mayor of Managua in 1990. That power group has serious contradictions with the traditional business group that backs Bolaños and is in fact more closely connected with the FSLN’s economic groups.

The FSLN did not concede the possibility of consecutive reelection to Alemán in the pact, but it did give him a lifetime seat in the National Assembly. History will never absolve the FSLN for this gift, the most visible threat to the debuting New Era. Even before Enrique Bolaños won the elections, Alemán had begun to brag that not only would he be a National Assembly representative, he would also be elected president of that legislative body. And so he was. His iron grip on the PLC allowed him to hand pick all its legislative candidates and with the PLC winning the majority in the National Assembly he was duly elected to chair the National Assembly on January 17, as calculated, daring the whole country to register any disapproval.

His by now familiar political methods were in evidence along the way. For weeks, public opinion and those who attempt to mold it through the media tried to dissuade Alemán. They warned, they alerted, they argued, and they disqualified him, undermined him and challenged him. Even some Liberals questioned his run for the legislative presidency. It was all in vain. He apparently took the crassness that characterized his government with him when he left it. He called his Liberal opponents, especially Augusto Navarro, Bolaños’ new agricultural minister, "gutter cockroaches" and referred to Bolaños, his erstwhile vice president, as an "oligarch" for the same reason. Ignoring all these voices, he pushed his candidacy through the National Assembly, which makes it depressingly predictable that the legislative body will be marked by his steamrollering, authoritarian style.

The short hop to the
other seat of power

Alemán’s brief trip to the presidency of the National Assembly was characteristic of his methods. He kicked it off while still President of the Republic with public announcements and private notifications, and followed it up with dirty legal tricks. Since he had not yet given up his presidential sash to Bolaños on January 9, when the new National Assembly convened for its inaugural session and election of the board, he ordered the PLC bench to choose another Liberal, Oscar Moncada, who would then make way for Alemán’s’ election. And how did this Liberal lawmaker feel about that? "I just do what they tell me," said Moncada.

A few days before the 9th, when the obedient Liberal legislators were supposed to follow orders, another aspirant emerged from among the 52 PLC deputies to challenge Alemán and the "dictatorship" he claimed existed in the PLC. This "traitor" was none other than Jaime Cuadra, a PLC founder and old Liberal with a long trajectory and popular support in Matagalpa. Both the FSLN and President-elect Bolaños expressed their support for his candidacy. With that, Alemán went into action, strong-arming possible defectors with meetings, offers, warnings and the rest of his arsenal of tried and true vote-securing techniques, including public threats against Cuadra. When the dust settled, the party leadership had ratified Alemán as their only candidate to head the National Assembly and 50 PLC legislators caved in and signed a document to that effect.
René Herrera, crafty mastermind of Alemán’s political strategies and today first secretary of the National Assembly, revealed why he supports Alemán unconditionally. "It is not," he explains, "because we are captives of what they call his caprices. It is simply because we understand history and know perfectly well that a government without a party is extraordinarily vulnerable, and that when a national political leader is not yet spent, it is stupid to sacrifice him for simple expressions of interests skillfully managed in the opinion media." In other words, those who control the PLC know just how vulnerable Bolaños is, and they also know, when it gets right down to it, just how much more a certain "unspent" leadership figure can undermine him.
The impact of Cuadra’s valiant but fruitless challenge was limited: he got four Liberal votes plus the 38 Sandinista votes in his first attempt, opposing Moncada, and five Liberal votes in his second, against Alemán, a session the Sandinistas boycotted. The Liberals who backed Cuadra labeled this FSLN action a "tacit understanding with Alemán."
The most concrete result so far of Cuadra’s audacity was the creation on January 23 of a new bench of Liberal legislators, which baptized itself the Blue and White Bench, presumably to differentiate itself from the Alemán-led bench. It is made up of Cuadra and three other PLC leaders from Carazo and Matagalpa, plus Jorge Matamoros, the only Conservative candidate who made it into the Assembly. What pawns will this bench play on the board, on what occasions, why, and with what consequences?
Alemán and the media that support him immediately flung criticisms, disqualifications, ultimatums and party inhibitions at the Blue and White bench. Cuadra declared that he was unafraid and defined his identity: "I was anti-Somocista, then anti-Sandinista and now I am anti-authoritarian."

Leadership, instability
and populism

From his new power base, Alemán’s re-election strategy will have three basic mechanisms: maintain his visibility as a driving force, foster instability and promote populism. His projection is assured for two reasons: the importance of his new post will keep him surrounded by cameras and microphones and his provoking and frequently coarse personal style—which the country’s journalists are all too familiar with—"sells."
As for instability, even before occupying his new legislative seat and picking up his new gavel, Alemán was already announcing new legislation detrimental to freedom of expression. His target was Nicaragua’s mass media, which have become a resounding counterweight to the kind of unbridled power that the former President champions. He was forced to back off, at least for the moment, but once sworn in he went back on the attack. First, he riled both Sandinistas and Protestants by announcing a bill to repeal July 19, the date of the revolutionary triumph in 1979, as a legal holiday, substituting it with April 14, the day on which the Pope will beatify the Catholic Nicaraguan-Costa Rican nun Sor María Romero in Rome. Next, Alemán stirred up a batch of that anti-Sandinista cement that unfortunately bonds so many Liberals. With both money and their own presence, a group of Liberal legislators sparked a strike and street protests by nearly 300 supernumerary municipal government workers who had been laid off by Sandinista mayor of Managua Herty Lewites. A deal cut between Bolaños and Lewites, who seem to be working toward a novel and constructive understanding, put an end to the strike, thus deactivating a dangerous focal point of instability in the capital.

Alemán designed his first populist maneuvers immediately upon kicking off his new parliamentary career by introducing a new school bond bill, tagging it with his now customary "urgent" label. This bill would oblige both the state and private enterprise to grant all workers with school-age children a kind of "14th-month bonus,’ whose amount would depend on how many children the worker has. The law would benefit tens of thousands of families, but would also swell the fiscal deficit and the deficit in private companies. As a result, the initiative sparked concern among private enterprise.

Then through former Central Bank president Noel Ramírez, now a Liberal National Assembly representative, Alemán proposed changes in the earmarking of 6% of the national budget to university legislation as originally legislated by the Sandinista government. The Liberal idea would be to provide this funding directly to students in the form of scholarships instead of sending it to the National University Council (CNU) for reallocation to the member universities. This provoked the FSLN upper echelons, which are now barely able to mobilize the university students and personnel but still have access to proselytizing, support for student mobilizations, etc. through the Sandinista-dominated CNU.

Even before assuming his new post, Alemán threatened to introduce legislation that would review the functions of nongovernmental organizations, which he referred to as "swine," and demand of them an accountability process with new rules so he could then proceed to selectively cancel their legal status. The announcement created instability, fear and indignation, particularly among the 32 members of the Nicaraguan Federation of NGOs, which are the most solid, senior and pro-Sandinista of the hundreds of national NGOs in the country. Shortly after taking office, Bolaños announced that he planned to maintain "excellent relations" with the NGOs.

The FSLN is bereft
of both ends and means

Alemán’s strategy is clear, moving forward and producing results. In contrast, the FSLN and Daniel Ortega seem to be lacking in a strategy, and are relegated to the back burner.

This has to do with the frustration of a third electoral defeat with the same candidate, for which the party apparatus was once again unprepared. It also has to do with an inability to resolve its central dilemma: should it keep negotiating with Alemán or support Bolaños? Either way, the FSLN could go up in smoke. The FSLN’s defense of its pact with Alemán was that the end justified the means: returning to power justified the pact. The post-electoral reality continues to show that the FSLN lost that end, perhaps forever, and that the means it employed have backfired on the party and its future.

After his adverse election results, Ortega demanded an immediate electoral audit to clear up a number of "irregularities." No one paid any attention to his request. The FSLN claimed that it should have won two more legislative seats, one in Boaco and one in Bluefields, and the "Convergence" of parties and personalities that had backed the FSLN’s electoral run announced that it would engage in "peaceful resistance" with massive mobilizations to defend those two seats. No one went out on any street. Meanwhile, the three Sandinista magistrates on the Supreme Electoral Council (CSE) broke quorum in the session called to proclaim the results and the FSLN announced that it would accuse the four Liberal magistrates on the CSE of prevaricating by not dealing with the Sandinista claims. The Sandinista magistrates also walked out of the event to bestow credentials on those elected, while Sandinista winners accepted theirs "under protest." The FSLN successfully filed for a hearing with the Appeals Court over the issue, and for several days the FSLN whipped up anxiety that those elected would be unable to take office in January. Finally, seeing no future in this batch of tactics, the Sandinista justices on the Supreme Court decided with their Liberal counterparts—in their accustomed negotiated fashion—to put an end to what the media were calling a "judicial coup attempt" by rejecting the suit.

Parallel to all this, the FSLN publicly conditioned its backing of Bolaños on his willingness to discuss a "plan for the nation" with the Sandinistas before Christmas. That meeting never took place.
All these tactics were designed to shore up Ortega’s deteriorated leadership, both over his frustrated voting constituency and within the Convergence, his new political springboard. They were all aimed at maintaining his profile as an indispensable power factor, but the demoralization in the Sandinista ranks produced by Ortega’s third electoral defeat and Bolaños’ solid victory, together with the expectation created by the new President’s first moves, proved to be more weighty factors.

With the failure of the "judicial coup attempt," other ways had to be considered to resurrect Ortega’s image, shaking the dust of defeat from his shoulders. Enter stage right the political-judicial show put on between December 12 and 19. It was one for the annals of impunity.

Case closed

To everyone’s surprise, Ortega showed up in court on December 12, accompanied by his wife, Rosario Murillo, and all their children to renounce his immunity in the case of the charges of incestuous sexual abuse made against him by his adopted stepdaughter Zoilamérica Narváez nearly four years ago. The judge now sitting on the court where she had filed her charges is Juana Méndez, known for her loyalty to the FSLN. He appeared when the court had only eight working days left in the year.
Ortega repeated that the accusation was part of a political plot, declared that he was innocent and requested in writing that the judge immediately dismiss the charges against him by default. Sensing the importance that the new government would give the anti-corruption struggle, he declared that his attitude was "an example" that should be followed by Liberal politicians accused of corruption who are also hiding behind their immunity.
His evident objective was to put a lid on the case, nationally and internationally, in such a way as to stifle any criticism or question, make it easier for him to head the Convergence without black marks behind his name and ensure his reelection as FSLN general secretary in the party’s congress in mid-March.
Both Sandinista and Liberal legislators and political figures such as Cardinal Obando and former comptroller general Agustín Jarquín—Ortega’s running mate in last November’s elections—praised the gesture. In contrast, the prevailing public opinion expressed in the media questioned the moment selected and openly suspected that the legal verdict had already been nailed down. And so it had been. On December 19, without even having heard Zoilamérica, Judge Méndez trampled over the legal proceedings with unprecedented celerity to dismiss the case on the grounds that the statute of limitations had expired. Unlike some other countries, the crimes of incest and sexual abuse are not exempt from the statute of limitations in Nicaragua, and there is no law that stops the clock when a suit is filed.
On January 7, once the courts had reopened after the Christmas recess, Zoilamérica appealed the sentence. Given the continuance of the Liberal-Sandinista pact and the fragile game board on which the current political moves are being played out, the Appeals Court and, later, the Supreme Court itself may opt to use the case as another negotiating card or as a pressure point in upcoming moments of tension.

Zoilamérica: "Dismissal by default
is not innocence"

For the first time in over two years, Zoilamérica granted several media interviews after Judge Méndez announced her decision. Saying she did not know why Ortega had "overcome his cowardice," she stressed that the time limit does not apply to the crimes she had charged him with, since they continued for over 19 years. They began with sexual abuse when she was 11, continued with rape and ended with sexual harassment that only stopped the day before she made her charge in March 1998.
She stressed that dismissal by default does not prove Ortega’s innocence and that while he wants to close the case, she wants to open an investigation to bring out the truth. She said that in a transparent process she would be able to use witnesses and evidence to demonstrate the crimes she has accused him of. She held the Alemán government and outgoing National Assembly representatives responsible for complicity with Ortega for years. She further declared that no result in the national courts could detain the process opened by the Inter-American Human Rights Commission, and that she was waiting to testify at a March hearing granted by this high court of the Organization of American States.

The country urgently needs
"moral regeneration"

Rosario Murillo, supported by the near-impenetrable silence with which militants and leaders of the FSLN and the Convergence continued to accompany Daniel Ortega following the questionable sentence by Judge Méndez, decided to recover the lead her daughter had gained by playing her own media card. She did two extensive public appearances and a long newspaper interview in which she declared, both tearfully and aggressively, that she was "ashamed" of her daughter and "proud of being Ortega’s wife," whom she described as a "man with an untarnished record."
Paradoxically, Murillo’s confusing and upset declarations only fed suspicions that Ortega did sexually abuse his stepdaughter. It is in fact far from uncommon for mothers to follow such a pattern of pointing the finger at their own daughters when faced with similar accusations.
Coming on the heels of the electoral campaign, in which the case was implicitly omnipresent, Nicaraguans were forced to spend yet another week immersed in this case when they would surely have been happier focusing their energies on family Christmas preparations. The case is emblematic of a problem that nearly all fear to discuss and find painful to reflect on, but we must do both if the promised "moral regeneration," not to mention development, is to be achieved in the New Era. Beyond Zoilamérica—a case closed to us by a wall of impunity but still an open wound in the social conscience—are thousands more cases of small and adolescent girls and even women who are still victims or now survivors of similar abuse.

USA puts Jerez in check

Together with extreme poverty, which the government already has a strategy to combat, Nicaragua’s other central problem is its extreme levels of corruption and impunity and the extreme inability of both society and state institutions to get a grip on these two evils. Bolaños has promised a new institutionality and has given signs to back it up, but so far they seem only sparks easily swallowed up by the shadows.
The density of these shadows suggests that there is no time to lose, and indeed, the US government, which is backing Enrique Bolaños’ economic-institutional model, wasted no time getting into the new national chess game. On January 25, less than a month after Bolaños took office, it unexpectedly canceled the US entry visa of Byron Jerez, General Tax Office (DGI) director under Alemán’s administration, intimate friend and prime business partner of the former President and former PLC treasurer. It quickly became apparent that Bush administration investigators believe he used US banks to launder dirty money obtained in Nicaragua when he was a public official.

To permanently cancel Jerez’s entry visa, the US government applied reforms made to the Immigration Law plus amendment 212 of the Law to Combat Terrorism, all made following the September 11 terrorist attacks. The reforms include rendering "ineligible" for a US visa those public officials of any country who are either suspected of misappropriating funds and transferring this money to US banks or are known to have done so.

Checking Jerez has nothing to do with an ethical move by the United States and everything to do with its defense of its own national security, which requires that impunity and corruption not exceed certain levels or elude strict institutional control.
The corruption and impunity of the outgoing Alemán mafia, tolerated and even enjoyed by those who control the FSLN—at least until the electoral rhetoric began to flow—jeopardizes the hegemonic plans of the United States. None of its economic projects currently underway in the continent—Free Trade Area of the Americas (FTAA), Plan Puebla Panama, North American Free Trade Agreement (NAFTA)—are served by having economic-political mafioso playing with loaded dice from inside governments, violating all rules of capitalist competition. Nor is Bush’s worldwide "war against terrorism" served by fact that such untouchable mafias are notoriously permeable to links with armed groups and the arms trade.
This surprise move was without doubt the most significant, controversial and hope-producing news that could possibly have rung in the New Year and the New Era. From Alemán on down, Jerez’s Liberal cohorts, particularly those in top institutional state posts, were shaken by the move. They quickly tried to cut some distance from him, presenting the issue as a "personal problem," some private dealings that Jerez had been mixed up with in the United States.

Daniel Ortega’s reaction to the visa cancellation was particularly noteworthy. He demanded that the United States "clarify what its accusations are based on" and warned that the issue "is sowing anxiety and uncertainty that does not favor stability or governability in Nicaragua." More noteworthy still was Jerez’s statement in his similarly terse declarations: "Those who have called me to express their solidarity have been Sandinistas, not Liberals."

The "check scam"
and the man behind it

Jerez was forced to resign from his post as DGI director last year when exemplary investigative journalism by La Prensa revealed that he had used that position to embezzle large amounts of money in an intricate web of corrupt acts. The case, which quickly came to be known as the "check scam," brought shame upon a number of national institutions. The exclusively Sandinista and Liberal directors of the Office of Comptroller General were paralyzed by ambiguity while the judicial branch unambiguously dismissed the case, absolving Jerez despite several volumes of evidence against him and his inability to offer any evidence exonerating himself. Alemán himself only asked for Jerez’s resignation after caving in to pressure from the international community.

Although Jerez later had to resign as PLC treasurer as well, his essence, presence and power remained strong in the party, Alemán’s personal businesses and the country as a whole. The check scam was only one of the many acts of corruption he organized to contribute to the economic accumulation of the new economic power group that began to coalesce in 1990 around Managua’s new mayor, Arnoldo Alemán, when Jerez was already his right and left hand.

Investigation past and future

After canceling Jerez’s visa, US government officials were very terse in their declarations, making it clear that investigation of the case corresponds to the Nicaraguan government, which the United States is fully prepared to support if its collaboration is requested. The Nicaraguan Office of Attorney General duly requested the said collaboration after initial declarations attempting to distance itself from the affair. This would be the first investigation of money laundering to be done in Nicaragua.

The investigation that Nicaraguan institutions say they are prepared to initiate is directly related to the check scam case, which Rafael Córdova began to look into as long ago as 1999, when he was director of probity in the Office of Comptroller General (CGR) headed at the time by Agustín Jarquín. Backed by additional information published by La Prensa, Córdova charged that since 1998 Jerez had been changing into dollars hundreds of checks written in córdobas to the DGI by various other state institutions. Jerez then transferred the money to his personal businesses in Nicaragua, Panama and Miami. When the court threw the case out in June 2000, it turned the "check scam" into the best-known and documented corruption and impunity scandal of Alemán’s government.

In November, following Bolaños’ victory, La Prensa journalistically reopened the case after discovering new checks involving Arnoldo Alemán, since companies belonging to his family had also benefited from check scams. Armed with this new evidence, it proposed that the new government judicially reopen the old case as well. With that, the shame mounted. On December 5, when the CGR requested the case file from the court records, it learned that the file had "disappeared." Part of the file has since reappeared, and the CGR is announcing a new investigation.

It does not take access to classified files to work out that the thread of the laundered money referred to by the United States leads to the skein of the check scam, and then on to Arnoldo Alemán’s own huge ball of yarn. Similarly, one need not be a brilliant analyst to recognize that canceling Jerez’s visa was as much a political move as a judicial one. It can safely be interpreted as an indirect message to Alemán himself. Only the nature of this warning shot fired over his head is left to speculation. Is it to isolate him and his corrupt cohorts or just encourage him to moderate or even renounce his destabilizing and populist strategy to dominate the scene, which he expressed with provocative ostentation right from the start of Bolaños’ term in office?
Whatever the nuances, this timely US intervention at the gateway to Bolaños’ New Era was very clear on one essential point: security equals scaling down corruption, not so much through trials and jail sentences as through symbolic sanctions. This gives Enrique Bolaños and his new government a free move, which if it knows how and when to play it, could put more of Alemán’s apparatus in check.

In a country whose economy has been virtually under international community intervention for years now, and whose institutional capacity-building projects are part of that same intervention, this latest move by the United States challenges all political actors and all state institutions. How might we expect the National Police or the Offices of Comptroller General, Attorney General or Public Defender to react? How far might they go? How far will the pact let them go?
And how much further can we expect the United States, one of the countries in the Group of Six following up on Consultative Group agreements, to go in the wake of all the other pressures it has been exerting around the world recently? It would be utopian to think that all the stakeholders involved in this challenge will be either willing or able to rise to the occasion to put Alemán and his cohorts in check.

Urgent anti-corruption bills

On January 31, a few days after this US-launched bombshell challenged so many people with so many dilemmas, President Bolaños made an unprecedented political gesture by formally appearing before the National Assembly, wearing his presidential sash, to present his legislative agenda in person to the 92 recently elected representatives. All members of his Cabinet, ambassadors and representatives of international agencies also attended the event, and gave Bolaños a strong ovation.

Five of the nearly thirty bills he wants approved were classified as urgent, an expeditious procedure not altogether unlike what is known in the United States as fast track. The tagged legislation corresponds to the political conditions the international financial institutions placed on the government when they signed the three-year structural adjustment agreement that will release funds for social projects and ultimately pardon 80% of the country’s unpayable foreign debt. Other non-legislative conditions are related to the fiscal debt and other macroeconomic indicators.

Of these five "urgent" bills, one is concerned with educational participation and another is a general health law. The three others are linked to the fight against corruption that Bolaños has promised will be his government’s hallmark: a civil service law, guaranteeing stability to public officials based on efficiency and capacity and not party criteria; a public servants probity law; and a law of penal code reforms and additions. The latter largely adds white-collar crimes such as illicit enrichment, influence peddling, fraud, cover-ups and international suborning, whose absence from the lagging Nicaraguan body of law served as an excuse to avoid investigating, punishing or serving justice during Alemán’s five years in government. The reforms also cover existing but obsolete classifications such as misappropriation of public funds, bribery, embezzlement and the private appropriation of state goods. The new legal classifications would go into effect immediately.

The central image of Bolaños’ day in the National Assembly will go down in history: him calmly and firmly reading the list of these crimes while Alemán, implicitly alluded to in all of them, listens from the directors’ table while his facial features by turn suggest disinterest, skepticism, anger and even, fleetingly, something that almost resembled remorse.
President Bolaños also announced that he would soon send 16 more pieces of legislation to the Assembly. They included a reform to the budget law, a bill on access to information, a reform to the law on state contracting (a focal point of corruption during the Alemán government), an organizational bill for the Comptroller General’s Office (which Alemán vetoed to limit its instruments and attributions), yet another reform to the electoral law and a reform to the law on demarcating indigenous lands. Bolaños also requested that debate be scheduled soon for eight bills already introduced into the Assembly in previous years. Among them are one on citizen participation, the regulatory bill for the Autonomy Statute of the Atlantic Regions (which has been a ongoing demand of the Caribbean coast population since the election of the first autonomous government in 1990), and a family code.

The most obvious hole in Bolaños’ legislative agenda was the much-needed reform to the Immunity Law, which has become an impregnable bulwark of corruption and impunity. During his electoral campaign, Bolaños promised on several occasions that he would also deal with this huge challenge.

Austerity measures:
One from column A, one from B

Two days after the presentation of those bills, the new treasury minister, Eduardo Montealegre, announced austerity measures to be applied to all ranking government personnel. The most noticeable was the slashing of 35% of the mega-salaries of all top executive branch officials, from the President down to the ministers’ executive secretaries and directors of autonomous government entities.
Even with the cuts, however, the top salaries are still excessively high for a bankrupt country, since these officials receive generous "stipends" on top of their nominal salaries. (To give an idea, the presidential salary is equivalent to $6,700 a month with a $4,000 stipend while ministers receive a $4,800 salary with a $2,000-$2,500 stipend.) Although the cuts are much less than what Nicaraguans had a right to expect, they will have the advantage of bringing everything out on the table.

The announcement gave a boost to the clamor for similar austerity for top posts in the judicial and electoral branches of power and the comptroller general’s office. It also brought to light another breeding ground of corruption that fermented during the Alemán government: dual payment rosters whose amounts the outgoing ministers refused to reveal, petty cash funds with no oversight control, confidential expenses for those with sensitive posts, checks for 4,000 córdobas (approximately US$300) on which they based their tax payments, plus real monthly salaries of nearly 60,000 (some $4,000) on which they paid nothing.

Rot and ghosts everywhere

Alongside these announcements, the new ministers have begun announcing investigations in which they are discovering embezzlements, squandering, ghost salaries, ghost employees…a ship of state whose timbers are rotten everywhere one dares look.

The new government also announced other austerity measures, all of them warmly welcomed by public opinion. They include dispositions against nepotism; the suspension of the famous fat fees that top officials sitting on the boards of state institutions and committees receive every time they attend a meeting, even during the working day; and suspension of state-paid credit cards and bodyguards for these same top officials. And it does not end there: international trips will not exceed five days; no family members, even spouses, will accompany the officials on their trips at state expense, and the per diems allocated for these trips will be cut by 30%. Implicitly the list of everything cut alludes to everything that was permitted and promoted during the Alemán administration. It is calculated that these first austerity measures will save the state the equivalent of about US$8 million.

Enrique Bolaños had already forbidden the use of state funds for parties and the exchange of gifts by government officials for birthdays, anniversaries, Christmas and other occasions, which also suggests just how much was squandered in the binges perpetrated by Alemán and his team. It further suggests, however, that Bolaños knew all about this all along.

No blank checks

Bolaños is determined that his recognized personal austerity translate into institutional austerity. His team knows that moving against corruption and austerity will provide visible signs of the lauded New Era in his first year of government. Only afterward will come stronger economic and social signs.
All the moves played out in these first weeks suggest that the greatest clashes Bolaños will face in coming months, even if disguised as social tensions or fair-sounding economic demands, will come from the leaders of the pact and will be motivated by the corruption that sustained them. After serving as Alemán’s vice president, when he knew or at least suspected this, Bolaños now has this inherited burden square in his lap.

His new government has made a great first effort in a complex, tense and fragile context. Even so, it would be wrong to give him a blank check, and not only for elementary reasons of political prudence in this country of fleeting ideals. A more concrete reason has to do with some less positive signs that appeared in his first month of government and seem to indicate a willingness to back off and concede. Our new President deserves expectations but no trust until we learn how far, how long, how much and to whom.

Among these signs, two are particularly worrying. First, he granted Alemán’s wife as a personal project an old-age home she had managed as a state project from her position as First Lady. Second, he proposed a Presidential Commission "of notables and honest individuals to study and propose to me the changes needed in the laws and judicial procedures to make it possible to apply laws equally to all without favor or exclusion."
This proposal seems particularly strange, since it amounts to interference by the head of the executive branch in the affairs of the judicial branch. Has Bolaños decided to interfere in this powerful machinery currently at the service of the pact in order to de-pact it? If he has, why head the commission with current Supreme Court president Iván Escobar Fornos, who was installed by the pact and is loyal to Alemán, faithfully following his orientations in the years he served as National Assembly president?
There is also an unanswered question about Bolaños’ years as Alemán’s vice president that councils against excess optimism: why did he remain silent about all he saw, heard and knew? It is up to society to monitor, step by step and blow by blow, how the new government deals with the check scam and the man who masterminded it.

We doubt, therefore we are

We are on the threshold of the New Era: among checks scams that must be given exemplary punishment and among blank checks we are tempted to grant out of either desperation or hope. We want more justice, less impunity. We want the knots of the pact to begin to be untangled and we want things to change…at least a little…in the right direction.

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