Guatemala’s Crisis is Not Over

By Eric Hershberg*

Guatemala City, August 2015. Photo Courtesy of Eric Hershberg.

Guatemala City, August 2015. Photo Courtesy of Eric Hershberg.

With President Otto Pérez Molina’s resignation early this morning, Guatemala lurches into a new phase in its long-running political crisis, with little prospect that this weekend’s elections will resolve much.  The investigations into the Pérez Molina administration’s corruption, the national assembly’s unanimous vote to suspend his immunity, and the peaceful surge in popular protests demanding that he step down all suggest progress in the country’s efforts to build a functioning democracy.  The UN-sponsored Comisión Internacional Contra la Impunidad en Guatemala (CICIG) fulfilled its mandate, and its example and training were arguably important factors in the ability of judicial officials in Pérez Molina’s own government to support the processes that led to his downfall.  (Click here for an AULABLOG assessment of CICIG in May.)  The Congressional vote to strip him of immunity was unanimous, including even his most loyal supporters, who until then had rejected popular clamoring for the president’s ouster.  By the end of last week societal disgust with the political elite had reached the point that even the most recalcitrant of incumbents realized that their own survival required ditching the president.  The comptroller’s office called on him to resign “to avoid greater social unrest that could have unpredictable consequences” – a sentiment echoed by powerful business groups and the Catholic Bishops Council.

The Guatemalan Constitution and laws lay out the next steps.  The Congress has accepted the resignation, clearing the way for Vice President Alejandro Maldonado – who replaced Vice President Roxana Baldetti after she was jailed in connection with the same corruption scandal – to take office.  The first round of Presidential elections, with 15 candidates in the running, will proceed as scheduled this Sunday, despite calls from some civil society organizations to delay the balloting on grounds that the campaign regulations reflect the influence and interests of criminal elements.  In all likelihood, a runoff round will be necessary six weeks later (October 25).  The convulsions of recent months and deep distrust in government suggest that tensions will be high between now and then, but there’s no indication yet that civil unrest could threaten the electoral process, and military intervention appears to be a thing of the past.  There is every reason to expect that a new President will be inaugurated on January 14.

The elections are unlikely, however, to lead Guatemala into an era of less corruption and greater accountability, or to install leadership willing or able to spearhead economic and social policies to enable the majority of the population to live with dignity.  The slogans on the banners of the tens of thousands of protestors in Guatemala City’s central square lacked any message beyond a rejection of the status quo.  “Throw them all out” and “I have no president”are potent rallying cries but do not address the core challenges of a country where the elite pay no taxes, half of all children are malnourished and tens of thousands of young people desperately seek better lives anywhere other than Guatemala.  

The reputations of the leading candidates and their failure to articulate coherent governing platforms give little room for optimism.  Leading in the polls is a wealthy businessman, Manuel Baldizón, whose running mate is already being investigated for corruption and whose own closet is widely understood to contain plenty of skeletons.  Protestors have already singled out Baldizón as unacceptable, taunting him with chants of “it’s your turn next.”  In second place is a comedian named Jimmy Morales, who enjoys the support of the economic elites and media but has advanced no policy platform whatsoever.  Former first lady Sandra Torres appears to be running third.  She divorced President Álvaro Colom in 2011 to circumvent a court ruling that, as First Lady, she couldn’t run for office.  (The Constitutional Court put a final stop to her campaign a month before elections that year.) 

Electoral victory by any of these candidates would leave Guatemala with weak leadership at a time that most government institutions desperately need revitalization.  Corruption is too deep-rooted for CICIG and its few allies in government to face down alone, and these candidates won’t use the presidency to carry out the needed purge.  The organized criminal groups that traffic drugs and persons through the country and permeate governing institutions stand to grow only stronger, and the misery that plagues a population deprived of education, health care and jobs will continue unabated.  U.S. Vice President Joe Biden’s billion-dollar aid package for Guatemala, Honduras and El Salvador, already in trouble in Washington, may have nowhere good to go.

September 3, 2015

*Eric Hershberg, director of the Center for Latin American & Latino Studies at American University, witnessed the protests in Guatemala City last week.

Guatemalan President’s Mid-term Exam: A Failing Grade?

By Ricardo Barrientos*

Guatemala Otto Pérez Molina President / Photo credit: World Economic Forum / Foter.com / CC BY-NC-SA

Guatemalan President Otto Pérez Molina / Photo credit: World Economic Forum / Foter.com / CC BY-NC-SA

President Pérez Molina’s second annual report to the nation last week at Guatemala’s National Theater featured statistics on the government’s progress, but it may be better remembered for an incident in which a protester threw white powder in the face of Vice President Roxana Baldetti.  A number of opposition deputies boycotted the session, and protestors outside drew headlines.  The President touted specific accomplishments, but his overarching plans –structured in three “pacts” welcomed even by the opposition – have fallen short of expectations.

  • The President in his speech said malnutrition has declined, but critics say that the Zero Hunger Pact is mostly unimplemented and chronic malnutrition persists. National surveys and several studies report that half of all Guatemalan children face a life with deficits in their abilities to learn and be competitive.
  • The Security, Justice and Peace Pact – expected to be a strong point for a former Guatemalan army general with a reputation as an “iron fist guy” – has fallen short.  Pérez Molina said the national homicide rate has dropped from 39 to 34 per hundred thousand inhabitants, but the National Institute of Forensic Sciences has reported a slight increase in murders in the capital and surrounding area.  Crime and insecurity remain a daily reality for Guatemalans, fueling popular frustration that Pérez Molina is not meeting one of his top campaign promises.
  • The Fiscal Pact for Change is also not delivering desired results.  According to Icefi, public finances are in crisis, not because of an external economic shock (2009-2010) or because tax reforms failed to increase revenues (corporate taxes rose 35 percent in 2013).  Rather, corruption is fueling fiscal shortfalls. According to President Pérez Molina and in Vice-President Baldetti’s own words, the influence of organized crime over the Customs System, whose duties and VAT on imports account for one third of Guatemalan tax revenues, is hampering collection.

For a student, a bad grade on a mid-term exam is an alert that things are not going well – but that a serious effort in the second half can save the course and achieve success.  For Pérez Molina, serious effort from now on is going to require more than a speech and applause at the National Theater.  The final exam for him and his government looms large on the horizon: elections will take place in September 2015, and campaigning will be well advanced in 2014. Voters are influenced by their daily reality, not an official report of success and accomplishments more reminiscent of Alice in Wonderland than real life Guatemala.  The President knows the clock is ticking.

Ricardo Barrientos is a senior economist at the Central American Institute for Fiscal Studies (Icefi).