‘‘As befits the outcome without victors or vanquished, the FMLN enters the peace by opening its fist into a hand and extending it in friendship to those we have fought, with the firm goal of initiating the unification of the Salvadoran family."

FMLN Commandante Schafik Handal
January 16, 1992

‘‘We say to the FMLN, with respectful conviction, that your contribution is needed to develop a stable and consistent democracy ... and we are sure that all political and social forces can work together ... for the benefit of the country, as El Salvador deserves."

President Alfredo Cristiani
January 16, 1992

Chapúltepec Five Years Later


The new Salvadoran society now emerging, strengthened by the pacifying effort, is the unquestionable protagonist of the state we are entering. This reality will undoubtedly contribute to making our democracy more viable and vital."

President Alfredo Cristiani, Chapúltepec, January 16, 1992

‘‘The agreements we have signed contain the design of the new country that we Salvadorans desire, and of the life that we Salvadorans want to live."

FMLN Comandante Schafik Handal, Chapúltepec, January 16, 1992

Formal implementation of the Salvadoran peace accords has been slowly drawing to a close. On April 30, 1996, the United Nations Mission in El Salvador (MINUSAL) closed its doors, leaving behind a small six-person office—the United Nations Office of Verification (ONUV)—to monitor and verify implementation of outstanding provisions of the Peace Accords signed by the Government of El Salvador and the Farabundo Martí Liberation Front (FMLN) on January 16, 1992. Those Accords followed eighteen months of negotiation and brought an end to eleven years of civil war.

In exchange for the phased demobilization of the FMLN’s army, the Accords called for a wide ranging series of institutional changes in El Salvador that were aimed at providing political guarantees for the FMLN to safely enter civilian political life, at healing the wounds of war and at amplifying democracy in El Salvador. In language both more general and less enforceable, the Accords called for more thoroughgoing democracy, for an overhaul of agrarian legislation and of the electoral system, and for economic reconstruction. Alvaro de Soto, the chief UN mediator during the peace talks, described the Accords as "a negotiated revolution."

Five years after the signing of the Accords, it is becoming apparent that the changes to Salvadoran society resulting from peace will be less than revolutionary, although in some areas there have been quite profound changes. The military is far smaller and less powerful than it has been in this century, and political power no longer rests on an alliance between the landed oligarchy and the military; leftist organizations that organized and led a peasant-based guerrilla war have become political parties with a share of institutional power through the 21 seats they hold in the 84-member Legislative Assembly; reforms to the police and judiciary, while far from complete, have established a degree of independence and competence that did not exist before.

The speeches of then President Cristiani and the FMLN’s Schafik Handal at Chapúltepec shared a strong sense of the social and political ills that led to the war, and a commitment to engage in partnership the shared goals of reconstruction, development, and shaping a deeper, participatory democracy. In early December, 1992, Hemisphere Initiatives published Endgame: A Progress Report on Implementation of the Salvadoran Peace Accords. The report noted that, "The purpose of the Accords is not only to end a civil war but to transform the institutional structures of Salvadoran society....Given such a broad purpose, it is important for international observers to avoid too narrow a focus on the cease-fire and military demobilization provisions of the agreements. The process of institutional reforms agreed-to in the negotiations will require a considerably longer time-frame to complete than the demobilization of FMLN military units."1

At the beginning of 1997, the central issue facing El Salvador is whether the peace process has initiated a process of democratization that is now irreversible, or whether the winding down of international attention and financial assistance will be followed by a resurgence of authoritarian practices and the consolidation of political and economic power in the hands of traditional elites.


The signatories to the accords, as well as key international players, have each declared the peace process a signal success. Based on the specific language of the accords, and measured against contemporaneous experiences in Cambodia, Angola, Mozambique, Guatemala, Nicaragua — to say nothing of the former Yugoslavia, Rwanda, Burundi, and Liberia — there is much to celebrate.

Though previous Hemisphere Initiatives (HI) reports have found grudging commitment to implementing the accords and reforming the electoral system, it is undeniable that the peace process and democratization have made dramatic advances in difficult circumstances.

• The war is over; troop demobilization was not marred by violence.

• The military was reduced in size and new civilian input was infused into the military academy.

• A civilian-directed human rights review of the officer corps led to the transfer, discharge, or retirement of some one hundred high ranking officers, despite delays that amounted to a treaty violation.

• Three former police forces were demobilized; a civilian police force was established and deployed.

• A multiparty commission, COPAZ, oversaw the peace process.

• Prior to Chapúltepec the elections had been without military candidates for a decade, and center and rightist civilian parties grew. Left civilian parties returned from exile in 1989; the FMLN was legalized as a party after Chapúltepec.

• The accords broadened party representation in the electoral authority, the Supreme Electoral Tribunal (TSE).

• A new constitutional process of selecting Supreme Court judges has resulted in a more professional, independent Court.

• A government funded independent office of Human Rights has been created.

• Reconstruction was advanced by the infusion of high levels of international money.

• Government land sales transferred war zone properties, after long delays, to some 35,000 peasants occupiers and former combatants, and significant retraining and credit programs were launched.

• The international community, principally through the UN, played an important roll advancing implementation and defusing crises.

Both signatories have in the past year devoted few resources to formal compliance issues. The language of the accords and the soaring rhetoric at Chapúltepec make clear that a broader transition from economic destruction to growth with equity, from confrontation to conciliation and from procedural democracy to participatory democracy was in the minds of the signatories.

"Revolution" (to recall Alvaro de Soto’s phrase) involves fundamental changes in the power relationships between social sectors, and here the changes have been far less profound. A small elite continues to dominate economic and political life, although power within that elite has shifted from landed to commercial interests; a middle class sector of white collar management and technical employees has grown in numbers but as yet has no independent political vehicle to espouse its interests; urban workers, and particularly unionized urban workers, have lost influence as a result of privatization of state enterprises and the rise of maquiladora industry; and the mass of peasants, in whose name the armed struggle was waged, are in more desperate condition than before the civil war began.

What has happened in El Salvador is more evolutionary than revolutionary, more adaptive than disruptive. The most significant reforms have been implemented only partially, and only after strong and continuing pressure from UN monitors and bilateral donors. As international assistance declines and the international presence is reduced, there are disturbing signs of retreat.

Stalled Political Transition?

This report points up areas of concern about stalled reform efforts and signs of increased activity and power from authoritarian forces. It does so with one eye toward international assistance to aid positive change, and the other on respected nationalist opinion, across the Salvadoran political spectrum, that has displayed impatience with internationally based critical opinion and pressures. With respect to this frequently justified national sensitivity, we note here and in detail below, that El Salvador’s sternest critics are most often Salvadorans.

There can be no doubt that the democratization of political life is incomplete. Numerous authoritarian tendencies and practices remain. While substantial institutional change has occurred, in each case there has been struggle between traditional forces and modernizers. One force for change, the international community, is waning in influence.

Electoral democracy has developed roots in El Salvador, but the system remains flawed. Resistance to making the electoral process more fair, accessible and professional has been manifest. With March 1997 municipal and Legislative Assembly elections beckoning, year-end legislation completely bypassed the reforms on the table since shortly after the 1994 elections. Even if legislated soon, needed change would be difficult to implement in time for the Presidential elections in 1999.

The resources of the incumbent party, ARENA, dominate with little effective counterweight. Opposition parties have either continued to fracture internally, or have shown few signs of growth in strength. The FMLN remains the main opposition group, but there are many signs that its material and human resources are badly stretched. The new electoral code could make life difficult if not impossible for small parties.

In the past two years elements on the far right have made a comeback, within and outside of ARENA, and have achieved important positions in government. These include figures associated by human rights groups with the formation of death squads in the 1980s.

If the peace is irreversible, political violence has continued. High level political figures (including former President Cristiani) have been targeted by shadowy forces that seem to emanate from rightist circles. The poor and unorganized could only receive the message that participating in politics is dangerous.

The past fifteen months have seen extreme and negative reactions from powerful quarters in and out of the government toward efforts within civil society to organize and protest. These range from a draconian closing down of low-watt community radio stations, to use of excessive force by the police against demonstrators. Extreme rhetoric has been directed toward trade unions and activists protesting conditions in tax-free zone assembly plants (maquilas), which includes, we regret to add, a recent statement by President Calderón Sol referring to them as "traitors."2

A new regulatory law would give the government excessively intrusive powers over non governmental organizations (NGOs—non profit civic, research, and aid groups), and stems from an attitude which sees such groups as political enemies supporting the FMLN.

Crime pays. It has reached spectacular proportions. It ranges from thieves, to gangs to international stolen car and drug rings. El Salvador has a homicide rate three times that of Colombia and killings in 1995 that exceeded the yearly average during the war.3 For a majority of citizens life is less safe now than during most of the war.

The new National Civilian Police (PNC), along with the Judicial and Prison systems, have been overwhelmed. Many police have been killed. Government response was slow; then last March the Assembly attempted to meet the crime wave with draconian laws. Some would violate civil liberties. The laws are punitive, but do not really address corruption, organized crime, or the social reasons behind crime. There have been signs of a return to the use of local vigilante groups in the guise of controlling crime. An Interior Ministry project was quashed by President Calderón Sol, but it is unclear that all vigilante groups have in fact been dismantled.

Judicial and police reform has been slow. The police have suffered pockets (some at high levels) of corruption and human rights violations, though since our January 1996 report corrective measures have been taken to improve efficiency, reduce excess in crowd control, and clean up corruption.

The new Office of the Human Rights Ombudsman began tentatively with much support from the UN. With more forceful leadership the office has come under attacks which range from budget cuts to death threats.

Economic Change for the Majority?

Despite profound social, political and economic change since 1979, El Salvador is still a country in which wealth and economic power remain highly concentrated, perhaps more concentrated — though not exactly in the same hands as before.

If de Soto’s "negotiated revolution" was an overstatement, two other revolutions, defining the term more loosely, have occurred during Salvador’s war and post-war years. One is a dramatic reduction of the state role in the economy. Since 1989, the ARENA governments have largely reversed the war years’ trend toward a larger state role in the economy. Banks have been privatized with considerable concentration of capital in few hands. Export taxes were drastically lowered and exporting was privatized. More regressive value-added taxes have twice increased substantially. Meanwhile the state plays a smaller role as employer, particularly after the discharge this year of some 15,000 employees.

Second has been a profound social transformation, the most sweeping in El Salvador’s history. In a country of five million, the war killed 75,000 people, most of them civilians, considerably more than the war losses of the U.S., a country forty-two times larger, in Vietnam. Families were fractured; populations shifted within the country. At least twenty per cent of the population emigrated.

Salvadorans working abroad now send $1 billion per year (remittances) home, an extraordinary amount by international standards. The amount is five times the yearly average of the relatively high levels of post war international aid. Unlike the trickle down strategy of the government, this money goes directly into the pockets of Salvadorans. But the legal status of many of the immigrants in the U.S. is tentative and threatened by anti immigration sentiment.

Until late 1995, the economy showed impressive aggregate growth over five years as the war wound down. With the highest growth rates in Central America, El Salvador became the darling of international financial organizations promoting ever more thorough structural adjustment programs in the region’s economies.

Despite robust growth, much international aid, and mountains of remittances, the overall percentage of people living in poverty and extreme poverty remains quite high, and extremely high in rural areas, particularly former war zones. Income poverty and lack of access to vital goods are joined by landlessness, and lack of access to education, health and welfare. El Salvador, despite robust growth, has ranked very low on the UN Human Development Index with only two or three countries in the hemisphere below it in the last three years.4 And the economy the past 15 months has shown signs of recession.

Within the neo liberal framework, the current administration has vacillated from plan to plan leading to a perception among business elites that the government does not lead. This is not merely a reflection of indecision, but also a manifestation of fierce, often behind the scenes, competition over policy changes which favor one group or another and over control of resources on the block to be privatized or otherwise cast into the marketplace by the government.

Dramatic changes legislated this year to restructure agrarian debt could, while providing debt relief for some, result in vast changes in land tenure leading toward new land uses, more concentration of control over high value land, and a reversal of the 1980s agrarian reform.

Moreover, despite campaign promises, more tax collections, and a blue ribbon commission 1995 report calling for massive support for educational change, there has been no dramatic change in education, health and welfare expenditures. El Salvador is falling short in the development of human capital, both because it is not investing in education and because it has been exporting Salvadorans.

And there is now ample evidence that El Salvador is fast becoming an environmental disaster area. Efforts to meet this challenge, among the few government and non-government sectors that seriously regard the problem, have been piecemeal at best. Failure to address this issue will add to health problems, fundamentally hold back the economy, and seriously deteriorate living standards.

Citizen Attitudes

Polls have consistently shown high levels of dissatisfaction with economic conditions among middle and lower income respondents. Citizens manifest low levels of respect for political parties and most government institutions. Substantial numbers regard the political process as unfair and barely democratic. There is a striking decline in support for parties. Voter turnout has been low.

Studies of democratic transitions question whether public discontent, stemming from economic difficulties or political problems, might destabilize a country and lead to radical change or to new authoritarianism. Polls contain some signs of a preference for authoritarianism. But equally important, discontent might lead to increased resignation, political passivity, and cynicism. Broad sectors of the public have not joined in the national and international elites’ celebration of the success of the post-war peace process and democratization and do not see themselves as "protagonists of the state."

Seen from one angle, the expression of discontent is surprising. The peace process has brought an end to the war, elections in which all forces have political parties and candidates, and high levels of economic growth. But it is far from clear that it has either involved broad sectors of Salvadorans, or (apart from the absence of forced military recruitment) made a significant positive material change in their daily lives.5

What is to be Done?

We emphasize that very substantial progress has been made in peace, democratization, and economic reactivation. We disagree with analogies that say, for example, that problems in the new police make them little better than the old.

Yet despite manifest peace benefits, much remains to be done and progress is hardly inevitable. How El Salvador responds in next March’s election, and to the crime, education, health, and land problems in the next 12 months, will be important in determining whether progress will continue or stop.

The current economic slowdown may call attention to the need for an economic model that offers economic opportunities to broad sectors of society that have been left out. Growth with equity is more sustainable growth.6 Some Salvadoran economic elites, as well as policy analysts on the left, are devising new strategies in search of international competitiveness while attempting to alleviate poverty and protect the environment. It is not clear, however, that consensus can be reached or that the strategies offer a lasting solution to El Salvador’s entrenched social deficits and poverty.

Countries which have become economic "tigers" invested more heavily in education and health, promoted a more equal distribution of income, and did more to support a peasant class. El Salvador should invest more heavily in these areas. A useful first step would be to approve an agrarian debt forgiveness law to forgive all debts to the government stemming from the agrarian reform and land transfer programs. This should be seen as a government-sponsored investment in peace and agricultural development.

The international community can assist in moving El Salvador forward. International agencies should monitor and support human rights protection, and judicial and police reform. Assistance to electoral processes should be conditioned on a clear demonstration of political will to enact and implement critically needed changes. Among these should be, in addition to improving access to the vote, campaign finance limitations to counter a tendency toward a wealth-based monopoly in elections.

International and Salvadoran public and private diplomacy should criticize and isolate powerful figures who promote intolerance and attempt to quash opposition initiatives. It should place the heaviest emphasis on the disarticulation of death squads and organized crime structures.

Aid should go to support demonstrated progress in the police and judicial sectors, but if political will is demonstrated aid should be ample. International aid should focus on reactivating the economy in the poorest regions and on providing health and education services, and should pay particular attention to the plight of poor women and their families. Such aid should be tied to partnership efforts on the part of the Salvadoran government. It should seek to strengthen institutions of civil society against attack and broaden participation in the political process between elections.

Even if next March’s elections result in a more competitive balance of power, they will not necessarily lead to better policy choices. And policy choices alone will not make healthy political institutions the public does not respect, reverse authoritarian inroads, or bring about increased political participation. This will require greater dedication to the ideals expressed at Chapúltepec.


  In the past, one of the most pernicious failings of our scheme of national life was the absence or inadequacy of the spaces and mechanisms needed to allow for a free play of ideas, for the natural unfolding of different political projects growing out of freedom of thought and ‘action. In synthesis, a genuinely democratic scheme of life did not exist."

President Alfredo Cristiani, Chapúltepec, January 16, 1992

‘‘The accords have opened the way with a method of economic and social discussion for finding and agreeing to solutions that allow the costs of the war and the possible crises at the beginning of the peace to be shared."

FMLN Comandante Schafik Handal, Chapúltepec, January 16, 1992

The literature on transitions to democracy describes a process in which elites negotiate pacts for greater democracy followed by the creation of new democratic institutions. Consolidating these changes, however, can be fragmented and tentative, affected by the nature of the original pacts (what deal was the military able to make for itself?), political party structures, economic policies and the ability to meet various challenges from traditional forces. Political culture impacts on the process in powerful ways. Democratic attitudes among the population can be a catalyst away from authoritarianism and can reinforce democratic forms, and can in turn be reinforced by increased democratization. While the literature expresses concern for fragile democracies being destabilized through radical movements or fragmented political systems, there is also concern that democracy will stabilize in an attenuated, "frozen" form.7

El Salvador fits into a special category — one in which the transition process is deeply affected by war. The government side during the war years portrayed itself as a bastion of democracy. The FMLN claimed that lack of democracy, and death squads, forced the war. The war forced the beginnings of electoral democracy, in no small part, to convince a reluctant U.S. Congress to vote for aid. War conditions also tightened security and restrictions on civil liberties and added to high levels of distrust. Then came "pact making" at Chapúltepec and calls for greater democracy.

In purely formal terms, electoral democracy seems firmly established in El Salvador. Civilian based elections without military candidates took place in 1982, 1984, 1985, 1988, 1989, 1991 and 1994, and will again in March. Civilian left parties, returned from exile, took part in 1989 and thereafter and the FMLN did in 1994.

But elections are not a synonym for democracy. Many authoritarian regimes have organized regular elections which they were sure to dominate. There were many, in and out of the FMLN, who believed that powerful sectors on the right, perhaps including military sectors, were not prepared to accept a broad FMLN victory in the 1994 elections. The substantial ARENA victory, obvious months before the election, did not provide the same sort of test of governmental transition as occurred in Nicaragua when the Sandinistas lost in 1990. Pre- and post-election violence against FMLN leaders, though limited when measured by ugly standards set in other countries such as Colombia, and hardline responses to widening participation detailed below, evince new and old authoritarian practices.8


Polls reveal substantial popular discontent with the performance of the political and economic systems in El Salvador. Despite the newness of electoral democracy voter turnout has been at strikingly low levels since the early 1980s. Public opinion suggests that democratic consolidation is held back because performance of the new political system has not earned enthusiastic support. Negative attitudes may reflect entrenched suspicions and distrust held over from the war, but polls indicate public concern grounded in a perception of contemporary problems and performance.9

Moreover scattered poll evidence indicates a certain sympathy for elements associated with authoritarianism. A vigilante group called Black Shadow began killing suspected criminals, and a May 1996 poll indicated that 33% sympathized.10 In a 1995 poll, 76% agreed that El Salvador needed a strong decisive leader; 16% disagreed. The answer may reflect an opinion, however, of a current vacillating administration.

In polls taken before the 1994 "elections of the century," 83% said they had little or no interest in politics and 53% had little or no interest in the electoral campaign, then in full swing.11 Only 38% thought there would be fraud-free elections. An impressive 34% predicted fraud and 28% didn’t know. Twelve years after the first all-civilian election, 36% per cent said El Salvador was not a democracy, while 48% said it was. Fifty-two percent said citizens can never influence government, another 12% said almost never, and 82% said they had never participated in a political meeting. Strikingly, thirty percent thought the social system needed total change.

Since the election very substantial doubt and skepticism remain. When asked, in February 1995, to express levels of confidence in national institutions, 43% of Salvadorans had much confidence in the Catholic Church (though 21% had none). By contrast, only 2.4% had much confidence in the political parties and 4.9% in the justice system. And 53.5% had no confidence in political parties and almost 40% had none in the justice system. In October 1995, 76.4% had little or no confidence in political parties.

The Legislative Assembly and President Calderón Sol did not fare much better: 71% had little or no confidence in the Assembly and 74.4% had little (32.2) or none (42.2%) in the President.12 And, as in early 1994, 85.6% said they had little or no interest in politics. Only 40.7% said the country was democratic, less than the 45.5% who said it was not — a seven point negative shift from that found just before the 1994 election.

Asked who benefits most from the government, poll responses abounded in cynicism: 42.8% said the rich; 14.3% said "themselves;" 9.8% said "ARENA;" and 4.4% said "entrepreneurs" —a total of 71.3% had an evaluation of unfairness contrasted with 18.7% who said "everyone" benefitted.13

Voter turnout has been low. Total votes cast in March 1994 showed the first significant increase since 1984, but as a percent of those on voting lists, turnout was still lower than elections in the mid 1980s, and in the second round, the second lowest of the 13 polling days since 1982. Turnout in the 1991 and 1994 (first round) elections as a percent of those on the voting rolls was 44% and 51% respectively, compared to 86% in 1990 in Nicaragua and 82% in Costa Rica.14 It must be said that this is not simply a reflection of low regard and interest; a cumbersome voter registration process, distant polling booths and election day disorders prevented many from voting.

Contrasting with these indicators of discontent, one poll found evidence of increased political tolerance from 1991 to 1995 and a significant increase (from 22% to 33%) in those who combine high indicators of political tolerance and high evaluations of institutions and support for the system.15 This more optimistic picture is tempered by the poll’s data on system support. Overall the poll found no significant increase in support, and two variables showed statistically significant downward estimations of the two directly elected institutions — the "government" and the "Legislative Assembly."16

In short, despite a possible increase in political tolerance, there is substantial doubt about system performance and fairness in poll data. Some of the public dissatisfaction goes to basic issues — need for thorough change and perceptions that the system is not democratic.

Electoral Reform

The performance of El Salvador’s election system in 1993-94 came in for criticism from virtually every quarter. After nearly three years the ARENA dominated Assembly has refused to address the problems, despite recommendations from a Presidential commission. Rather, a new electoral law approved in the Fall of 1996 will make it more difficult for existing small parties to compete or to exist.17

The United Nations gave the 1994 election a mediocre passing grade. The ONUSAL mission lodged criticisms over many months about the conduct of the registration process. On election day, ONUSAL was distressed by disorder at many polling places preventing, it estimated, 25,000 voters from voting. Hemisphere Initiative’s estimates, and those of an Argentine polling firm (reliably reported to be ARENA’s survey team), were that as many as 87,000 voters, or six percent, may have been unable to vote.18

The Junta de Vigilancia, an official multiparty oversight committee issued many consensus criticisms, as did the U.S. and other foreign governments. Even President-elect Calderón Sol said that the process was deficient.

It was not difficult, then, for the left’s defeated Presidential candidate, Rubén Zamora, to win a pledge of serious electoral reform from Calderón Sol. After some delay, the Presidential commission was formed (with Zamora a member) and made recommendatinos in four critical problem areas (see Box).

In November 1996, the ARENA-dominated legislature pushed through electoral reforms, but none dealt with these issues. Rather, they vastly increased the number of signatures needed to form a party from 3,000 to 2% of the valid vote; required parties to gain 3% of the vote to maintain their legal status; and limited government campaign fund support to post election disbursements to parties which gain the minimum number of votes.

Election systems can err in making it too easy to legalize a political party or to spend public campaign finances without accountability. The Salvadoran electoral system has not been burdened by too many parties and a requirement of signatures amounting to 2% of the vote seems prohibitive. The central campaign finance problems were not addressed: one party dominates public and private financial resources; there is little accountability of private financing; and incumbents make excessive use of state propaganda through TV ads (limited to a few months before the election) trumpeting the accomplishments of government ministries.

It is difficult to avoid ascribing political motivations to the lack of electoral reform. In June, while there was still hope for some reform, a senior Western diplomat who holds a more positive view of the 1994 electoral process, noted that: "The incumbent party is not uncomfortable with the system which brought it victory." The existing registration practice and system for assigning polling places holds down turnout and disadvantages the poor.

A centrist political figure and leading businessman, Abraham Rodríguez, lodged a more serious charge in a June 1996 interview. In his view, the oligarchy of El Salvador, currently represented by ARENA, has never been willing to give up power, and did so only partially and briefly when forced to by war-time revolutionary challenges of the FMLN. The oligarchy, he warned, will resist change in an electoral system that has maintained it in power. That criticism goes to the heart of the issue of the extent of transition to democracy.

The late 1996 election law was quickly followed by an legislative attempt to control the Supreme Electoral Tribunal (TSE). A wing of the Christian Democrats (PDC) pledged to vote with ARENA on the NGO law (see below) in exchange for removing the Christian Democrat Magistrate on the TSE, Eduardo Colindres. Ronal Umaña had been contesting for control of the PDC (see section on PDC below). Colindres, along with the rest of the TSE, had voted to recognize Umaña’s opponent, Carlos Claramont, as head of the party. The removal of Colindres was without apparent constitutional justification as there were no hearings demonstrating that he had not fulfilled his duties. However Colindres was regarded as a Claramont supporter. His temporary replacement, Mártir Arnoldo Marín on the TSE was said to be an Umaña supporter. The vote against Colindres came the day before a PDC convention in which Claramont and Umaña would again contest for power. Needless to say, none of this either enhanced the independence of the TSE or, regarding the PDC, spoke well of its representation on it.19

ARENA also tried to remove the TSE President Jorge Díaz (whom ARENA had nominated but who apparently was too independent) and replace him with ARENA hardliner former vice president Francisco Merino, and apparently also wanted to replace Magistrate Felix Ulloa, whose history has been on the left. These efforts, coming only 4 months before an election, were apparently beaten back by opposition parties, international pressures and divisions within ARENA.20

Civil Organizations

‘‘We parties in the negotiation have finished our work. From here on the entire nation assumes the leadership of its own transformation."

FMLN Comandante Schafik Handal, Chapúltepec, January 16, 1992

‘‘We Salvadorans are coming out of a period determined by the most absolute distrust among individuals and among sectors. It is now the responsibility of us all to make a consistent effort to build trust and we believe that the peace accord is an excellent basis for doing so.

President Alfredo Cristiani, Chapúltepec, January 16, 1992

Analysts associate transitions to democracy with the expansion of a "dense" network of civic associations.22 In El Salvador a post-war decline in repression has enhanced opportunities for organization and expression. Non governmental organizations (NGOs) have grown, in no small measure stimulated by international aid, and public debate has expanded and been less polarized. For example, since the war, the conservative daily, La Prensa Gráfica employs guest columnists from a range of perspectives. But only 11% of Salvadorans in a June 1996 CID-Gallup poll had, in the past year, participated in any non political party group that promoted services or policies, raised funds or helped people.

But in some arenas there have been efforts from high placed sources to close down space. We look briefly at developments limiting organization and expression in three arenas: Unlicensed, tiny community radio stations have been silenced; NGOs were threatened by a government regulatory effort which leaves too much discretionary power in the most politicized ministry of the government; Trade unions weakened by a long history of repression face strong employer opposition and lax enforcement of labor laws.

Media closures

In December 1995 the police forcibly closed 11 rural community radios operating on extremely low wattage, and confiscated equipment. The government charged that the unlicensed stations were interfering with other stations’ signals. The stations denied the claim of interference, and said they wanted licenses. Given the weak signals and rural locations, the interference claim seems dubious.

The stations operated in communities where the FMLN has a presence. The director of ANTEL, the state telephone company charged with regulating radios, was Juan José Domenech who was also head of ARENA’s executive committee (COENA). The stations charged the closures were political. Though denying the move was political, Domenech lent credence to the charge by claiming that the FMLN planned to introduce 50 "clandestine" radio stations for the electoral campaign. (The stations had been openly broadcasting.) The Minister of Interior, Mario Acosta, who gave the orders to the police, has the reputation of being a hard-line opponent of any concessions to the FMLN.

September 1996 legislation would seem to preclude the stations ever getting licenses. It gives broad licensing rights to existing stations, while establishing heavy financial fines for those who broadcast without a license, and ignores all suggestions made by the Association of Participatory Radios (ARPAS) for inclusive legislation for low wattage stations. That the Supreme Court earlier ruled that confiscation of the radio stations’ equipment was illegal proved to be a pyrrhic victory.

The peace accords guaranteed the FMLN two radio frequencies. Both have had commercial success, perhaps bought by sacrificing political content for popular music programs. Rural community low-watt radio stations from any political stripe could easily be authorized with safeguards against interference to larger commercial stations. This would meld with other efforts, supported by the government and the US, to decentralize important activities to municipal and local areas.

In addition to legal controls, alternative media face difficult financial conditions. Two newspapers, Primera Plana and La Noticia closed their doors due to financial troubles, as did a news digest service, Flor de Izote. Primera Plana was a creative, insouciant paper begun by individuals associated with various left currents. It did not shrink from criticizing, even burlesquing, political leaders, including leftists. While the paper suffered from growing pains, it could not, given its political stance, secure sufficient advertising to make ends meet. So it had to rely upon international funds for its existence — not a reliable source in the long run.

Controlling nonprofit organizations?

During the civil war and in its pre-democratic era, El Salvador did not foster strong citizen organizations, and often repressed them. Non governmental organizations (NGOs) have grown since Chapúltepec, but largely as recipients of post war international aid.23

In December 1995 Minister of Interior Mario Acosta unveiled a proposed law to regulate NGOs. In uncompromising tones, he said, the new law would "bring the NGOs into line with the state of law", and would "avoid [them] carrying out actions in support of any one political party...and [avoid] their operations being used to launder drug money." The Minister predicted that the law would provoke "protests from leftists and from those parasites..who are used to usurping funds and doing nothing with them."24

This did indeed provoke an outcry, but from NGOs that covered the Salvadoran political spectrum, including the massive private sector think tank FUSADES (Salvadoran Foundation for Economic and Social Development). The proposal would have required all national and international NGOs to seek legal status before a "Superintendent" directly responsible to the Interior Minister. The Superintendent would have had wide-ranging discretionary powers, not only to vet applications, but to intervene in any organization’s internal finances, donations, expenditures and/or general functioning, and even to replace its top officers. Rights to appeal were minimal.

The proposal engendered organized opposition from an array of NGOs, which had hitherto had relatively little communication among themselves or, with the exception of FUSADES, little experience in "lobbying" government.25 Officials of FUSADES said the proposal invited a state invasion of private responsibilities. The "Superintendent" would add bureaucracy to the already top-heavy State apparatus, a direct contradiction of the ARENA government policy of reducing the size of the State.26

In an unprecedented show of unity an ad hoc NGO group worked hurriedly on their own counter-proposal. They recognized the need to replace obsolete and unworkable laws on forming associations. However their proposal flatly rejected the original government plan. Instead, it proposed that the (less politicized) Ministry of Justice organize a registry of NGOs to avoid "political interference" and help maintain a "technical, and not politically-based register," and have a process with ample and detailed rights of appeal.

Some forty international aid agencies began lobbying against the governmental proposal, and warned that unworkable measures could frighten off foreign assistance. Florentín Meléndez, a leading human rights lawyer working with the UN, criticized the fundamental conception behind Acosta’s proposal for failing to recognize that "the law should open and not close off the doors to every type of association, or organization." At stake, he said, was "not just the NGOs, but rather the future of the country’s democracy and socio-economic development."27

In the face of this pressure the government invited all parties to join a "mixed commission" to redraft the proposed law — and all previous proposals were immediately put on ice. Compared with the emotive rhetoric with which the whole issue was originally presented, such a move was a healthy, as well as a prudent decision, and perhaps reflected internal divisions between Acosta and more conciliatory figures.

Optimism began to dissipate, however, as the mixed commission became bogged down in its labor. In April the Interior Minister suddenly announced a new version of his own bill, which he claimed had been agreed upon by all parties involved in the commission. The NGO group immediately denied this claim. It appeared that things were back to the square one.

Finally in November, legislation was passed. It bore most of the features of the Minister’s April proposal, better than his original plan, but far from what the NGOs had been proposing. It improves upon the original proposal most markedly by eliminating the Superintendent and by reducing the discretionary powers of the Director General of Registers, as well as by establishing clearer and fairer procedural rules for registration. Lawyers advising the NGO sector emphasize the new bill gives legal form to a set of procedures already being utilized. But these existent procedures have been used to deny or delay applications for legal registration, a fact which has prevented NGOs from receiving funds from willing governments whose rules require donations to be funneled only through registered local NGOs.

Moreover, the Minister’s bill still fails to provide clear appeal mechanisms and time-bound rules. Neither does the law protect the legal status of foreign NGO workers — one of the basic demands made by international NGOs. The Ministry of Interior has been known to make it difficult to gain safe visa status for foreign NGO workers it does not like, including in a recent trade union case. The foreign NGOs argue that automatic migratory status, unconditional permission to work, and tax incentives would all form a major incentive for foreign assistance directed at El Salvador.

Trade Unions

El Salvador traditionally has been hostile to trade unions. Early in the war, with the U.S. supported rise to power of the Christian Democrats, rural unions associated with the center grew, in a period in which left union organizers were being brutally repressed. Later and since the war, repression declined markedly. The peace accords gave unions a formal place in the Forum for Economic and Social Consultation, a body of high-level union, business, and government representatives which was to discuss, debate, and propose laws pertaining to trade unions and the overall political and economic development of the country.

After a delayed start the FORO never moved beyond trade union issues and became increasingly paralyzed with the approach of the 1994 elections. Under some international pressure, the FORO did draft new legislation to bring El Salvador’s labor laws more in line with international norms. Unions considered the law which resulted weaker in language than the FORO’s proposal and weaker still in implementation.

Unions, with some exceptions, are in a weak state. According to a World Bank sponsored survey of managers in 206 Salvadoran enterprises, labor "obstacles related to contracting inflexibility, labor management relations, labor regulations, and union activity" were ranked the lowest among Latin American countries surveyed. Respondents ranked labor problems on a 1-4 point scale about 1.3 (between "not a problem" and "minor") compared to respondents in Brazil, Ecuador, Peru and Mexico who rated it between 2.7 and 3.0 (3 = moderate problem). Only 14% of enterprises had unionized workers, and only 6% had experienced a strike in the last five years. "Firing appears to be easy; the process averaged about three days..."28 Another study says that fourteen national union organizations have no more than 4.5% of the economically active population as affiliates, and but 3% are covered by collective bargaining agreements, many of which are quite weak.29

The construction sector has, by far, the highest level of unionization. As of 1993, about 11% of the Salvadoran employed urban work force were members of unions; the percentage in agriculture would seem to be considerably lower. However, in construction 80.1% of construction workers were in unions with leadership leaning to the right with ties to ARENA. While 54% of construction workers work under union contracts, less than 1% of agricultural workers and 7.4% of manufacturing workers do.30

Public-sector unions, some affiliated with the left, have been on the defensive as ARENA governments have downsized the government. A heavy blow was dealt in December 1995, when law 471 called for 15,000 government layoffs, with severance pay. The unions saw the plan as an effort to destroy the them, and countered with a proposal to protect a minority of the 15,000 jobs. They succeeded in saving some jobs, but, as a measure of union strength, it was telling that the unions’ position did not demand saving all jobs.

Unions have in some cases hurt themselves. FENASTRAS was the largest union confederation on the left, and perhaps the largest in the country, but is down to less than 10% of its former membership largely due to internal splits, lack of democracy, and strong allegations of corruption with funds from international sources. The unions in the aforementioned FORO were divided in dealing with the business representatives. In addition, FMLN leaders admit that the 1994-1995 schism in the FMLN severely weakened once-powerful public-sector unions.31

According to one international labor expert with ties to the U.S. government, the problem is not with labor legislation, itself, but lax implementation of the labor laws.32 In the rapidly growing maquila sector, employers, domestic and foreign, have often ignored the laws, dismissing those who attempt to organize.

Last year protestors charging abusive practices targeted a Taiwanese textile operation called Mandarin. The protests were met by firings. Then Mandarin workers found international allies who took full advantage of the fact that two of the major contractors of Mandarin were GAP and Eddie Bauer. Public protests against GAP in the U.S. became part of a larger campaign against well-known U.S. entertainment personalities who endorse products made in third world sweatshops. The GAP, with maquila contracts in several dozen third world countries, did not need noisy protestors outside its hip retail stores. GAP eventually put pressure on Mandarin to abide by Salvadoran labor laws, and to rehire workers.

The unionists then lost another round when some of the rehired labor leaders, who were generally inexperienced and had gone several months without work, agreed to resign with severance pay. GAP then sought to monitor the process. The government, in turn, appointed a commission to examine work conditions in the maquila sector, but in announcing the commission said that abusive conditions were the exception—a conclusion in advance of the study.

Several prominent international figures and national activists in El Salvador signed a letter protesting conditions at Mandarin and calling for international pressure. Sectors from the right end of the Salvadoran political spectrum, including the Minister of Interior, responded by calling them traitors who should be shot. Just last month, President Calderón Sol called international protestors "fronts" doing the bidding of "traitors" who attack the Salvadoran family. The Assembly, drawing analogies to economic sabotage created by the FMLN during the war, passed a resolution against CISPES, a U.S. group active in the Mandarin/GAP campaign.33

Crime and the Justice System.

El Salvador has been overwhelmed by crime. It has the highest murder rate in the Western Hemisphere, well above that of Colombia. Everybody talks about crime and has personal stories to relate, in addition to the more spectacular crimes luridly portrayed in the media. In an October 1995 IUDOP poll 37% said crime was the principal problem (20 points ahead of the second ranked problem); a June 1996 IUDOP poll listed combatting crime as the most important task for the government. A January 1996 CID-Gallup poll had 95% rank crime as "very serious", ahead of economic problems.

Some crime is politically motivated, some involves settling scores from the war. Much, particularly violence within families, is a consequence of war-related stress traumas. But it is not simply a post war phenomenon. Crime pays, and legitimate economic opportunities are limited

Emboldened by polls showing citizen concern about crime, hardline forces successfully forced the government to pass tough anti-crime laws earlier this year. In March, business people in the city of Usulután called a day-long strike to protest government inattention. Concerned about losing support on its own right flank, the government passed legislation in 4 days. The bill reduced the rights of defendants by permitting extra judicial confession in some circumstances and forms of preventive detention. The already stuffed jails quickly filled to overflowing. The law has been challenged in the Supreme Court, so far without result. In late 1996, ARENA deputies narrowly pushed through the first round approval of a constitutional amendment to reinstate the death penalty.

The Police

In these circumstances, a crack, veteran police force would be challenged. The National Civilian Police (PNC) was born as the crime wave rolled in. Crime, and a diversity of political pressures have shaped the development of the PNC over the last few years.

The peace accords envisioned a professional, apolitical, and rights-based police force, using a community grounded presence to prevent crime and employing modern investigative techniques to solve them. ONUSAL, and international police training groups, from the U.S. and Spain in particular, have pushed this conception.

There are other conceptions that have been competing for influence. Some in the business community wanted a force whose leadership would address crimes they wanted solved, while avoiding white collar crime. Some involved in war-time death squads or corruption wanted to assure their continuing influence in a new police force. Some of these forces overlap, and their various efforts to undermine the police have had a cumulative impact.

Finally, the PNC has been deeply affected by the first Minister of Public Security, Hugo Barrera, a strong-willed figure. He has undermined the chain of command by supporting policing groups operating outside police command structures.

Thus the PNC has been buffeted by cross pressures and, inevitably subject to criticism from every quarter, including a public attitude that cooled rapidly after initial rave reviews.

Given the context and problems it is important to note that much has been accomplished:

• The old security forces are gone.

• The new police academy has graduated over 13,000 agents, after start up delays and lack of cooperation from the military.

• A police career law now governs promotions.

• A new criminal investigations unit was finally formed, though it has problems.

• An internal disciplinary system has punished officers who violate human rights and police norms.

• An inspector general was finally appointed.

• Police have performed valiantly on many occasions, and the force has proven its mettle by sustaining an extraordinarily high level of casualties in El Salvador’s vicious criminal vortex.

But the PNC has serious problems:

• the criminal investigations unit has many weaknesses and the success of the PNC depends on the success of this unit.

• irregular police units have been created that report out of the chain of command to senior officers.

• internal disciplinary mechanisms have been established, but they have thus far been weak and face an increasing case load.

• a lack of modern communications and information processing equipment leaves the PNC at a severe disadvantage in combatting sophisticated, international criminal operations.

• Leadership problems have emerged in a variety of forms.

These are not a series of isolated difficulties, but reflect a more fundamental problem. The PNC mission continues to be in dispute — principally between those who want a community based, professional force with high respect for human rights, and traditionalists who believe only a repressive model can effectively deal with crime. These competing visions continue to battle for control of the PNC.

A dominant issue is the leadership of Hugo Barrera. He has important strengths. Not a member of ARENA, he has demonstrated political independence, and willingness to take strong action. For example, the Minister has ordered the arrest of military personnel accused of criminal activity, unprecedented in the old El Salvador.

But he also has serious weaknesses. Approaching the PNC as if it were his own personal security force, he has interfered with day-to-day police actions and has created irregular investigative units outside the police chain of command. For example, an "analysis unit" of 100 members (forty of whom were not police officers) existed for over a year. Many of the 40 were former members of the old National Police (PN) who failed the entrance exams for the new PNC. A former PN captain on the Minister’s personal payroll was the de facto head of the "analysis unit." He, and others, supported formation of local vigilante neighborhood groups — darkly reminiscent of repressive groups which the military sponsored before and during the war.

The Minister’s personalistic approach undercuts the institutionalization of the PNC and leaves it prey to attempts to improperly influence it, now and in the future.

PNC problems cannot all be laid at the feet of the Minister. Those who support the professional model of the PNC have done too little to build public and political support for their conception. Spain and the U.S., along with the UNDP and the UN Observer mission have pushed for professionalization, but their efforts have been hindered by competitiveness and lack of communication, weaknesses quickly sensed by their adversaries in the policy battle over the PNC. Serious doubts about the long time viability of their model will persist unless a strong professionalism develops within the PNC, or the model gains public support.

Public support for the PNC waned when human rights complaints against the PNC went up (though most were minor), the crime wave crested, and the anti riot police were seen on television breaking up demonstrations of war veterans with excessive force. The PNC, however, did fairly well in polls compared with other institutions, ranking ahead of the military, the Assembly, the President, and political parties.

The police are isolated. Police officers were to live in the communities where they worked. In the rush to deploy the force, officers were housed in barracks, often working in communities far from where they lived. Police continue to live in barracks, with no plans for community deployment. This has cost the PNC public support and perhaps has negatively affected police behavior.

The United Nations observer mission carried out two major evaluations of the PNC. In October 1995 it advised President Calderón Sol that the PNC needed corrective measures to "avoid running the risk of losing its status as an institution at the service of the community, converting it instead into a new structure of power, which is closed and with growing signs of authoritarianism." It’s central recommendations:

• A National Commission on Public Security to design and oversee plans to correct problems;

• international technical assistance coordinated through the UNDP;

• review of all senior officers, including investigations of criminal involvement or past ties to the prior State Intelligence Service;

• evaluation of the Criminal Investigations Division;

• dissolution of all irregular units;

• steps to improve the quality of cadets accepted in the Police Academy.

There have been some results. Two irregular units — the anti-kidnapping unit, and analysis unit — have been dissolved, although their personnel hold positions of responsibility in the PNC or the civilian structures of the Ministry of Public Security.

The successes of the PNC internal disciplinary system have been marred by wide variations in decisions suggesting a lack of impartiality. A small staff and inexperience have contributed to the problems. With 1200 cases pending, they process 120 cases a month.

Minister Barrera appointed the PNC Inspector General in October 1995 after a long dispute with Human Rights Ombudsperson Victoria Velázquez de Aviles, whose approval he needed. The new Inspector General, Victor Valle, former presidential candidate for the social democratic National Revolutionary Movement, has had political conflicts both with the Minister and with the Sub-Director for Operations of the PNC. In June 1996, he submitted his resignation, due to a "lack of respect", but subsequently withdrew the resignation.

President Calderón Sol did create a Public Security Commission with high profile civilians including well-respected former peace negotiators from the government and the FMLN, David Escobar Galindo and Salvador Samayoa, and business leader Luís Cardenal. Though slow in getting its bearings and a budget, the Commission has focused on the need to develop the PNC as an institution, and for long range planning. Its planning proposal recently went to the President.

The role of the new Public Security Commission could be crucial in advancing the professionalization of the PNC and bringing the forceful Minister around to that vision. Should it develop a unified voice it might help to stabilize the PNC, push back forces and criminal elements that seek to subvert it, and broaden public support. Its members have clout, but also lack time for the project.

But the problems are vast and interrelated. Even a PNC of much expanded effectiveness would be undermined unless the terrible prison system is improved and the judicial system reformed. A culture of crime is fed by an economy which lacks jobs and opportunities for advancement, and an ongoing history of corruption. The pressures on the police to revert to a repressive model may be overwhelming.

The Judicial System

The Salvadoran judicial system continues to be weak, though important steps have been taken to professionalize the judiciary. Many judges remain poorly trained, inefficient, and open to corruption and political influence.

Coordination between the police, the public prosecutor, and the courts is deficient. Cases are processed extremely slowly; conviction rates are low. And, until recently, the legislature bottled up laws to modernize criminal procedures and protect the rights of defendants.

The Human Rights Ombudsperson’s Office has become an important force for police and judicial reform. This has subjected chief Human Rights officer Velázquez to public criticism from Minister Barrera and others. Her Office’s 1997 budget has been cut 10%, and she recently reported receiving death threats.

The Salvadoran judicial system had been highly centralized and politicized. The Supreme Court used to be named by a simple majority of the Assembly for five-year terms, thus giving the majority party extremely close links to the court. The Court in turn appointed all other judges, controlled their budgets and exercised disciplinary power. Political affiliation and family influence were key. This system led to corruption and abuse.

The peace negotiations produced a 1991 constitutional reform requiring a two thirds Assembly majority to approve Supreme Court nominees and set staggered terms of 9 years. Implemented in July 1994, the new procedure resulted in a Supreme Court which has been, by far, more professional, politically independent and pluralistic than its predecessors. The National Council on the Judiciary (Council), an auxiliary body that nominates judges, was also strengthened.

However, the system remains overly centralized. The 1993 Truth Commission report recommended having the Council appoint and remove lower court judges, and remove to another entity the power to license attorneys. The Ministry of Justice proposed such changes in 1994, but the proposal has languished in the Assembly.

In 1994 the Council evaluated judges on behalf of the Supreme Court. It focused on administrative issues, not on respect for human rights and corruption. Judges objected, arguing that the evaluators were unqualified. By mid-1996, the Council had carried out three evaluations — the last on justices of the peace. The Council recommended that 11 of 320 justices of the peace be removed, but the response of the Court is not yet clear.

The Supreme Court established a Department of Investigations to look into complaints against judges, including complaints received from MINUSAL, the UN mission. According to Chief Justice José Domingo Méndez, the Court suspended thirty judges in the new court’s first 18 months. While these steps are positive, they are still too slow given the magnitude of the problem.

A Judicial Training School began seeking to enhance case management and legal understanding. An evaluation of the school is underway.

The Salvadoran Ministry of Justice, with assistance from USAID, began to draft modern criminal procedures legislation several years ago. These included a new family code, a juvenile justice code, new criminal procedures, penal procedures, and sentencing codes. Family and juvenile codes were legislated in 1995.

Critics have charged that the newly functioning family and juvenile courts are excessively lenient with juvenile offenders. But statistics from the Judicial Reform II project (supported by USAID) show that a greater proportion of cases reach the sentencing stage in juvenile courts than in the unreformed criminal courts, and 75% of those result in convictions, compared to 50% in criminal courts.

The Truth Commission recommended constitutional reforms that would strengthen the right of habeas corpus, the right to appeal improper government actions, and a defendant’s right to an attorney from the beginning of criminal proceedings. Sixteen Constitutional amendments were approved in April 1994. To become effective, they must be approved a second time by the current legislature, before its term ends in May. Two of the sixteen were easily ratified. But ARENA deputies refused to support provisions that abolished all forms of extra-judicial confessions, and that guaranteed the right to an attorney from the moment of arrest. The FMLN deputies argued that all fourteen of the amendments had to be approved together. The process stalled.

The United Nations mission in El Salvador viewed the amendments as binding commitments that arose from the peace accords, and pressed the Salvadoran government to have them approved. Secretary of State Christopher in a speech last February to the Assembly lent U.S. support. But ARENA deputies, resisted, arguing that the amendments coddled criminals. They might be appropriate for Switzerland, they said, but not for El Salvador.

After a visit by UN envoy Alvaro de Soto, the FMLN agreed to permit some Constitutional amendments to be addressed separately. This broke the log jam; five amendments were unanimously ratified. These reduced the period of judicial detention, allowed indemnification of victims of judicial mistakes, defined the procedure for selecting the National Council on the Judiciary, and guaranteed habeas corpus when authorities violate a person’s dignity.

The other nine were reformulated, including compromise language which permits extra-judicial confession to serve as evidence if counsel was present when the statement was given. The changes were approved by the Assembly, and must now be ratified by the next one.

Similarly, secondary legislation on sentencing and penal codes has been resisted by ARENA deputies. They objected to strengthening the presumption of innocence and the abolition of preventive detention. Following FMLN concessions, the criminal procedures code was passed in December. Overall, the new code modernizes procedures and protects the procedural rights of defendants and victims.

Political Parties

‘‘The positive result of the negotiation is not the only product of value to emerge from this constructive and concerted effort. The very method of dialogue, of reasonable understanding, and of a sensible and effective search for solutions to extremely difficult and acute problems, in and of themselves, have enormous significance for the development of Salvadoran democracy."

President Alfredo Cristiani, Chapúltepec, January 16, 1992

‘‘The signing of the Peace Accord marks the culmination of a decisive stage in the long and heroic struggle of the Salvadoran people for their ideals of liberty, justice, democracy, human dignity and progress. It has been the indomitable rebellion of thousands and thousands of Salvadorans, in the main young people and also children, like those of Chapúltepec, who have brought the nation to make a pact based on this new consensus that assures all its children equal rights of participation in the conduct of the country."

FMLN Comandante Schafik Handal, Chapúltepec, January 16, 1992

Political parties have often played a crucial role in transitions away from authoritarianism.34 In El Salvador the 1980s saw the end of military-dominated electoral politics and the emergence of a new party system. The Christian Democrats, with U.S. support, became a national power; the new ARENA party evolved from a paramilitary group to a muscular electoral political party; some left political parties entered the 1989 electoral contest, and the FMLN participated in 1994.

This new party system was born in war-time conditions and remains volatile. The political party "market place" has shown a tendency toward monopoly. Small center and right parties have come and gone. The Christian Democrats have diminished drastically for reasons related to the war, loss of international sponsors, and seemingly interminable succession crises. Small left parties have never really had the resources to grow. The FMLN has encountered profound difficulties changing from warfare and pact making to a peacetime electoral organization. ARENA enjoys a near monopoly of financial resources and the momentum of a string of electoral victories.

In the last two years ARENA has experienced sharp internal struggles while managing to present a united front at its 1996 annual convention. It’s support has declined in the polls. There is a perception among voters and even among elite party supporters that President Calderón Sol has been less than a forceful public figure. Despite a fall in popularity, ARENA seems to believe it can win a head to head competition with the FMLN.

Poll data show an increase in FMLN support, though the data are inconclusive with very high numbers of people not revealing their preferences. But the FMLN cannot match ARENA in money, and is still behind in building organizational resources. While it finished second in 1994, it was a distant second.

Other opposition parties have done little to convince Salvadorans that a valid centrist alternative exists. In various stages of disarray, the opposition since 1994 has been marked by party splits and an inability to fashion electoral coalitions.35 Opposition parties have occasionally made coalitions in the Assembly on votes requiring more than a simple majority. However, ARENA has also been successful in getting a few necessary votes to attain a majority from its traditional ally the PCN, conservative members of the Christian Democrats and even former guerrilla chief Joaquín Villalobos’ Democratic Party.36

Fourteen years after the first all civilian election in decades, the military enjoy higher regard in the polls than political parties or the Assembly.37 Party infighting seems to be between a very small number of people (not always visible, particularly in the case of ARENA) over issues that remain obscure to the public. When the backbiting is made public, citizens view the same small group of political leaders night after night on the evening news. In short, party politics appears to be a contact sport available to insiders. Outsiders — the public that is — increasingly appear to want no part of it.

The stakes of the March 1997 elections for Legislative Assembly and Municipal Councils go well beyond a calculus of control. If the elections consolidate a de facto one-party electoral system the democratic transition will be set back, particularly if the elections reveal continued flaws in the electoral processes, low turnout, and if the internal workings of the dominant party remain hidden and, by reputation, not particularly democratic.

The health of democracy depends on more than the vigors and banalities of an election campaign or results. It depends as well on the internal health and practices of the parties, and whether parties deal with issues affecting the lives of their constituents in a meaningful, effective way.

A review of the vicissitudes in these competing camps in 1996 reveals that the overall slide in the parties’ credibility is rooted in serious internal contradictions, in strategic false steps, and in the inadequate exercise of internal democracy and public diplomacy toward their supposed constituents.


Despite this very private organization’s efforts to keep them quiet, struggles within ARENA have increasingly had a public face. Both in 1994 and 1995, the annual election of ARENA officers made evident a three-way power struggle in the party. The 1994 contest indicated that the faction loyal to former president Alfredo Cristiani was losing power, perhaps to President Calderón Sol. By 1995 however, events indicated that a dangerous third force was making a comeback within ARENA.38

For several years a hardline faction of the party had grown increasingly disgruntled. Founding party leaders from the military and landowning groups in both western and eastern El Salvador believed that the party had been taken over by country-club technocrats whose wealth stemmed as much from commerce and finance as from land. This old guard, composed of people close to party godfather Roberto D’Aubuisson, had been disadvantaged not only by the doling out of quotas of party power, but also by President Cristiani’s economic policies. According to party insiders, the selection of Calderón Sol as candidate, and his campaign’s inflammatory rhetoric in rural areas, was a bridge to the old guard.39

At ARENA’s 1995 convention, the far-right made a major bid to grab center stage. Although the party convention passed without public indications of a row (albeit without Cristiani present), the new lineup in top party bodies was startling. Cristiani maintained a foothold on ARENA’s 6-member Political Commission, but he was forced to share space not only with Calderón Sol but with some figures from ARENA’s shadowy past whom the peace process had apparently relegated to the sidelines. Key among these were former Supreme Court president Maurício Gutiérrez Castro, ex-vice president Francisco Merino, and Alfredo Mena Lagos. Mena Lagos, together with Roberto D’Aubuisson, founded the clandestine precursor to ARENA that was heavily implicated in death squad activity as the country moved toward civil war.

The acridness of the battle led the rightwing newspaper El Diario de Hoy, traditionally close to ARENA, to warn against waging a naked power struggle in the convention hall. Admonished the paper, "judging from the sidelines, COENA (the National Executive Committee of ARENA) is turning into a stage for internal party quarrels, and some think, into a sure launching pad for the presidential succession." Noting that "the latest polls are anything but encouraging about ARENA’s credibility...this is a luxury ARENA cannot afford given the tremendous risks it implies for the party’s long-term future." (Diario de Hoy, September 21, 1995).

Accompanying this 1995 fight was an attack launched by ARENA defector Kirio Waldo Salgado, whose vitriolic attacks on the FMLN in Diario del Hoy reportedly won him many favors in the military. Beginning with spectacular charges of corruption against Calderón Sol appointees that ultimately forced the resignation of two cabinet ministers, Salgado then attacked ex-president Cristiani for benefitting from the 1991 bank privatization. Salgado also accused ARENA president Juan Domenech of illicit dealings as head of ANTEL.40

In 1996, developments inside ARENA signaled increased volatility. In January, the police leveled charges of selling documents and collusion with illegal immigration rings at several ARENA mayors. Initially, party president Domenech and San Salvador Mayor Mario Valiente hardly defended the mayors, asserting that no one was above the law. Within days, however, sectors of the ARENA youth branch and other mayors supported the defendants and portrayed the arrests as an attack on loyal ARENA officials, implicitly criticizing Domenech’s bland response. The party brass immediately called for an investigation of "excessive police behavior", and the Assembly passed legislation granting mayors limited immunity from prosecution.41

In March, party hardliners linked to traditional landed interests in Usulután launched the aforementioned protest against crime accompanied by unspecified threats. An angry Calderón Sol retorted that he would not be intimidated; but he sent hard line legislation to the Assembly within 48 hours. It was swiftly passed.

On April 25, a car bomb exploded near the residential enclave in the foothills above San Salvador where former president Cristiani and a few close allies have their highly protected mansions. A month later, a considerably more powerful bomb exploded outside a Cristiani dominated insurance company. Then Cristiani’s mother was robbed in Guatemala of jewels and money; according to a reliable source, important Cristiani documents were also taken.42

These were not the first acts of violence directed at people around Alfredo Cristiani. In September, 1995, just prior to the ARENA convention, assailants had kidnapped 16-year-old Andres Suster, the son of former ANTEL director Saul Suster, who is a business associate of Cristiani. It was later revealed that his captors kept Suster imprisoned in barbaric conditions on a farm in Guatemala. He was not to be released for a year, again just prior to the ARENA convention.

By July another former D’Aubuisson intimate, Antonio Cornejo Arango, emerged as a spokesperson for a faction of aggressive ARENA hardliners. He assailed the party for losing its way by favoring a small elite over the interests of the nation.43 Cornejo’s complaints soon turned into a call for the resignation of ARENA president Domenech. Domenech countered that debate was helpful and asserted that while differences existed in the party, there were no divisions. The campaign against him did not abate, however.

Finally in August, a nephew and business associate of Domenech was murdered, gangland style, for no apparent motive. Shortly thereafter, articles began appearing in the newspapers charging that the ARENA president, reputed to be a millionaire several times over, had illegally imported a stolen luxury car and was also involved in drug-running. There seemed to be convincing evidence on the car. Though Domenech had responded to Cornejo Arango’s earlier calls for his head that he would obey only the unanimous vote of his party, he resigned unceremoniously in September.

Some of the violence chronicled in the above narrative may be part of El Salvador’s spectacular crime wave and have nothing to do with ARENA infighting.44 But the violent nature of ARENA’s history has inevitably fed speculation that intra-elite rivalries have turned ugly. Theories abound. In addition to a fight over party control, some see a struggle to control the privatization of public utility companies like ANTEL, and in general to control government economic policy. Both Cristiani and Domenech were reputed to be among those aspiring to acquire pieces of the national phone company. A budding rival, however, was Mena Lagos, who was appointed in December 1995 as national commissioner for privatization and modernization of the state. According to Salvadoran analysts, two other extreme ARENA figures join Mena in his bid for ANTEL: Orlando de Sola (recently named to head a new Superintendency of Energy and Communications) and Enrique Altamirano of Diario de Hoy.

During 1996, Mena Lagos has been critical of the 1991 bank privatization (in which Cristiani interests got control of Banco Cuscatlán, the largest bank) and of the monopoly power exercised by the country’s economic and financial elites, even attacking the monopoly of regional air service enjoyed by El Salvador’s TACA Airlines, which is headed by Vice-President Enrique Borgo. Although the competing ARENA factions agree on promoting the country’s image abroad (see section on Economic Policy below), current indications are that they remain at loggerheads over the spoils of public sector divestments and other policy issues.

Despite these signs of high stakes rivalry, ARENA by its September 1996 annual conclave, composed its differences in public. Few changes in the lineup of party leaders occurred, the most important being the ascent of Assembly head Gloria Salguero Gross to the post of ARENA president. This may not have markedly shifted the internal balance of party forces—Salguero is said to play the role of conciliator between rival interests. But others say she has historic ties to the extreme rightwing parts of ARENA. Meanwhile, the commotion at the convention came from Cornejo Arango, who arrived with a contingent of 250 followers demanding unsuccessfully that someone resign and give him a spot on COENA.45

The impact that the internal divisions will have on ARENA’s 1997 electoral performance is hard to predict. It could affect candidate selection, particularly in view of the dozens of ARENA mayors who are currently laboring under clouds of corruption. Given hints that ARENA will run a strong, slashing campaign, the key question is the extent to which the party’s anti-Communist 1994 message retains its resonance, enabling the party to win back the support that has recently slipped away. A CID-Gallup poll in October, 1996, showed ARENA with 21% of the vote to the FMLN’s 14%, while a whopping 53% remained undecided. ARENA faces small defections to Kirio Salgado’s party and to Cornejo Arango, who has deserted to the PCN, the former electoral vehicle of the military, and an ARENA legislative ally of declining strength.


The FMLN must surmount several challenges in order to make inroads into ARENA support. These include forging an effective party unity, revising its pitch to Salvadoran voters (particularly those in populous urban centers) and mounting an effective campaign organization despite having little money. In 1995 the FMLN appeared to have made some progress toward the first goal but at the cost of consuming most of its energies. In 1996, the party announced it would put virtually all of its efforts toward electoral matters which would include an effort to deepen party unity.

In the party’s December 1994 convention, the three forces remaining after portions of Villalobos’ People’s Liberation Army (ERP) and Eduardo Sancho’s National Resistance (RN) left the FMLN — the Popular Forces of Liberation (FPL), the Salvadoran Communist Party (PCS), and the Revolutionary Party of Central American Workers (PRTC) — announced a decision to fuse their respective forces into a single body with a unified leadership. They subsequently dissolved the separate parties and have united local, departmental, and national party offices. These steps prepared the ground for another party convention in December 1995, the first in which delegates were chosen by local party bodies without the use of the classic quota formulas used to divvy up positions in the FMLN’s five original groups.46

FMLN leaders interviewed in early 1996 claimed that the unification drive had been successful. As evidence of this trend, two former PCS leaders elected to the FMLN’s National Council in December claimed they had defeated opponents from the FPL in territory dominated by FPL followers. This trend, they insisted, had dispelled fears of hegemonism by the more powerful FPL, whose numerical weight in the scaled-down FMLN is unmistakable.47

New party rules permit tendencies — temporary or permanent groupings organized along political-ideological lines — to exist in the FMLN as long as they adhere to party policy and keep their proposals in-house. Affiliation along party lines seems to have been replaced by informal groupings around key figures. The most important are Facundo Guardado, an FPL military chieftain during the war, and deputy Eugenio Chicas ("Marcos Jimenez"), a leader of the National Resistance (RN) who threw in his lot with the FMLN. The most Senior party officials — Salvador Sánchez Ceren, Nidia Díaz, Schafik Handal — are not associated with tendencies.

At the December 1995 convention Guardado made a strong bid for leadership with Chicas as his principal rival. The election of the 550 voting delegates, not surprisingly, resulted in a majority of ex-FPL members, so Guardado might have expected easy victory. But the voting for the FMLN’s fifty-four-member National Council left Guardado in tenth-place, indicating a lack of sufficient support to vie for the post of general party coordinator.

The National Council in turn elects the fifteen-member Political Commission. To avoid a subsequent battle inside the Council, other party leaders persuaded previous coordinator Salvador Sánchez Ceren to postpone a planned retirement and continue serving as the linchpin of party unity.

The stakes of the intra-party battle are not easily discerned. In addition to personal ambitions, differing conceptions of what the new FMLN should look like appear to play a strong role. Some supporting Chicas describe the Guardado faction — not the whole of the FPL — as committed to a traditional, vertical, and even "Stalinist" notion of party organization, to which they counterpose their own modernizing and democratic vision.

Unwilling to be cast in the role of troglodyte, Guardado himself argues that his criticisms at the 1995 convention — to the effect that the emerging party structure reflected tendencies toward accommodation to the role of tame opposition — were aimed at ensuring that the FMLN would continue to serve Salvadoran’s real needs, not just those of FMLN leaders. Guardado also argued in June in favor of tactical alliances with Abraham Rodríguez’ new centrist party and for the FMLN to be more open, less traditional and rule bound in acquiring new members.

Guardado plays a key role on the election secretariat, and the party says that it is open to local-level election alliances, and that it does not rule out a grand anti-ARENA alliance in 1999.48

Further steps to democratize the party were employed in the 1996 selection of candidates for the March elections. The election features a national slate of candidates to fill twenty of the 84 Legislative Assembly seats, with the remainder selected from Departments based roughly on population size. For the 1994 election the FMLN used a top down selection process with candidate quotas going to each of the five factions in proportion to overall strength and strength within a particular department. This year, Department candidates were selected by secret ballot in Department conventions, though delegates to conventions were primarily veteran FMLN members. For the National Slate, the 54 member National Council ranked candidates from among 13 of its members who put themselves forth as candidates. In all, eight women candidates were placed on national and departmental slates in positions where their chances of victory are good.

The FMLN now dwarfs other opposition parties. It claimed in early 1996 to have 33,000 card-carrying members, and a short-term goal of expanding the number to 60,000. Year-end estimates by party leaders differed markedly ranging from 40,000 to 80,000 — the wide range suggesting perhaps less than cohesive organizing.

There are indications that the FMLN has not mastered the difficult tasks of being both a cadre organization, which tends to close it off from society, and one which must get enthusiastic "volunteer" work from "cadre" on whom it has a weaker hold than during the military discipline of the war years. Veteran members have had to convert to civilian life and to survive in a difficult economic world in which their military past is not a particular advantage.

According to one source outside the FMLN, the party is not yet organized for election day, still lacking several thousand representatives to staff and poll watch at some 8000 voting tables. This is crucial because their chief opponent thoroughly blankets polling places with staff, and aggressive poll watchers festooned in party colors.

One FMLN source told HI that the FMLN has serious financial problems, with a steep debt and rent payments in arrears. In December, high ranking party members went on a "commercial delegation" to China, Vietnam and North Korea with an announced intention as serving as trade intermediaries between Salvadoran businessmen and the FMLN’s contacts in those countries. The party hopes "commissions" for these dealings will add substantially to party coffers.

Backed by some poll evidence, FMLN leaders seem optimistic of increasing the number of municipalities it controls from 12 to perhaps 30 of 262 municipalities. In 1994 it won 21 deputies in the Assembly, but then lost seven when the ERP and RN split off. Party leaders predict that it will win between 23 and 30 of the 84 seats up for election in March.49

Center Parties50

Democratic Party. When former guerrilla leader Joaquín Villalobos took his forces out of the FMLN, his stated intention was to establish a firm foothold on the political center. By 1996, this insistence on making a fraction of the left palatable to the holders of economic power, had earned the newly-baptized Democratic Party or PD more opprobrium than dividends and some hard-won lessons about the politics of centrism.

In an attempt to keep their party in the limelight, distinguish it from its former allies in the FMLN, and, they insisted, to infuse new life into a flagging peace process, PD chief Villalobos and his associates signed the so-called Pacto de San Andrés with president Calderón Sol in May 1995. According to some sources, Villalobos himself cobbled together the Pacto including many elements that other parties had desired.

San Andrés committed the PD to support a gamut of measures aimed at modernizing the Salvadoran state. Among the more controversial items, for leftists, were the privatization of public services, tariff reduction, and amendments which would reduce civil service protection and introduce greater flexibility in labor relations and the labor market. In return for these political favors, ARENA offered the PD a series of promises that the government would invest in human development, promote genuine free competition, combat tax evasion and corruption, and protect the consumer, among other items. The most important element in the Pact was a steep increase in the hated IVA tax, a centerpiece of Calderón Sol’s economic plan.

At the time Calderón Sol’s political fortunes were sagging following the failure of his early 1995 economic plan. Eduardo Sancho, former National Resistance head and number two in the new party, argued that the Pact was designed to "give continuity to the Chapúltepec accords" — which PD leaders argued were "exhausted" — endowing the nation with "a socio-economic matrix that permits different sectors and interests to unite little by little in a still polarized context..."51

In June 1995, the PD alone voted with ARENA for an increase in the VAT tax from 10% to 13%, later assisted ARENA in rubber-stamping the 1996 budget, and lent its imprimatur to the proposed NGO control law (while charging that the FMLN funneled international NGO money through national NGO fronts to support the party).

A bold gamble to raise the party’s stock as leader of the overall opposition, the Pacto de San Andrés collapsed around the PD when ARENA redeemed few of its specific promises. Confirming the obvious, a party spokesman interviewed by HI in February 1996 admitted that the premise of the PD’s decision to prop the government up at crucial junctures — that a modernizing element existed in ARENA which would keep its word to its allies — had turned out to be erroneous and naive.52

Late 1995 and 1996 polls showed the PD barely registering, while the prestige of leader Villalobos plummeted.53 He chose temporarily to quit the scene, attending Oxford University for a year. A visit to party headquarters in early 1996 turned up a small campaign strategy meeting conducted by an overburdened leadership that admitted its inexperience in electoral politics.

Christian Democrats. El Salvador’s once powerful Christian Democratic Party (PDC) split in the aftermath of its 1994 election debacle, in which it came in third and gained just eighteen seats (down from 26) in the Legislative Assembly. Its 1994 misfortunes were preceded by a punishing fight for the party nomination amidst cries of fraud by the losers. Dissidents took the party leadership to court a mere three months before the election. Similar struggles embroiled the party before the 1989 presidential election, when ailing, incumbent President Duarte could not legally be a candidate. Intramural fights have contributed mightily to a precipitous electoral decline: In 1994 Presidential contender Fidel Chávez Mena gained but 28% of the votes won by Duarte in the 1984 election, and less than two thirds what he himself had won in 1989.

The conservative leaders who emerged in control of the rump PDC in 1995 vowed to decentralize and rejuvenate the party to make it relevant again to Salvadoran voters. But subsequent months have witnessed continued wastage of the PDC’s capital, culminating in still another protracted leadership wrangle. The party Assembly bench divided in 1995. In an annual convention held in December 1995, secretary-general Ronal Umaña insisted on revising the party’s statutes so as to eliminate the primary elections that in 1993 had made the PDC unique among Salvadoran parties. The rules change gave the national leadership final say over candidacies for deputy, producing what other leaders regarded as a dangerous concentration of power.54

Other PDC leaders retaliated by engineering Umaña’s expulsion from the party leadership by the PDC honor tribunal. Umaña riposted in a manner typical of past intra-party battles — he organized his own honor tribunal to expel the expellers. The struggle hit a new low in January 1996 when some 100 protesters attempted to wrest the PDC’s headquarters from the Umaña group. Shots were fired, and embarrassing photos of PDC dissidents hurling themselves against the steel door of party headquarters played on Sunday-edition front pages.55

The decision over which PDC leadership and honor tribunal is legitimate went to the Supreme Electoral Tribunal. In June it declared against Umaña, and in favor of Carlos Claramont who according to Umaña was allied with a former Umaña ally and magistrate of the TSE Eduardo Colindres.56 By November Umaña had gained ARENA support to oust Colindres from the TSE, the day before another PDC convention was to open, apparently in exchange for supporting ARENA’s NGO law (see above). Once again the convention was marked by struggles over control of the party and candidate nominations. Claramont appears to have emerged victorious, but with Umaña hoping for TSE support from Colindres’ replacement.

Though it maintains an organized, aging base of support at the local level, particularly in rural areas, the most recent division and the withdrawal of financial support by Germany’s Adenauer Foundation do not augur well for the party’s chances to reverse a secular decline into irrelevance.

The Renovation of Christian Democracy. Another contender emerged on the political scene in early 1996 — the Party of Social Christian Renovation (PRSC). Formed out of yet another split in the PDC in 1994-1995, Renovation claims to be faithful to the original ideals that inspired the birth of Christian Democracy in the 1950s — social justice and political democratization.

Initial optimism stemmed from the election of Abraham Rodríguez as president in the party’s first convention, held in February 1996. A founder of the Christian Democratic Party and a staunch, long-time opponent of military rule, the 75-year old Rodríguez has more recently played a key role in El Salvador’s transition as a member of the Ad Hoc Commission charged by the peace accords with the dangerous task of recommending to President Cristiani the purging of the Salvadoran officer corps of human rights violators. Alone among opposition leaders, he was looked upon in 1993 as a figure capable of rallying disaffected Christian Democrats and other centrists into a broad alliance capable of combatting ARENA and chipping away its support, but he lost the PDC party nomination to Chávez Mena.

In addition, Rodríguez possesses an asset the rest of the opposition lacks — entree into the closed world of the Salvadoran economic elite. He is an executive in the Salvadoran multinational packaging producer SIGMA and a shareholder in the private bank BANCASA. At a moment when diverse entrepreneurial sectors are at odds with the ARENA government, analysts pondered Rodríguez’ capacity to convince them that as a fellow big businessman, he represents a credible alternative to the current government and its policies.57

The rector of El Salvador’s Technological University, prominent business executives and professionals associated themselves with the new party. They included Dr. Herman Schlageter, a long-time commentator in Diario de Hoy, and Carmen Maria Gallardo de Hernandez, executive director of FUNDAPAZ, a foundation headed by ex-president Cristiani.58 Rodríguez’s message to business groups is that he will counter Calderón’s radical neoliberal economic policy with government support for agricultural and industrial reconversion while curbing the exorbitant interest rates and profits enjoyed by the big bankers.59

Thus far the PRSC has failed to project itself as a viable contender. Overestimating his strength, Rodríguez spurned all alliance overtures from other parties, including the FMLN. There are complaints that the party has been less them democratic internally, and some of its allies in the Assembly (elected in 1994 on the PDC ticket) have voted on occasion with ARENA. The party has not shown well in the polls.

Democratic Convergence. Rubén Zamora was the standard bearer of all left parties in 1994’s Presidential election. Though soundly defeated, he forced (by a slight margin) Calderón Sol into a runoff and easily outdistanced the Christian Democratic candidate. But the CD’s fortunes in the Assembly elections were another story. In the 1991 Assembly elections before the end of the war, (in a somewhat altered alliance) the CD was the rising star with 12% of the votes (in third place) and 8 Deputies elected. But running on its own in 1994, without FMLN support, the CD won but one deputy seat and betrayed serious organizational weaknesses.

For March 1997 the CD has cast about for coalition possibilities and may yet secure successful coalitions for Municipal elections in some locales. But the FMLN is putting forth its own Assembly candidates, and Rodríguez also spurned various alliance possibilities. At year’s end this left the CD hoping that the Claramont faction, a possible alliance partner, would win in the PDC and also hoping to ally in local races with the MU, a small party with evangelical roots which elected one Deputy in 1994.


  We have said many times already that the people themselves are the ones who initiated this peace and hence they must be its main beneficiaries."

President Alfredo Cristiani, Chapúltepec, January 16, 1992

‘‘We are not coming to this moment as lost sheep returning to the fold, but as mature and energetic promoters of the changes so long desired by the immense majority of Salvadorans."

FMLN Comandante Schafik Handal, Chapúltepec, January 16, 1992

ARENA’s Neoliberal Drive and its Limits

The Salvadoran economy of the 1990s is vastly different from the reformist, state-centered model of the Christian Democratic era (1980-1989). The Cristiani administration’s (1989-1994) structural adjustment policies, fomented and funded by international financial agencies, anchored the economic system on different moorings, and initially brought about a strong alliance between business leaders and the government. The private sector was rewarded almost immediately by the privatization of banks and exporting, and by a sharp reduction in export taxes.

With a substantial reduction in tariff barriers the economy was supposed to be oriented toward competing in foreign markets. Bank privatization led to competition among the country’s dominant elites (including broad charges of corruption) and widened space for the private sector to accumulate.

Early signs seemed positive. As the war declined in intensity in 1990, economic growth went up and, once the war was over, averaged over 5% annual growth from 1992-1995.60 Moreover inflation came down from 20% in 1992 to 10%-12% in subsequent years, open unemployment dropped to 7.2% in San Salvador, and urban poverty (measured by ability to purchase a market basket of goods) declined from 57% in 1993 to 48% in 1995, and rural poverty from 65% to 58% during the same period. However, this income measure probably vastly understates rural poverty.

Largely because of increases in the regressive IVA, tax revenues expanded from 7.6% of GDP in 1989 to just under 12% in 1995, though the World Bank noted that the 10.5% of GDP in 1994 tax revenues was "well below international standards." Government expenditures, however, have also been quite low by international standards, according to the World Bank, at some 17% of GDP in 1993 compared to 35% in Honduras, 27% in Costa Rica and 25% in Mexico and Venezuela. Health and Education spending went up from 2.5% of GDP in 1992 to a quite modest 3.5% in 1995, still lower than in any of the ten years preceding the war.61

A unique feature of the Salvadoran economy is receipt of over $1 billion yearly in remittances from Salvadorans who fled the war to the U.S. — an annual GNP bonus garnered by few economies around the globe but which masks and distorts the functioning of the economic system.

In 1994 remittances of $870 million more than doubled the export earnings and amounted to almost 10% of GDP. By contrast, in 1984, remittances amounted to $121 million, but 16.7% of exports and only 2.6% of GDP. (And 1984 remittances were double those of 1980.) Most agree that this windfall will not continue, and all agree that it will not continue to grow as a percentage of GDP.

Moreover, even with a per capita inflow of remittances that places El Salvador consistently in the top two to five countries in the world, poverty has only fallen slightly. Consumption per capita has held even, despite continuing declines in real wages, because of remittances.62

Economic analysts of diverse persuasions agree that El Salvador’s postwar economy is showing a number of unhealthy signs:63

a) growing imbalances in foreign trade since 1989. In 1995, despite high coffee prices, imports ($3.3 billion) exceeded exports by $1.7 billion. As in prior years, the difference was made up largely by remittances which grew to $1.1 billion. In a trend the National Private Enterprise Association (ANEP) termed "alarming", the country’s import-GNP ratio grew from 41.7% the year before to 48.1%. ANEP’s executive director opined "we do not share the view that the country can go on maintaining a growing trade gap as long as remittances keep flowing, particularly if imports are not linked to the productive process."64

b) growth in commercial, construction and service sectors to the detriment of agriculture and manufacturing. This resulted in part from the bias introduced by the import frenzy. While the barons of commerce erected new shopping centers to sell imported wares, agriculture’s contribution to GDP had in 1993 declined to just 9%, compared to 28% in 1980. Meanwhile, by 1993 the share of the service sector in GDP equaled 50%.65 Demands for sectoral policies to bolster agriculture and industry are loud, and claim the importance of these sectors for employment growth.

c) Salvadorans are consuming the equivalent of everything they produce domestically each year, so national savings and investment are insufficient to sustain high levels of growth in the future. Easy access to imported goods has fostered an ethic of consumption eroding the work ethic for which Salvadorans have long been proud. Queries ANEP, "we must ask if the country can grow without genuine national savings."66

d) With the exception of the largely foreign maquila companies, Salvadoran producers are becoming less competitive in world markets right at the time they should be gearing up to globalize. With the country awash in dollars, the Salvadoran colón has held steady at C8.7 to $1 since 1991, appreciating in real terms by more than 25%. The higher real purchasing power makes it easy to import, but harder for domestic producers to sell their goods on foreign markets.

e) The price of capital has gone up. In order to keep the colón from revaluing even further, El Salvador’s Central Reserve Bank spends hundreds of millions of colones each year to prop the dollar up locally. This effectively creates domestic government debt which is then foisted onto the banking system, jacking up domestic interest rates to sky-high levels.67 The high cost of money discourages investment in long-term projects. The concentrated nature of the newly privatized banking system only reinforces the tendency toward exorbitant financial margins.

f) El Salvador in 1992 had, according to the IMF, the largest share in the Western Hemisphere of government spending for defense (16%) and the smallest share for social security and welfare (3%), despite the fact that peace negotiations were drawing to a close in late 1991. There have been modest positive changes since then. Defense spending has declined in real terms, but El Salvador is still not spending nearly enough on the development of human capital. In 1995, a blue ribbon commission called for revolutionary changes to support education in a report praised by ARENA, the FMLN and leading Jesuit intellectuals, but so far change has been modest.68

g) The economy is still marked by extensive poverty and inequality measured in terms of wages, distribution of land and other assets, and educational attainment. Apart from the immorality of such inequality and poverty, inveighed against by the Pope during his visit in early 1996, many analysts see poverty and inequality as brakes on sustainable economic development.

In the face of these tendencies, both pro-government and pro-opposition economists have been warning for several years that the present growth path of the Salvadoran economy is "fragile", "artificial," and "unsustainable".69 The recent deceleration in growth and the large current account deficit have been interpreted by economists as signs of stagnation. Darkening the horizon is the vulnerability of the Salvadoran economy to the hot button issue of immigration in the U.S. National and state policy decisions in the US might negatively affect a million Salvadoran emigres whose dollars pump up demand at home.

Groping Toward a New Model

After much hesitation, the Calderón Sol government made a bold stab in January 1995 at addressing these problems, launching an economic plan with visions of a new Hong Kong in Central America and warnings that it was the "only" solution to the danger of economic stagnation. A radical deepening of previous adjustment policies, the plan bore the intellectual stamp of the Finance Minister, Manuel Enrique Hinds, and enjoyed behind-the-scenes backing from El Salvador’s powerful financial and commercial elites.70

The "Hinds Plan" essayed a vision of an El Salvador converted into a major offshore banking center and a giant export platform for maquiladoras. The policies included a quick transition to zero external tariffs, the tying of the Salvadoran colón to the US dollar at a parity of C8.75/US1$, and an aggressive approach to privatization and modernization of the state. In the short term, however, some unpleasant medicine would be necessary in the form of a much higher VAT tax.

Unfortunately for Calderón Sol, the plan (particularly the rapid schedule for tariff reduction) threatened to do sharp short-term damage to the domestic industrial and landed interests which dominate the tightly knit ANEP and are important props of the official party. When these groups mounted a vigorous campaign of opposition, the government was forced to back away. Government, said the businessmen, had not demonstrated the ability to coordinate with the "private sector’ nor avoid catastrophic side effects of the plan.

Calderón Sol and his ministers opted for piecemeal implementation of various planks of the Hinds plan, while failing to move on others of major concern to ever-alert business groups. This muddle-through approach and lack of consultation cost the government support both at the mass and the elite levels.

The first policy foray—raising the Value Added Tax (VAT) from 10 to 13%—turned out to be the most costly. Deserted by its normal allies in parliament (PCN and PDC deputies) who feared the political repercussions of the vastly unpopular increase, Calderón Sol was forced to make common cause with a most unlikely ally, Joaquín Villalobos. When the tax increase generated an unexpected bout of inflation, it added to the government’s problems in the polls.71

When the Central Reserve Bank promoted a gradual, "natural" dollarization of the economy by permitting private banks wider latitude in the use of the U.S. currency, the plan boomeranged. The banks contracted big dollar loans abroad and used them to expand domestic credit far beyond the 19% official target. This fueled the price spiral. Inflation closed the year at 11.4%, well above the government’s 8% target.72

Bereft of an overall strategy for revamping the public bureaucracy, the government opted for the simple expedient of laying off workers—some 15,000—through so-called Law 471. Massive demonstrations by public employees capped by a sit-in and hunger strike in San Salvador’s metropolitan cathedral just prior to the Pope’s visit provoked an embarrassing stand off. ANEP particularly criticized the VAT increase and what it called "the lack of a coherent line (hilo conductor)" in the government’s approach to privatization and modernization of the state apparatus.73

The Finance Ministry did make notable progress in raising the level of tax collections through an aggressive policy of pursuing tax evaders. Prospectively, this has raised the national tax coefficient by over a point, from 11.5% in 1995 to a budgeted 12.7% in 1996. But when the tax men stepped on some powerful toes belonging to ARENA party funders, the official in charge of the tax morality drive was sacked and shipped out of the country to a sinecure with an international organization.74

An unexpectedly serious economic downturn at the end of 1995 aggravated tensions between the government and various sectors of Salvadoran business. The government’s plans had been predicated on a continued boom in commerce and construction, leading to a rapid expansion of inventories and consumer credit. By early 1996, entrepreneurs were facing sluggish sales and watching unsold stocks of cars, housing units and merchandise pile up.75

The downturn signaled that El Salvador’s postwar building boom, based on pent-up middle class demand and remittance flows was playing itself out. Economic authorities have had to revise growth estimates downward, most recently to 3%-4%, while private economists gauge the growth figure at a maximum of 2.5%. Moreover, the government has responded to downturn by fudging its numbers.76

Unsold inventories and high rates of default on bank loans and consumer credit cards have been joined by a sharp fall in tax revenue and the sudden emergence of a sizable fiscal deficit—estimated in 1996 at 2% as compared to 0.7% in 1995— and the sharp drop in imports of capital and intermediate goods used by Salvadoran producers. Although the latter trend has helped reduce the country’s vast trade gap, $1.213 billion from January-October 1996 in contrast to $1.391 during the same period in 1995, it is not a healthy sign. And although the government makes much of reduced inflation (to 9%), this "success" also is a product of the economy’s deceleration.77

Diverse business groups continued to express unhappiness with government, adding demands for anti-cyclical measures designed to restart growth. Although its commitment to conservative financial management hindered any serious response, the government signaled a willingness to negotiate. After informal discussions with ANEP business sectors, Calderón Sol announced, in June, a package of 12 economic measures. The speech was greeted by polite, but distinctly mild approval notices among business leaders. Some doubted the commitment about new public investment in infrastructure or said it was previously programmed money.78

Meanwhile, ANEP unexpectedly published in June its own economic strategy in a "Salvadoran Manifesto." The Manifesto invites Salvadorans to join forces in a national strategy for achieving prosperity in the global economy. A bid by ANEP to assume leadership in planning, the Manifesto takes ANEP’s critique of recent economic evolution as a starting point.

The FMLN and a left-wing think tank, FUNDE, also issued economic plans. While the ANEP plan differs from the two leftist plans, particularly in regard to the role of the state, similarities between the plans are striking. The plans celebrated the Salvadoran worker, called for high national savings and an emphasis on promoting industry and agriculture, called for protection of the environment, alleviation of poverty, and advancing democratization. FUNDE and the FMLN would have the state play a larger role as the guarantor of the standard of living and perhaps as price regulator.

In a distinct departure, ANEP used strong progressive language, acknowledging an "ineluctable ethical commitment" to overcome poverty, an imperative necessity to avoid national ecological catastrophe, a desire to expand civil society and the democratic process. The "authoritarian option" has failed, ANEP asserted, and "political stability that is not anchored in democratic arrangements is an uncertain stability coquetting on the brink of a precipice." It affirms "incipient democratic regimes are perhaps not the most efficient, at least in the short run, for they demand high levels of consensus...but they are so, farther along.." It is possible to discern in ANEP’s Manifesto an implicit distancing of El Salvador’s most representative business body from the far-right agenda. Ironically, the ANEP and FUNDE plans, not those of the President, may become the focal point for public debate.79

However, the government has made additional moves to involve sectors shunned in 1995. In addition to consulting on his mid-1996 speech Calderón Sol’s Minister of Economy Eduardo Zablah, who has emerged as the effective coordinator of Calderón’s economic cabinet, also negotiated an acceptably moderate calendar for tariff reductions with El Salvador’s industrial interests.80

Significantly, the government included the Chamber of Commerce and Industry, the fat part of ANEP, in formulating a so-called National Competitiveness Program. Details of this program’s content appear to have been deliberately kept from public view. It has gradually become apparent that these deliberations aim at the forging of a new development strategy replacing the ill-fated Hinds Plan of early 1995 while maintaining a necessary minimum of elite consensus.

Another event that may indicate a new consensus came in October when a so-called "dream team" of businessmen attended a World Bank meeting in which El Salvador’s achievements in stabilization and structural adjustment (most of them effected during the term of Alfredo Cristiani) were touted alongside Chile’s. El Salvador was held up as a model site to which world investment should flock. The team included representatives from the two at-odds segments of big capital (Cristiani and Murray Meza on one hand, Mena Lagos and Orlando de Sola on the other), but no one from ANEP. The World Bank subsequently announced it will make available $300 million to El Salvador over the next 3 years for rural and local development, modernization of the state, and investment in human resources.81

According to Salvadoran analysts, behind this seal of international approval lies a reformulated national economic strategy aimed at achieving global competitiveness. Unlike the brusque and abrasive Hinds formula, the new model acknowledges the economic and political need to incorporate all sectors, including agriculture, and to move in tandem with the rest of Central America in terms of trade arrangements. The heart of the plan, based on the ideas of Harvard economist Michael Porter, is to use government policy to promote "clusters" of linked enterprises that are judged to have a potential for export success as the spearheads of a new global insertion. The success of these clusters would pull the economy into a new era.

Despite biases in the "dream team’s" membership, the emerging "plan for national competitiveness" may attenuate policy conflict among different interests. It offers opportunities for economic advancement to at least some (though not all) actors within the economic groups that were to have been relegated by the Hinds Plan to oblivion. The plan, which has a budding counterpart at the Central American level, simultaneously emphasizes the need for ecological soundness and efforts at local community development.

There are signs that the government bureaucracy is being revamped and cleansed to put parts of the plan into effect. In September, the Legislative Assembly merged the Social Investment Fund (FIS) and the National Secretariat for Reconstruction (SRN) into a new "Corporation for Local Development." Following charges of corruption, Calderón Sol then accepted the resignation in October of Norma de Dowe as head of the conjoint agency, appointing María Teresa de Rendón in her place.82

In addition, the government named a new minister of agriculture, Ricardo Quinones Avila, while FUSADES is reportedly preparing a sectoral plan for agricultural development that will complement the new global strategy. In November, the Banco de Fomento Agropecuario announced a major reduction in interest rates for small producer loans and notified 13,000 beneficiaries of Decree 698 that they were once again eligible for credits, a move no doubt made with an eye on the March elections.83

With the backing of the country’s most powerful interests, assistance from international actors, and at least acquiescence from ANEP, the plan would appear in the short run to be unstoppable. Whether it offers a formula for bridging destructive competition between rival oligarchic segments is still unclear. But ASI spokesperson Jorge Arriaza argued that sectoral development policies were still needed for the interests that would be left out of the government’s "cluster" scheme.84

The Problem of Equity

The machinations among elites obscures the extent to which most Salvadorans feel left out of the equations of economic planning. In a mid-1996 poll, only 5.7% of respondents mentioned economic measures as positive changes by the government, while 48.3% mentioned economic issues as negative changes. Asked whether the economic situation of the country and of their family was better or worse in the last year, 61.6% said the country was in worse shape, and 44.2% said their family was in worse shape. Another 44.6% said their family’s economic condition was the same, while only 12.8% thought the country’s economic situation was better.

The poll data suggest that the postwar political system has not found a solution for the structural problem of the Salvadoran economy — how to forge a model of capital accumulation with a distribution of benefits ample enough and equitable enough to satisfy the expectations of ordinary Salvadorans that government will deal with their problems. They do not see themselves as "the main beneficiaries" of the peace.

Macro level data showing GDP growth may mask unpleasant distributive undersides of the system’s performance. Although a recent UNDP study found that overall the urban poor declined from 55.2% to 50.4% between 1989-1993, the share comprised by the "extremely poor" rose from 23.3% to 29.6%.

Measuring poverty by counting families who have at least one basic need unmet, a recent study found that urban poverty went down from 41.4% (1992) to 38.6% (1995) but rural poverty remained very high, declining 2 points to 88.6%.85 Moreover, in real terms, the wages in the public and private sector continued to fall after the war wound down through 1993, according to the World Bank, albeit not so rapidly as during the war.86

Inflation news has been mixed. In 1995 and again in 1996 prices of some basic food products (beans, corn products) were up. Food prices, a family’s least deferrable cost, have since the war consistently inflated faster than other elements (clothing, housing, etc.) making up the consumer price index.87 Then in mid 1995 all prices jumped with the 3 point increase in the value added tax to 13%. Inflation in 1995 was 2.5% points higher than the previous year. In 1996 inflation is down, but due to the economic slowdown.

The World Bank report on El Salvador persistently mentions low expenditures on health and education, and low levels of education attained as brakes on economic growth. El Salvador’s primary school enrollment ratio, for example, showed almost no improvement between 1975 and 1991 and was below the Latin American average and fast growing east Asian economies.88 Improving health and education will necessitate better tax collection from elites and Assembly support.

Popular appraisal of current economic performance may be affected by the extraordinarily sharp fall in living standards during the war (real wages fell approximately 30% from 1980-1988.89), making Salvadorans insensitive to small improvements. And the demonstration effect of the shop-window economy recently created via vastly augmented imports has increased Salvadorans’ economic frustration, as the gap widens between what they have and what they see in shop windows.

Even should elite consensus on a new economic strategy be achieved it is not clear that it would anytime soon reverse the decline in real wages or generally improve living standards — that is speak to the discontent manifested in the polls — nor is it clear that political will exists to improve health and educational services for the population. Much as we found in the case of political participation, the maneuverings around an economic strategy have been almost entirely by elites, mainly those backing ARENA, largely behind closed doors with a few events breaking into short bursts of media attention. There has been no public participation, nor has El Salvador’s new political party structure and relatively weak framework of civil organizations served to mediate between the public and the planners.


Land has traditionally been the key asset in the Salvadoran economy. However, the war years brought an economic shift toward other economic activities. From 1979 through 1993 agriculture’s share of GDP declined from 29% to 8.8%. The lion’s share of the decline was in coffee and cotton, the two principal export crops. The secondary sector (manufacturing, construction, utilities) rose during the same period from 21% to 25% of GDP, and services accelerated from 49% to 66.5%. The war made agriculture difficult in some regions, but price declines contributed and other sectors grew. The war-time drop in land use was less severe than the drop in share of GDP.90

Land, nonetheless, has been a critical issue in the post-war process and will remain so. One third of the economically active population works (or is trying to) in agriculture. Landlessness and rural poverty were a principal cause of the civil war, and the 1980 agrarian reform program was a centerpiece in the government’s counter insurgency efforts against the FMLN. Landlessness and land poverty remain "the principle source of endemic poverty for the 73% of the Salvadoran population living outside the San Salvador metropolitan area."91

The extent of landlessness and rural poverty in El Salvador and its political implications has been an issue of sharp debate between scholars Mitchell Seligson, Martin Diskin and Jeffery Paige. Diskin argues that Seligson minimizes rural poverty by undercounting the landless, and setting too low standards for estimating the land-poor. Diskin calculates that the rural landless amount to 362,000, or 22.4% of [Seligson’s] national population figure, and 52.2% of the rural population.. Seligson caculates the landless as 169,000, but does not count unpaid family laborers and permanent wage laborers, or the rural unemployed. Diskin and Seligson calculate that half of those with land are tenants (109,000). Diskin notes that 4 manzanas are required to make as much as a job in the industrial sector would pay, but virtually all renters or sharecroppers have less than 5 manzanas. Of the land owners almost half have less than 1 manzana, and 68% have less than 2. Seligson claims that those with over 1 manzana earn as much as some fully employed workers, but Diskin notes that this fails to take into account levels of rural and urban poverty among the employed and unemployed. Paige calculates that despite the 1980 Agrarian Reform an increase in the proportion of renters in the 20 years leading up to 1991 make the rural landless, as a percent of the total population slightly higher (35% to 34%) than in 1971, a level associated with more than substantial dangers of rural political instability. In his response Seligson notes his estimate was conservative.92

The peace accords’ Program to Transfer Lands (PTT) to those who had occupied lands in war zones and to former combatants has been more plagued with delays than any other section of the accords. As it inched toward the legal finish line more than 3 years after the initially agreed upon deadline, the economic viability of the program was under serious question. Meanwhile, a year ago, peasants organized a series of land invasions and claimed the lands under the agrarian reform law. Contests for land remain a prominent part of the political landscape.

A new debt relief law offers forgiveness of 70% of agrarian debt owed to the government, plus an additional 5000 colones ($575) for lands held by an individual, if the remaining 30% of the debt is paid within one year (or by June 1997). A second law facilitates breaking up collectively held lands and allowing (individual) sales of portions of the land. If put into effect, these laws may well unwind the 1980 agrarian reform, and will complicate the PTT and reduce the collective aspects of PTT land transfers. If semi collective owners do not take the option, more aggressive debt collection could result with attendant increases in political tension and protest.

Breaking up collective land ownership has reportedly been pushed by the World Bank, and has found a positive reaction in the ARENA government. However, six months after passage, it is not clear if the relevant agrarian agencies (ISTA and the Land Bank) have the administrative capacity to implement the law. Most important, there has been little support in terms of credit or technical assistance for other small and medium sized farmers (until an pre election announcement of increased credit made last month). There seems to be no idea of what will become of the land-poor and rural unemployed. Should they move to San Salvador, the growing maquila sector will not be nearly big enough to absorb them. Migration to the U.S. is a possibility despite increased restrictions on immigration and increased costs in getting to the U.S.93

Land Transfer Program (PTT)

As the peace negotiations wound down, the two sides locked horns over occupied lands in war zones. The FMLN argued that peasants who had occupied lands in war zones (many of them supporters of the FMLN) should keep them. The government insisted that the property rights of titleholders, who had left or been forced off their lands, must be respected. In the compromise eviction rights were suspended; the government agreed to purchase occupied lands and then sell them with government mortgages to occupiers (at slightly below the very high market interest rates). Other state owned lands would be sold to FMLN combatants and ex-soldiers. If a titleholder refused to sell, the government was obligated to find appropriate state lands for occupiers. The U.S. and the European Union financed the government’s purchase money.

Technical difficulties, bureaucracy and political resistance delayed the PTT.94 FMLN opponents saw the PTT as a reward. And the FMLN did need a tangible benefit for their followers, not simply the right to elect FMLN leaders to the National Assembly.

Others saw the PTT, along with job training and credit programs to ex-combatants, as a guns for land (credit and training) exchange that would insure the war’s end and forestall a turn to banditry by unemployed veterans.

Properties were held by groups, but group ownership smacked of socialism, and some in ARENA feared the FMLN would control the lands if collectively owned. But the government did not have the means to subdivide several thousand farms among a target of 47,500 purchasers. So the PTT has used a difficult hybrid land title. A farm is conveyed to a list of individuals; each has an individual mortgage for an amount not to exceed 30,000 colones.95 The sum of the individual mortgages equals the purchase price of the land, which in turn is equal to the price the government paid to the title holder, which in turn is a negotiated price based on market prices for soil and land types of similar lands elsewhere in the country. The individual mortgage, however, does not specify which slice of the farm the individual "owns," nor is it clear what happens to the entire farm if one of the "owners" defaults on the mortgage. This hybrid legal form would make resale of an individual’s "portion" difficult. FMLN supporters complained that years of fighting had gained them the right to purchase land (something they had before), a high mortgage and an unclear title.

Within five years, owners can subdivide their land. As it will have taken over 5 years to finish PTT conveyances, it seems unlikely ten times as many titles could be conveyed in the next five years were agreements reached on potentially fractious question of how to subdivide each farm.

Potential beneficiaries were estimated in late 1992 at 15,000 former government soldiers, 7500 FMLN combatants, and 25,000 land occupiers. The final list of beneficiaries will be closer to 35,000, about 8,000 of them former government soldiers because: original lists were incorrect; potential beneficiaries were not in the right place at the right time during registration programs; some peasant combatants preferred city living, and poor government outreach eliminated many former government soldiers.

The government’s insistence on market principles and property rights were applied to a highly distorted market: (a) The real market price of the occupied land was obviously less than the price of physically equivalent lands because of the occupation. In real markets insiders or occupiers get better prices. (b) By agreeing to stop fighting, the FMLN combatants increased the price of the land they eventually bought. (c) The government gave full rights to those "owners" who could not produce a title, if they had witnesses, and would not take land by eminent domain when the owner could not be located.

In early December the UN observer mission said 99% of the registered beneficiaries had received titles, 85% of which had been recorded in the registry of deeds. Substantially complete, the PTT nonetheless missed another deadline for December 31.

The average amount of land per beneficiary was 4.01 manzanas (6.82 acres) costing 25,649 colones ($2948). State-held lands were sold for 18% less than the prices the Land Bank negotiated for purchase from former land owners, so those who received state land, disproportionately former combatants, received more land — an average of 4.21 manzanas.

According to international analysts and the FMLN, most of these lands are not economically viable under the mortgage terms if planted in traditional peasant food crops (corn, beans, sorghum), though the PTT did include some fine coffee and ranch lands. To shift from traditional crops would require more credits, and technical assistance. Though the great majority of beneficiaries came from peasant backgrounds, for many who had grown up fighting running a farm is a new experience. So technical assistance would be vital. The government has not prioritized aid to small farmers, and the success of small farmers moving into non traditional commercial crops in Central America has been, at best, mixed.

The Agrarian Debt Laws

The May 1996 laws offer to forgive 70% (plus 5,000 colones) of agrarian debts owed to the government in exchange for payment of the remainder within a year. The law affects: 35,000 PTT beneficiaries, 32,000 to 40,000 Phase I cooperative members of the 1980 agrarian reform, 42,000 to 64,000 Phase III agrarian reform individual holders, and 1500 large landholder beneficiaries of previous government programs to refinance debts.97 If each beneficiary is thought to represent a household, those directly affected would be well over half a million people, a substantial percentage of whom are voting age.

At first glance, the law would almost seem to be a free good. Beneficiaries have the bulk of their debt disappear; the government loses little because much of the debt is regarded as uncollectible; the government gains a considerable amount of funds within a year (something under 30% of 2.5 billion colones); when the 30% is paid off landholders become eligible for more credit; and the government gains politically. The first glance is deceptive.

The current debt is largely uncollectible for two reasons: the great bulk of the debtors do not have the cash to pay principal and interest on their loans; and a large portion of the debtors are politically organized (or would quickly become so), vastly raising the political costs of a concerted government foreclosure effort. Looking at each of four affected sectors reveals the complex political character of the proposition.

Phase III Agrarian Reform Landholders. The 5000 colón ($575) relief on top of the 70% forgiveness means that debts below 16,666 colones ($1916) would be completely forgiven. (If .3x - 5000 = 0, x = 16,666.) Virtually all Phase III holders would have complete debt relief; their average debt is 2607 colones. ARENA will attempt to reap the political benefits from finateros during the election campaign.

Other Individual Holders. In 1992 and 1994 the government refinanced, at favorable rates, loans taken out by war impacted farmers. Beneficiaries now qualify for more relief. Debt sizes are highly variable, but, relative to PTT, Phase I and III beneficiaries, these are all big economic players. One person owes more than 20,000,000 colones, some 473 owe less than 50,000, another 479 owe between 101,000 and 500,000 colones, and another 102 between 501,000 and 1 million.98

Critics charge that these people have received one form of relief already, and that they can afford to pay. By including some large landowners among the beneficiaries, the government might blunt criticism from those who don’t want to benefit FMLN followers or Phase I cooperatives.

The PTT. It seems odd that a government which insisted upon market principles to an extreme in negotiating and implementing the PTT seeks now, just as the program is finally grinding to completion, to forgive debts the FMLN beneficiaries just acquired. Why?

If these loans fall into arrears, as many predict they will, they might prove very difficult to collect. The plan may be attractive to ARENA because it presents real complications to the FMLN and to many PTT beneficiaries. FMLN deputies voted for the debt forgiveness law which applies to the PTT, (but did not vote for the bill which also facilitated division of the Phase I agrarian cooperatives). The FMLN also issued statements at the time the law was proposed calling it a trick, suggesting division or ambivalence within the FMLN.

Consider the basic math in 3 cases, each one with, and without, the 5000 colón debt relief bonus to individual parcel holders. The maximum purchase loan permitted under the PTT was 30,000 colones; the average loan was 25,482.

Loan 30,000 25,482 20,000

Less 70% 21,000 17,837 14,000

debt 1 9,000 7,645 6,000

less 5000 5,000 5,000 5,000

debt 2 4,000 2,645 1,000

AID estimates that 900 PTT beneficiaries would have all purchase debt forgiven assuming the 5,000 colón addition.99 The range in debts is a function of the quality of land (which affected the purchase price) and the number of acres per family. In addition, most ex combatants have still higher debts because they took out production loans available as part of the "reinsertion" package. Some war veterans were able to borrow as much as 15,000 colones more.100 Income per acre is variable. A rule of thumb would be that it would take, for the average PTT beneficiary growing traditional crops, about one third of annual net income to pay off the 2645 colón debt in the middle case above. Thus, the 5000 colón benefit is crucial.

The 5000 colón bonus carries a strong incentive to divide the semi collective landholdings into individual units. The proposal, obviously tempting, presents a number of potentially divisive elements to PTT beneficiaries and local FMLN leaders.101

Suppose on a particular property some want to pay down their debt and others do not. Is the property to be subdivided?

Some towns have many PTT beneficiaries located on several pieces of property and want a common integrated development plan. Division of the lands to individual parcels would complicate this.

Some pieces of land are more uniform than others. Equitable division of lands that have widely varied character will provoke division and fears of being disadvantaged when the land is physically divided. It will create competition with unclear rules of the game for the slice of the property with best access to a spring or the best soil.

Choices must be made rapidly; the deadline for prompt payment of the remaining 30% is June 30, 1997. But all lands cannot be surveyed and subdided by the deadline, so those who pay off their loan will do so without an exact document, formalized in a property register, of what they bought.

If some pay their debt and others not, it could leave those with debts with less organized protection against debt collection.

The potential of dividing FMLN ranks might also have been a way for ARENA legislative leaders to "sell" the program to more visceral ARENA opponents of the FMLN. These factors may explain the paradox of ARENA suddenly changing from its stern injunction that the FMLN must adhere to non subsidized market principles.

There is little financial reason to forgive all Phase III debt and not all PTT debt. The total amount of money is relatively little. If all PTT beneficiaries paid 30% (less 5000 colones) in the next year the government would reap 88 million colones, about $10 million. Against that must be offset the considerable administrative expenses, to say nothing of the titling of the individual properties. If the government is willing to forgive 90% of the debt (including the 5000 colón bonus) it makes little sense to not forgive the remaining 10%. It would put the issue to rest and provide war afflicted beneficiaries with a measure of certainty following over a decade of war and nearly 5 years of limbo in the complex, confusing PTT process.

Phase I Agrarian Reform Beneficiaries. The impact of the laws might be to break up the cooperatives. The vast majority of the cooperatives would not have the cash reserves to come up with 30% of the debt by the deadline next June.

A considerable number of the cooperatives have significant portions of their land which have high commercial value for future semi urban commercial and residential development or for tourism (on the coast). These lands may well be the target of the architects of the law. One option might be for the cooperative to sell a portion of its most valuable property to pay off the debt.

A cooperative could pay off the government debt by borrowing from a private bank. However, interest rates would be substantially higher than their current loans, and the banks would surely insist on securing the loans with the land. The cooperatives may not have the capacity to generate new projects which might deliver income to pay off new loans.

A cooperative could subdivide among cooperative members who would each take on a portion of the cooperative’s debt, and thus qualify for the 5000 colón bonus. This could be a complex and divisive strategy. Phase I cooperative members would have much higher remaining debts that PTT beneficiaries. However, in general they are better off, with large pieces of land, lives less disrupted by the war, and probably with greater ties to financial help from relatives in the U.S.

The Assembly clearly had subdivision in mind, as it also passed a law facilitating and regulating subdivision and sale of parcels of cooperative lands.

According to one well placed expert interviewed in November, a small portion of the cooperatives (perhaps 70 of the 350), principally in coffee and sugar, could take advantage of the deal.102 A few tried to do so, only to discover that the agrarian agency, ISTA, was not set up to implement the law. Another group, perhaps 100, could borrow from private banks. The remainder would have to sell 30% to 50% of their land to pay off the remaining debt.

The cooperatives could elect to sit tight. So far no government has been willing to undertake the political costs of forcing the cooperatives to pay or lose their land. The cooperatives still have close to 20 years to pay off the principle on the debt. This option has the advantage of requiring less strategizing and being more familiar. Also, the cooperatives have constitutional protection with permits them to exceed the 600 acre limit and sets up a special regimen to govern sales. Some claim the new law is of dubious constitutional merit. Changing the Constitution must be done in two consecutive Assemblies, and takes a considerably larger majority that ARENA currently enjoys.

It is not likely that ARENA fashioned the law only to watch it be ignored. At the same time there is no evidence government institutions can now implement the law, and it could be a typical case of policy makers not being realistic about the capacity of policy implementers. However, ARENA’s next move could attempt to force a few cooperatives to make up arrears or lose a portion of their land. Whether ARENA has the political clout to pull this off will depend on the electoral outcome next March.

Though there is some organization among peasant sectors it is hardly unified. Peasant organizations hastily erected an umbrella group called the FORO to lobby over the law. But once the law was passed, the FORO became inactive. There are political divisions among different organizations of cooperatives. The FMLN has been quite focused on the PTT and not on Phase I cooperatives.

Land Occupations and Land Poverty. On October 23, 1995 hundreds of peasants peacefully occupied thirteen large estates in the western, coffee growing provinces of Ahuachapán and Sonsonate. The same day, another three properties were occupied in the southern La Libertad province and one in La Páz, in the center of the country.

Organized by the Alianza Democrática Campesina (ADC), the peasants claimed their right to part of these properties, which, they argued, exceed the legal limit of land tenure (245 hectares or 603 acres) stipulated by the 1983 Constitution. They accused the government of having repeatedly violated its constitutional obligation to expropriate the land in favor of landless peasants and of thus protecting the interests of the large land owners.

The peasants had touched a sensitive nerve-point. Within hours, government functionaries and land-owners moved quickly to dismiss the peasants’s actions as "manipulations of the (political) opposition." The Director of the National Civilian Police called it an "orchestrated situation..without legal justification."103

Three days later, on the initiative of the ARENA party, the Legislative Assembly passed "emergency" reforms to the existing Penal Codes, widening the powers of eviction of the justices of the peace, and imposing harsher sentences on "land usurpers....or those who promote, or instigate the usurpation of properties."104 The President of the Legislative Assembly and ARENA deputy, Gloria Salguero Gross made the Government’s position crystal clear: "We are willing to pass any legislation (necessary) to assist the maintenance of the rule of law."105

Confrontation was avoided, however, due to the timely intervention of members of the UN mission and the Human Rights Ombudsperson’s office. By week’s end, the occupiers had retired peacefully from the properties and set up make-shift camps along the perimeter fences of the farms. After lengthy bi-lateral meetings, the UN also succeeded in bringing the Government and peasant organizations to the negotiating table, where they agreed to reactivate previously interrupted mechanisms to resolve the situation of the so-called "excedentes".106

The peasants’ claim to the "excedentes", or surplus land over the legally established limits, dates back to the 1980 Agrarian Reform, an emergency decree emitted under intense U.S. pressure as the country tottered on the brink of civil war. The first phase of the law stipulated that no one individual could own over 1230 acres. Any"excedente", or surplus, should be expropriated by the State. Despite the virulent—and often violent—opposition from wealthy land-owners, around 20% of the country’s agricultural land was redistributed, the majority of it to cooperatives.

The 1983 Constitution made the land-holding limit 245 hectares, or 600 acres. But it also gave land-owners three years in which to avoid confiscation by dividing up land among relatives or legal straws, or by selling portions. Moreover, it allowed them to decide which portion of their estate would be expropriated in favor of the peasantry. Even so, using the pretext of the civil war, virtually none of the farms over 245 hectares were touched during the Duarte administration. President Cristiani’s election in 1989 was supported by large landowners.

The peasants involved in the current dispute claim a constitutional, as well as historical justification for their actions.107 They claim that the majority of the properties occupied were in the process of being investigated for exceeding the 245 hectare limit, a process which they accuse the Institute for Agrarian Reform (ISTA) of having boycotted. According to one ADC leader, in the western provinces alone there were around forty such properties under scrutiny.

Most of those involved in the occupations were peasants who have never had access to a plot of their own. Many of them were living near the farms they occupied, and in some cases had worked previously as hired laborers on the estates themselves, or had been moving from one farm to another in search of seasonal work. All of those interviewed by HI said that they had joined in the occupations in the hope of obtaining a small plot to farm.

ISTA functionaries accuse the peasant leadership of misleading its members. They say that the whole "excedente" issue has been a misconception.108 According to official figures, over sixty properties have already been "intervened" by the State and the excess land redistributed. Forty-seven of those estates were handed over to ex guerrillas under the Land Transfer Program (PTT) contemplated by the 1992 Peace Accords. In the light of these figures, ISTA argues that there are very few estates with surplus land — a claim which is difficult to prove, or disprove — though the status of the particular estates invaded remains unclear.

One reason is the fact that the country’s land register is incomplete and out-of-date. This represents a major aberration affecting the whole issue of land tenure in El Salvador a point about which all parties seem to agree. Neither are many land sales properly registered, including transactions done with large farming estates which exceeded the 245 hectare limit.

The absence of a credible register — the starting point for any investigation into the size of individual land-holdings — is a serious impediment in resolving the whole "excedente" issue. A recently approved $50 million World Bank loan aims to address, amongst other things, the inadequacies of the current land register, but this is obviously a long-term project, and its initial priority does not seem to be to resolve the disputes over the "exedentes."

Equally worrying is the slowness with which the joint ISTA-peasant organizations commission — set up in late 1995 — has been functioning. Considering that land occupations in the country were previously resolved by brute force, the creation of the joint working party, involving the principal protagonists, is an important step in the right direction, and one which might not have occurred without the UN intervention. It is to be noted that this particular issue was not part of the UN mandate and its intervention is but another example of how it has facilitated and mediated short term cooling off periods in a variety of crises on the border or beyond of its mandate.

But over a year after the invasions, the commission has done little more than define the framework for its internal functioning. While some government functionaries and land-owners may believe they have nothing to talk to the ADC about, neither the land disputes, nor those involved in last year’s occupations will simply disappear. This issue too may await the outcome of the March elections. Though estimates of land poverty differ, all parties involved agree that only a tiny fraction would benefit from the redistribution of the remaining excess land.

Rather than further distributions to the peasantry, the end result of the agrarian debt laws may lead to a process of the well-to-do buying up the best pieces of land, leading to more rural landlessness and poverty and a greater concentration of land — an historic trend the Agrarian Reform was meant to halt.


El Salvador can draw a long list of dire environmental problems: pesticide contamination and poisoning, increased resistance to pesticides by pests, dramatically increased air pollution since the end of the war (the number of cars has more than doubled.), garbage contamination, and extensive soil contamination. But the central problem is water.

The problem springs from economic features discussed above and flows back through the economic and health systems negatively affecting both.

The supply of clean water is not keeping pace with increased demand, and environmental degradation is causing the country to lose its "capacity to renew the most basic resource."110 Water supply in San Salvador is now intermittent. The World Bank cites an average availability of 16-18 hours a day, but this does not measure the staggered and unpredictable impact which leave sections of the city without water, or with water every other day.

In rural areas deforestation leads to water shortages because the soil will not hold the water. This in turn leads to soil erosion affecting agricultural productivity. And soil erosion in turn silts the rivers, a process which has, in turn, negatively impacted the generation of power (and hydroelectric power in El Salvador has been a principal source), and the provision of water to the sprawling San Salvador metropolitan area.

Because virtually none of human waste dumped into water is treated, all rivers are contaminated. The river system flows in a large U pattern, with San Salvador and Santa Ana polluting nearby rivers as they flow north into the Rio Lempa which proceeds east through the (silting up) Cerron Grande hydroelectric complex, and then south between the major agricultural producing Departments of Usulatán and San Vicente. There (and at earlier stretches) it is recontaminated by agricultural runoff and periodically floods the farm land in its lower basin. Because subsoil waters no longer can feed San Salvador sufficiently water is pumped back south from the Rio Lempa complex upstream from Cerron Grande. Silting befouls the pumps.

In rural areas lack of access to clean water is a principal cause of death particularly among children. The mortality rates for children under 5 in households without running water are 70% higher (or 61 per 1000) than in those with running water. The annual economic costs associated with illness from contaminated water, in lost wages, has been estimated to be between $93 and $140 million, the later about 70% the average amount of international annual post war aid to El Salvador.111

Deforestation has been extreme, caused principally by shortage of land availability to the bulk of the rural population. Also for the rural poor (and many urban poor), wood is used for cooking, making it still the principal source of power in the country. During the war drastically falling rural wages, a sharp drop in export crop harvest time employment, and falling real grain prices cut the props from under a peasant economy based on growing grains and harvesting export crops.

This, and the war, led to extensive migration, mainly to San Salvador where the water system has faltered under increased demand. A post war construction boom in San Salvador has also seen middle class and luxury developments, supported by government subsidized infrastructure development, crawling up the sides of the hills in San Salvador’s valley, eliminating forest and coffee plantations along the way, and exacerbating water supply problems. Urban growth, from the poor and the rich, goes almost completely unregulated.

Thus, technical aid and credit to small farmers and the land poor to encourage soil conservation, for example, would represent a great benefit beyond that of enhancing social equity; it could also, with sufficient local level education, assist in the repair of El Salvador’s degraded environment. Zoning and environmentally conscious laws and strict implementation would represent a sea change.

Unfortunately there is little indication that this or other environmentally conscious policies are about to be effectively implemented. At the Miami Summit of the Americas in late 1995, all Latin American heads of state signed pledges brokered by the U.S. Department of State, for environmentally sustainable development, and Central American Presidents signed an additional pledge during a mini summit. But little concrete has been done since then.

A USAID contracted report, written just before the Miami Summit of the Americas at the end of 1995, notes an "apparent lack of political will and interest ... to aggressively address the social, economic, and environmental problems associated with pollution and to attack root causes...The present Administration has not made any public statements signaling its strong commitment to environmental protection as a national priority, nor has it moved aggressively to convince the private sector...." Elsewhere the report argues that the lack of support for the government environmental agency (SEMA) has seriously weakened it to the extent that SEMA is not an aid but a constraint to environmental protection and channeling international money in support of this goal.112 However, if the current administration moved aggressively it would set off howls of protest from powerful private sector interests quite used to operating without government regulation.

The above cited World Bank study, written after the Summit of the Americas, does not turn up environmental issues on the lists of problems concerning the private sector, and among many efforts the report advocates, it assigns a low priority to improving water systems as a minor constraint on entrepreneurial activity. On the other hand, USAID and the Interamerican Development Bank have made substantial environmental efforts in El Salvador as have the governments of Spain, Switzerland and the Nordic countries.113


  The FMLN is conscious of the risks and the difficulties, the obstacles to be surmounted so that this work may be achieved, fulfilling the signed documents in both letter and spirit. Stability, the solidity of the peace and the future of the country will depend on it."

FMLN Comandante Schafik Handal, Chapúltepec, January 16, 1992

‘‘We are neither dreamers nor ingenuous: we know the historic challenge thrust upon our country from this moment forward; we know the difficulties of the material reconstruction and the moral restoration of our country; but it encourages us to think that if, together, we Salvadorans can reach a peace accord that so many saw as impossible, then virtually nothing should allow us to be blindfolded to understanding in the future."

President Alfredo Cristiani, Chapúltepec, January 16, 1992

El Salvador’s triple transitions in this decade —from military dictatorship toward civilian based electoral democracy; from state interventionist policies toward a neoliberal economic model; and from war to peace — have profoundly transformed the country. Five years after the signing of the Chapúltepec accords there is solid evidence of an ongoing process of democratization, but there is also evidence that the process is far from consolidated.

After five years of peace, the limits as well as the promise of change are evident. Competitive electoral politics does not necessarily lead to balanced portions of power and negotiated solutions; it can lead as well to creeping political monopoly. That possibility remains very real in El Salvador.

Two of the three transitions have failed to win the enthusiastic support of Salvadorans as reflected in public opinion polls, and there is an abundance of factual material to support those opinions. Real wages continue to go down and Salvadorans know that if their consumption levels have been maintained it is more due to help from their relatives abroad than to the functioning of the political and economic models in practice.

There has been little effort by political parties and other organizations to expand political participation or local participation in economic and environmental planning. On the contrary, there is evidence of efforts to restrict participation: the failure of electoral reform, efforts to control the TSE, excessive rhetoric and efforts to control perceived political opponents.

And the extremes of the economic model have left Salvadorans in the dust in terms of expanding health care and education, not only as a way of improving economic activity, as called for by the World Bank, but as a means to level the political and economic playing fields. Unaltered, the current economic course will soon leave El Salvador literally in the dust unless it addresses environmental concerns.

These negative features of the post-war situation undermine the justifiable and widespread Salvadoran pride in their country and their work, reduce a commitment to the common good, increase cynicism, and leave many looking with envy at their relatives who fled abroad and, despite uncertain migration status, are able to send money home and their children to school.

The influence of the international community on the process of transformation in El Salvador is diminishing greatly. That influence has been a mixed blessing for Salvadorans proud of their independence and sovereignty. Overall, however, the political and financial support of the international community has been linked to carrying out the agreements Salvadorans made themselves to become a modern and democratic society. The task is as yet unfinished, and the burden of ensuring its completion falls more than ever on the shoulders of all the people of El Salvador. The "historic challenge" and the "obstacles to be surmounted," have to be met by a consensual political and economic process employing the capacity and creativity of Salvadorans, so eloquently evoked by President Cristiani and Comandante Handal at Chapúltepec, "uniting the Salvadoran family," in a manner which "allows for a free play of ideas and the natural unfolding of different political projects," for the benefit of "flesh and blood people who work, who dream and who suffer," in order to insure "stability, the solidity of the peace and the future of the country."


1 Hemisphere Initiatives publications are listed on the inside back cover, and hereinafter cited by date. HI, December 1, 1992, p. 1. See also March 1994 and March 1995, and on the electoral process, HI, February and July 1994.

2 Diario de Hoy, December 6, 1996.

3 USAID, Sustainable Development & Democracy in El Salvador: 1997-2002, May 1996, p. 9 citing 1993 statistics. In 1994 death by violence climbed to 9,135 in El Salvador and declined in 1995 to 8,485. In the latter years of the war casualties, military and civilian were about 5,000 per year. Douglas Farah, Washington Post, March 16, 1996, p.A23. That would make the homicide rate in El Salvador around 150 per 100,000 in 1995. According to the New York Times, (October 13, 1996, p. 25) the homicide rate in the U.S. dropped to 8 per 100,000 in 1995, double that of Sweden.

4 The 1994 index placed El Salvador 112th with only Haiti and Bolivia in this hemisphere below it. Nicaragua’s ongoing economic lack of growth placed it just below El Salvador in the 1995 and 1996 indexes.

5 For a searching analysis of public attitudes and the consolidation of democracy in El Salvador, see Kenneth M. Coleman, José Miguel Cruz and Peter J. Moore, "Retos para consolidar la democracia en El Salvador," Estudios Centroamericanos, No. 571-572, Mayo-Junio 1996, pp. 415-440.

6 See essays in James K. Boyce, ed., Economic Policies for Building Peace: The Lessons of El Salvador, Lynne Rienner, 1996, in particular the editor’s opening chapter.

7 For two important broad comparative works on transition in a voluminous literature see Dietrich Rueschemeyer, Evelyne Huber Stephens and John D. Stephens, Capitalist Development & Democracy, University of Chicago Press, 1992; and Stephen Haggard and Robert R. Kaufman, The Political Economy of Transitions, Princeton University Press, 1995. See also, Terry, Lynn Karl, "Dillemma of Democratization in Latin America," Comparative Politics, vol. 23, 1990, pp. 1–21.

8 Rueschemeyer, et.al., op. cit., pp. 57-69. They indicate that powerful private sector interests accept transitions to democracy when their interests will not be seriously damaged. This raises obvious questions in contexts such as El Salvador with a strong leftist party about tactics these interests would use to prevent the left from coming to power.

9 Coleman, Cruz and Moore, op. cit.

10 Unless otherwise indicated polls cited are by IUDOP, the Instituto Universitario de Opinión Pública of the Universidad Centroamericana José Simeón Cañas.

11 In Mexico in 1988, by contrast, 39% said they had some or great interest in politics, and 61% said they did not while similar levels (50%) expressed little or no interest in the Presidential campaign. In Mexico 15% said they had no interest as opposed to 23% in El Salvador. Jorge I. Domínguez and James A. McCann, Democratizing Mexico: Public Opinion and Electoral Choices, Johns Hopkins University Press, 1996, pp. 29-37.

12 In 1992, a CID- Gallup poll found that 69% had little or no confidence in the Assembly.

13 In June 1995, 47.9% thought the government benefitted the rich the most, 6.1% said entrepreneurs, and 15.3% said "themselves" or ARENA.

14 Votes in the 1982 and 1984 (second round) were 1.5 million. In the 4 elections up to 1994, they sank to between 1.0 and 1.1 million. In 1994 1.4 million voted in March; 1.2 million in the second round. The latter figure was but 44% of registered voters. For comparisons to other Central American countries using percentage of voting age population, the relevant percentages were: Costa Rica 1990, 79%; Honduras 1989, 75%; Nicaragua 1990, 75%; Guatemala 1990, 41%, and El Salvador 1991, 44%. See Mitchell A. Seligson and Ricardo Córdova Macías, De La Guerra A La Paz: Una Cultura Política en Transición, FundaUngo and University of Pittsburgh, July 1995, p.65. For an analysis of declines in turnout in El Salvador see Enrique Baloyra-Herp, "Elections, Civil War and Transition in El Salvador 1982-1994: A Preliminary Evaluation," in Mitchell A.Seligson and John A. Booth, eds., Elections and Democracy in Central America Revisited, University of North Carolina, 1995, pp. 45-65. The government figures for 1994 for those who registered and received their voting cards, used in the latter article, were inflated by the electoral authority in HI’s opinion.

15 Seligson and Córdova, op. cit., pp. 43-62. The 33% result is roughly on a par with other Central American countries, save for a much lower level (18%) in Guatemala and a much higher figure (52%) in Costa Rica. Surprisingly democratic Costa Rica’ had 41% with a combination of attitudes supportive of authoritarianism, higher than all other Central American countries save Guatemala. Also, for a view that the authors are over optimistic about the increase in political tolerance in El Salvador see Coleman, Cruz and Moore, op. cit., note 42.

16 This same study, unlike the IUDOP poll cited above, found a tiny number (3.1% in 1991, 5.3% in San Salvador in 1995) who thought the system needs radical change — but this difference from IUDOP was perhaps strongly affected by the inclusion of the phrase "by revolutionary means" which could well have implied violent methods in a country weary from war.

17 The final Peace Accords call for a comprehensive reform of the electoral system. See Chapter IV of the Chapúltepec Accords and the earlier Mexico Agreement.

18 ONUSAL provided much logistical assistance during voter registration (exceeding its mandate), but the process remained plagued with problems. ONUSAL "Boletín de Prensa" has Chief of Mission Dr. Augusto Ramírez-Ocampo’s evaluation two days after the election. In addition to those who turned out and could not vote, 71,000 could not vote because their application for a voting card was turned back, and perhaps as many as 300,000 had registered but had not received their voting card. This estimate is at sharp variance with the official figure of 100,000 without a voting card. The TSE figure seems highly inconsistent with other ONUSAL and previous TSE data, and post election surveys. See HI, July 1994.

19 La Prensa Gráfica, November 23 and 28, 1996.

20 Tommie Sue Montgomery provided helpful information on this episode.

21 Felix Ulloa, "Una deuda a la democracia: La integración de los concejos municipales," Tendencias, No. 46, Noviembre 1995, pp. 40-41.

22 Rueschemeyer, et.al., op. cit., pp. 49-50. The authors’ definition would include everything from a card playing club to a trade union. It seems overly expansive. But their central point is important.

23 Michael W. Foley and Franzi Miguel Hasbún, "NGOs, Democracy and Development in the New El Salvador," presented at Conference of the International Society for Third-Sector Research, Colegio de Mexico, July 1996. (Foley is at the Catholic University of America in Washington, D.C.; Hasbún is at the Universidad Centroamericana in San Salvador.)

24 La Prensa Gráfica, Dec. 21 1995; El Diario de Hoy, Sept 26 1995.

25 Foley and Hasbún, pp. 6-12. Their survey found NGOs heavily reliant on foreign funds, lacking coordination among themselves, and, despite good projects, facing grassroots criticism of being too distant from the communities. NGOs that had their origins in FMLN parties were now more independent.

26 "Regular la Libertad de Asociación?", Boletín Económico y Social, No. 122, Enero de 1996, FUSADES, San Salvador, pp. 1-9.

27 Declarations made in a seminar on the new law, May 1996.

28 The World Bank, El Salvador: Meeting the Challenge of Globalization, August 1996., pp. 36, 77.

29 Mark Anner, Hacia la sincicalización de los sindicatos?," Estudios Centroamericanos, 573-574, Julio-Agosto 1996, p. 600.

30 Informe Laboral: 1993, Fundación Friedrich Ebert, El Salvador, pp 31-35 and Informe Laboral: 1994, pp. 47-58. The reports warn that the data from the Ministry of Labor are likely incomplete. In the 1993 report, for example, agricultural sectors are not included.

31 Interview with Humberto Centeno, February 29, 1996.

32 Interview with U.S. Embassy official, June 16, 1995.

33 Diario de Hoy, December 5, 1996; La Prensa Gráfica, December 3 and 4.

34 Rueschemeyer, et.al., op. cit, pp. 66-67, 168-169; Haggard and Kaufman, op. cit., pp. 14-15, 126-138.

35 See HI, March 1995 for an analysis of party splits.

36 Interviews with legislators Nidia Díaz (FMLN), January 15, 1996, Jorge Villacorta (CD), February 21, 1996, Gerson Martínez (FMLN), February 26, 1996.

37 Coleman, Cruz and Moore, op. cit., p. 422. On a scale of 1-3 (Little, some and much confidence, the Catholic Church had 1.86, the media, 1.76, the military 1.3, the Assembly .93, the President .86, and political parties .83. The Civilian National Police rated quite well at 1.64.

38 The interpretation in this section was developed through interviews in February, March, June, November and December 1996 with Salvadoran political analysts Hector Dada and Carlos Ramos (FLACSO), Rafael Guido Bejar (UCA) and Hermann Schlageter (ISEPES), among other sources. See also Rafael Guido Bejar, "Los ajustes de derecha," Tendencias, No.46, Nov.1995, and "Recambios cupulares al interior de ARENA," Proceso, No.680, Oct.4, 1995.

39 Interview, René Figueroa, January 1994.

40 "Cristiani y sus hombres controlan el pais: Salgado," Primera Plana, February 17, 1995; "Salgado: existe un plan para acabar con la oposición," Primera Plana, July 14, 1995; and La Prensa Gráfica, February 29, 1996.

41 "Ambiguedades en el partido ARENA en la lucha contra la corrupción," Proceso, No.693, January 17, 1996; La Prensa Gráfica, January 18, 1996; and Diario de Hoy, January 18, 1996 (which carries an ARENA statement).

42 Diario de Hoy, May 25,; May 30, May 31, June 8, June 19, 1996; La Prensa Gráfica June 18, June 19, June 22, 1996.

43 Cornejo Arango, also a party founder, worked for D’Aubuisson in the Assembly, when, according to human rights groups, death squads and kidnappings were being organized out of the Assembly security detail.

44 For example, the 17 year-old grandson of Vice President Enrique Borgo Bustamante was wounded in a kidnapping in June. The ransom demands and arrest of the kidnappers, former soldiers, indicated a common crime. Diario de Hoy, June 17, 1996. In the case of the insurance company bombing, the police in June accused several apparently leftist law students, though the public and private skepticism, including that of senior diplomatic officials, surrounding the arrests cast much doubt on the veracity of the accusation.

45 The Convention stipulated that the party president must resign to become a candidate for president of El Salvador. "Modifican funciones de COENA," La Prensa Gráfica, September 30, 1996; "Gloria Salguero preside COENA," Diario de Hoy, September 30, 1996. On the vertical authority structure in ARENA and a defense of it, see Prensa Gráfica, October 14, 1996, p. 6-A.

46 The interpretation in this section stems from mainly from interviews with FMLN leaders in January, February, June, November, and December 1996.

47 Interviews with Miguel Sáenz, February 19, 1996 Humberto Centeno, February 20, 1996.

48 Interviews with Facundo Guardado, February 29, 1996, June 17, 1996.

49 December 1996 interviews with Eugenio Chicas and Humberto Centeno; Handal interview in La Prensa Gráfica, December 5, 1996.

50 Interviews with Ana Guadalupe Martínez, Juan Ramón Medrano, Paolo Luers, ONUSAL sources, Roberto Cañas in June 1995, January 1996, June 1996 and with Juan José Martel, Ernesto Zelayandia, Maurício Díaz, and Hector Dada, November-December 1996.

51 Eduardo Sancho, "El Pacto de San Andrés: una decisión histórica," La Prensa Gráfica, June 16, 1995.

52 Interview with PD deputy Juan Ramón Medrano, February 28, 1996.

53 In the October 1995 poll in which Salgado placed second (and Cristiani first), the formerly charismatic Villalobos trailed in 8th place.

54 "Rebrotan los conflictos internos en el PDC," Proceso, No.693, January 17, 1996.

55 La Prensa Gráfica, January 14, 1996.

56 Party chief Umaña disavowed Colindres as the PDC’s representative on the Tribunal. Diario de Hoy, February 28, 1996. Interview with TSE magistrate Felix Ulloa June 17, 1996; La Prensa Gráfica, June 25, 1996.

57 Interview, Hector Dada, FLACSO, February 21, 1996.

58 Interview with PRSC deputy Miguel Espinal, February 19, 1996. "Abraham Rodríguez: potenciando el centro político?", Proceso, February 21, 1996.

59 Interviews, Abraham Rodríguez, January 17, February 27, and June 18 1996.

60 Different sources find somewhat different percentage rates of growth. The Commercial sector of the U.S. Embassy cites rates of growth for 1992-1994 5.1, 5.0 and 5.5% respectively, while a USAID statistical summary places the percentages at 5.9, 5.6 and 4.2. The same USAID source indicates growth was 4.3% in 1995, while the Banco Central de Reserva, as reported by the Latin American Data Base, placed growth in 1995 at 6.0%.

61 For adjustment policies under Cristiani see, Carlos Briones and Carlos G. Ramos, op. cit., pp. 22-44, and Segovia, "Policies Since 1989" in Boyce, op. cit., pp. 51-72. World Bank, op. cit., pp. 11-13. Boyce, op. cit., Statistical Annex, Table A.6.

62 Alexander Segovia, "Policies Since 1989," in Boyce, op. cit., pp. 55-57; World Bank, op. cit., p. 35; Juan José Garcia V., "El futuro de las remesas familiares," Tendencias, No. 52, Junio 1996, pp. 14-16.

63 Interviews with Salvadoran economists and business leaders conducted in February, March, June, November, and December 1996 inform this section. Those consulted included Juan Hector Vidal, chief economist at the National Association of Private Enterprise (ANEP), Luís Cardenal, vice-president of the Chamber of Commerce and Industry, William Pleitez, president of the Salvadoran College of Economists (COLPROCE), Jorge Arriaza, manager of the Salvadoran Industrialists Association (ASI), and Alfonso Goitia, economist at the National Foundation for Development(FUNDE), Abraham Rodríguez of the SIGMA/Q company, Roberto Rubio of FUNDE. A chief documentary source is the excellent collection of essays in Boyce, op. cit., in particular those of economists: James Boyce, Alexander Segovia, Manual Pastor, Michael E. Conroy, Carlos Acevedo, Eva Puas and Colin Danby.

64 Juan Hector Vidal, "La economía virtual: tesis e interrogantes," in Unidad Empresarial (ANEP), vol. 36, Nov-Dec. 1995, p. 54. For an extensive analysis of current problems in the Salvadoran economy from a business perspective, see "Evolución de la economía en 1995 y perspectivas para 1996," in the same issue, from which the statistics cited here are taken.

65 Statistics from Carlos Acevedo, "Structural Adjustment , Agriculture and Peace" in Boyce, op.cit. pp. 211-212.

66 Vidal, op. cit. p.57.

67 This dynamic is analyzed in Colin Danby, "The Financial System: Opportunities and Risks," in Boyce, op. cit., chapter 9.

68 Comisión Nacional de Educación, Ciencia y Desarrollo, "Transformar la educación para la paz y el desarrollo de El Salvador," 22 de junio de 1995, published in Estudios Centroamericanos, 561-562, Julio-Augosto 1995, pp. 747-782. The issue contains five articles analyzing the report as well.

69 Compare the ANEP document "Evolución de la economia en 1995, op. cit., with FUNDE, "Bases para la construcción de un nuevo proyecto económico nacional para El Salvador," November 1994, pp.8-31, and Roberto Rubio, Joaquín Arriolia, and José Victor Aguilar, Crecimiento esteríl o desarrollo: Bases para la construcción de un nuevo proyecto económico en El Salvador, 1996. See also "Balance de la economía salvadoreña en 1995," El Economista, Vol.1, no.3, Nov-Dec. 1995, pp.4-10.

70 HI, March 1995, pp. 28-29.

71 See, "Calderón Sol insiste en imponer el alza del IVA," Primera Plana, May 26, 1995; and Rafael Guido Bejar, "Las sorpresas políticas," Tendencias, No.42, June 1995.

72 See "El mercado decidirá si hay dolarización," Primera Plana, July 14, 1995; and "Idea de dolarizar fue un error," Diario de Hoy, December 13, 1995.

73 "La ley temporal de compensación económica," Proceso, No.683, October 25, 1995; "Conflictividad socio-laboral y democracia," Proceso, No.692, January 10, 1996; ANEP, "Evolución de la economia en 1995...", op. cit., p.51.

74 "La política fiscal de los años noventa," and "Análisis comparativo de los presupuestos generales 1995-96," both in Banco Central de Reserva, Boletín Económico, No.90, December 1995. See "El acoso fiscal," Proceso, No.686, November 15, 1996.

75 Alexander Segovia, "Los síntomas de una crisis anunciada," Tendencias, No. 45, Octubre 1995, pp. 29-30.

76 Raúl Moreno, "Desacleración de la actividad económica o crisis en el esquema de crecimiento?", in Alternativas para el Desarrollo, October, 1996.

77 "La economia en el tercer trimestre de 1996," Proceso, 735, November 20, 1996; Banco Central de Reserva, Revista Trimestral (July-Sept) 1996.

78 Diario de Hoy, June 2 and 3, 1996. "Evaluación del plan de emergencia del gobierno," Proceso 725, Sept.11, 1996. The plan included accelerated depreciation, elimination of the capital gains tax, and lower interest rates.

79 "ANEP presenta: el Manifiesto Salvadoreño," in Unidad Empresarial 7:40 (July-August) 1996; Diario de Hoy, June 29, July 4, July 9, July 13, 1996, La Prensa Gráfica, July 3, 1996; interview with Luís Cardenal, Diario de Hoy, June 16, 1996; column (on rural poverty) by former Minister of Planning Mirna Liévano, La Prensa Gráfica, July 23, 1996. On the Funde Plan see Roberto Rubio, et. al. FUNDE, op. cit.; Diario de Hoy, July 1, 1996. "Economy: Four Development Proposals", Proceso, No. 719, July 24, 1996. On Association of Salvadoran Industry’s opposition to tariff reduction see, "Revelan severos problemas en la industria regional," Diario de Hoy, February 23, 1996 and "Nueva propuesta arancelaria," La Prensa Gráfica, February 21, 1996.

80 "Libre comercio solo con México," Diario de Hoy, December 5, 1996; "Ministros revisan degravación arancelaria," La Prensa Gráfica, November 21, 1996. In February, sectors of ANEP were brought into Central American trade negotiations. At year’s end, El Salvador was coordinating tariff reduction with Central America to lower final-goods tariffs to 15% over four years, starting in July, 1997.

81 "Banco Mundial prestaría a El Salvador $300 millones," Diario de Hoy, November 20, 1996.

82 "Nuevo escándalo de corrupción: el caso del FIS," Proceso, 732, October 30, 1996.

83 "BFA reducirá tasas de interés," Diario de Hoy, November 23, 1996.

84 La Prensa Gráfica, December 9, 1996.

85 Ibid., p. 79; For higher urban poverty figures in the earlier years see, Andre Segovia, "Performance and Policies Since 1989," in Boyce, op. cit., pp. 64-65. Based also on MIPLAN’s household survey he cites urban poverty at 51% and 50% in 1991-92 and 1992-93 respectively. And, consonant with a 1994 UNDP study, there was an increase in urban extreme poverty in the two years cited from 21% to 30%.

86 World Bank, op. cit., pp. 34-35.

87 Boyce, op. cit., Statistical Appendix, Table A. 11.

88 World Bank, op. cit., p. 5.

89 Briones and Ramos, op. cit., pp. 102-26, Alexander Segovia, "The War Economy of the 1980s," in Boyce, op. cit., pp. 44-45. The World Bank places the decline in real earnings from 1980-1991 at just over 10%.

90 Table A.2a in Boyce, op. cit., pp. 286-289 for GDP shares at current prices, Table A.8 for production data. and Table 10.4 in Acevedo’s essay in Boyce, showing coffee price and production variations (which does show a sizeable increase (32%) in pounds of coffee grown the first season after the war). Area planted in coffee for example, declined 13% between 1980-1982, but then, in the middle of the war, rose to 1980 levels for two years with almost the precise same yield and output in 1984. The sharp drop in output in 1985 is due to a drop in yield. Cotton output dropped sharply at the war’s outset, then held even for three years, then dropped again. Beef production held fairly steady until 1985, then dropped 9,000 tons or 30%. Corresponding to the onset of the war was a period of steep decline in terms of trade, beginning in 1978, owing to falling commodity prices and steep increases oil, higher world interest rates and higher import costs. Higher debt service also came at the same time as the war. The war itself also deeply impacted non agricultural areas of the economy with 337 businesses closing, affecting 24,800 jobs between 1979-1983. Capital flight during the same period is estimated at $840 million. Segovia, in Boyce, op. cit., pp. 34-36 and n. 5.

91 Manual Pastor and Michael Conroy, "Distributional Implications of Macroeconomic Policy: Theory and Applications to El Salvador," in Boyce, op. cit. p. 157, and for employment see Acevedo in Boyce, Table 10.8, p. 222.

92 See Mitchell A. Seligson, "Thirty Years of Agrarian Transformation in El Salvador," Latin American Research Review,(LARR) v. 30, no.3, 1995, pp. 43-74 and in LARR, v. 31, n. 2, 1996, Martin Diskin, "Distilled Conclusions: The Disappearance of the Agrarian Question in El Salvador," pp. 111-126; Jeffery M. Paige, "Land Reform and Agrarian Revolution in El Salvador: Comment on Seligson and Diskin," pp. 127-139; and Seligson, "Agrarian Inequality and the Theory of Peasant Rebellion," pp. 140-158.

93 Seligson, "Agrarian Inequality..," op. cit., p. 142. though finding a relative decline, suggests the "legacy of human suffering caused by land scarcity and overpopulation will remain an enduring feature of the landscape for decades to come. On migration costs see, Richard Luers, "Migrantes," Tendencias, No. 52, Junio 1996, pp. 8-11.

94 HI, March 1994 and March 1995; SHARE Foundation, Land Transfer Program: Short Term Advances, Long Term Uncertainty, November 15, 1996.

95 Some lands financed by the European Union upped the total to 35,000 colones.

96 In the UN Secretary General’s report of August, he considered that without a redoubling of efforts this aspect of the real estate post war problem would not be completed by the end of the year. It was not.

97 This section profits from the analysis in PRISMA, La Deuda del Sector Agropecurario: Implicaciones de la Condonación Parcial, July 1996. The numbers vary. Phase I and III numbers are from PRISMA. Acevedo, op. cit., p. 218 places Phase I beneficiaries at 36,697 and Phase III at 42,289. A USAID official, interviewed in November, estimated Phase III at 52,000.

98 PRISMA, op. cit., p. 9.

99 Interview, June 1996.

100 It is not clear if these debts can be treated separately.

101 June 1996 interviews with town council of San José las Flores, with Antonio Alvarez of the FMLN, Juan Pablo Hernández of FUNDE, Nelson Escobar of Share, Ken Ellis and Gordon Straub of USAID, and Deborah Barry of PRISMA.

102 A FUNDE source estimated in June that only a dozen could do so.

103 La Prensa Gráfica, October 27, 1995.

104 Art 248 Penal Code and Art. 122 Penal Procedural Code as reformed October 25, 1995.

105 Proceso, November 11, 1995.

106 Interviews with Carlos Ortega, MINUSAL specialist on land.

107 Interviews with ADC leaders and peasants occupying properties in Ahuachapán and Sonsonate provinces, October, November 1995.

108 Interviews with ISTA officials, November 1995.

109 This section draws upon Deborah Barry and Herman Rosa, "Environmental Degradation and Development Options," in Boyce, op. cit., pp. 233-246 and interviews with Barry in June 1995, January and June 1996 and with Ken Ellis of USAID in June 1996. See also PRISMA, World Wildlife Fund Adjust Project Study II: Country Study Report for El Salvador, March 1995, San Salvador and Richard Carlos Worden, El Salvador Environmental Contamination: Diagnostic and Strategy, November 30, 1995, USAID/El Salvador.

110 Barry and Herman, op. cit., p. 233.

111 Worden, op. cit. p. 15.

112 Worden, op. cit., pp. 114, 124.

113 World Bank, op. cit. pp. xxi, 69-83.