Geoff Herzog, Voices on the Border
September 15, 2004
On September 1st the fourth consecutive Presidential term of the ARENA Party (Nationalist Republican Alliance) celebrated 100 days in office. The first days of the Saca Government broke with the authoritarian style of his predecessor, opening tables of discussion in the different government dependencies including with the opposition political parties in the Presidential House. Yet before the first month was out the dialogue with political parties which had raised hopes of developing consensus policies quickly established itself as merely a dialogue from which agreements would not emerge as appears to be the case with numerous dialogue tables.
It is worth mentioning that concrete advances seem to have come at the Salvadoran Social Security Institute (ISSS) where Jorge Mariano Pinto, the new Director, who was educated at the Jesuit primary school and appears to be perhaps the least ideological of the new appointees who in their majority emerge from the ranks of the right wing ruling party, has reached important agreements with the Union of Workers of the ISSS (STISSS). As of last week accords had been reached on the re-instatement of 60 of the 114 workers that had been fired during the past strike at Social Security which ended more than one year ago and in the ensuing 9 months.
At the same time however the authorities at Social Security continue to attempt to bind the union to a public cease-fire as the talks continue, a censure rejected by the union, particularly as announcements have been made by the Institutes authorities for the concessioning of services at the Specialties Hospital of Social Security. So as gains are made for complying with elements of the accords that ended the strike against privatization regarding the re-instatement of personnel, privatization under the guise of concessions continues to advance.
The re-hirings combine with other propaganda elements at Social Security to continue to project an image of a new style of government that is re-constructing the safety net for Salvadorans. At the end of August, the investment of $98,669,000 into Social Security was announced, as part of a plan to modernize infrastructure and broaden health coverage to children of up to 12 years of age for those covered by the Social Security system (employees with formal jobs).
Yet on September 6, the sub-Director of the ISSS admitted on the Channel 12 morning television interview that the Institute does not have the capacity to attend to grave or chronic cases and that the ISSS would only take charge of external consultations and regular control of infants. According to STISSS, official figures show that the demand for care to children under the new plan would include 382,500 children nationally yet only 40 cribs exist in the Social Security installations at the national level. While the new plan appears aimed to win propaganda points toward the first 100 days of the new administration, to cover the demand the Director if the ISSS has admitted that the demand cannot be covered by the ISSS, and that therefore concessions of services will be granted to specialists, in practice advancing toward the privatization of Social Security.
On other fronts, only 2 weeks of the new Government had passed when the largest effrontery to date was committed by the ARENA deputies against the Salvadoran people and later signed into law by President Saca, Decree 347, which reforms the pensions law, condemning Salvadorans on the verge of retirement to ten more years of labor in order to access their pensions while at the same time forcing them to turnover millions of dollars more to the pension funds controlled by Salvadoran finance capital and its international partners.
The reforms to Section b) of articles 104 and 200 of the Law of the System of Savings for Pensions, which previously allowed retirement after 30 years of continual or non-continual service, now mandate reaching the age of 60 in order to retire in the case of men and 55 years in the case of women, without accounting for the existing lack of labor stability or life expectancy in the country. Immediately effected are the 1,142,393 Salvadorans that were inscribed as of March 2004 in the private and public pension systems. The reform is being appealed in the Supreme Court by the FMLN as a violation of Article 2 of the Constitution of the Republic which, regarding the role of the state to respect and ensure the rights of its subjects.
Thousands, if not tens of thousands of Salvadorans that had planned on retiring this year, for example, are now obliged to another 10 years of labor. This move also dashes the hopes of an equal number of jobless young people from replacing their seniors in the work place in a country devastated by unemployment and under-employment with the majority of the population working in the informal sector of the economy, doing whatever they can in order to make a buck at sub-minimum wage salaries. The private pension funds (AFPs) Crecer (owned by Banco Agricola and the Spanish bank BBVA) and Confa (owned by Banco Cuscatln and the World Bank), with the lions share of pensions, currently have a base commission profit of 3% which is $115.93/year for each worker paying into the fund. The yearly total currently paid the two private pension funds by their combined share of 1,100,373 members in commissions is $126 million.
If 835,719 AFP members need to work an additional 10 years (a number calculated by the FMLN) before opting for retirement, the 2 AFPs earn an additional $97 million profit for each additional year or $970 million total over 10 years. For its part the FMLN considers this payment by Saca to the big bank which supported his campaign wholeheartedly and continue to control the ARENA Party while others speculate that the move comes to fill the gap of the differed payments by the state run Pension Fund INPEP to the private pension funds that took on the majority of pensions through pension fund privatization in 1997, supposing that much of those funds had been previously looted from the state treasuries and that the additional funds generated give solvency to the AFPs particularly regarding payment to the foreign partners BBVA and the World Bank.
Meanwhile, the first 100 days have also seen the deployment of the third contingent of Salvadoran troops to Iraq, contrary to the 80% of public opinion, which had opposed the initial deployment in the first place. Saca no doubt considers it urgent to maintain the good graces of the Bush Administration which promoted the former President Francisco Flores internationally not to mention wholeheartedly and unconstitutionally campaigned for Saca with erroneous statements by a parade of high-ranking US officials threatening the Salvadoran population with economic ruin in the event of a possible FMLN Victory last March, (cutting of remittances from Salvadorans in the US, mass deportations, change in US relationship to El Salvador hurting economy, etc).
Purported greater respect for the institutionality of the country, which would have been a break from the Flores Presidency which entered into polemical public warfare against the Assembly as well as the Supreme Court on repeated occasions during his Presidency (1999-2004), appears to have been a promise which, along with that of emphasizing social welfare, already debunked through continued steps to privatize health and Decree 347 around pensions, was also broken within the first 100 days. This came with the maneuver by the ARENA Party in the legislature to join with the small right-wing National Conciliation Party (PCN) to designate one of the 3 seats in the Supreme Electoral Tribunal (TSE) to the PCN despite its 4th place showing in the March elections.
The Law establishes the election by the Assembly of the Magistrates to the TSE as emerging from lists proposed by the three parties with the largest share of votes to the electoral body (in the case of the 2004 elections ARENA, FMLN and the CDU/PDC Coalition) and 2 magistrates selected by the legislature from lists presented by the Supreme Court of Justice. However, taking advantage of the post-elections rupture in the CDU/PDC coalition, little time was wasted by ARENA and the PCN, gaining support from the current split among legislators and leaders of the PDC, to arm a two thirds majority in support of the PCN candidate, displacing the legal heir apparent to the third slot.
It can be quickly assumed with little space for doubt that with this move the ARENA Party re-cements its alliance with the PCN which had soured in the past two years, now facilitating a permanent alliance, at least for the foreseeable future, among the two parties, yielding an nearly automatic simple majority to ARENA initiatives and on the flipside, a permanent blockade to legislative initiatives from the FMLN unless substantial social pressure can be brought to bare. One of the likely first victims of this pact will be the FMLN initiative for a half-fare for students and senior citizens to confront the recent fare hike on collective transportation.
In summary, the first 100 days of the media mogul Tony Saca in the Presidency demonstrate a very capable administration of media management of image in favor of the Government while policies that continue to pursue the same social agenda of advancing the neo-liberal model, specifically in favor of finance capital and its interests to the detriment of the Salvadoran People which can expect a continued worsening economic and social crisis.
Geoff Herzog, Voices on the Border