Sometimes we think of development—whichever your preferred adjective (human, sustainable, equitable, integral, social, appropriate, transformative, etc.)—as an activity distinct from politics or economics. But it’s really a subset of both, as four decades of history in Nicaragua show.

Before I delve in to this, let me be clear that I support calls from Pope Francis, Nicaragua’s Catholic bishops, and Protestant church agencies for dialogue. In Bilwi—on the Atlantic coast, the place I go most frequently when I visit Nicaragua—the Moravian Church joined an ecumenical “chain of prayer for peace.”

Reasonable people can talk through the issues that led to rioting and police repression. But as we’ll also see below, there are some unreasonable people engaged in this dispute.

For more than a week near the end of April, Nicaragua was shaken by protests. What might not have been clear in media coverage in English in North America—and even in Spanish-language coverage elsewhere—was a description of the dispute.

Policy options and riots

The best description of the policy options facing the government that I have found was provided by Jake Johnston of the Center for Economic Policy and Research (CEPR). The national social security institute (INSS) is running deficit of about US$75 million a year, or about 0.5 percentage points of GDP: a problem, but not a “calamitous” one, as Johnston notes.

The 2016 Ortega-Murillo campaign: “Times of victories, by the grace of God.”

Even so, the International Monetary Fund (IMF) demanded an increase in premiums by as much as 20 per cent, reduced benefits, and an increase of the retirement age from 60 to 63 (or 65). Nicaragua’s national business council, COSEP, largely agreed with the IMF.

For months, the government resisted, but then instead of initiating a national dialogue to rally support for a different solution, it announced a unilateral solution on April 18.

What the government proposed was to raise employer and employee contributions to the INSS over coming years by 3.5 per cent and 0.75 per cent respectively, and a five-per-cent cut to pensions. Benefits would be reduced, as Johnston points out, “but by far lower amounts than what the IMF and COSEP have been proposing.”

People may or may not have known the IMF or COSEP positions. But it’s clear that calls for protest struck a chord with people who have grown tired of the present government. Protests erupted.

Daniel Ortega has been at the forefront of Nicaraguan politics since the triumph of the Sandinista Revolution on July 19, 1979. After serving as first coordinator of the reconstruction government, he was elected president in 1984. He lost elections in 1990, 1996 and 2001, but then won in 2006, 2011 and 2016. Part of the opposition boycotted the last election, but there was a 68-per-cent voter turn-out, and Ortega won with 72 per cent of the vote.

Seven times the candidate, and that, for some, might have been six times too many. (For reasons I fail to understand, the FSLN political party did not dump him in 1998 when his step-daughter accused him of sexual abuse throughout her childhood and adolescence.)

Rosario Murillo in February 1984

Ortega’s wife, Rosario Murillo, having served in many posts over the decades, is now the vice-president. I met her in Managua in 1984 when she was general secretary of the Sandinista Association of Cultural Workers (ASTC). The two are frequently accused of corruption, having privatized some state assets into their own hands. Opposition media portray Murillo as Lady Macbeth. The government is said to be like Game of Thrones.

Pent-up frustration, legitimate criticism, mishandling of the social security reform: these factors combined into an explosion of street protest that resulted in at least 42 deaths (some say 60); some who died were student protestors; at least one was a journalist; others included police.

A made-in-Washington script?

By April 22, the government backed down, rescinded the social security reforms, and accepted the calls for dialogue. The Nicaraguan Catholic bishops will serve as mediators.

From what I can see, these calls for dialogue have been accepted by government and student groups—but not the COSEP business organization, which makes me think business leaders are working from a different script: one made in Washington and paid for by the National Endowment for Democracy (NED) and its c0horts.

My suspicion is derived from recent experiences in Haiti, Venezuela, Bolivia, Cuba (the infamous USAID social media intervention), Brazil and elsewhere. Sow division, deepen polarization, and resist mediation.

I’m not saying that all criticism of (relatively) progressive governments is unjustified, but there is a history here—from CIA funding of opponents of the Sandinista Revolution in Nicaragua in the 1980s to NED support to opposition movements in Haiti. What happened to Dilma Rousseff’s presidency in Brazil and efforts to block Lula da Silva’s candidacy in this year’s election are part of the same story.

What is happening in Venezuela is instructive. Government and opposition reached agreement on new, earlier elections in talks mediated in Santo Domingo by the Vatican and several outside politicians (among them, José Luis Rodríguez Zapatero from Spain, Leonel Fernández of the Dominican Republic and Martín Torrijos of Panama). Then most opposition leaders rejected the agreement they had just made. Now elections are underway; some opposition parties participate; others call for boycott.

It seems to me that if the opposition in Venezuela and Nicaragua actually got together with a proposal that would win the votes of the majority, that would protect what the poor majority has won—access to health care, education, housing, and pensions (however modest)—they would stand a chance. But those social goals are anathema to the external backers of the opposition movements.

In Nicaragua, students and many former Sandinista supporters offer valid criticisms that need to be taken seriously in reform efforts. I’m not being paternalistic or interventionist here, but it seems to me that they should be careful to distinguish their goals from those of the business council or the US embassy, and avoid calls for regime change without viable, progressive alternative proposals. While I hear stories of repression, and different perspectives on the Ortega-Murillo government, I also see a country that mostly protects the interests of the poor through free education and health care, and provides (albeit limited) pensions. Reasonable people can discuss policy proposals. That is why everything I have said is prefaced by support for calls to dialogue.

I also see a government that has done a good job on citizen security: it is not El Salvador, Honduras or Guatemala. I fear that precipitous regime change would provide an opening to the protagonists of violence: the drug-traffickers and gangster wolves who prey on people in the neighbouring states.

CEPR’s Johnston also points to Nicaragua’s economic improvements over the past 11 years: an increase of GDP growth of 38 per cent (ahead of its neighbours). The World Bank says that poverty has been cut nearly in half, from 48 to 25 per cent.

Nicaragua reminds us that development goals advance more quickly when they become public policy. Social goals—adult literacy, public education and health care, empowerment of women, community policing, constitutional reform, environmental protection—must be set ahead of narrowly-defined economic ones.

What exists now is not all we hope for: Nicaraguans deserve better. The country still lags in terms of equality for women and LGBTI people. Autonomous regions on the Atlantic coast fail to protect Indigenous people, their lands and cultures. Mega-projects (like the trans-isthmus canal) may not be the best way forward. But in Nicaragua, those issues and others can best be advanced through political debate and regular elections.


7 Responses to Hope, fear and development in Nicaragua

  1. Denise van Wissen says:

    Great analysis, Jim!
    I think you really covered all the bases, and I’d like to share this with my networks here in Nicaragua.

  2. Wendy Gichuru says:

    Thanks for this, Jim. It helps me understand a little better some of the underlying issues. Prayers for dialogue going out.

  3. Katherine Hoyt says:

    A commentary that really tries to be balanced, unlike many recent ones. It seems strange that COSEP, AMCHAM, UPANIC, etc. would turn on a dime and join forces with the gringos. Business leaders just went to Washington to lobby against the Nica Act. But it is true they couldn’t come to an agreement on Social Security and evidently are not joining the dialogue. I would still refer folks to the NGO sector which is the one that has received the greatest funding from the National Endowment for Democracy. Click on this link Fill in Nicaragua and choose “newest first” and the grants for 2017 will come up.

    • Nan McCurdy says:

      Good analysis, Jim! And now we know that ALL the business sectors have come together and seem to be working closely with the US. In eleven years the Sandinistas were able to make quite a bit of headway for the marginalized sectors, in part, by giving in to the business interests. But those interests want more money and are not willing to pay a greater percentage for employee’s social security.

  4. Anne Larson says:

    Please, please, listen to your own words: “While I hear stories of repression… I also see a country that mostly protects the interests of the poor through free education and health care…” Are you suggesting that repression is acceptable, as long as the poor are getting some of their interests protected? Think about this! Where do you draw the line on repression, then? Why should this be the only choice available for Nicaraguans?

    • Jim Hodgson says:

      Thanks for your comment. The police response in this situation was excessive, and I support the calls for further investigation. I didn’t say that I think repression is acceptable. But I do believe people should value what has been accomplished in Nicaragua with regard to social goals and public safety. And I think that the proponents of regime change should be very clear about what it is they want and what they can deliver. The 2009 coup in Honduras ushered in a series of governments that are infinitely worse than what preceded them.

  5. Colin MacDonald says:

    Thank you, Jim. This is really helpful and insightful.


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