Living On

Armen is heavily missed. His absence left a hole in independent observation of the political and economic risk situation in Latin America. Beyond the merely analytical though his work was wide-ranging from Armenian philanthropy and social observation of Latin and European lifestyles through to being a "fly on the wall" at the Cannes Film Festival every year and reporting back on the more exotic foibles of the international jet-set.

We miss his wit, his sense of history and his bon mots (in French, Armenian and, even, Turkish). Armen was very much a product of the Levant but then, like so many other Levantines, converted to an international stage where they offer insight into all around them. This record tries to humbly accumulate his collected writings for public consumption so they can be preserved and appreciated for the urgency of the moment in which they were written to the timelessness of the observations.

How best to categorise the uncategorisable? Maybe Armen could be described as an Armenian/Anglo/Franco Samuel Pepys for our times.....

It is ironic that ultimately it was the very mediocrity and self-satisfaction of the Chilean "system", which he documented so thoroughly, that brought about his tragic end.

Sunday, January 17, 2010

THE SHAPE OF THINGS TO COME - In the future Piñera administration

So Sebastian Piñera has won, as I have unflinchingly predicted since January 2008. In fact, Piñera did not win as much as the Concertación lost. It did not lose last December 13, nor this January 17. It lost when it promised a cut in poor people´s electricity bills, and allowed the suppliers to steal it from hundreds of thousands of potential beneficiaries. It lost when it thought it could lie to the 2006 student movement, and make them think that a useless ad hoc committee would address their grievances. It lost when it promised a new hospital for Easter Island three and a half years ago, and has yet to lay down even a foundation stone. It lost when it promised to shorten waiting lists in the public health system and left them actually longer. It lost when it
promised that all Chileans will have emergency medical help facility like the ones that helped save the life of the Finance minister’s daughter, and forgot about it within a few days. It lost when it spent U$ 4bn of public money into transforming a functioning public transport system in Santiago into a daily misery for millions of commuters whilst pretending there was no money for other essential needs. It lost when it shied away from jailing a single corrupt senior public official or private corporate manager caught breaking the law.

It lost when it caved in to the blackmail of businessman Horst Paulmann and his Albert Speer inspired Costanera Centre project, which breaks both the letter and spirit of the environmental impact legislation, whilst refusing to deal with a Spanish-owned water treatment plant (La Farfana) whose odours have made life hell for the inhabitants of a whole Santiago neighbourhood (Maipu) for years. It lost when it said it would have only new faces in the government and in the latest campaign, and ended up emptying the old politician’s asylums to fill in posts and committees. They even dug out Frei senior from his grave, literally. It was a political mass suicide of the Guyana sect dimension.

THE RESULTS Though we do not have the final results, the fact that not
only did Eduardo Frei recognise defeat as early at 6.45 PM after the first
bulletin covering 60 % of voting stations, but the distance (about 52-48
%) is sufficiently clear, is the reason why this report is being sent
earlier than I was expecting.

Please note that that even if there a cabinet announcement in the next 24
hours, there will be no further free coverage by me of this election. By
predicting the result 2 years ago, and not letting myself be swayed by
outsiders and the murmurs of last minute “miracles”, I think my record is
sufficiently clear. It is not my face you shall be seeing on TV, hearing
on the radio or reading in the press in coming days, but I hope you
remember who was consistently right.

COMPOSITION OF CONGRESS Few people have so far concentrated on the
composition of Congress, even though it is fundamental to the conduction
of government. In fact, it is amazingly difficult to find the final
results of the December 13 legislative elections broken down by parties.
Not on the congressional sites, not on the electoral service site
(SERVEL), nor on the Ministry of the Interior site. Partial or confusing
information only, so what follows is given without guarantees. Contrary to
a well maintained legend, I have proclaimed ad nauseam that Chile is NOT a
presidential regime as the expression is generally understood. The only
thing a president can do is appoint or dismiss a number of people (around
2,000 currently), and to propose laws, but at the end they have to be
voted by Congress.

In the full elections for the lower House of Deputies, which has 120 seats, the Piñera crowd, including independents formally supporting his coalition, got 58 seats. The impressive thing is the 37 seats directly
obtained by the extreme-Right UDI, making it almost twice as large as the 19-strong Christian Democrats.

The Concertación got 57 seats (19 CD, 18 PPD, 11 PS, 5 PRSD, and three
Communists, elected for the first time in decades, and one
pro-Concertación independent). The three deputies from the Concertación
breakaway group known as the PRI called to vote for Frei so they may be
seen as a conditional support in the new Congress. There are two
uncommitted members to make up the total of 120 deputies, 45 of whom are
first timers.

Though only half the Senate was up for re-election, the final make-up
appears to have 20 Concertación members (9 DC, 6 PS, 4 PPD, 1 PRSD), as
against 16 for the Piñera lot (8 each for UDI & RN). There are two
independent members, but in any case with 20/38 the Concertación has a
small majority there and can shoot down any Piñera legislation they do not
like. One Frau Ena Von Baer, a former scribbler at their Libertad y
Desarrollo think tank, was standing as an UDI senator for the first time.
She appeared to be ahead as the counting proceeded, so even though she is
in her mid-thirties, married with two children, she decided to act like a
teenager at a TV show meeting her pop idols. With a bare midriff, she
started jumping up and down in victory. Her Ardennes battle advantage was
short lived because a recount finally gave victory to her Piñerista
colleague from RN, Francisco “Patton” Chahuan, with 682 votes. Her chances
of showing her naked stomach in the corridors of Congress thus became
kaput. Arabs like Mr Chahuan did quite well, capturing 8 deputy seats and
3 senate ones.

As in the past, ad hoc agreements across parties will have to be made if
some legislation needs to be passed, but the former Concertación, who
might hope that their desert crossing will only last four years, has no
incentive to make life easier for the Piñera administration. As for any
sensitive constitutional reforms, Maazel Tov!

FUTURE PUBLIC APPOINTMENTS Those who know the ins and outs of Mexican
politics will be familiar with the phenomenon of the “Año de Hidalgo”.
This is the last year of office or a given administration, and usually
considered as the time to “see yourself right” before you are back on the
streets. (“Año de Hidalgo. Chinga su madre quien deje algo “ as the saying
goes). One hears of something similar going on in the outgoing Chilean
administration, sometimes with specific instructions to that effect from
the bosses, particularly in regional administrations where controls are
looser. Once that is done, including lower caste hangers-on, up to 20,000
people could be on the street from their juicy sinecures of the
Concertación. Do you remember the scene in the 1987 Bertolucci movie, The
Last Emperor, when the eunuchs are expulsed from the Forbidden City? Well,
that’s what it will more or less look like.

So where is Piñera going to recruit their replacements? We might know a
partial answer as early as in the coming 24 hours, as far as ministerial
portfolios are concerned. There will be several sources. Not a few will be
given to second and third division remnants of the Pinochet years, who
have been lying low and toning down their discourse, a bit like Saddam
Hussein’s former Republican Guard members, but keeping their weapons until
the field is open for a new attack. Make no mistake about them. They are
older but not wiser or different. They are totally unreconstructed, and
with over twice as many deputies as their RN partners, supported by the
UDI shock troops. The Reconquista of much of the social progress made
under the Concertación (for what it’s worth) will be their main target,
together with such things as rolling back divorce reform, gay rights
(notwithstanding accusations in that direction against their late
ideologue Jaime Guzman), therapeutic abortion, etc.. Forget about any
support for the environment, which even under the Concertación was tackled
in a very perfunctory matter. Remember, such people eat babies, every day
of the week.

Another source will be academe, as the many higher education
establishments which Rightwing religious and business groups have set up
over the years, have a good supply of specialists in various areas.
Unfortunately, their specialization is theoretical, often based on foreign
books whose real origins are in the Ukrainian countryside of a century
ago, and totally unsuitable to today’s Chile. It is like someone with no
natural talent in cooking opening a restaurant with the help of exotic
cookbooks. The advantage of these academics is that not only they will not
be very greedy in terms of income, but the law permits public servants to
impart classes in their spare time, so they will not have to forego that.
This may not even apply as most will not be civil servants and can do what
they want in their spare time.

Also contributing will be the various think tanks such as Libertad y
Desarrollo, Instituto Libertad, Fundación Jaime Guzman, etc who have been
for some time preparing teams in various areas, again totally
inexperienced in public service. These are made up of enthusiastic young
people, reminiscent of the idealistic Chicago Boys of the mid-70’s who
thought they could change the world (they did, they gave us George Bush,
José María Aznar, Bernard Madoff and Lehman Bros.). Contrary to their
earlier generation, they are unlikely to work for a pittance though.
Austerity is not a Chilean trait any more.

Last but not least there will be the “tokens”: people from other parties,
even former Concertación activists, who have moved towards Piñera out of
disgust, directly or through the MEO route. Contrary to most other
candidates, they are more mature and many might have experience of
government outside the Pinochet years. They will be named to give the
impression of pluralism. How much and how long they can withstand the
pressures of the hard nucleus once in the job, remains to be seen. Even
the other groups do not agree on many things and there are some very
strong personalities involved, which may cause instability.

Established career civil servants cannot be fired, but their life can be
made unpleasant by shifting them to unimportant tasks and away from real
policy decisions.

It is most likely that the first division (i.e.) the Cabinet, in its first
version, will be presentable (“probably not include Pinochetists”, as
Piñera announced ambiguously, but in the corridors of power will be
lurking dark intriguing monks of the medieval variety, or modern-day
Rasputins (I mean Sergio Melnick is a shoe-in for the part) who will be
the real policymakers. Those interested in the current fad for vampires
know that they cannot enter by force. They have to be invited-in.

of candidate Piñera would have realized that he drives around in the
passenger seat without his belt on. Similarly, Eduardo Frei was filmed at
the back of a motorbike without a helmet. Admittedly millions of Chilean
pendejos do the same, but shouldn’t the future head of state give the
example (both in respecting the law and safeguarding his personal
security)? Piñera probably thinks he is an immortal busybody, and will be
a hands-on president of the kind Chile has not seen for some time, a sort
of sub-tropical Sarkozy. He might end up quickly rubbing his ministers and
advisers up the wrong way, going for media impact rather than
fundamentals. Gimmicky aspects will be favoured over in-depth changes.

I can see two stages in the four-year mandate of Sebastian Piñera, in a
scenario which fans of B&W horror movies of half a century ago will
recognize. In the first step, people will feel well, thinking they are in
a brave new world, surrounded by caring people. Some socially-oriented
measures will be announced, a few actually draft legislation, and among
which a couple may actually be passed.

Then suddenly, people will realize that these nice people are actually
aliens from another planet that they thought was not habited any more,
with a hidden agenda. They will rise in the middle of the night (sorry to
mix my cinematographic metaphors) and start doing nasty things to the
population. Rather than care about the poor, they might revive the
Pinochet plan of sending them instead to Bantustans in Patagonia (why do
you think they built the Carretera Austral? So that Austrian backpackers
and adventurous ambassadors have an original holiday?

Hah! The same guys who will be in the top jobs on March 12 are the ones
who once told foreign diplomats:” we have three million poor in Chile we
do not know what to do with. We wish we could send them away somewhere”.

The promise of a million new jobs in 4 years? Even if the new cabinet was
made up of Christ’s apostles, that is technically impossible.

The first concern of the electorate, as all polls show, is public
security. For years, different factions have been arguing as to the cause
and remedy of the notable deterioration in crime levels. The right calls
for “a strong hand” (Mano Dura), but what is that? Sending the troops down
South to create a Chilean FARC or Zapatista movement among the Mapuches?
(Well, at least it would give the navy something more serious to do than
bothering topless Dutch girls on Reñaca beach). Hitting demonstrators
harder every time they protest about something? And why is white collar
crime or corruption never punished? Polls also show that Human Rights
issues are very low on the worry list of the population, so it was a
mistake for Frei to score an own goal in relation with the possibility
(actually quite likely) that his father was assassinated.

FOREIGN AFFAIRS & DEFENCE Though Piñera has indicated his wish to
maintain good relations with both the region and further away, in practice
(and depending also of the holder of the ministerial portfolio), things
may be a bit more complicated. Whenever there is tension with either a
neighbour such as Peru, or one of the “progressive” regimes such as
Venezuela, a much tougher approach could be adopted, rather than
immediately trying to reduce the temperature as has been the case in
earlier years. The USA will obviously be pleased at the result (though
apart from not persuading president Lagos to join the Iraq operation,
there has been little tension in recent years. There should be no change
of any substance in the relationship with China, which has been steady
since the Pinochet years, and China is now the first trading partner of

The right has never been very interested in Defence, and as mentioned in
the last monthly reports, there could be a mild economic squeeze on the
armed forces. The new administration will also have to implement the
recently voted reform of the ministry, and also tackle remaining
legislation in the cards such as reforming procurement finance, tackling
the increased cost of military pensions and defining a new status for
armed forces’ personnel.

WHAT I WANT I am not Chilean, unable and unwilling to seek public office,
and have limited ambitions in life. All that interests me is that the
dollar goes back to 800 pesos and that I am rid of my psychopath
neighbour. On that basis, I don’t give a hoot if the next cabinet is
entirely made up of the young tarts who appear on CHV’s Jingo programme.

ANY FUTURE FOR MEO? Independent maverick candidate Marco Enriquez
Ominami got 20.13 % of votes in the first presidential round, but not a
single congressional seat. The only other outsider to stand for president
in recent memory, businessman Francisco Javier Errazuriz, got 15.4 % of
votes in 1989 and several congressional seats for his UCC party. It
prolonged his life but then went into a steady decline, and all but
disappeared. He is now outside the political arena.

With no congressional representation, and his ambiguity to latch his wagon
to the two front-runners, MEO going to have a hard time keeping in the
public eye except as a newspaper columnist. “Agua pasada no mueve
molinos”, as the Spanish saying goes. Do not get impressed by the current
rearguard action. A new party was created on January 7. Waste of time.
Chileans are not interested in desert crossings which provide no jobs,
consultancies, power or prestige. New parties are created and die every
month, and you do not even hear about them. A coalition of parties
supporting him put up candidates in 79 districts, and got a combined vote
of just 4.6 %. Obviously few people regarded him as a credible alternative
of government. His belated lukewarm support for Frei surely disappointed
those who thought he wanted a different future, not the best of a bad job,
and if anything reflects his personal anxiety in remaining in the public

Can he make another outsider comeback in 2013, or be re-engaged in a
renewal of the Concertación? Not impossible but unlikely (he is not even a
deputy any more), though unless Piñera does a wonderful job for the
masses, the Right may be very pushed to find another attractive candidate
after him (perhaps Lavin, who once came very close).

HUEVADA DE LA SEMANA After the first round last December 13, President
Bachelet described the polls as “having given a democratic example to the
world”. Really? And how is that? It was just a run of the mill election
like dozens of countries have them every year. Chile is not Iraq nor
Afghanistan (not yet anyway, wait until the infiltrated Israelis all over
the south put their plans into action). There may have been a time when a
democratic election in Latin America without army intervention was an
achievement. That was 20 years or so ago.

Also in the running for electoral huevada is Alvaro Vargas Llosa, son of
Mario, who published, well after the first round, an article in a US
neo-liberal journal that the second round would be between Piñera and
Marco Enriquez Ominami…I hope his father knew better who he was supporting
when he visited before the polls.