Nicaragua: Before and After the Social Security Heist

A man wearing a Sandinista Youth T-shirt hits and robs Associated Press photographer Alfredo Zuniga. Photo: Jorge Torres EFE /confidencial


By Carlos F. Chamorro  (Confidencial)

HAVANA TIMES – The repression unleashed this week by the Ortega shock troops operating under police protection reveals the regime’s fear of social protest. Here are four key points as to why.

1- The packet of reforms to the country’s Social Security, made official by President Ortega’s decree, marks a parting of the waters in the relations between the Ortega dictatorship and Nicaraguan society. Its inevitable economic, social, and political repercussions will clearly mark two eras: Before and After the “big bundle” of INSS reforms. At this time, the outcome of these repercussions is still unforeseeable.

On the one hand, although the bases of support for the regime appear monolithic and impenetrable, economic discontent and popular ire about the INSS theft will now be added to their other points of vulnerability: corruption, repression, government centralization and nepotism. On the other hand, the political sectors that are promoting a democratic change lack force, strategy and leadership; and their demands for electoral reform in 2021 have remained unconnected to the population’s social struggles and the upsurge of new leadership. The INSS crisis now confronts them with the disjunctive of changing or dying.

2- The first thing that leaps out, is the state of unease and uncertainty felt by the business class with the rupture of the economic alliance, the so-called process of “dialogue and consensus” that has offered political legitimacy to the regime and opportunities for business deals to investors.

By unilaterally liquidating this and imposing a major increase in employers’ INSS contributions the government is threatening the economic stability. The business class already knew that one day the moment of rupture would arrive, at the point when Ortega’s discretional use of the funds from the Venezuelan cooperation ran out on him, but they weren’t prepared to propose an alternative.

The only thing clear at present is that the corporate scheme of short-term economic opportunities, at the price of democracy and transparency, is no longer sustainable, and is at the point of sinking, taking everything and the current leadership of COSEP (the superior council of private industry) down with it.

The large business owners, then, have reached a crossroads: either they submit to the regime to preserve their economic interests, with the risk of being dragged into a larger crisis in the mid-term; or place their bets on democracy and transparency and begin to set limits on the exercise of an authoritarian power that practices repression, promotes corruption, and is designing new economic reprisals.   

3- The economic blow represented by the reform in the INSS collections affects in the first place the workers, the retired, and the small and medium businesses that don’t have the capacity of the large formal businesses to absorb the shock. Tens of thousands of people – among them many supporters of the regime – will be harmed by the increase in unemployment and the need to join the informal sector.

It’s true that there’s the precedent of other crises in which the regime succeeded in imposing its will despite the protests of the population, and were able to coopt the discontent, but this is the first time in which the arbitrariness and the abuse of power have accompanied a direct hit to people’s pockets.

First, the votes were stolen in the elections of 2008 and 2011, exalting Ortega through the method of electoral fraud and unconstitutional reelection. Next, they assaulted the state institutions – the electoral branch, the judicial branch, the National Assembly, the comptroller, the attorney general’s office, the army and the police – and put them all under their thumb, thus imposing a regime of total impunity. Following this, they committed the most shameless act of corruption in the national history by detouring to private channels more than 4 billion dollars from the Venezuelan foreign aid money. And finally, they resorted to repression to suffocate the social protest of the farmers and students, and the demands for democracy and free elections.

The difference in the Social Security heist is that the political corruption and the disorder in the management of the investments and funds belonging to the Social Security institute are now directly linked to an attack on the family economy. And if we add to that the reduction in the subsidy for electricity, and the impact of the crisis affecting the coffee growers in the north of the country, it could be concluded that the Ortega regime is facing an unprecedented panorama of social conflict.

4- The brutal repression unleashed by the shock troops of the government under the protection of the police to suffocate the initial peaceful protest against the INSS reforms, gives clear evidence of the regime’s fear of social protest. They assaulted dozens of peaceful demonstrators, and attacked independent journalists. At greater levels of social protest, threats increase against the few spaces of press freedom that still survive in the country. In a dictatorship, the next victim could be the right to private enterprise.

Because of this, it’s imperative that the right to peaceful protest be restored as a demand of all segments of society. The calls to peace and against violence that the churches and the chambers of commerce promote will be useless if they don’t demand an end to the paramilitary and police repression. And they must also clear the road towards an urgently needed reform of the police, demanding the immediate resignation or discharge of Police Commissioner Aminta Granera and General Commissioner Francisco Diaz, the de facto director of the police.

There isn’t an easy way out or simple formula for confronting the economic crisis in the Social Security Institute. But the first step towards tracing a solution consists in annulling the presidential decree affecting INSS, not so they can reestablish a closed-door negotiation between the government and the large business organization, but in order to restore the right of all active members of society to participate in a national debate about a comprehensive reform and how to reclaim the autonomy of the Social Security Institute.

The time has run out for sending communiques in hopes that “the government comes to its senses”, or the imposition of external sanctions and solutions and have never represented a viable solution to the crisis in the country. Now, we have to give popular mobilization and pressure a chance to work, along with the different national spheres of influence. It’s the only peaceful and democratic out, to demand changes like the electoral reform today that would allow for a demand to end the dictatorship tomorrow.