US embassy cable - 03GUATEMALA2916

C O N F I D E N T I A L SECTION 01 OF 02 GUATEMALA 002916 
 
SIPDIS 
 
E.O. 12958: DECL: 11/13/2013 
TAGS: PGOV, PINR, PREL, EAID, GT 
SUBJECT: FRG CONGRESSMAN COMMENTS ON ELECTORAL DEFEAT 
 
REF: GUATEMALA 2889 
 
Classified By: PolCouns David Lindwall for reason 1.5 (b) and (d). 
 
1. (C) Summary: FRG Congressman-elect Antonio Arenales told 
the Ambassador on November 13 that the FRG accepts its 
electoral defeat and will not challenge the election results. 
 The FRG will not endorse a candidate in the second round 
elections.  Within the party there are those who want the FRG 
to play the role of loyal opposition and those who want to 
make it difficult for the next government to govern 
successfully.  It is unclear at this point which of the two 
factions will predominate.  We will continue to use our 
contacts with the FRG to urge them to support the democratic 
process in Guatemala, consistent with the values they claim 
to uphold.  End summary. 
 
2. (C) In a breakfast with the Ambassador, DCM and PolCouns 
on November 13, FRG Congressman-elect and soon-to-be former 
Ambassador to the U.S. Antonio Arenales said that the FRG 
accepts its defeat in the November 9 presidential elections 
and will not challenge the results (Note: There were reports 
on November 12, per reftel, that the FRG might lodge a legal 
challenge. End note).  He said some in the party (including 
himself) expected the loss of the presidential election, but 
that others are disappointed and "have their swords drawn" to 
continue the political confrontation that has characterized 
the past four years.  Arenales suggested that the party's 
national leaders (including Zury Rios and Aristides Crespo) 
are beginning to focus on the FRG's legislative strategy, 
after winning the largest single party bloc in Congress, 
while some of the leaders in rural areas are not yet 
reconciled to the party's presidential defeat.  He said 
General Rios Montt himself is quite at peace ("tranquilo") 
about the loss, but suggested the General's wife and daughter 
are less so.  Arenales said some in the party believe the FRG 
will be better positioned in the next election if the 
government that takes office on January 14, 2004 is a 
failure, and they are arguing for a frontal opposition to the 
new government to ensure it is not a success.  He urged us to 
weigh-in with our other FRG contacts to convince them of the 
wisdom of not waging an opposition that could make Guatemala 
ungovernable. 
 
3. (C) Arenales said the FRG would not endorse a candidate in 
the second round.  He said that if the FRG picked wrong and 
endorsed the loser, there would be no space for them to reach 
compromises with the new government. 
 
4. (C) Arenales believes that there is space for the FRG to 
work with the new government, whoever is elected on December 
28, on very concrete issues where there is a mutual interest. 
 He is not sanguine, however, that the new government will 
reach out to the FRG and fears they may start the 
relationship off with a confrontation.  He said that if the 
new government tries to repeal the minimum wage raise decreed 
by President Portillo following the FRG's electoral defeat, 
it provoke a confrontation with the FRG from the start and 
make it difficult to generate momentum for cooperation. 
(Note: On November 11, President Portillo decreed the largest 
minimum wage increase of his presidency -- 21% for 
agricultural workers, 16% for all others.  The increase was 
announced after it was clear that the FRG would not inherit 
the huge expense this will represent for the national budget, 
and is widely viewed as the FRG's parting shot at the new 
government and the private sector. End note). 
 
5. (C) Arenales said many in the FRG blame President 
Portillo's corruption for the party's electoral defeat, and 
they would like to see him and his Private Secretary, Julio 
Giron, behind bars.  He added that Vice Presidential 
candidate Edin Barrientos is not a member of the FRG's inner 
circle and is already effectively marginalized from the 
party's decision making.  More surprisingly, he said that 
Vice President Reyes Lopez has lost his standing with the FRG 
leadership, and, along with his son, Juan Francisco Reyes 
Wyld, has been exiled to the Central American Parliament, 
where they will enjoy immunity (from possible new "Panama 
Connection" investigations), but have no influence. 
 
6. (C) Arenales expressed concern that Guatemala would become 
"ungovernable" if Alvaro Colom wins the presidency in 
December, arguing that his small base in Congress (roughly 
20%), the lack of cohesion of his diverse team, and his 
alleged ties to "shady businessmen" (a common, but 
unsubstantiated, rumor) would represent a serious handicap 
from the start.  He said that Berger and his CACIF allies are 
at least "rational and predictable" (Note: Conventional 
wisdom is that the FRG favors a Colom victory, as they 
believe Colom would pursue the FRG corruption in the courts 
with less vigor than a CACIF-backed Berger government. 
Arenales' professed preference for Berger may come from his 
own strong pro-military, anti-left views, which make the 
center-left Colom look like the red menace. End note). 
7. (C) Comment: The FRG is slowly getting used to its 
overwhelming defeat in the November 9 elections, and is 
starting to look at how it can use its large presence in 
Congress and its control of a large number of municipalities 
to protect its interests during the next four years.  It is 
too soon to tell if the FRG will play the role of loyal 
opposition or spoiler, and there are clearly forces within 
the party pulling in both directions.  We will continue to 
use all contacts with the FRG to urge it to play a role 
consistent with the democratic values it claims to represent. 
HAMILTON