US embassy cable - 05QUITO1404

C O N F I D E N T I A L SECTION 01 OF 03 QUITO 001404 
 
SIPDIS 
 
SOUTHCOM FOR COMMANDER BANTZ J. CRADDOCK 
 
E.O. 12958: DECL: 06/13/2015 
TAGS: PREL, PGOV, MARR, MASS, MOPS, SNAR, PTER, EC, CO 
SUBJECT: WELCOME TO ECUADOR, GENERAL CRADDOCK 
 
Classified By: Ambassador Kristie A. Kenney, Reasons 1.4 (b), (d) 
 
1.  (U) On behalf of Mission Ecuador, General, please accept 
a warm welcome on your second visit to this fascinating South 
American nation.  Regrettably, your tight schedule forced an 
agenda trimming -- we initially had you traversing Ecuador's 
border with Colombia -- but we'll file that itinerary for 
future visits.  Into your 23 hours in-country June 20-21 we 
have packed a Country Team briefing, calls on the Ecuadorian 
minister of defense and high command, brief press 
availability (we can discuss themes in person), a visit to 
police headquarters, and a stop at the Cooperative Security 
Location (CSL) in coastal city Manta.  There, you will tour 
CSL facilities, attend an operational briefing, and call on 
the Ecuadorian base commander, with whom we enjoy excellent 
relations.  We look forward to your arrival. 
 
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A coup by any other name... 
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2.  (SBU) You come during a (typically) tumultuous time, the 
Quito "street" having deposed former President Lucio 
Gutierrez April 20 and whisking then-VP Alfredo Palacio into 
power.  Space limitations prevent me from fully accounting 
Gutierrez's downfall; citing just three components, I'd 
highlight the mostly-white Quito and Guayaquil elites' 
unacceptance of the mestizo Gutierrez, the ex-leader's 
inability to define his policies and find a political base, 
and his tacit approval of the Supreme Court president's 
decision that allowed a hated, exiled former president to 
return to Ecuador.  This last action sent middle-class 
Quitenos into the street, demanding "que se vayan todos" 
("all must go") and adopting as their nom de guerre 
"forajidos" (bandits).  Protests grew in size and scope after 
Gutierrez declared a local state of emergency April 15; five 
days later, security forces executed their rescue plan, a 
helicopter plucking the fleeing leader off the palace roof. 
 
3.  (C) We since have learned that not only the forajidos 
sought Gutierrez's head; conspirators were everywhere.  On 
the coast, Social Christian henchman and puppeteer Leon 
Febres-Cordero had pressured the then-high command to 
"withdraw its support" for the president.  Current Minister 
of Government Mauricio Gandara admitted similar actions in 
recent comments to the press.  Palacio confidant and later 
Vice-minister of Government Juan Guzman egged on forajidos in 
the streets, promising the vice president believed in their 
cause.  Our friends in Caracas too played a role, which we 
can discuss further in person.  And Palacio himself upheld 
the Ecuadorian tradition of VPs scheming against their 
bosses.  While the media, elites, the administration and its 
allies continue to trumpet their "selfless democratic actions 
against a brutal dictator," Gutierrez's departure appears 
more and more a coup, albeit non-traditional in 
implementation. 
 
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New boss blazes new trail 
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4.  (C) In word if not always in deed, Gutierrez remained a 
U.S. ally until his departure.  Deserving particular praise 
were his economic team, who oversaw hemisphere-leading growth 
and shrinking inflation, and his national security 
leadership, who orchestrated a tripling in Ecuador's northern 
border force posture.  Palacio, however, has striven to 
differentiate himself from predecessor Gutierrez, whom many 
here deemed a U.S. apologist and kowtower.  "I am Ecuador's 
last, best hope," he boasted upon taking office. 
 
5.  (C) A physician long drawn to the left, Palacio promised 
a kinder, gentler administration.  Security forces would no 
longer conduct crowd control with tear gas, for example, 
hitherto the Ecuadorian SOP.  Bowing to the forajidos, he 
promised more direct democracy, featuring referenda on key 
issues, administration jobs for youth, and even 
constitutional changes.  The CSL agreement would remain in 
force, proof Ecuador respected its international commitments, 
but the agreement would be enforced to the letter.  Palacio's 
early nominations worry us.  Gandara, perhaps the president's 
closest advisor, delights in U.S.-bashing, whatever the 
issue.  Foreign Minister Antonio Parra makes nice in person, 
but tired national sovereignty ideology dominates his 
discourse as well.  And two Gutierrez retreads -- former 
Colonels Jorge Brito and Patricio Acosta, both wedded to 
Bolivarian ideals -- have enjoyed palace access. 
 
6.  (C) Most troublesome is Finance Minister Rafael Correa. 
Despite a U.S. education (U. of Illinois), the youthful, 
charismatic minister offers 1970s-era economic policies, 
replete with "pay down the social debt, damn the foreign 
debt" sloganeering.  His keynote action -- "restructuring" 
oil revenues from debt reduction to government spending 
increases, in hopes of reactivating Ecuador's productive 
sectors -- invites profligacy and has scared off many 
investors.  He also aims to gain more state control over 
Ecuador's rich, but underexploited (especially by state-owned 
PetroEcuador) oil fields.  Correa's early IMF-bashing 
rhetoric won him few friends in international financial 
institution (IFI) circles.  Palacio's discontent and some 
public backlash have resulted in Correa toning down the 
rhetoric somewhat, but we surmise he has not changed his 
strongly-held views. 
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Hold on power tenuous 
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7.  (C) Ecuador's next presidential elections occur in 
October 2006.  Frankly, I'd be surprised if the president 
survives that long.  Adoring the office's trappings but not 
its responsibilities, the non-politician Palacio lacks 
fortitude (his wife told me that "Freddy" had been crazy to 
take the job).  He also lacks party brethren, allies in 
Congress, and is beholden to powerbrokers like Febres-Cordero 
and the ID's Rodrigo Borja.  Forajido discontent with the 
pace of reforms is great.  Three Cabinet-level officials 
already have departed amidst scandal, testament Palacio's 
government is no cleaner than the last.  Financial experts 
tell us budget gap looms in autumn.  And former President 
Gutierrez renounced his asylee status in Brazil and, from the 
United States, is lobbing coup/conspiracy charges against his 
former running mate. 
 
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Military becoming whipping-boys 
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8.  (C) "Icy" describes Palacio's dealings with Ecuador's 
high command.  Bad relations commenced April 20 after the 
president took the oath of office in Quito think-tank 
CIESPAL, where Congress had relocated due to street protests 
at its regular site.  A crowd of protesters stormed CIESPAL, 
beating fleeing deputies and putting the president's life in 
danger for four hours.  Media immediately claimed the armed 
forces were lax in rescuing their commander-in-chief, owing 
to the existence of angry pro-Lucio factions.  Whether true 
or not, Palacio responded immediately, sacking the joint 
forces commander and service chiefs.  Weeks later, rumors 
surfaced that an April 22 meeting of Quito-vicinity brigade 
commanders was actually a coup-plotting session.  Despite 
Minister of Defense Solon Espinosa absolving the 
participants, Palacio remains uncomfortable with the high 
command (and has twice replaced his Army commander). 
 
9.  (C) Neither are Ecuador's elites pleased by the 
military's alleged "involvement" in civilian affairs.  Media 
have demanded, and Congress might take on, a revision to 
Ecuador's constitution, whose Article 182 gives the armed 
forces responsibility for ensuring judicial order. 
Commentators also lambaste the military's commercial 
interests -- from ammunition production to hotel ownership -- 
codified in Ecuador's "White Book" mission statement.  Last, 
Ecuador's Navy has been bludgeoned lately over accusations it 
turned a blind eye toward U.S. naval forces' sinking of 
Ecuador-flagged fishing and cargo vessels (involved in 
migrant and drug smuggling, I might add).  The last issue is 
bound to come up in Manta; I'll brief you further upon 
arrival. 
 
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Front-line focus still sound 
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10.  (C) Palacio, Gandara and Parra are no friends of 
Colombia, representing instead Ecuador's isolationist, "its 
not our problem" wing.  The government minister has proven 
particularly critical of Plan Colombia and USG efforts to 
assist Ecuador's northern neighbor in defeating the 
narcoterrorist threat, and advocates reducing GoE frontier 
troop levels.  Parra has re-assumed former FM Nina Pacari's 
campaign to demand the GoC end aerial coca eradication near 
the Ecuadorian border.  In this environment, one would expect 
a tactical about-face in the north. 
 
11.  (C) Thankfully, policy changes have yet to reach 
front-line security forces.  A recent Embassy officer visit 
to Tulcan, deep in the mountains four miles from Colombia, 
showed counter-narcotics police determined to increase 
interdictions.  The provincial prefect (U.S. 
governor-equivalent) lauded the assignment of 400 additional 
troops to Tulcan's resident Army battalion.  And the 
commander revealed that many of his newest soldiers were 
already in the field on training exercises.  The 
Embassy-funded and supported Ecuadorian Quick Reaction Force 
(QRF) in Sucumbios province should become operational this 
year, with QRFs planned for other localities.  USG elements 
are conducting intel operations training in Esmeraldas, two 
hours south of the frontier, and an U.S. Army PsyOps team 
will conduct a northern border assessment June 20-24. 
Finally, a Special Forces team is in-country, conducting C-N 
operations joint training (with an unspoken Colombian 
narcoterrorist nexus). 
 
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Changes to the Way Ahead 
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12.  (C) Containing Colombian spillover will remain a Top-5 
Embassy priority and the focus of our security assistance 
program.  But while serious security interlocutors comprehend 
the threats Ecuador faces from Colombia, many, especially in 
media (and now in government) do not.  They instead espouse a 
return to "neutrality," arguing that Plan Colombia and USG 
assistance exacerbate what is fundamentally a political 
problem.  U.S. military aid therefore is viewed with 
suspicion, an effort to drag Ecuador into Colombia's 
conflict.  Any description of Colombia's as a "regional" 
conflict will spawn lengthy tremors, for example.  Our 
response is to focus Embassy PR efforts on Southcom's 
"softer" aid, to include Medical Readiness Training Exercises 
(MEDRETEs) and Humanitarian Assistance Program (HAP) 
projects.  Defense Minister Espinosa was to accompany me on a 
recent MEDRETE visit but had to cancel; his air force 
commander became a true believer, however, after seeing the 
goodwill his and our forces created.  Concurrently, we 
continue traditional security cooperation efforts designed in 
part to protect Ecuadorian sovereignty from organized 
crime/narcoterrorist infringement. 
 
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And how you might help 
---------------------- 
 
13.  (C) Your calls on Espinosa and the high command 
represent great opportunities to push various USG messages, 
from "stay the course on Colombia" to "remain outside (or 
above) the political fray."  Southcom's experiences with 
media management should be of unique interest to Ecuadorian 
military leadership under a heavier than usual microscope. 
Similarly, any thoughts on reinventing the armed forces 
should be welcome, since Ecuador, with USG support (via the 
Center for Hemispheric Defense Studies), is knee-deep in the 
process. 
 
14.  (C) Last, I suggest words of praise in your meeting with 
Manta Airbase commander Colonel Leonidas Enriquez.  Under his 
and his predecessor's stewardship, coordination between CSL 
and Ecuadorian forces in Manta has improved dramatically. 
Issues of PR concern, such as the AWACS deployment, became 
non-stories due greatly to Enriquez's seriousness and mission 
dedication. 
Kenney