US embassy cable - 05QUITO2359

C O N F I D E N T I A L SECTION 01 OF 02 QUITO 002359 
 
SIPDIS 
 
E.O. 12958: DECL: TEN YEARS 
TAGS: PGOV, PINR, PREL, EC, President 
SUBJECT: GUTIERREZ RETURNS TO JAIL, PALACIO SOWS UNCERTAINTY 
 
REF: QUITO 2348 
 
Classified By: PolChief Erik Hall for reason 1.4 (b&d). 
 
1.  (C) Summary:  Ex-president Lucio Gutierrez returned to 
Ecuador on October 14 and was promptly arrested and 
incarcerated in Quito.  Perhaps more destabilizing was an 
announcement the same day by President Alfredo Palacio 
proposing a national constituent assembly over congressional 
opposition.  On October 17 Palacio sent the assembly proposal 
directly to the Supreme Electoral Tribunal, making an end run 
around Congress.  While some civil society groups and 
applauded the proposal, most political parties have reacted 
negatively.  Palacio's insistence on a reform agenda without 
consensus could put his presidency at risk, and his latest 
tactic makes him vulnerable to charges of flouting the 
constitution.  End Summary. 
 
Gutierrez Returns 
----------------- 
 
2.  (U) Gutierrez arrived in Manta at approximately 1930 
local time, by chartered aircraft from Bogota.  A crowd of 
approximately 500 supporters that had gathered earlier 
outside the Manta airport was kept from the airport by the 
police, and by the time of Gutierrez' arrival numbered around 
200, according to press reports.  On arrival at the military 
side of the airport, Gutierrez, his former aide Fausto Cobo, 
and his brother Gilmar Gutierrez were arrested by authorities 
on charges of sedition, put on a military aircraft and 
transported to the Garcia Moreno prison in Quito, arriving 
around 22:00.  In Quito another group of 200 Gutierrez 
supporters had spent the day marching and being denied access 
to the park in front of the palace.  Upon his arrival in 
Quito, Gutierrez and Cobo were assigned to a normal cell in 
the maximum security prison for common criminals.  A series 
of Gutierrez government officials visited throughout the 
weekend, smuggling out video recordings from the prison.  A 
march to the jail by Gutierrez supporters on October 17 
attracted only 20 people, according to the police. 
 
3.  (U) Gutierrez' lawyers announced they would request 
habeas corpus to release Gutierrez from preventive detention. 
 Under Ecuadorian law, this request must be made to the mayor 
in the place of detention, in this case Quito mayor Paco 
Moncayo, a strong opponent of Gutierrez' rule.  The lawyers 
also announced they would request the judge in the Gutierrez 
case to drop the charges against him for lack of proof that 
his statements abroad had undermined the security of the 
state.  Meanwhile, press reported that prosecutors were 
formulating new charges against Gutierrez for a range of 
crimes while in office, for presentation to the new Supreme 
Court once it is conformed.  For his part, Gutierrez said he 
would not leave prison unless he was exonerated.  Gutierrez 
opponent Leon Febres Cordero claimed Gutierrez left Colombia 
under threat from the FARC. 
 
Palacio Calls for Reform 
------------------------ 
 
4.  (SBU) On October 13, some Congressional leaders and 
cabinet members discussed Gutierrez' possible return 
informally, agreeing to consider declaring a political truce 
over the President's reform agenda.  President Palacio, 
however, spurned the offer by publicly announcing that he 
would propose a referendum calling a national constituent 
assembly to consider political reforms.  On October 17, 
Palacio sent his assembly proposal directly to the Supreme 
Electoral Tribunal, a move which some in Congress charged was 
unconstitutional.  Palacio justified the move under article 
104 of the constitution, which allows the president to 
convoke a referendum when, in his opinion, it deals with 
issues of "transcendental importance" which do not reform the 
constitution. 
 
5.  (U) Palacio's proposal consists of a one-question 
referendum, proposed for December 18, which would ask the 
public whether they authorize the convocation of a national 
constituent assembly to restructure the Ecuadorian state 
under a new constitution.  It would be established in the 
following manner:  100 members, elected proportionally by 
province in the first trimester of 2006, including 50 party 
representatives and 50 members of civil society, excluding 
present government officials or anyone elected to government 
posts within the last four years, and, notably, all dismissed 
ex-presidents.  The assembly would finish its deliberations 
before regularly scheduled national elections in 2006. 
 
6.  (U) Reaction to Palacio's announcement was mixed.  Social 
groups who had supported the ouster of Gutierrez praised it 
as fulfilling the reform mandate of the people.  Independent 
presidential candidate Leon Roldos, leading early 
presidential polls with 30% support, came out in favor.  So 
did the fringe leftist MPD party, and the indigenous party 
Pachakutik, with the proviso that the FTA with the U.S. be 
put up for debate in an assembly. 
 
7.  (U) Meanwhile, president of Congress Wilfredo Lucero and 
most political party leaders condemned the president's move, 
including Democratic Left president Guillermo Landazuri and 
Social Christian party leader Leon Febres Cordero, with 
Landazuri lamenting Palacio's rejection of former Government 
Minister Molestina's reform package and declaring that the 
Congress would pass its own constitutional reforms.  ID 
congressional leader Jorge Sanchez told PolChief on October 
17 that the ID would react to Palacio's proposal in congress 
on October 18, but stopped short of threatening Palacio's 
impeachment. 
Comment 
------- 
 
8.  (C) By attempting an end run around large party leaders 
and Congress, Palacio risks his own presidency, and is aware 
of that risk.  Acting Minister of Government Galo Chiriboga 
stated as much, saying the president was willing to place his 
own fate at the hands of the assembly.  The Ambassador has 
privately stressed to Palacio the risks of this gambit, but 
his frustration with Congress and stubborn allegiance to what 
he sees as the principles of the movement that brought him to 
power has prevailed. 
 
9.  (C) The electoral tribunal is headed by Febres Cordero's 
PSC and composed of representatives from seven political 
parties.  Of these, Pachakutik and MPD already support the 
assembly, and another, the PRIAN of banana magnate Alvaro 
Noboa, is wavering.  Noboa is currently second in 
presidential polling, at around 15% support, and a two-time 
second place finisher.  A constituent assembly would open the 
possibility of calling early elections, which favors Noboa 
and Roldos, the early front-runners (meanwhile, the PSC and 
ID have not even announced candidates).  A fourth vote in 
favor could come from the Citizens New Country group 
("Ciudadanos Nuevo Pais"), led by two-time presidential 
candidate Freddy Ehlers.  The PSC, ID and PRE solidly oppose 
an assembly. 
 
10.  (C) To convince four members of the PSC-headed tribunal 
to approve the referendum will probably require incentives 
from the government or strong public support from civil 
society.  Thus far the public has been unmoved.  Polls show 
them focused more on economic than political questions, and 
pro-reform street action has yet to appear.  Gutierrez' 
presence adds an unpredictable factor to the mix.  Palacio's 
insistence on a constituent assembly has provoked party 
leaders, but Gutierrez' destabilizing presence has mitigated 
their resentment of Palacio.  Despite rumored internal 
divisions, the military has not taken anti-government action. 
 
 
Suggested Press Guidance on Constituent Assembly Proposal 
--------------------------------------------- ------------ 
 
11.  (U) If asked for USG views on a constituent assembly, we 
recommend: 
 
-- repeating our commitment to help Ecuador strengthen 
democratic institutions, but 
 
-- declaring this to be an internal matter for Ecuadorians to 
resolve, and 
 
-- expressing the view that the Ecuadorian people deserve a 
democratic system which benefits all. 
JEWELL