Former Sandinista comandante Daniel Ortega is back,
having won a first-round victory on November 5-his fourth try at
the presidency of Nicaragua since free elections were instituted in
1990. His vague promises to curb poverty were enough to beat
investment banker Eduardo Montealegre's concrete proposals, thanks
to a split opposition, a low victory threshold, and a younger
electorate with little memory of how Sandinistas once jailed
opponents and stole property.
Assuming the election was honest, the United States can do
nothing to change the outcome. However, wise policy choices can
help sustain positive relations, press Ortega's administration to
keep basic democratic promises, contain foreign adventures, and
promote the rule of law and liberal market reforms in the face of
possible inclinations to restore a dictatorial grip.
A Fragile Democracy
Since the end of the Somoza family dynasty in 1979, Nicaraguans
have been struggling to end oligarchic rule. Yet the Sandinista
revolutionaries who overthrew Anastasio Somoza became a new ruling
class that plundered the economy to finance a huge military
build-up, aligned the country with Cuba and the Soviet Union, and
sent arms to overthrow the government of El Salvador. Pressured by
U.S.-supported counter-revolutionaries, the Sandinistas allowed
free elections in 1990 and lost.
Nicaragua's first freely elected president, Violeta Chamorro of
the Liberal Party, formed a reconciliation government that ended
the armed conflict, reduced the military from 90,000 to 12,000
troops, and plugged the country's isolated economy back into the
global market. Her successor, Arnoldo Alemán, promised
further progress but stumbled trying to enrich himself in office.
Accused of embezzling government funds, he conspired with
Sandinista Party leader Ortega to stack Nicaragua's courts and
commissions with friendly cronies and change the constitution to
obtain immunity from criminal prosecution. Facing charges of
sexually abusing his stepdaughter, Ortega agreed to the pact.
Once out of office, Alemán got the worst of the deal.
Prosecutors went after him, and Sandinistas in the National
Assembly voted to strip his immunity. Tried and convicted, he
received a 20-year jail sentence for corruption. Adding salt to the
wound, coveted judgeships and commission memberships fell to
Sandinistas, as Alemán loyalists traded away positions to
get their boss released to house arrest.
During the 1980s, comandante Daniel Ortega ruled with an
iron fist. Aided by Cuban and East German advisers, his regime
built a penitentiary system that held between 6,000 to 10,000
political prisoners. The Interior Ministry encouraged violent
street gangs called "divine mobs" that regularly attacked
opposition leaders. Sandinista officials heavily censored the
independent newspaper La Prensa and closed it in 1986.
Soldiers destroyed numerous Miskito Indian villages in a relocation
campaign that forced a third of the Indians into Honduras as
refugees. Nicaragua became a base for smuggling arms to Salvadoran
guerrillas. Meanwhile, the government handed ration cards to
loyalists as inflation rose to more than 20,000 percent.
Voted out in 1990, Ortega and other high ranking Sandinistas
reportedly took tens of millions of dollars from the central bank
and enacted laws protecting property seizures worth hundreds of
millions. To keep peace, incoming President Violeta Chamorro
approved amnesties that allowed Ortega and others to keep their
Although rank and file Sandinistas have transformed their
movement from a Marxist front in the 1980s to a moderate leftist
party, Daniel Ortega seems stuck in the past. Ortega has remained
the party's leader and appointed himself its presidential candidate
in every succeeding election. In February 2005, former Managua
mayor Herty Lewites challenged Ortega to a primary contest for the
Sandinista candidacy. Ortega reportedly labeled him a "Judas" and
threw him out of the party.
Unless Ortega has had a change of heart, Nicaraguans can expect
a president who acts with impunity, justifies corruption among
friends, deals ruthlessly with adversaries, and scares off
investors. And if Ortega tries to strangle private enterprise as he
did in the 1980s, Nicaragua may find that foreign assistance from
the United States and the European Union is not so forthcoming,
leaving only Venezuela to come to its aid.
Fortunately, outgoing president Enrique Bolaños has left
the economy in better shape than he found it. Growth has
risen from 1 percent to 4 percent a year, government deficits have
been reduced, and Nicaragua ratified the U.S.- Dominican Republic
and Central American Free Trade Agreement (DR-CAFTA), opening up
trade opportunities. But a reversal in policy could end Nicaragua's
fragile recovery from the disaster years of Sandinista rule, when a
milk carton cost a half-day's wages.
In fact, Nicaragua still has a long way to go. It is a nation of
5.5 million with a gross domestic product (GDP) of $4.2 billion,
which is comparable to the economy of Lebanon, Pennsylvania, a city
of 125,000. Some 46 percent of its inhabitants live under the
poverty line and two-thirds of its students never make it beyond
elementary school. Remittances account for about 12 percent of GDP,
while imports, at $2.1 billion, loom over exports of $1.1
What the United States Can Do
General Hugo Banzer governed Bolivia once as a dictator and then
as an elected democrat. Perhaps Ortega can effect a similar
transformation. He will need to establish priorities that rub
against his grain. To make Nicaragua prosperous, he must strengthen
property rights so ordinary citizens can buy, keep, and
collateralize real estate. He will need to bolster the rule of law
so both rich and poor receive equal treatment in business
transactions. Trade openings under DR-CAFTA must be maintained.
Nicaragua's secondary education system must reach more students.
And energy needs should be met with local inputs, from the
sugar-cane harvest and geothermal sources, to avoid a build-up of
The United States should congratulate Ortega on his victory and
offer to support such goals with judicious assistance. But
Washington should also make clear that a positive relationship
rests on principles, not personalities. In return for $41 million
in aid and a $175 million Millennium Challenge grant, America
should expect Nicaragua's new leaders to avoid backsliding into
corruption, political polarization, and threats to neighbors, such
as supporting groups that aim to unseat other elected governments
as fellow leftist Hugo Chávez of Venezuela has done.
With free elections, there was always the possibility that the
Sandinistas could return to power via the ballot box. Now that they
have, Nicaraguans and neighboring leaders should encourage them to
play by democratic rules. At the end of the day, Nicaragua may
still be struggling to choose a free and prosperous future. If
Sandinistas can set aside ideological baggage to move the country
in that direction, so much the better.
is Senior Policy Analyst in the Douglas and Sarah Allison Center
for Foreign Policy Studies at The Heritage Foundation.