Ecuadoreans from all socioeconomic backgrounds and various social movements filled Plaza Grande on Monday to show their support for the country’s Citizen’s Revolution.
Following what has been a week of protests in Quito and other major cities across the country, many citizens felt it was especially important to welcome President Rafael Correa back from his European tour, said Maria Jose Carrion, a legislator for the governing PAIS Alliance party.
“This is the continued defense of our values and our revolutionary convictions. This process of transformation in Ecuador has given hope back to millions of Ecuadoreans. Not just for a few,” Carrion told teleSUR.
Before Correa attended the EU-CELAC Summit in Europe, his administration recently submitted an inheritance tax bill and a law limiting illegitimate capital gains, both of which aimed to redistribute wealth in the South American country where a stark inequality between the haves and the have-nots still exists.
Now, the proposed laws to redistribute wealth has become a rallying cause for protest for wealthy and right-wing factions, which at times has turned violent .
Carrion emphasized that while only two percent of the population will be affected by the inheritance law, which is still under debate in the National Assembly over a 30-day period, attempts by the opposition continue to try and bring instability.
“There has been a destabilization attempt here in a country that has successfully obtained political, economic and social stability over the years. This is collective struggle, the struggle of citizens who have worked for and believed in this country. We now have a different nation,” she said.
Opposition leaders called for a “Black Sunday” action, where a caravan of cars waving black flags unsuccessfully attempted to block President Correa’s return at the airport. Opposition activists also rallied in front of the ruling PAIS Alliance party headquarters, demanding a change of government.
“We believe in the redistribution of wealth, and we believe that this bill can change power relations,” supporter of PAIS Alliance Franzka Poverta told teleSUR during the changing of the guard ceremony. “Ecuador’s upper classes have demonstrated against this, and as a journalist I can say that there is a media war of disinformation, above all else in social media, which seeks to make people believe that the Citizen’s Revolution is against the popular classes.”
President Correa urged citizens to remain united against opposition aggression, and rejected the violent tactics which were registered at last week’s protests. The opposition has called for more demonstrations to happen throughout the week at various points throughout the country, and government supporters will continue demonstrating in favor bills with seek to redistribute wealth and further social equality.
Who’s Behind Ecuador’s Demonstrations?
Ecuador is currently facing a wave of demonstrations throughout the country’s main cities, with both opposition activists and government supporters taking to the streets.
Right-wing violence has caused injuries.
Some of the demonstrations have ended in opposition led violence. Wednesday night was particularly heated, as protesters encircled government supporters and began throwing bottles into the crowd, striking several people including a former government minister. In a separate incident, opposition militants broke into the headquarters of the governing party PAIS Alliance offices and assaulted staff.
But who are behind these protests and what is their goal?
The demonstrations were initially sparked by opposition activists against two proposed laws, one that would tax inheritances and another that would tax capital gains on illegitimate land speculation.
As President Rafael Correa has explained, 90 percent of Ecuador’s largest companies are held by two percent of the population, and usually ownership over these highly profitable corporations is inherited.
Opposition lawmakers, media, activists and businessmen alike, repeatedly argue that both taxes will negatively affect the middle and working classes. Yet these new progressive taxes only hit the wealthiest hardest 2 percent of the population, with the bill proposing a 47.5 percent tax on inheritances from US$849,600 dollars up.
Symbolically, the opposition protests have focused on Shyris Avenue, in the heart of Quito’s commercial district, targeting the building of the governing PAIS Alliance party.
Whatever the initial justification, the demonstrations soon clearly began to call for the “ousting” of President Correa who they describe as a “dictator.” Protesters adopted a black flag, to symbolize their mourning over the supposed “death of democracy.”
This has been the slogan of frustrated opposition groups for years now, emerging soon after President Correa took office in 2007 and throughout the nine electoral victories for Correa and his alliance of supporters.
Given their repeated electoral defeats, Ecuador’s right-wing politicians are seeking to provoke and take advantage of the current situation to try to boost their faded popularity.
Many of them played an important role during tainted past governments. Others presented themselves in the last elections as a “new option” from the right.
Below we look at some of the leaders of the opposition who are opposing the tax and calling right-wing demonstrators to the streets:
The main backer of the protests has been banker and opposition presidential candidate Guillermo Lasso, and his CREO party. Lasso received 23 percent of the vote at the 2010 elections, 30 percentage points behind Correa who won in the first round.
Lasso has much to gain from the overturning of the inheritance laws and the government. He is reported to earn US$70,000 per month, the equivalent of around 16 years of an average Ecuadorean worker’s salary.
So it may come as no surprise that after violence broke out in Shyris Avenue, the former presidential candidate Lasso called upon supporters and opposition activist to take the streets of Guayaquil Friday to continue the mobilizations.
Lasso has a checkered past, linked to some of the most dramatic and negative moments in Ecuador’s recent history.
He was Economy Minister for a period during the government of Jamil Mahuad (1998-2000), who was responsible for the banking crisis and subsequent economic collapse, caused by a massive fraud scheme by Ecuador’s biggest banks.
That crisis was one of the most profound that Latin America has seen, bankrupting huge sectors of the society overnight and stirring huge economic, social and political turbulence that saw seven different Presidents replaced in a decade.
The banking crisis led to around 70 percent of the country’s financial institutions folding with the accounts of clients frozen, meaning many lost their livelihoods and life savings. The shock reverberated around Ecuador’s wider economy: income per head fell by one-third, unemployment doubled and subsequently one in ten Ecuadoreans were forced to emigrate to to seek income.
Despite this, Lasso later became an economic adviser and special ambassador under President Lucio Gutiérrez, another president ousted by popular pressure.
In that role Lasso was appointed a member of the negotiation team for the Free Trade Agreement for the Americas (FTAA) and coordinated the visit of President Lucio Gutierrez to meet George W. Bush in 2003 on the eve of the outbreak of the Iraq war. During the visit, Gutierrez declared that “We want to become the best friend and ally of the United States”
The controversial mayor of Guayaquil, Jaime Nebot, has also backed the protests and announced he would be calling a march for June 25.
Nebot became mayor of Guayaquil after being a long time ally of Leon Febres-Cordero, Ecuador’s former authoritarian leader and mayor of Guayaquil who ruled the country through political assassinations and repression.
Shortly after Correa’s election, Nebot began a brief campaign to declare Guayaquil an independent state, with little public support.
Jaime Nebot also became notoriously known for his period as lawmaker in the 90s, after he entered the parlimant drunk and insulted fellow lawmakers on live television as he was escorted out by security officials.
Though milder in support of the street demonstrations, former presidential candidate and current mayor of Quito, Mauricio Rodas, has raised his “concern” over the inheritance and capital gains taxes, and called upon the government to heed the demonstrators. Howver Rodas’ party – SUMA – has openly backed Lasso’s call for protests.
Rodas received just 3.9 percent in the 2013 presidential election and is a former member the Social Christian Party youth wing, the party of former president Febres-Cordero. While some claim Rodas was a vice president of the party’s youth, he says he was only a member.
Perhaps the most audacious backer of the protests is Abdalá Bucaram, another disgraced former president who currently lives in Panama following several corruption charges being made against him. Bucaram was declared unfit for the presidency in 1997.
He expressed his support in a tweet to Jaime Nebot, saying “Today the country needs all its patriots….(for) the great national march on June 25 in Guayaquil.”
A former Pachakutik lawmaker whose party actively supported the coup attempt against President Correa in September 2010, Jimenez was seen in Shyris Avenue during the recent protests with his adviser Fernando Villavicencio.
On the day of the failed 2010 coup Jimenez publicly demanded that the elected President should resign and called for a national front of opposition forces to remove him from office. Later he expressed regret that the President was not shot on the day of the coup.
Bizarrely, after the coup was defeated, Jimenez and Villavicencio made baseless accusations against Correa, saying he orchestrated the events and was responsible for crimes against humanity, as several people were killed and hundreds injured during the events. Numerous police officials have been found guilty of planning the events on Sept. 30, 2010.
Right-Wing Attack on Ecuador’s Democracy
Privileged and right-wing sectors in Ecuador have been holding anti-government protests across the country since last Monday.
Since June 8, right-wing opposition demonstrators have protested daily outside the headquarters of the Ecuador’s governing party in Quito.
The protesters initially came out in the streets in response to proposed revisiones to legislation on inheritance and capital gains taxes, which would see the wealthy and upper middle classes paying more. However, the right-wing protesters are now openly calling for the ousting of the elected government of President Rafael Correa. Correa was elected in a landslide victory in 2013 with 57 percent of the vote.
6 Key Points About the Opposition Protests in Ecuador
1. This is a Rebellion of the Wealthy
Government supporters and opposition demonstrators are separated by a line of police on a major road in Quito, Ecuador, June 10, 2015. The Citizens’ Revolution commands broad support from a cross-section of Ecuadorean society, including support from the middle-classes, however there is great resentment from the wealthy upper classes who begrudge the fact that, after previously ruling the country for so long, they no longer wield the same political power.
This is despite the fact that Ecuador is one of the best performing economies in the region. The Wealth Redistribution Law, which prompted this latest round of protests is a measure specifically designed to target the wealthiest in the country, affecting a mere 2 percent of the population. The law provides a progressive taxation schedule, meaning those inheriting more will pay more.
Only three out of every 100,000 Ecuadoreans will ever receive an inheritance greater than US$50,000. Those calling on people to protest are looking to protect their own interests.
Unlike other opposition demonstrations in Ecuador, the class character is clear. Those protesting are among the wealthiest in the country who want to keep their economic power and perpetuate the inter-generational transfer of wealth.
In Ecuador 2 percent of the population controls 90 percent of big business, giving them a disproportionate amount of wealth and influence.
2. Violent Marches are Part of a Broader Right-wing Strategy in the Region
Revolutionary and left-leaning governments have won resounding electoral victories throughout Latin America, bringing with them an end to the neoliberal era, where governments did the bidding of the United States. These governments have invested massively in social programs, infrastructure, health care and education, raising the living standards of millions, while reducing inequality and poverty. The conservative opposition knows that these governments, like the Correa government in Ecuador, have the support of the majority of the population, and their only recourse is to destabilize the government in order to prompt foreign intervention or a coup d’état.
President Correa has previously warned that coups are still a real threat in the region, with opposition figures through Latin America openly calling for a military intervention against democratically-elected governments.
These latest protests have seen flashes of violence, several government supporters have been injured, including the former Minister of Culture Paco Velasco, who was pelted with a bottle.
Violence is being employed in order to provoke a response from security officials in order to accuse the government of having violated civil rights.
This is the same strategy used in Venezuela in early 2014, where opposition barricades led to the death of 43 people, mostly government supporters. Those violent right-wing barricades were used to justify U.S. sanctions against Venezuela, that called the country a threat to national security of the United States – a position that has been universally rejected by governments in Latin America.
3. Demonstrations are Being Promoted by the Private Corporate Press
The same tiny minority being targeted by these new inheritance taxes are those who own the private media outlets in the country who have been promoting the protests. The private media in Ecuador has also deliberately misrepresented the proposed inheritance tax, saying that it will negatively impact working class families and destroy family-owned businesses. Several outlets have also invited so-called analysts who claim that the law harms low-income and working class people without providing any proof whatsoever.
The highest tax rate of 47.5 percent, charged on inheritances above US$566,400, is inline with those charged throughout the world, and lower than those charged in countries such as Japan.
Apart from only affecting two percent of the population, the law provides for important exemptions and deductions. For example, if the inheritance involves the transfer of a home, the nontaxable amount doubles from US$35,400 to US$70,800. The law also allows the inheritance tax to be paid via stock to workers of a company, democratizing the means of production and the state does not receive any money in these cases.
4. The Opposition has Previously Tried to Oust Correa by Force
President Correa has warned that these demonstrations are only tangentially about the inheritance tax, instead it is an effort to destabilize and oust a democratically-elected government.
The opposition has tried this tactic before. On September 30, 2010, a police strike ended in a violent revolt against President Correa, who was held hostage in a hospital for several hours. The opposition tried to pin the blame on Correa, saying he was responsible for the events. The Office of the Public Prosecutor determined that the events of September 30 were in fact a pre-planned event, a plot to oust the government.
This fact is not lost on supporters of the government. Members of the September 30 Never Again collective, the group formed after the attempted coup against Correa in September 30, 2010, has been active in the counter marches held by supporters of the government.
5. Ecuador’s Constitution Demands Wealth Redistribution
One of the first major reforms undertaken by President Correa during his first term was the writing of a new constitution. Praised as one of the most progressive constitutions in the world, since it’s approval in 2008, the government has been steadily working to bring the country’s laws in line with what the constitution requires of them. The redistributive nature of the inheritance tax is based on article three of the Ecuadorean constitution, which reads,
“The primary duties of the state are planning national development and eradicating poverty, promoting sustainable development and equitable distribution of resources and wealth in order to bring about Good Living.”
Despite significant drops in poverty and extreme poverty, inequality is still a pressing problem in Ecuador. In terms of inequality, Ecuador sits at 132 out of 160 countries. The tax on inheritances is expected to significantly impact inequality in the country by redistributing wealth through social programs and investments.
6. The Opposition is Afraid of Losing Elections in 2017
President Correa was re-elected as president in 2013 with an overwhelming 57 percent of the vote, beating his nearest rival by over 30 points or nearly 3 million votes. Should Correa run again as the candidate of the Citizen’s Revolution, he is widely expected to win. This is why the opposition has been working to prevent his candidacy in the elections.
The Constitutional Court of Ecuador, the highest judicial body in the country regarding matters involving the constitution, affirmed that the National Assembly may make changes to the constitution without the need for a referendum, including a change that would allow the Ecuadorean people to indefinitely re-elect the president through popular vote.
Guillermo Lasso, the same politician who was trounced in the last elections, led a delegation of opposition politicians to the offices of the Organization of American States to request that they freeze efforts by the National Assembly to make changes to the constitution, calling for the U.S.-dominated body to interfere in the democratic process of the country.
Because the opposition knows it likely cannot win at the ballot box, they are seeking to oust the democratically-elected government by other means. Opposition protestors openly call for his ouster during their demonstrations, falsely accusing Correa of being a “dictator.”