1985-94 - A Rocky Road
Uruguayans rejected the proposed national security state. As a result, Lieutenant General (retired) Gregorio Alvarez Armelino (1981-85) was obliged to transfer power to an elected civilian, Julio Maria Sanguinetti. During the first half of the Sanguinetti administration, Uruguay became an atypical island of economic stability and, thanks to a deregulated financial system, a refuge for capital fleeing Argentina and Brazil.
Although Uruguay bore a heavy foreign debt load, it never stopped paying on its debt. Uruguay also had important gold reserves, one of the largest in proportion to its indebtedness and economic potential. During the final two years of Sanguinetti's administration, however, the economy suffered a downturn. In 1989 inflation had increased to 85 percent, the foreign debt to US$6.7 billion, and the fiscal deficit to 8.5 percent of GDP, and the purchasing power of salaries had fallen.
During Sanguinetti 's administration, Uruguay, like other Latin American countries undergoing a transition from military dictatorship to democracy, found itself confronted with the dilemma of having to decide between prosecuting military officers for crimes committed during the period of military rule, and thereby risk antagonizing civil-military relations, or granting them a blanket amnesty. Sanguinetti had noted that every conflict in Uruguayan history was followed by a generous amnesty law. Nevertheless, a 1986 law granting amnesty to the military was so controversial that a national referendum on the issue had to be held. In a 1989 referendum, a majority of the population upheld the law exempting military officers from human rights prosecutions.
Thus, Lacalle was spared from having to contend with the amnesty issue after assuming office as Uruguay's president. Yet, he quickly caused grumbling within the armed forces by asserting his presidential prerogative and naming two trusted officers to head the navy and air force, thereby sidestepping the order of military seniority. The military was already unhappy with its shrinking size and the reduction in the military budget during the Sanguinetti administration.
Although the military reaffirmed its subservience to the nation's democracy, Lacalle ordered the Ministry of National Defense in May 1990 to formulate a new armed forces doctrine "within the framework of the Constitution and current laws." The guidelines were to restrict its scope of action by excluding the military from responding to ordinary internal conflicts that came within the sphere of the police. Nevertheless, Army Commander Lieutenant General Guillermo de Nava raised concerns among Uruguayan politicians because of his public endorsement of a retired general's statements in April 1991 warning of a comeback by the Tupamaros and the Communist Party of Uruguay and calling for Uruguayan society to be placed on a "red alert."
Lacalle also embarked on an austere economic adjustment program that had two main components: a reduction in public spending and the inflation rate, as well as an increase in certain taxes. He succeeded in his first year in office in cutting spending by 10 percent and increasing revenue by 9 percent. Nevertheless, real wages in the public sector fell by 9 percent and in the private sector, by 6 percent; GDP growth in 1990 was negligible; and inflation reached 129 percent by year's end.
The popularity of the Blancos plummeted from about 38 percent at the time of the 1989 election to 21 percent in December 1990, according to a public opinion poll published by Busqueda. Lacalle at least shared company with the Marxist mayor of Montevideo, the Broad Front's Tabare Vazquez, whose popularity fell from 35 to 30 percent; national support for the Broad Front slipped from 26 to 24 percent. Essentially, in the wake of the 1989 elections the two traditional parties no longer dominated Uruguay, and Montevideo in particular. (Vazquez even assumed a diplomatic role by paying a five-day visit to Cuba in June 1991 and signing a five-year agreement of intent for bilateral cooperation with Havana.)
Lacking a parliamentary majority, Lacalle formed a governing coalition, National Coincidence (Coincidencia Nacional), with the Colorados but encountered strong resistance to his proposed austerity and privatization programs. Labor union opposition to these plans and support of wage claims increased during 1991, taking the form of work stoppages, slowdowns, and, in May, a one-day general strike (the third since Lacalle took office). Instead of using the unpopular term privatization to describe his economic policy agenda, Lacalle called instead for a redefinition of the role of the state, deregulation, and elimination of monopolies.
With only thirty-nine seats in the Chamber of Representatives, the Lacalle government was forced to negotiate support for each of its initiatives with the Colorado Party (thirty seats), Broad Front (twenty-one seats), and New Sector (Nuevo Espacio; nine seats). Consequendy, it was not until September 1991, by which time Lacalle 's popularity had fallen to 11 percent, that the General Assembly narrowly approved his privatization law (the Public Companies Law), after eighteen months of drafting it and four months of debating it. This law allowed private entrepreneurs to compete in a bidding system for the right to privatize public services.
Reflecting growing opposition to his economic policy of austerity and privatization, Lacalle 's National Coincidence alliance and his narrow parliamentary majority collapsed by early 1992. At the end of January 1992, Lacalle had to call for the resignation of his cabinet ministers, who were then "provisionally ratified." By that April, dissent had emerged even within the ruling National Party, with two factions opposing the strong tightening of workers' salaries, which had particularly affected state workers. One of these factions, calling itself the Progressive Pole (Polo Progresista) and supported by several prominent Blancos, including Senator Alberto Saenz de Zumaran, launched itself as a new party on May 10.
In contrast to the plunging popularity of Lacalle and his National Party, the popularity rating of Montevideo's leftist mayor, Tabare Vazquez, soared to 53 percent in September 1991, increasing the Broad Front's confidence of victory in the 1994 elections. By November 1991, the Broad Front's popularity had risen to 24 percent, making it the second most popular party after the Colorado Party, which had a 41 percent popularity rating (the National Party was supported by only 19 percent of those surveyed in an April 1992 poll). Taking a cue from events in the former Soviet Union, the Broad Front officially abandoned its commitment to Marxist-Leninist principles. In April 1992, however, the Broad Front's most radical member, the Uruguayan Revolutionary Movement (Movimiento Revolucionario Oriental—MRO), stepped back into an earlier, dark era by endorsing "an armed struggle strategy." That approach was also adopted by a self-styled right-wing paramilitary group linked to military officers and called the Juan Antonio Lavalleja Command (Comando Juan Antonio Lavalleja), which launched a series of bombings, including one against Sanguinetti's office, and bomb threats in May.
The resulting climate of fear and restlessness, which had characterized the early 1970s, seemed anachronistic in the Uruguay of the 1990s, where democracy supposedly had been consolidated. The military-linked terrorism and the public remarks made by some retired military officers revealing sentiment in favor of a coup also seemed to reflect growing military uneasiness over the prospects of a Broad Front electoral victory in 1994.
The Colorado Party, the National (Blanco) Party, and the Broad Front coalition were the three major political groupings. Each allowed ideological divisions within the party, and each such division may field its own slate of candidates in general elections. In national elections, each party fields different lists of candidates; in essence, voters express a preference for a party and for a list of candidates rather than for an individual candidate. The winning list of the party that receives the most overall votes occupies the Presidency and a proportion of seats in the Senate and Chamber of Deputies corresponding to the percentage of votes that the party received. A party therefore may run multiple presidential candidates, each with his or her own slate of legislative candidates.
In the November 1994 elections, the Broad Front chose to run only one presidential candidate. This candidate won more popular votes than any other candidate in history. He did not, however, win the presidency, since the Colorado Party's four candidates received more combined votes. Former President Julio Maria Sanguinetti won a narrow victory on November 27, the third election following the end of the military government. He replaced President Luis Alberto Lacalle on March 1, 1995.
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