Committee to Support the Revolution in Peru
PO Box 1246, Berkeley, California 94701
415-252-5786 * Fax: 415-252-7414
THE REALITY BEHIND THE SO-CALLED ECONOMIC MIRACLE IN PERU
by the Committee to Support the Revolution in Peru, April 1996
The Fujimori regime, under the direct guidance of U.S. imperialism, has launched a new economic program. The imperialists call it a "free market economy" and "privatization." In short, it is about squeezing even more profit out of the Peruvian masses and plundering the country dry. Fujimori's economic plans offer up the Peruvian masses as low-cost wage slaves to the multinational capitalists, and has put the land and resources of Peru on the auction block.
This has made Peru temporarily more "viable" for America's bloodthirsty investors. The Wall Street Journal and the New York Times crow that Peru is now an "economic miracle!" And a "virtual gold mine!" It has been for them, and a minority of Peruvian bureaucrat-capitalists, landlords, and officials. One example they love to talk about is the Yanacocha gold mine, which reaps one million dollars of profit per month for its foreign owners and a handful of Peruvian lackeys.
But for the oppressed masses, for the peasants, for the those in vast shantytowns surrounding Lima -- in fact for the majority of Peruvians -- this so-called viability is a filthy lie. For them it has brought only increased misery and famine. Whatever "viability" imperialism's domination of Peru has, has been paid for with their blood and on their backs.
What has imperialism's new economic miracle brought to the masses? 120,000 workers in government-owned companies and in government ministries have lost their jobs. Wages have been slashed. Subsidies have been eliminated, raising the price of food, fuel and other basic necessities. As a result of the IMF-orchestrated policies of free market capitalism and privatization, the number of people who fall into the category of "very poor" in Peru has almost doubled from seven million to 13 million since 1991. 70,000 children still die every year of malnutrition and preventable disease.
The conditions are especially horrible in the countryside. None of the recent increase in imperialist investment has gone into agriculture; indeed the regime and its imperialist backers don't even pretend to have economic solutions for the rural crisis. Conditions for the peasants remain abysmal, millions have been driven into the cities under the pressure of landlessness and intolerable poverty, and the basis for them to support a protracted people's war remains great.
Recently Peru's economic output has grown a few percentage points after 5 years of recession. But this just goes to show that capitalist development can never be anything but a further source of misery and chains for the people.
And, despite all the fanfare, economic growth in Peru is very uneven and unstable. In fact it has not even reached its 1987 level. The new US investments have not helped develop a coherent national economy. Instead, they have made the Peruvian economy even more dependent on the needs and whims of imperialist capital. Much foreign capital in Peru is short-term, high-profit investment that sucks the wealth out of Peru in the shortest possible time. It imparts little economic stability to Peru, much less serves the needs of the masses.
The Fujimori regime is relying on privatization -- selling off Peru's most valuable industries and resources -- to attract investments and raise the money to pay off its $25 billion foreign debt. But all this is like burning your floorboards to heat your house.
In January, during a highly publicized "good-will" mission to Peru, Alexander Watson, US Assistant Secretary of State for Inter-American Affairs, suggested that the cases of political prisoners be reviewed following reports that innocent people had been sent to jail. But the answer was "no." "President Alberto Fujimori has rejected a proposal from a senior US official to review hundreds of secret court trials of guerrillas. The government refused any review because guerrillas could be freed for lack of evidence, Fujimori said late Thursday." (AP 1/21/94)
A panel of lawyers from the New York City Bar Association went to Peru during the first week of May for "meetings to discuss the situation on political prisoners in Peru." (UPI 5/10/94) They concluded that "hundreds of Peruvians have been unjustly convicted and sentenced under Fujimori's anti-terrorism and treason laws, and that at least 30% of the 1,375 people imprisoned for treason or terrorism held in Lima's Miguel Castro Castro prison were wrongly convicted." While the formal report of this group is not yet available, the panel was clearly partisan to the Fujimori regime. Their concern about attacks on the people focused on the fact that "innocent" people are being imprisoned. They were clearly not issuing their report on behalf of those who are in fact "guilty" of heroically standing up against the murderous regime. Note: this same organization hosted Fujimori in New York during October '93.
Another report, commissioned by the US government and made public on March 31, 1994, found that literally anyone can be arrested for terrorism, that there is no right to defense, that there is no presumption of innocence, and that the military tribunals are neither impartial nor competent. Known as the "Goldman Report," this document then advises the regime on what it should do to carry out its crimes "legally." This report, in particular, is one more indication that Fujimori's backers are becoming increasingly nervous about the fact that his crimes are so blatant. Efforts are being made from very high places to do "damage control."
In 1990, when Alberto Fujimori became president of Peru, he instituted brutal austerity measures (known as Fujishock) in order to re-qualify Peru for International Monetary Fund (IMF) loans. The percentage of Peruvians who could meet their own basic needs fell from 54% down to 5% in the first year. Peru was able to borrow almost $1 billion from the US and Japan, but all of this money went straight to the IMF banks (largely US) to pay overdue interest on old loans.
In the past six months since Fujimori's "public relations" trip to the US, all of Peru's state-owned businesses have been on the auction block. Peru is a country rich in resources, but Fujimori's desperate fire sale will raise only enough capital ($3-4 billion) to pay the interest on Peru's debt for two years - if every state-owned holding is sold. Then what? On average, companies sold to foreign investors lay off 52% of the former workers. In Peru, only 10-15% of the people are considered fully employed.
To facilitate this devastating plunder of Peru, the new constitution removes regulations on exports and exempts foreign investors from taxes. At the same time, the IMF has ordered Peru to raise domestic taxes by 3.5%, to 13% of gross domestic product (up from 4.4% in 1990) if they want to qualify for more new loans. The burden of these new taxes will fall almost entirely on the poor, and taxes on food are already going up.
Simply stated, for the vast majority of Peru's people, increased foreign domination means greater misery, poverty, and continued repression and genocide. For workers it means higher unemployment and lower wages. For peasants it means loss of land and livelihood. For the indigenous people it means the penetration of jungle areas by oil and gold explorers and loss of historic hunting areas. And for all Peruvians it means loss of dignity as a people, and increased foreign domination over every aspect of their lives (which the Peruvian people have vigorously resisted for centuries, and are continuing to fight against).
According to an article in Parade Magazine on March 6, 1994, in spite of US hopes for the defeat of the Communist Party of Peru (PCP), "the Shining Path is still very much in business." According to a new study conducted by Gordon McCormick (an "expert" on Peru who runs a program on special operations and low intensity conflict at the US Naval Postgraduate School), after the capture of Dr. Guzmán, "[PCP] members soon were going underground faster than they could be caught. Instead of falling apart, the Shining Path turned out to have an effective organization, especially within Peru's massive interior... Some members are even operating openly within a mile of the capital."
According to the Toronto Globe, "...Fujimori is doing little to win the hearts and minds of Peruvians who might be disposed toward some kind of revolutionary change. Gross human-rights violations by security forces are common. Due process has been suspended for terrorism trials... The government's economic policy does almost nothing to relieve the deep misery of most Peruvians. Shining Path is gaining on them once again."
In July 1992, nine students and a professor were kidnapped by government soldiers and later found shot in the head in a mass grave. On February 21, 1994, a general, a colonel and a captain were sentenced to 15 years for "negligence." These convictions are a cover-up and the scandal over this brutal massacre has not stopped: "Some scapegoats have been convicted but the rest of those involved and the planners, as well as those who covered up the crime, have not been have tried," said a lawyer for the victims' families. The families announced they will take the case to the Inter-American Court on Human Rights, part of the Organization of American States [where the petitions on behalf of Dr. Guzmán and other political prisoners were filed by democratic lawyers in Lima one year ago].
This scandal was set up on February 8, when Peru's Congress approved a law which insured that the La Cantuta case would be heard by a military court, rather than a civilian court. The law, which was reportedly ordered by Fujimori directly, was rushed through Congress without following normal procedures. This law is in direct violation of four articles of the new Peruvian Constitution, revealing the dictatorial powers Fujimori has assumed. He declared the law to go into effect immediately - another violation of the new Constitution. The Lima Bar Association has filed a complaint before the Supreme Court over the law.
Originally Fujimori blamed the Communist Party of Peru (PCP) for the La Cantuta disappearances. When a Congressional Committee found that the military was implicated, Peru's top general, Hermoza, rolled his tanks in front of the Parliament building as a threat. Fujimori declared the military was not responsible. But the case wouldn't go away. General Robles, who was at one time the 3rd-highest ranking officer in the Peruvian army and has since fled the country, accused both General Hermoza and Fujimori's security advisor Vladimir Montesinos of forming death squads and executing the La Cantuta victims. When the charred remains of the victims were found, Fujimori was forced to concede that there should be a trial which, according to Peru's Constitution, must be in a civilian court. However, Fujimori could not risk the exposure of high-level officials which could have come out in civilian trial. This was why he ordered Congress to pass the new law allowing for a military court to hear the case in secret.
The scandal over the La Cantuta case continues to cause big problems for the regime. Peru's Prime Minister, Mr. Bustamente, has recently resigned over the issue. Jorge Avendano, dean of the Lima Bar Association, said: "This is direct interference by Congress in the work of the judiciary. The separation of powers has ended." And General Robles is continuing to expose the high level officials who are behind the death squads. After the convictions he wrote a public letter to Fujimori: "I reaffirm my denunciation... The [decision of the] Supreme Council allows the important actors in the chain of command in this case to remain in hiding. These are the real planners and accomplices: Vladimir Montesinos, your counselor who is really commanding the SIN and who made use of the instruments of your system, giving precise orders and instructions. General Hermoza, who can not hide behind his supposed ignorance of the case and deny his responsibility. It's shameful to see this general, who implicates his own people and who uses all the resources of his position to save himself, Montesinos and the rest of the responsible authorities."
Fujimori's US backers are also having trouble justifying (or whitewashing) this heinous crime before the world. This comes at a time when massive international investment in Peru is being promoted in the capitals of the "economic superpowers." Officially, US government officials have announced that "the resolution of the La Cantuta case will signal the return of democracy in Peru." This "resolution," however, is nowhere in sight.
While in Colombia recently, Fujimori defended himself, "We cannot put at risk the armed forces. Furthermore, those who are objecting to the "Cantuta" law were part of past governments where flagrant cases were also dealt with by military courts. The most notorious example is the prison massacre where approximately 300 prisoners were shot in the head..." The opportunism Fujimori exhibits verges on the absurd - defending the death squad massacres carried out by his own henchmen by claiming that his predecessors did the same thing to hundreds of political prisoners during the 1986 El Fronton massacre - which of course they did. The bottom line for Fujimori is revealed in his next comment: "[The anti-terrorist struggle] is a national objective of Peru... [We cannot permit] the diminishing of the morale and operational capacities of the Armed Forces.... We are going to defeat Sendero Luminoso. I will defeat it. And after that, there will be human rights."
Committee to Support the Revolution in Peru
PO Box 1246, Berkeley, California 94701
415-252-5786 * Fax: 415-252-7414