By Sylvan Hardy
When Rafael Correa announced plans to increase inheritance and capital gains last month he said he was prepared to take the heat that he knew was coming.
Five weeks later, it’s fair to say that the intensity of the heat has been more than he bargained for.
By withdrawing the tax hike proposals from the National Assembly, he had hoped to defuse the growing protests, but Thursday’s big demonstrations in Guayaquil and Quito suggest that that was a miscalculation.
Leaders of the Guayaquil and Quito protests, Mayors Jaime Nebot and Mauricio Rodas, made the point that their opposition was about more than the tax hikes. “We are challenging the government on many fronts that take power away from individuals, including the changes in social security that will hurt retirees, more and more bureaucratic burdens on businesses, and the confiscation of the teachers’ pension fund account.”
Both Nebot and Rodas understand, however, that the large size of their protests were a result of the tax proposals and the anti-Correa momentum that was building in the days before they were withdrawn.
Correa clearly underestimated the negative reaction to the proposals, especially from poorer and middle class Ecuadorians who he had counted on for support. His claim that the taxes would only affect the richest two percent of the population was contradicted by the devilish details, scant as they were, presented by administration officials.
It is likely that the protests will continue although probably not on the scale of Thursday’s. Correa’s opponents smell blood.
They may be making a mistake, however, if they assume they have the clout to force him from office. Even those who disagree with Correa on some issues, support him on others. A Chilean television channel that interviewed protesters in Guayaquil found that many of the participants had mixed feelings about the president. Several praised him for improving roads, schools, and hospitals, two even saying he was the best president in years; their problem, they said, were his recent decisions, such as the ones on taxes and changes to the social security system, that they believed was an over-extension of government power.
Correa is on the defensive for the first time in his presidency. He has back-pedaled significantly on his tax proposals and it is anyone’s guess what they will look like when they are resubmitted to the National Assembly in September. He would be well advised to curb the rhetoric charging the opposition with insurrection and focus on creating the national dialogue he promised for his tax proposals.
Despite the week’s events, Correa still operates from a position of strength. He remains steadfast in his belief that Ecuadorian society needs re-engineering and he sees it as his manifest destiny to wrest control from the power elite who have run the country for generations. His “citizen’s revolution” is a work in progress, and his popularity, by Ecuadorian standards, remains extraordinarily high.
Although the heat has been turned up, he shows no signs of getting out of the kitchen.