Time-Inconsistent Preferences: The Citizens' Revolution And The Indefinite Re-election For Presidents In Ecuador

1. Resumen

La política en el Ecuador y en el mundo entero es un tema que causa muchas reacciones, positivas y negativas. Distintas son las ideologías y puntos de vista lo con los cuales se puede en un día ganar a un país completo y al día siguiente perderlo todo. Esto es básicamente lo que la teoría de la inconsistencia del tiempo habla, de los distintos factores que podrían influenciar en el cambio de decisiones sean estas de individuos naturales o incluso de líderes gubernamentales. En Ecuador esto ha sido evidenciado dado a los distintos cambios políticos que ha sufrido el país durante los últimos años, acciones y pensamientos que en principio eran fuertemente criticados ahora son reconsiderados por parte de muchos. Son muchos los factores que influyen y en este ensayo se analizaran las mismas.

Palabras Claves: política, Ecuador, mundo, reacciones, positivas, negativas, ideologías, teoría, inconsistencia, tiempo, influenciar, gubernamentales, cambios políticos, factores

2. Abstract

Politics in Ecuador and around the world is an issue that causes many reactions, positive and negative. Are different ideologies and views him with whom you can in a country win a full day and the next day losing everything. This is basically what the theory of time inconsistency speaking of the various factors that could influence decisions on changing individuals be they natural or even government leaders. In Ecuador this has been evidenced since the various political changes that have hit the country in recent years, actions and thoughts that were heavily criticized in principle are now reconsidered by many. There are many factors that influence and in this trial were analyzed them.

Keywords: politics, Ecuador, world, reactions, positive, negative, ideology, theory, inconsistency, time, influence, government, political, factors

3. Introduction

During the last years Ecuador has been recognize for many different aspects worldwide; from its culture, to its amazing diversity; from its growing economy to its different and revolutionary politics. Even though Ecuador´s politics like any other country politics is a topic that can bring diverse thoughts, from criticism to big supporters. The citizen´s revolution is an ideology that was brought to Ecuador at the right time to the right people.

Before the Revolution, Ecuador was going through difficulties with previous president Lucio Gutierrez, he was accused of many different things that certainly were not proven but created a great problem of trust among the citizens. This lead to a revolution among certain groups, specifically the military group that took actions into their hands and dismissed Lucio Gutierrez, letting the presidency to Alfredo Palacio Vice-President at that moment, was then when Rafael Correa made its first appearance as minister of economy and showed his revolutionary position to many Ecuadorians including socialist leaders and other important people from the politic world. As Alfredo Palacio´s time in the presidency came to an end, Rafael Correa was all around Ecuador talking and persuading Ecuadorians of the magnificence of the citizen revolution, selling the idea of greatness that this ideology had behind and this it was the peoples´ duty to seek for it in order to reach Ecuador’s fullest potential.

As appealing this whole ideology was, and continues to be to many citizens, it has carry its own problems to the mandatary, his followers and other public professionals. This mainly given to the vast amount of criticism received by many other leading countries, to the many irregularities in thoughts, laws and others shown by the president and public servers. The citizens are reluctant to the current position of the president as many postures he was first against are now being taken into consideration given the probable benefits it might bring. This could be define as the time inconsistency problem that the country is going through. The proper definition of the problem is “The problem that arises when a decision maker, especially a policy maker, prefers one policy in advance but a different one when the time to implement arrives. Knowing this, others will not find the commitment to the first policy credible.” (InvestorWords, 2014) As can be read this issue is what the country is going through and there are different factors that has led to this.

Is more than evident the changes that the politic system in Ecuador is passing at this moment. Taking everything narrowly analyzed previously this essay will study the different factors that led from a Citizens Revolution system to an Indefinite Reelection for presidency, perspective that firstly was condemned by the original revolutionary thoughts. In this specific analysis three factors are going to be evaluated, the instability or downfall governmental among others socialist government in Latin America, the lack of trust and credibility from the president, and the increasingly seek of dominance or power shown by different leaders in the parliament.

4. Body or Analysis

The first aspect to be analyzed is the instability or downfall governmental control among others socialist government in Latin America. First it must be pointed out that the revolutionary point of view comes from a socialist ideology where it seeks for wealth equality and more opportunities. This ideology openly criticizes the difference in wealth and tries to proportionate more opportunity to the lower class people. The international legal dictionary defines socialism as “An economic and social theory that seeks to maximize wealth and opportunity for all people through public ownership and control of industries and social services.” (ILegalDic, 2014) As it is visible in the economy Ecuador’s entirely ideology revolves around socialism and during these past years the results have been positive, Ecuador gross domestic product has increased and it has been ranked as one of the economies with increasingly growth in the Latin American area. Even though the outcomes of this posture establish by the current president Rafael Correa, are nothing but exceptional citizen are hesitative to the near future, how are these thoughts possible, well thanks to the primary leader of all socialist countries, Venezuela.

Venezuela must not be forgotten was one of the pioneers in socialism in Latin America proposed by the now deceased president Hugo Chavez, followed by others including Rafael Correa. Economically both countries are at different stages which as a result have created uncertainty among Ecuadorians. The current Venezuelan economy is critic, and the different deficiencies and difficulties Venezuelans are facing has brought fear to Ecuadorians and many other socialist countries. An annual report during the first trimester of 2014 shows the conditions of the country,

“Inflation rate with an excess of 75%, sharp devaluation of the exchange rate, negative or no economic growth, more price controls and shortages. So grim is the diagnosis of major national and international consultants’ signatures on the behavior of the Venezuelan economy in the year just begun. The advance should not surprise anyone, because the situation of the Venezuelan economy is more critical each year, and most of the indicators agree that it is the country in the region that faces the greatest difficulties in 2014. Most troubling is that nobody believes that Nicolas Maduro has the sufficient capacity to reverse the direction reaction. "I think the government as we know that the cost pressure is enormous and cannot download the shortage, some prices will lighten up selectively" said economist Orlando Ochoa, consulted by El Nacional.” (InfobaeAmerica, 2014)

As the economist Orland Ochoa says, the shortage in many sectors from the economy is evidently has brought the worse in people in that country, Ecuador is not in that position. Oppositely enough many analysis agree that Ecuador is at its finest economically even though with the new import substation strategy being applied certain product shortage have been evidently during the last year, but is nowhere near in comparison to Venezuela. This is evidently during the report made by an international analysis during 2014,

“Ecuador's economy grew 4.5 percent last year, a slowdown compared to 5.1 percent in 2012, due to a slowdown in the non-oil sector, according to a report by the Central Bank. The government hopes that this year the economy accelerates its growth rate to about 5 percent, although the government has warned that the next two years will be difficult in the fiscal area due to heavy government outlays to finance the construction of several hydroelectric plants. "The Gross Domestic Product (GDP) had an annual growth of 4.5 percent in 2013 compared to 2012, placing the country as one of the best performing economies in the region," the central bank said in a report released weekend on its website.” (Financiero, 2014)

The analyst points out and emphasized the continue grow of Ecuador’s economy, it is evident that an oil-based economy goes through difficulties as oil prices are continuously decreasing, but even through those barriers the economy continues to flourish. The problem itself, the fear of the people, resides in two main problems that the country is going through and it’s the slowdown the GDP is facing and the consequences of applying the import substitution strategy has had over the economy which is the shortage or certain products (mainly imported) that the day to day consumer was habituated to find at any supermarket. During some studies realized by local newspapers it was evidenced that the government was using certain protectionist laws in order to promote local products, “This situation arises after the Committee of Foreign Trade (Comex) requiring a certificate of recognition INEN as customs clearance requirement of 293 subheadings.” (Lisbeth Zumba, 2014), and this laws were delivering results as different products were not able to entrance the country,

“Margarine and toiletries are some of the products that slowly disappear from the racks of markets and shops; there are shortages of certain products. Mary Rea, merchant supplies, reports daily to customers who do not have a specific brand of butter or soap for washing. A similar situation lives other traders who have sought explanations from their suppliers by the lack of products that are in high demand” (Ecuavisa, 2014)

Is this types of realities or studies that creates uncertainty among Ecuadorians, but the minister of industry and productivity denies any type of shortage and argues that is just a change process Ecuador´s market is going through at the moment given the push that local producers are having by the central government;

“However, the Minister of Industry and Productivity, Ramiro Gonzalez, dismissed question of a shortage of products and urged employers to use local raw materials. “The Ecuadorian will begin to value and purchase domestic products that have equal or better quality than imported. There is no such shortage, it's about to get used to the consumption of domestic products. Here we have an excellent industry and quality production that requires the support of all. " (Ecuavisa, 2014)

In the other hand Venezuela is going to a different situation its shortage in products is more evident, from local products as well as international products as one study showed, many Venezuelans have to queue in line for days in order to get a single primary product “Tension persists in Venezuela among eager buyers to the difficulty in finding food, personal hygiene and household. The queues are replicated throughout the country in what the Government is the result of an ambush and an economic war.” (CNN, 2014) As well as its reasons as to why there is a shortage are completely different, in Ecuador in mainly due to a change from international products to local ones, as for Venezuela the reason varies from lack of foreign exchange to exorbitant high inflation rates as a study made by the Infobae an international analyst shows

“Venezuela suffers from a year ago a deep economic crisis due mainly to lack of foreign exchange, which has been exacerbated by the fall in oil prices, the great engine of the economy of this nation. The main problem faced by Venezuelans is the shortage of commodities such as food and medicine, even in operating rooms. This in turn has driven prices, making it impossible to access certain assets.” (Infobae, 2014)

With these evidence it is certain to say that as of this exact moment Ecuador and Venezuela are I different points economically, even though politically they share the same ideology. Many citizens assure there is no guarantee that Ecuador won’t fall into the same path, but the President himself is aware of the situation that Venezuela is facing and continuously affirmed that he won’t allow Ecuador to get to that situation.

A second variable as to the time inconsistency problem that Ecuador is facing is the lack of trust or credibility that the President is going through at the moment. Credibility is a huge factor that generates trust and harmony in a politic system. Rafael Correa during his first campaign showed lots of confidence for his posture and ideology which was immediately transmitted to the citizen and led him to a victory during voting season in 2008. In 2012, Rafael Correa was still at the top of his popularity among citizens the ideology he was proposing was a revolution that many hadn’t seen in the country in a while and with previous presidents whose labor were not their best, the citizens revolution continued to be the best option there was out there, but this has change during the past years. Many private and international public survey companies are questioning Rafael Correa´s popularity and credibility among Ecuadorians.

“President Rafael Correa recorded as one downward credibility figure and discharge in late December, said on Monday Santiago Nieto, director of the polling firm Confidential Report. Speaking to TV network Teleamazonas, Nieto explained that "there has been an event that has caused a sharp drop, but has gradually been eroded the credibility and image of President (Correa) ... the fall is much most evident in Quito to Guayaquil” (AP, 2012)

As it is pointed out by Nieto, the president’s credibility has diminished during the previous years, statistics show it has not been an immediate drop, but every year it continues to decrease. “About approval, Nieto said that "48% of Quito disapprove and 47% approve ... we see a slow but steady decline since January 2009" when he started with 71%.” (AP, 2012) Correa is aware of the situation, but continuously refuses to accept the statistics value categorizing the distinct survey companies as corrupts with anti-revolutionary beliefs seeking only to harm the people, when in reality the numbers show nothing but the reality he is facing as a leader. Thus a proper study made by the public newspaper El Telegrafo can be more assertive and credible among Correa´s eyes,

“The administration of President of Ecuador, Rafael Correa, is maintained at 61% acceptance in the population, according to a study published by the company with cutting Cedatos August 2014. The figures indicate that the credibility of the word the president has a 50% acceptance, and approval on their way to be recorded the same percentage.” (Telegrafo, 2014)

The third aspect in this time inconsistency problem is Rafael Correa´s increasingly seek of power and dominance among the country and its different private institutions. This continuously power seeking has arose due to distinct aspects for example the lack of the citizens identification with the revolution, during an interview Correa pointed out that he must govern with hard hand a continuously in order to show and prove the impact the revolutions has had and will have in the country.

“On the other hand, Cedatos Gallup asked 2120 people in 10 cities, if they feel identified with the so-called citizen's revolution. Just 29% said yes, while 71% said he was not identified with the political project of the government.” (Explored, 2010)

It is evident in the analysis made by Explored, the level of identification is very low with only 29%, while 71% have opposing ideas or ideologies. As well of ideology identification there is a part that president Correa seeks to change by continue under the presidency and is the vast amount of benefits and positive changes that the revolution has had since 2008 when it was first implemented, as Barber points out around 40% are not aware or doesn’t inform themselves about the improvements the revolution has brought to the Ecuadorians,

“The sample had a size of 640 cases and was taken in the cities of Quito and Guayaquil. The confidence level is 95% with a margin of error of +/- 3%. In fact, the survey the best and worst of the Correa government is consulted. In the first category the improvements of education are located with 19.6% though 22.9% responded with nothing. In the second category leads with 16.68% "contracts with the state by Fabricio Correa," although there is a high percentage that says nothing: 18.54%.” (Barber, 2011)

With all of these aspects pointed out, the overall time inconsistency problem Ecuador is facing nowadays that unifies the previous aspects or issues is the indefinite reelection proposed by the government legislatives and the president himself as the proper way to continue doing the best for the country until somebody of his own trust can be left to continue with the revolutionary ideologies. The current constitution doesn’t have any law that approves indefinite reelection for any type of public position, but Correa diligently has the parliament to take this into hand and change this referendum to make it part of the current constitution. Gabriela Rivadeneira, president of the National Assembly, point of view on the change of the constitution in order to continue with the revolution,

“Rivadeneira said yesterday that "the Constitution of 2008, which is guarantor of rights, is not written in stone," so he said he would make changes to the Constitution to ensure the sustainability of the process of revolution of government.” (Tiempo, 2014)

This thought concerning reelection in quite new, when Rafael Correa first started doing campaigns he pointed out the importance to bring young and new leaders to govern and to revolutionize the country, but applying indefinite reelection won’t make this happen, instead this will incentive current public leaders to continuously launched themselves as candidates. There are many independent groups that openly opposes this reform, they categorized this as a perfect dictatorship as explained by former president Osvaldo Hurtado,

“Correa achieved impose a "perfect dictatorship" disguised "constitutional garb" if he wins the referendum on Saturday, it will get subdue "the two institutions not yet fully controls: justice and the press," said former President Osvaldo Hurtado” (PortfolioCo, 2015)

To conclude this analysis there are many perspectives in which this topic can be look up depending on the point of view. Revolutionaries are straight on in favor of this new reform, even though its inconsistency with former revolutionary thoughts, as for opponents they belief Mr. Correa´s time is up and it’s time for new and fresh president with new ideas and new ideologies. As which point of view is better, that would be part of a difference analysis, but there is no doubt that the country is experiencing a time inconsistency problem. As Mr. Correa´s time to govern will be over in 2016, and is very aware that the current constitution won´t allow any reelection he has been very open and in favor to a change in constitution to allow an indefinite reelection, he clearly states this during an interview done in Guayaquil this past November,

“The amendment does not diminish rights, rights increases. He who believes in alternation (in power) can vote for the changeover, but believes in continuity also can do," Correa told reporters in Guayaquil said. (Comercio, 2014)

To appropriately continue this discussion another different analysis could be done to demonstrate the effectiveness or lack of effectiveness an indefinite reelection could have in a developing country where there is not an apparent trust in the current ideology. Or probably a compare and contrast investigation with other developing countries with the same and different ideology this could led to different findings that could effectively educate the reader into distinguishing an ideology and its points which at the end could help to educate better voters in the near future. It is important to remember that many different presidents can come and go with different thoughts and ideologies but with proper educated citizens it will be in the people hands for the country to develop and grow.

Bibliography

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