Garcia, Alan

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Alan Garcia

President of Peru

Born Alan Gabriel Ludwig Garcia Perez, May 23, 1949, in Lima, Peru; married; children: five. Education: Studied at the Pontifical Catholic University of Peru; National University of San Marcos, law degree, 1971; Complutense University of Madrid, doctorate in political science, 1973; Sorbonne University, sociology degree, Paris, France.

Addresses: Office—Presidente, Avda Paseo de la Republica 4297, San Isidro-Lima, Peru.

Career

Joined the American Popular Revolutionary Alliance (APRA), 1976; elected to constituency assembly, 1979; elected as a national deputy in Peru's Congress, 1980; named secretary-general of APRA, 1982; elected president of Peru, 1985; term ended, 1990; named secretary-general of APRA, early 1990s; fled into exile, 1992; returned from exile, 2001; ran unsuccessfully for president, 2001; elected president a second time, 2006.

Sidelights

The career of Alan Garcia, twice elected president of Peru, is one of South America's most unlikely comeback stories. A young, charismatic leader when he first took office, Garcia squandered the great optimism surrounding him with a series of impulsive decisions that caused terrible damage to Peru's fragile economy. Garcia fled the country two years after his presidency ended, when his rival, new president Alberto Fujimori, assumed dictatorial powers. Garcia spent nine years in exile, leaving behind corruption accusations that were never successfully prosecuted, nor refuted. After Fujimori left office in even greater disgrace than Garcia had, Garcia returned to Peru and reconstructed his political career. In 2006, he ran for the presidency against an impulsive populist much like he had been a generation earlier. He was elected on the promise that he would not repeat his past mistakes. Once in office, Garcia pursued a very different course than in his first term: careful, centrist, free-market economic policies.

Alan Gabriel Ludwig Garcia Perez was born on May 23, 1949, in Lima, the capital of Peru. He grew up in a middle-class family, went to law school in Lima, and studied political science in Madrid and sociology in Paris. He joined the American Popular Revolutionary Alliance (APRA), a center-left party, in 1976. His political success came quickly; he was elected to a constituent assembly in 1979 and to Peru's Congress in 1980, then named the secretary-general of APRA in 1982.

Garcia first ran for president in 1985, when he was only 36. Peruvian voters were attracted to his youthful charisma and spellbinding speech-making style. Some compared him to former U.S. President John F. Kennedy. In a field of nine candidates, Garcia won roughly 45 percent of the votes in the first round of voting, then won the runoff election. It was the first time the APRA party had won the presidency, and the first time in 73 years that Peru, which was used to violent takeovers of power, had two democratically elected leaders in a row. Garcia referenced Kennedy's inaugural address in his own. According to the Chicago Tribune's Vincent J. Schodolski, Garcia said, "As someone did once before, I will say that I do not come to say what I will do, but rather to ask my people what they will do for their government, their destiny, for their justice and their liberty."

Garcia inherited terrible financial problems, which were common to many Latin American nations at the time: dire poverty, inflation, flight of currency out of the country, and slow economic growth. Peru, like many developing countries, had borrowed heavily from international lenders in its past. By 1985, it was $13 billion in debt and facing huge payments to its creditors, limiting how much the government could spend on Peru's own needs. During his campaign, Garcia hinted that he would take a new, defiant approach to repaying his country's debts. "As much as you pay me for my copper, I'll pay you for your debt," he declared during a speech, as quoted by Schodolski of the Chicago Tribune. "We will pay, but first we will pay off our debt to the people by providing food and jobs."

On his first day in office, Garcia declared that Peru would only make debt payments equal to ten percent of the country's total exports. At that time, Peru faced $3.7 billion in debt payments a year, while its exports totaled $3.1 billion. Still, his declaration that he would repay $300 million a year amounted to twice the amount actually paid back by the previous Peruvian president the year before. Garcia also stimulated wages and subsidized imports into Peru. For two years, consumer spending boomed, lifting Peru's economy.

Garcia was wildly popular, at first. One poll in late 1985 put his approval rating at an astonishing 97 percent. He also reformed the police force to root out corruption and canceled an order for French fighter jets as a way to tone down a Latin American arms race. He faced criticism on human-rights issues, however. Rights groups said he did not do enough to investigate and prosecute soldiers who massacred prisoners during prison riots in 1986, or to stop the military from committing atrocities during its war with the Shining Path insurgency, which had been trying to overthrow the government since 1980.

In the summer of 1987, Garcia attempted a government takeover of the banking and insurance industries, saying he was trying to make credit more democratic; it was a disaster. Business leaders, international investors, and much of the middle class resisted, seeing the effort as an overbearing intrusion into the economy. Garcia backed down, but financiers had become convinced he was not reliable or trustworthy. Industries could no longer get loans to expand. Shortages of goods increased, inflation spiked, and the government's budget deficit grew. Critics began to describe Garcia's leadership style as imperious and impulsive.

In March of 1988, Garcia announced an austerity program, billed as part of the war effort against the Shining Path. It restricted purchases of foreign currency, raised interest rates, and eliminated subsidies of staples such as food and gas, causing their prices to shoot up. Garcia's government also increased the minimum wage and the salaries of state employees and printed more currency. Inflation skyrocketed further.

By the end of 1988, it became obvious that the austerity program had failed. Garcia's approval rating had fallen to 16 percent as Peru's economy collapsed. Chicago Tribune writer George de Lama pronounced Peru "the basket case of South America," facing "its worst depression of the century." Inflation reached rates above 1,000 percent, so that the amount of money that would have bought a car in 1985 was only enough to buy a box of matches by 1990. Peruvians ended up poor and hungry, standing in long lines for food. Protests became an almost daily occurrence, and freighters often refused to unload their cargo in ports until they were paid. Instead of being called another JFK, Garcia came to be nicknamed "Crazy Horse" for his unstable policies.

The economic distress helped strengthen the Shining Path insurgency. The Peruvian military, given free rein by Garcia, responded with brutal counterattacks, sometimes killing civilians suspected of supporting the Shining Path. By February of 1989, Peruvian military leaders began asking United States diplomats whether the United States would support a coup in Peru, but they declined.

Garcia left the presidency in June of 1990. Peruvians elected Alberto Fujimori, a political rival of Garcia's, to succeed him. Later that year, Peru's Congress narrowly voted against bringing criminal charges against Garcia for the 1986 prisoner massacres. Next, the Congress spent months investigating allegations that Garcia had embezzled public funds, finally voting to strip him of presidential immunity. Peru's attorney general then charged Garcia with embez-zling $400,000 in public funds to build three houses for himself, but the Supreme Court ruled that there was not enough evidence to charge him. Garcia claimed the charges were false and politically motivated; his opponents argued that since he had appointed several Supreme Court justices, their ruling was no surprise.

Garcia remained a major figure in Peruvian politics, quickly emerging as Fujimori's most prominent opponent. APRA once again named Garcia its secretary-general. When Fujimori instituted budget-cutting and tax measures, Garcia suggested that Congress, where APRA formed a large voting bloc, might overturn them. He and various agencies APRA controlled began preparing to investigate various deals struck by the Fujimori administration.

In April of 1992, Fujimori dissolved Peru's Congress and instituted one-party rule. Police raided the headquarters of Garcia's APRA party and surrounded Garcia's house in an attempt to arrest him, but he was not home. Garcia went into hiding, and the Fujimori government quickly filed criminal charges against him, accusing him of possessing illegal weapons in the party headquarters. Garcia eventually sought refuge in the Colombian embassy in Lima, received political asylum from Colombia, and flew out of Peru in a Colombian military plane in June. From exile, he pledged to fight what he called Fujimori's dictatorship. Meanwhile, the Supreme Court looked further into the embezzlement accusations, issuing an arrest order for Garcia in late 1992, but the court's attempt to get Colombia to extradite him was unsuccessful.

Garcia spent nine years in exile, living in Germany, France, and Colombia and writing books about Peru and Latin America. In November of 2000, Fujimori resigned the presidency after a massive corruption scandal and accusations that his electoral victory that year was rigged. Around the same time, the Supreme Court ruled that the statute of limitations on the corruption accusations against Garcia had run out. Garcia returned to Peru in January of 2001. Immediately, he began running for president again.

His campaign surged from single digits in the polls to become a serious challenge to centrist front-runner Alejandro Toledo. Though Garcia promised he had learned from his past, he also said he would withhold several payments from international creditors and again offer easy credit to farmers. Garcia narrowly lost the election that June with about 48.5 percent of the vote. Commentators suggested that Toledo had won because many people were casting their ballots against Garcia. On the other hand, Garcia's strong showing re-established him as an important political figure.

Toledo began to falter soon into his five-year term. He failed to make a dent in Peru's deep poverty, and Peruvians complained that he was indecisive and had not kept his campaign promises. Peruvians began to look to Garcia, who once again became the country's main opposition figure.

Garcia ran for president again in 2006, promising to create jobs and tax the profits of mining companies so that Peruvians could benefit more from Peru's mineral wealth. At the same time, he vowed to pursue more careful, moderate economic policies, acknowledging that he made mistakes during the 1980s. Because of economic globalization, he said, he realized that reassuring international investors would be an important part of his job. "Do you think I want my tombstone to read, 'He was so stupid that he made the same mistakes twice?'" he said, according to the BBC. He especially promised to prevent inflation.

In the first round of presidential elections in April of 2006, Garcia came in second, securing a place in the runoff election. The more conservative candidates in the race all finished below him. Instead, his first-place opponent was the left-wing populist candidate Ollanta Humala. Garcia, taking a very different approach than he had in the 1980s, campaigned against Humala by criticizing his populism and his plans to increase government control over the mining and energy industries. While Humala said he would reject the free-trade pact that president Alejandro Toledo had negotiated with the United States, Garcia supported it.

Garcia also criticized Humala's links with the president of Venezuela, the controversial and radical Hugo Chavez. "Go with Chavez, or with Peru—that is the decision," Garcia declared, according to the Washington Post's Monte Reel. Chavez responded by threatening to cut off diplomatic ties to Peru if Garcia won, a comment that a top international election observer criticized as an inappropriate attempt to influence Peru's election.

Garcia took about 55 percent of the vote in the June runoff. In his victory speech, Garcia claimed that Chavez was the true loser of the election. Garcia was sworn in as president in July of 2006 at a ceremony in Peru's Congress chamber attended by eight other Latin American presidents. He prom-ised, in his inaugural speech, to fight poverty, which had not improved under Toledo. He also attacked what he called waste in Toledo's administration.

Three days after Garcia took office, he slashed the pay of government workers, including his own salary. He also sold off some government assets. His cuts created the government's largest budget surplus since 1970. While in exile, Garcia had studied Chile's economic comeback and noted how budget surpluses had been an important ingredient. The effect in Peru was similar: By early 2007, the government had earned better ratings on the stability of its debt, an important step toward encouraging more investment. The Peruvian economy increased by eight percent in 2006, the fastest rate it had enjoyed since the early 1990s.

Throughout the first half of 2007, Garcia pushed for the United States to approve a free-trade agreement with Peru, which would encourage international investment in his country and make it easier for Peru to export its products to the United States. It was another dramatic reversal for Garcia, since he had denounced trade deals and called the United States an imperial power during his first term as president. He was said to be taking advice from economist Hernando de Soto, known for arguing that free trade is the best way for developing nations to move out of poverty.

Selected writings

Non-fiction

El Futuro Differente (A Different Future), 1982.
A la Inmensa Mayoria (To the Vast Majority), 1987.
El Desarme Financiero (The Financial Disarmament), 1989.
La Revolucion Regional (The Regional Revolution), 1990.
El Nuevo Totalitarismo (The New Totalitarianism), 1991.
Contra la Dictadura (Against Dictatorship), 1992.
El Mundo de Maquiavelo (The World of Machiavelli), 1994.
La Falsa Modernidad (False Modernity), 1997.
Mi Gobierno hizo la Regionalizacion (My Government Made Regionalization), 1998.
Modernidad y Politica en el siglo XXI (Modernity and Politics in the 21st Century), 2003.
Para Comprender el Siglo XXI (To Understand the 21st Century), 2004.
Sierra Exportada, 2005.

Sources

Periodicals

Chicago Tribune, April 15, 1985, sec. News, p. 4; June 6, 1985, sec. Business, p. 4; August 2, 1985, sec. Editorial, p. 18; October 6, 1985, sec. News, p. 21; November 3, 1985, sec. Perspective, p. 13; November 27, 1988, sec. News, p. 3; November 8, 1990, sec. News, p. 16; June 3, 1992, sec. News, p. 16; November 29, 1992, sec. News, p. 26; April 8, 2001, sec. News, p. 4; July 29, 2006, sec. News, p. 9.

Houston Chronicle, April 10, 2007.

Washington Post, December 20, 1987, p. A36; April 2, 1988, p. A11; September 17, 1988, p. A22; February 20, 1989, p. A1; April 18, 1990, p. A26; September 16, 1991, p. A17; October 20, 1991, p. A34; November 23, 1991, p. A24; December 28, 1991, p. A15; April 9, 1992, p. A24; April 16, 1992, p. A34; April 17, 2001, p. A16; June 4, 2001, p. A1; June 16, 2002, p. A22; July 15, 2004, p. A16; April 10, 2006, p. A12; June 4, 2006, p. A18, p. B2; June 5, 2006, p. A10; June 6, 2006, p. A11; November 23, 2006, p. A1; April 26, 2007, p. A26.