The real shocker is that either man would be an improvement in Peru. Whatever its final outcome, the election will end the chaos that began with last year’s corrupt elections and bring to power a legitimate, democratically elected president. That will be good news for Peru, but maybe not for the winner. A host of daunting challenges faces him–from a faltering war on drug trafficking to the ongoing search for former spymaster Vladimiro Montesinos. But no issue will command more attention than the need to generate new jobs and jump-start the sluggish economy. Roughly half of the country’s 25 million people get by on the equivalent of $1.25 a day, and an estimated two thirds of the labor force is either jobless or underemployed.
The political farce playing out over the last year has hardly helped. Peruvians have been bombarded by a dizzying concatenation of events that started with the emergence of Toledo in March 2000 as a serious challenge to President Alberto Fujimori’s ambitions for a third consecutive five-year term. Through a blend of pork-barrel politics and blatant election rigging, Fujimori managed to fend off Toledo’s challenge–only to collapse within a matter of weeks last fall when secret videos showing Montesinos bribing one of Toledo’s own congressional candidates went public. By November, the once invincible Fujimori was stewing in self-imposed exile in Japan and Montesinos had become one of the world’s most sought-after fugitives.
But not even that breathtaking series of downfalls and upheavals could have prepared the country for perhaps the unlikeliest development of all: the renaissance of Alan Garcia. Garcia handed the presidency over to Fujimori in disgrace in 1990 and, as recently as seven months ago, he couldn’t even set foot in Peru without facing trial on long-standing corruption charges. But in January, he ended eight years of exile and returned to Lima a mere two months after his political nemesis faxed in his resignation from Tokyo.
Garcia promptly launched what seemed to be a delusional bid to retake the presidency. Summoning his formidable skills as a fiery campaigner, he squeaked into second place in the first-round balloting last April–to the astonishment of many Peruvians and the dismay of most foreign investors, who still recall his ill-considered nationalization of the banking system and reckless fiscal policies, which plunged the country into four-digit hyperinflation.
Now, even if he falls short of completing an astounding comeback and instead finishes second, Garcia is still poised to play a central role in Peruvian politics for years to come–either as leader of the opposition to President Toledo or as junior partner in a coalition government of national unity. With the victor expected to take only 40 to 45 percent of the ballots, neither Toledo nor Garcia will take office with a mandate for change or a working majority in Congress to ram through emergency economic measures. Sooner or later, whoever wins will have to reach out to other political parties and cobble together a governing coalition to steer Peru through the next two years.
What will it mean for Peru’s economic morass? On the hustings, both candidates shamelessly played the populist card. Toledo promised to create 1 million new jobs and hook up every schoolkid to the Internet; Garcia countered with pledges to raise the $175-a-month salaries of experienced teachers and lower the utility rates charged by privately owned telephone and electricity monopolies. Regardless of whether any of these campaign promises is ever fulfilled, the surprisingly similar economic prescriptions of Garcia and Toledo reflect Peruvians’ disenchantment with the mainly neoliberal policies that Fujimori implemented during his 10 years in office. And that by itself portends a major change in the offing inside Peru. “The voters have very clearly rejected a center-right program,” says political analyst Francisco Sagasti. “In that sense, the electorate is in tune with world trends [in favor of] a less laissez-faire approach. Both Toledo and Garcia represent that.” For better or worse.
