Backing out

President Evo Morales 22-month old government had his most serious political setback Friday in Santa Cruz, the region that opposes his La Paz-controlled Indigenous Socialism and proclaims the virtues of free market instead. Less than 36 hours after deploying 400 soldiers from Altiplano garrisons to seize control of the Viru Viru international airport, he backed out.

 Soldiers were withdrawn and a peaceful crowd of thousands of Cruceños took the airport control. Authorities and technicians who had been dismissed by Morales were reinstated. Morales admitted he had ordered soldiers to be removed from their positions at the airport gates to prevent violence.

It was a massive response from Cruceños (as Santa Cruz people are called) to an attempt they saw as the beginning of a major attack on “decentralization,” a process started years ago by promoting greater fiscal and administrative autonomy thoughout the country. It was a way of overcoming traditional centralization that required approval from central government for every major decision. The Viru Viru airport, built in the early 1980s mainly under an agreement between the Japanese International Cooperation Agency and Cordecruz, a regional public corporation, became Bolivia´s central airport, a hub taking care of international and most domestic flights. Because of its geopolitical location in the center of South America, and the number of flights coming in from the U.S., Brazil, Argentina, Paraguay and Chile, it was also the busiest airport. But in the 1990s it accumulated debts of up to Bs. 200 million (about $US 24 million), in pension contributions and other social obligations.

Sources said the shortly-sacked administration had started to payback the debt. “It was beginning to seriously respond to its payment commitments,” told me Gen. (r) Gary Prado, who took part of previous boards of directors. But Morales’ government found the situation of the airport was financially precarious.

Aasana, the name of the airport agency, has legal rules to appoint directors. Morales decided to ignore those rules and intervene militarily the institution. His government appointed new directors from his own political party, MAS (Movement Toward Socialism).

This enraged Cruceño leaders, who saw it as a major move to suffocate the region´s demand to win autonomy from the government. Other three departments (Beni, Pando and Tarija) share the same pro-autonomy campaign. Bolivia has nine departments, but the four ”autonomista” departments comprise more than a half of its territory and hold most of the country´s natural gas fields, iron ore and the growing agro-industrial sector ranging from soybeans and sugar cane to cattle.

The government asserts that of all of the airport income, 85 percent went to pay a payroll of about 200, including bloated fees to directors. But it did not elaborate. It also argues that the reinstated chairman had taken from Aasana up to $150,000 and deposited the money in a personal bank account.

It wasn´t clear why the government did not resort to a judicial process within the country’s court-system to quell and seek the corresponding legal punishment for the alleged corruption. It would have won wide public approval. But it might still pursue this matter, and if its case is proved, at least explain part of the blunder.

The government charges the demand for autonomy came from a movement of “oligarchs” and ”elites.” For what has been seen lately, including Thursday and Friday protests, that qualification hardly holds, or it is an arbitrary extrapolation. Otherwise Santa Cruz would have tens of thousands oligarchs and elites. The question now is if the political setback in Santa Cruz will bear any cost on Mr. Morales government. It may take some time to fully appreciate the magnitude of said cost.