Which President for Peru?

PERUVIAN electoral law prohibits the publication of polling results during the two weeks prior to a presidential election. When the last poll was published, acclaimed novelist Mario Vargas Llosa held a comfortable lead over all his rivals; indeed, he was still hoping to gain an overwhelming mandate for his Thatcheresque free-market program by capturing more than 50 percent of the votes cast, and thereby to avoid a second round of balloting. But when the ballots were counted two weeks later Mr. Vargas Llosa had come up short, gaining less than one-third and ending in a tie with political unknown, Alberto Fujimori, who offered no concrete proposals, and a month earlier registered only 3 percent in the polls. This was a stunning reversal for Vargas Llosa and his dream of reshaping Peru. It may, however, end up making him or Mr. Fujimori - whoever wins the runoff contest two months from now - a better president, if they extract the right lessons from the surprise handed to them by Peruvian voters.

Peru is a country in crisis. A 10-year-old insurgency, waged by the fanatical Shining Path guerrillas, continues to spread violence and destruction. The war intrudes on the lives of all Peruvians. Authorities have declared more than half the nation to be in a state of emergency, giving the military a nearly free rein there. Human rights abuses by the guerrillas and the counterinsurgency forces are escalating to the tune of some 4,000 killings a year.

Peru is also the world's largest supplier of coca leaves to produce cocaine; currently 250,000 acres are in cultivation. The Shining Path guerrillas derive much of their financial support from the drug trade - by levying ``taxes'' on growers and buyers of the coca leaf. Drug profits are also responsible for corruption among underpaid government officials, including judges, police officers, and military authorities. But coca is also a mainstay of the Peruvian economy - some 25 percent of the country's export earnings.

Yet neither drugs nor guerrillas is the key issue in the presidential campaign. The major concern of most Peruvians is economic survival. Per capita income in the country has plummeted to 1955 levels; it fell by 15 percent last year alone. Inflation is running at 3,000 percent a year. Malnutrition and infant mortality have been increasing. Peru's infrastructure - schools, factories, roads, bridges - is wearing out.

Mario Vargas Llosa has proposed a harsh remedy for Peru's economic ills - ``surgery without anesthesia'' in the words of an Argentine president. He wants to end the country's long tradition of a state-managed economy and give free rein to markets. He calls for the sale of government-owned industries, a halt to public subsidies for private economic activity, sharp cuts in Peru's bureaucracy, and an opening of the economy to foreign trade. There are no two ways about it. The immediate social costs of the Vargas Llosa program would be painfully high, particularly for Peru's poorest sectors. But it would be even more tragic for the country to stick with its current course.

Peruvians are ambivalent. Many of them fear the intense hardship, however therapeutic, that Vargas Llosa's ``shock treatment'' represents. But his strong early support in the polls, as well as Fujimori's extraordinary showing on election day, indicated the profound desire of most Peruvians for change. They are fed up with the unfilled promises, the political manipulation, and the sheer incompetence of Peru's established parties. Vargas Llosa and Fujimori brought fresh faces to the political arena.

Vargas Llosa made two crucial mistakes. First, he allowed himself to become identified with Peru's traditional right. By election time, he had become increasingly associated with the discredited establishment. Second, he promoted his economic ideas with the certainty of a fundamentalist. He rejected compromises. Having suffered the failure of many other programs, Peruvians have become distrustful of anyone who claims ownership of the truth.

The benefactor of these mistakes was Alberto Fujimori. He was a genuine outsider. He forged no political alliances, offered no promises. He conveyed an image of efficiency, integrity, and independence. Fujimori has momentum on his side. In the coming weeks, however, he must be more specific about his plans.

Mario Vargas Llosa faces a different challenge. He must demonstrate he is not beholden to any particular political faction; that he will rule not on behalf of the social and economic elite, but as president of all Peruvians. He must also show that he is prepared to work with diverse political groups, and to make the compromises necessary to build a broad governing coalition. If he can do that, not only could he still win the June runoff elections, but he will be a better president. His economic proposals may be technically correct and just the medicine Peru needs, but most Peruvians aren't yet persuaded.

Without broad political support, no economic policy can be sustained over time. Peru's new president must offer a sound program, but he must also reach out far enough to forge a wide consensus in support of his ideas. Lacking such a consensus, he will not be able to govern effectively, his program will be short-lived, and Peru will remain in crisis. This is the crucial lesson to be drawn from the failure of so many other promising economic initiatives in Latin America.

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