This continued a longstanding trend. In 2000, two members of the family of Federico Franco's newly appointed foreign minister, José Félix Fernández Estigarribia (then based in Barcelona) were awarded land at Fuerte Olimpo in the Paraguayan Chaco: his daughter Marta Elvira Fernández Lloret received 3,208 hectares, and his wife María Teresa Lloret de Fernández received 3,000 hectares. Needless to say, neither of these scions of the establishment are "landless peasants".
With such a pedigree, it is unsurprising that congress has functioned as the political embodiment of the tiny elite that controls Paraguay's destiny. This is a country where 21% of the population control 87% of the land, the most unequal concentration of land ownership in Latin America; a pattern, moreover, which has worsened substantially since the overthrow of Stroessner in 1989, as commercial soybean-farming and cattle-ranching have taken off.
Paraguay is now the world's fourth-largest exporter of soybean and the eighth-largest exporter of meat. A rooted hostility toward tax reform is a crucial mechanism for maintaining this extreme inequality. The congress has repeatedly opposed a tax on unprocessed cereal exports (soybean, maize and rapeseed) and has kept the tax on commercial agriculture to derisory levels (the amount netted in 2011 was only $13m, equivalent to 0.5% of total tax revenue).
But even more significant, the congress has postponed the introduction of personal income tax on four occasions since 2006 - including in 2010 when the country recorded the second-highest growth rate in the world (15.3%), after Singapore. This despite the fact that the proposed income-tax law would allow taxpayers (limited to the roughly top 5% of the population) to deduct any personal expenditure - yes, any - as deductible allowances from tax liability.
This is the same congress that reluctantly complied with a constitutional requirement obliging its members to declare their assets on taking and leaving office - then refused to publish the said information, and has repeatedly refused to initiate impeachment proceedings against supreme-court judges accused of blatant corruption and nepotism.
This is the same congress that since 2008 has imposed severe cuts in budget votes on mother-and-child health programmes and an incipient anti-poverty conditional cash-transfer programme for Paraguay's "poorest-of-the poor", even as it cynically lambasted Lugo for failing to reduce poverty levels (which, according to the household survey of 2011, stand at 32.4% of the population, with 18% in extreme poverty).
The Paraguayan congress's record in these areas means that it is held in contempt by a majority of citizens. So low is its reputation that in polling surveys it invariably is regarded as the least trusted institution of the state. Even when, in 2008, the United Nations Development Programme (UNDP) entrusted the congress to oversee its latest survey of "governance", it came out bottom yet again. (The congress bosses then stifled the planned follow-up, such as distribution of the survey, by refusing to convene a monitoring committee).
The protest
An institution with such a composition and record can hardly be said to be reflecting the broader interests of society. A closer look at the events just prior to Fernando Lugo's removal illustrates how these background elements were at play.
In April 2012, the congress suddenly added an extra $35 million to the 2012 budget to pay for 5,000 staff for the bloated electoral commission. This was ostensibly in order to cope with the expected demand for Paraguayans living overseas to register to vote following a recent referendum that agreed to grant them this right. But the real reason was to fund punteros, the party-political operators who are crucial to bring in the vote in the April 2013 elections. All parties - Colorados, Liberals, Unace (a breakaway from the Colorados), and the pro-business party, Patria Querida - had agreed on the "division of the cake" and sought to overturn Lugo's decision to veto the move.
Then, something happened that was unheard of in Paraguay. A group of young professionals launched a social-media protest campaign via Twitter that mobilised thousands outside congress in support of the presidential veto. After Office Revolucionario (AOR) argued that any increase in the budget should instead be spent on expanding primary healthcare in a country which still has the highest maternal mortality rate in Latin America.
In the face of the protest, the congress was forced in late May to back down, abandoning its attempt to overturn the presidential veto. This success emboldened AOR to announce its next campaign: ending the "closed party-list" electoral system, whereby the rich and powerful literally buy their place in the senate or congress through contributions to party finances. By opening up the electoral system, AOR sought to broaden the social representation in Paraguay's legislature. At present, due in large part to the closed party-list system, not one of the 80 deputies or 45 senators comes from what could broadly be described as a "poor peasant-farmer" background, even though the latter constitute over 60% of the population.
It is clear that members of congress felt under threat from civil society, just at a time - the electoral-campaign period - when access to state funds would became crucial in ensuring their re-election as either senators or deputies. But what tipped the balance was the confrontation between landless peasants and the police on 15 June at Campo Morombí.
The crisis
There has been constant peaceful peasant protest in favour of land reform and the confiscation of the tierras malhabidas in Paraguaty ever since Alfredo Stroessner was overthrown in 1989. Every year, usually in June, thousands of peasants march through Asunción, are applauded by the public, receive empty promises of land reform from politicians, return home, and are forgotten. In addition, since the mid-1990s, the two main peasant organisations - the MCNOC and the FNC - have had over 100 of their activists killed by police and thugs paid by landowners.
When Fernando Lugo came to power in 2008, the peasants thought that - at last - positive action would be taken. As that hope dimmed under his lacklustre administration, and a more radical grouping - the Liga Nacional de Carperos (LNT, with carperos meaning roughly "tent-dwellers") - began to eclipse the MCNOC and FNC. When peasant activists engaged in a violent shoot-out for the first time, with six police and eleven peasants were killed at Campo Morombí - the message was clear: no longer could the elite buy off peasant leaders with false promises of reform. A new strategy had to be employed to "defend private property".
In this context, the evidence-free accusation by the architects of the impeachment process - that Lugo was complicit in the shoot-out (and even that he had links to an incipient rural guerrilla movement, the Ejército del Pueblo Paraguayo [EPP]) - can be understood as a clear message to Paraguay's rural poor: we are here to stay and we will make no concessions. In other words, the exclusionary and corrupt land-ownership model will continue to be imposed. In a most revealing remark to the international press corps, Federico Franco said that his political priority was to "avoid a civil war".
The impeachment proposal was made by the opposition Colorado Party and gained support from the Liberals, who were hitherto in a tacit alliance with Lugo (provoking five Liberal ministers to resign from the government). The deal was brokered by Horacio Cartes, a millionaire businessman involved in the production and "trading" of cigarettes to Brazil, who met with Liberal leaders during the weekend following the Campo Morombí killings. Cartes joined the Colorado party only in September 2010, but is already its leading presidential contender; his popularity, though, has slumped following press revelations of his alleged involvement in narcotics trade and money-laundering. When on 5 July Uruguayan president José Mujica suggested that what he called "narcoloradismo" was a factor in the impeachment of Lugo, he may also having been revealing a hitherto unstated concern that prompted such a united regional response.
More broadly, the analysts Gustavo Setrini and Lucas Arce note that by joining forces to remove Lugo, the Colorados and Liberals have sought to suffocate efforts by the left to establish "... its first foothold within the Paraguayan state and its first opportunity to build its own political machine - a deeply threatening prospect for both traditional parties" (see "Paraguay's impeached democracy", Project Syndicate, 9 July 2012).
The new Franco government has promised to address Paraguay's deep problem of inequality in land tenure, although little can be expected from an interim president and in the absence of a rural cadastre. Franco's chances of using his time to strengthen the Liberal vote around a consensus presidential candidate are limited. He will have to oversee a scramble for lucrative ministerial posts within his faction-ridden party, which is likely to create further dissension.
The Liberals' "home delivery" poll on 1 April 2012 to choose their presidential candidate in 2013 ended with the party's electoral commission declaring party president Blas Llano as the winner. The result was immediately disputed by Senator Efrain Alegre, who is threatening to stand as an independent (Franco himself came a poor third). There are now fears that Franco will use his new powers to resurrect his bid for the nomination, supported by a powerful Franco clan based in the Fernando de la Mora suburb of Asunción.
