Ecuador - Lasso wins the election. Can he govern?
The country’s divided political system including the rise of Yaku Perez creates the potential for interesting political coalitions or disaster.
Yaku Perez would have crushed Andres Arauz or Guillermo Lasso if he had made the second round. Nobody can run hypothetical counterfactuals, but we all know it’s true. I think it would have easily been a 20 point margin and a popular mandate instead of Lasso’s narrow victory.
Source: Ecuador CNE
Lasso’s margin of victory was about 400,000 votes. There were nearly two million protest votes, people who cast a blank or null ballot instead of choosing one of the top two candidates. It’s tempting to debate the question of who the protest votes helped or hurt. The more important issue is that those votes should be seen for what they are: a rejection of the two leading candidates and their parties.
The fact that everyone including Lasso and Arauz knows Perez would have won the presidency makes the indigenous candidate who narrowly came in third place an influential figure moving forward. As ridiculous as it is to talk about an election years down the line, he starts as the presumptive frontrunner for 2025. Pachakutik controls 27 seats in the 137 member Congress. The NYT was correct to cover Perez and his influence the day of the runoff.
A graceful concession
The other notable part of the Ecuador runoff was how gracefully Arauz and Correa accepted the loss. There were no angry claims of fraud or protests. Just respectful acknowledgement of defeat and a wish for Lasso to do his best as president.
Why? The optimist might note that Correa and his supporters have always somewhat respected democratic rules, bending but not breaking them. Unlike many of his allies in other countries, Correa walked away from the presidency instead of trying to remain president forever.
The cynic can see that Lasso has a very tough year ahead. He needs to successfully deliver vaccines and renegotiate debt, something that will be inevitably unpopular with the population. Gracefully losing, sitting back and letting the new president take a beating in public opinion may be the correct strategy.
Lasso’s three paths
If Ecuador were divided into two polarized political sides, Lasso’s game plan as president would be easier. So would the strategy for Correa and Arauz as they lead the opposition. Instead, this election has exacerbated a divided party system (though nowhere near as bad as Peru’s, which I’ll cover in a future newsletter) and disillusioned much of the electorate.
There are three paths forward:
Lasso forms a big coalition from the far right to the center left that includes CREO, PSC, ID (the party of Xavier Hervas) and Pachakutik. This is the most obvious coalition structure for the first 100 days. But maintaining this coalition requires keeping two former opponents, Perez and Hervas, happy. Both men are ideologically motivated and have little reason to give much ground in negotiations with Lasso. The pro-market president would need to move towards them in some significant ways. A successful final agreement on economic reforms with this coalition would probably represent Perez’s and Hervas’s positions more than the president-elect’s.
Lasso forms a transactional coalition with UNES. This is the least likely scenario, but it’s a wildcard to keep in mind as a possibility in the coming year and something Lasso may use as leverage. Correa and Arauz hate Lasso, but they also proved in this campaign that they hate and fear Perez even more. He represents a future left that isn’t beholden to Correa and his political network. Correa made clear in his concession that his main concern is not Lasso’s economic agenda but an end to “lawfare,” in other words, the corruption cases against the former president and his allies. There is a deal to be done here that would not make citizens happy but could provide Lasso with room to govern.
Lasso fails to govern. If he can’t get a working coalition, Lasso is going to find his ability to govern restricted. Economic reforms that need to pass the Congress are going to hit a wall of opposition. There is only so much the president can do on his own and protests would follow any reforms that don’t have a Congressional majority.
Thanks for reading
Yesterday’s newsletter for subscribers focused on Lasso’s security policies. Do you want to ask me questions about Ecuador’s election and find out what I think about Peru’s runoff? I’m hosting a subscriber-only webinar on April 28th from 2-3 PM ET. To attend the webinar and receive additional analysis in the coming weeks, subscribe for only $9 per month.