wealth inequality

Costa Rica’s Fragmented Politics Is Failing to Deliver Results

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Costa Ricans went to the polls Feb. 6 for the first round of the country’s presidential election, as well as its congressional elections. But with none of the 25 presidential candidates able to reach the 40 percent of votes required to win the contest outright, the country will hold the runoff round in April to decide whether first-place finisher Jose Maria Figueres Olsen or runner-up Rodrigo Chaves will become its next leader.

One of the most stable democracies in Latin America, Costa Rica’s electoral integrity standards are considered to be among the most transparent and fair in the world. But a 40 percent rate of abstention on Election Day may be associated with Costa Ricans’ increasing dissatisfaction with the performance of their democratic institutions—a trend many other stable democracies around the world are also experiencing. Public frustrations over economic instability and inequality, disillusionment stemming from various corruption scandals involving multiple political parties, and widespread vacillation among voters in polls just days before the election might have also contributed to the election’s inconclusive outcome.

The election campaign was dominated by the country’s most urgent problems, including a volatile economy as well as high levels of poverty and unemployment, with the debate over these issues framed within a discussion of whether the state should intervene more or less in the economy. Costa Rica’s elevated public debt and erratic economic growth led outgoing President Carlos Alvarado’s government to negotiate an unpopular $1.8 billion loan agreement with the International Monetary Fund in January 2021 to stabilize the economy. Although poverty decreased compared to 2020 from 26.2 percent to 23 percent, it is still higher than it was before the pandemic started, when it stood at 21 percent. And while unemployment dropped from 17 percent in 2020 to 14.4 percent last year, it nonetheless continues to disproportionately affect women and young people. Perhaps most importantly, the pandemic has accelerated Costa Rica’s most pressing structural issue: the unequal distribution of wealth. Inequality has increased and risks undoing the country’s achievements in improving human development indicators over the past four decades.

The election also took place amid several significant corruption investigations: the Cochinilla mega-scandal, involving payoffs by construction companies to public employees and political figures from multiple parties; the Diamond case, involving a graft network of construction firms, public employees and at least five mayors linked to different political parties; and the Azteca case, involving corruption that linked public construction projects to narco-groups, among others. These high-profile cases exacerbated popular discontent over perceived inequality in access to goods and services provided by the state.

In light of all these factors, the abstention rate—the highest in more than six decades—was hardly unsurprising. Although more post-election surveys must be done to determine the precise causes of the abstentionism, increasing disaffection with parties—with 90 percent of voters not sympathizing with any political formation—along with socio-economic inequality and the effects of the multiple corruption scandals almost certainly played a role. Another factor may have been territorial inequality, with abstentionism reaching above 48 percent in marginalized provinces like Puntarenas, Guanacaste and Limon, where social inequality and poverty are disproportionately concentrated.

Polls also indicated high levels of voter indecision, with 32 percent of the electorate still undecided about who they planned to vote for just days before the election. This, combined with the large numbers of competing candidates resulting from the fragmentation of the country’s party landscape, made it difficult for any one candidate to obtain the 40 percent of votes to win outright.

While other Latin American countries have seen the power of their executives strengthened, in Costa Rica the reverse is true.

Figueres, a former president from 1994 to 1998 and representative of the National Liberation Party, or PLN—one of the traditional parties of the two-party era from 1949 to 2002—took the most votes, with 27 percent. He campaigned on a platform of transforming the country through innovative economic and environmental initiatives, in an effort to refresh the PLN, an old party torn by internal fractures and tarnished by corruption scandals. Chaves, a former World Bank bureaucrat and briefly the finance minister of the outgoing administration, came in second with 16.7 percent of the votes. Running under the banner of one of the most recently created center-right parties, the Social Democratic Progress Party, or PPSD, Chaves promised to use his technocratic experience to improve efficiency and expedite decision-making in the lethargic state apparatus.

With 80 percent of voters ranking corruption as a major issue in the country, however, both candidates labored under the burden of ethical challenges in the first round—Figueres due to a 2004 investigation into alleged corruption involving French company Alcatel, for which he refused to provide evidence; and Chaves due to a World Bank Internal Tribunal ruling that sanctioned him for sexual misconduct against two female coworkers in 2008 and 2013, prohibiting him from entering the World Bank premises without previously alerting the victims.

By contrast to the presidential election, the results of the voting for Congress actually resulted in less fragmentation, with the number of parties represented in the legislature dropping from seven to six. That said, the incoming Congress, although less fragmented, will be dramatically reconfigured due to the failure of Alvarado’s ruling Citizens’ Action Party, or PAC, to win a single seat after eight years in power. The party’s lack of ideological definition and contentious fiscal reform, combined with corruption scandals and unpopular pandemic restrictions, dramatically eroded its support. Its exit from Congress alongside some other parties, and the presence of several new or recently created center-right parties, is a reflection of Costa Rica’s “taxi party phenomenon,” whereby parties emerge, suddenly get strong and then weaken or disappear altogether.

Figueres’ PLN nevertheless won a solid bloc in Congress, with 18 out of 57 seats, though still not enough to pass laws alone were he to win the runoff. Chaves, with only nine representatives, would need to search for even more partners to be able to implement his agenda if he wins. The disappearance of the two-party system in Costa Rica over the past two decades has made it difficult for the president to secure majorities in parliament and approve his or her governing program. In fact, while other Latin American countries have seen the power of their executives strengthened, in Costa Rica the reverse is true: In the past few years, only two out of 10 laws approved by Congress were the result of presidential initiatives.

It is still too early to know what sorts of alliances Figueres and Chaves might put together in an attempt to woo further support in April’s runoff, and whether those alliances will remain in place when the new president takes office to govern.  What is already clear from the voting two weekends ago is that Costa Rica’s solid electoral democratic infrastructure once again performed well. But its institutions and political class must improve on delivering results to voters demanding concrete and rapid solutions to the country’s pressing economic and social issues.

Tatiana Benavides-Santos is a political scientist and international consultant specializing in democracy development and governance in Latin America and the United States. She is an affiliated researcher at Columbia University.

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