New President, 36, May Upset U.S. : Peru’s Garcia: Appealing Master of Mixed Signals

The hotel restaurant had closed for the night. A lone waiter hovered nearby, anxious to be gone but unwilling to interrupt the tired young man who sat slumped before a glass of mineral water.

“I know that I am young. There are days when I would rather be sailing my boat,” Alan Garcia mused. Then, more forcefully, he said, “But if I am to have a time, my time is now.”

Garcia was 35 years old that night last February, the upstart presidential candidate of a venerable, contentious, always-a-bridesmaid political movement called the American Popular Revolutionary Alliance.

Garcia was 36 last month when six heads of state and delegations from around the world braved terrorist threats to celebrate his inauguration as the $100-a-week president of Peru. Two of Garcia’s four daughters attended the inauguration. The other two are still in diapers.

Alan Garcia’s time is now. He is expected to make the most of it.

An intense populist, Garcia has embarked Peru on a quest for change that is both audacious and perilous. Latin America’s newest political star has captivated the impoverished Peruvian majority with the promise of a revolution that he says will be both profound and democratic.

Garcia is long on ambition and emotion but short on experience and specifics. His sincerity is as unmistakable as his romanticism and the tinges of demagoguery that underscore his charisma. He is at once a seasoned political infighter yet, on a larger stage, a bumptious rookie with pretensions of regional leadership.

The mixture is volatile. It raises the likelihood that Garcia will not only chafe internal opponents of left and right but also--by accident or by design--irritate the Reagan Administration as well.

Garcia’s social democratic style of nationalism comes wrapped in powerful anti-imperialistic rhetoric. At this early stage, it is difficult to know how much of all this is radicalism and how much is simply zeal untempered by experience. His public posture is in part a product of the historic stand of the APRA party, as the American Popular Revolutionary Alliance is commonly called here. APRA has denounced imperialism with the monotonous solemnity of a man wishing “Buenos dias” to the same breakfast partner for six decades.

Message to Bankers

Garcia is a master of mixed signals. He demands a better deal for workers, but he also wants to make it easier for employers to fire unproductive workers. Before his inauguration, Garcia sent a quiet message to conservative banker friends of his own uptown social class urging them not to be alarmed. A free-swinging inaugural speech was expected of him, Garcia said.

He is a firebrand Third World nationalist who rails against economic and political dependence on the United States, unjust terms of trade, protectionism and the “hegemonic imperialism” of American foreign policy.

At the same time, he sounds like a Jeffersonian democrat in his commitments to political pluralism and respect for private property and his ringing promises to “scrupulously respect human rights and a free press.”

Already, Garcia has thrown down the gauntlet to Peru’s creditors, asserting that he will limit payments on the country’s $14-billion foreign debt for at least the next 12 months to an amount equal to 10% of export earnings. That means around $300 million, which, as the debt is currently structured, is more than Peru is paying at present but less than is necessary to avoid arrears.

Should foreign creditors accept Garcia’s figure, they would quickly hear from other large Latin American debtors that have reluctantly agreed to pay more. But a financial crackdown against Peru, on the other hand, would invite radicalization of a Garcia government that says it wants to pay but cannot pay now.

The new government’s troubles grew a little worse last week when the Reagan Administration automatically suspended new U.S. economic and military aid because Peru is more than a year in arrears on a $200,000 loan from the U.S. government. A State Department official said Thursday in Washington that the suspension was required by law and that Peru quickly agreed to make the payment. The suspension is expected to be lifted within days.

But if Garcia distresses American bankers, he has doubtless already pleased American congressmen with his vow to relentlessly attack drug smugglers in Peru.

Surging Inflation

The violent, corrupting cocaine business is the most dynamic industry in this Andean nation, a caldron of Third World misery. In that context, Garcia’s economic message to the 19.7 million Peruvians is stark.

“It is later in our history than we suppose. The crisis is greater than we think. It requires an audacious road toward a revolution of independence, development and social justice,” he proclaimed in the inaugural address.

It is by now banal among Peruvians to dwell on such well-lamented facts of 1980s existence as living standards that have declined to levels first achieved 20 years ago, of low international prices for primary exports, of climatic disaster, surging inflation and bureaucratic ineptitude, or what Garcia calls “the gangrene” of administrative corruption.

In his address, Garcia graphically encapsulized national agony that is aggravated by social and geographic imbalance: The poorest 75% of the people share only 23% of the national income. Down-at-the-heels Lima, bloated by internal migration to more than 6 million people, houses 85% of all industrial investment. The 62% of the people who live in the Andean highlands make do with less help from central authority than their ancestors received in the days of the Incas.

High Rate of Child Deaths

“One of every two deaths is a child under 5 from illness that could be avoided,” Garcia intoned. “Half of preschool children are malnourished. . . . Seven pregnant or nursing mothers of every 10 suffer nutritional anemia. . . . Only 35 of every 100 people of working age have stable employment. . . . About 1.2 million workers earn a minimum wage of around $30 per month.”

Even before taking office, Garcia made a gesture toward the poor rural majority for whose principal benefit he promises to govern. He slashed his own salary to around $400 a month, bringing quick accusations of grandstanding. Since no Cabinet minister may earn more than the president, Garcia had, in effect, made financial hardship a requirement for working in the new government.

Garcia has a broad program for resolving national ills that worsened under the hapless predecessor government of President Fernando Belaunde Terry. He calls for government and economic decentralization, a greater priority for agriculture as part of economic reactivation, a tax reform, a crackdown on corruption, and further government austerity.

The new president’s first act was to declare a two-day bank holiday. He followed last Thursday with an economic package that raised gasoline prices and minimum wages, froze dollar accounts and prices of basic goods and lowered interest rates on domestic savings.

Policies are gradually taking shape, but there are already questions about the new government’s ability to effectively administer its own ambitions. Garcia is vastly clearer about what he proposes to do than how he proposes to do it.

APRA, an anti-Communist, anti-imperialistic movement founded more than 60 years ago by Victor Raul Haya de la Torre, the late dean of modern Latin American revolutionaries, has never before governed Peru. There is no stock of establishment experience for Garcia to fall back on.

Garcia, who reveres Haya’s memory and copies the body language he learned as a guitar-playing acolyte at Sunday afternoon rap sessions with the founder, is as inexperienced in government as his party.

A stocky, handsome man who studied in France and Spain after training in Peru as a lawyer, Garcia became leader of the party after Haya died in 1979 and APRA subsequently lost the 1980 presidential election to Belaunde’s Popular Action party. At the head of a Young Turks movement, Garcia won control of the party from still-resentful old pols to his political left who considered themselves Haya’s most legitimate heirs.

As leader of the multiclass party, Garcia was its inevitable presidential candidate this year, although his personal experience in government was limited to a single undistinguished term in the Chamber of Deputies. In a nation where personalities, not parties, win elections, Garcia brushed aside the party’s once-radical roots to campaign as a Social Democrat. He easily won the April election and is by now so popular that APRA is whatever he says it is.

His honeymoon, though, within the party and within Peru, may be brief.

Even friends and political allies acknowledge that Garcia does not delegate responsibility well and that he is sometimes difficult to work with. His inaugural address, as a case in point, was written exclusively by him, and he toyed with it until just hours before its delivery. Cabinet ministers in the audience did not know in advance what policies he would announce for them to implement.

Garcia’s Cabinet is lackluster. He apparently intends to be his own minister of economy, agriculture and industry, and it appears that he will also take a decisive hand in managing foreign affairs. Last week’s economic package issued not from the Finance Ministry but from the presidency.

Garcia projects himself as a regional statesman and is already feuding with Fidel Castro over which of them should lead Latin America’s counterattack against crushing debt.

And, evoking Haya’s old dream of Latin American integration, Garcia called at his inauguration for Panama to convoke a summit meeting of Latin American presidents. Diplomats said later that Panamanian President Nicolas Ardito Barletta, who was in the audience, had no warning that Garcia intended to involve him in an idea coldly received by other Latin leaders attending the inauguration.

Amnesty Plan Dies

The Peruvian armed forces, however, apparently did learn in advance that Garcia intended to offer an amnesty to guerrilla sympathizers accused of nonviolent crimes. And the amnesty idea, strongly supported by a Marxist-dominated coalition that is Garcia’s strongest opponent in the new Congress, died aborning.

Garcia appears to have overcome historic hostility toward his party from the armed forces, which are the ultimate arbiters of power in Peru and which also spend a staggering one-third of the central government’s budget--a much higher share than that of armed forces elsewhere in Latin America. Improbably, Garcia insists that there was no objection by the military to his plan to limit the number of advanced Mirage jet fighters on order from France.

“Tanks and planes are important, but the armed forces realize that if people are hungry and malnourished, the country is not well-defended,” Garcia said at his first press conference. As reporters filed from the downtown presidential palace, Garcia impetuously went to a second-floor balcony to exchange pleasantries with startled passers-by in the street below.

Garcia would like to further restrict arms purchases, but he needs the army’s support if he is to combat rural and urban Marxist terrorists of rival Maoist and Castroist persuasion. He would like to wipe out the guerrillas but, at the same time, he promises to eliminate the human rights abuses that have so far accompanied their repression.

He would like fresh investment to invigorate the economy, but he first must make peace with Peru’s creditors. He would like a smooth-functioning Congress, but he must cope with different wings within APRA while at the same time accommodating parliamentary Marxists, who are biding their time, and parliamentary conservatives, who are openly suspicious of his intentions.