NEWS ANALYSIS : The Ghosts of Panama’s Past Haunt Elections, Spooking Some Observers

In the end, Panamanians participating in their most open elections in decades voted for two dead men.

Ernesto Perez Balladares, who won Sunday’s presidential race, successfully conjured the image of military strongman Gen. Omar Torrijos, killed in a plane crash in 1981 but still a hero to the poor.

Mireya Moscoso de Gruber placed a surprisingly strong second by riding a wave of loyalty toward her late husband, Arnulfo Arias, the legendary autocrat who was elected president three times and overthrown by the army each time.

And so results from the national elections showed that Panamanian voters generally divided into the two enemy camps that have been dominant political forces here for years: Torrijistas and Arnulfistas.

The new-and-unusual candidacy of salsa star Ruben Blades, portraying itself as a clean break from the past, finished a distant third.

Panama remains a largely polarized society, the election results indicate, and that could spell trouble for the new government and its ability to get things done at a crucial time: Panama assumes control of the Panama Canal in 5 1/2 years.

Some legislation necessary to run the canal efficiently depends on approval by a two-thirds majority of what promises to be a divided National Assembly. But neither of the main political forces trusts the other, and there is little history of mutual cooperation.

“We look at (Perez Balladares’ party) with some fear given what we lived through in past years,” Gruber said Monday after conceding defeat. “Let us hope that once he is president, he has the best men at his side and that he governs for the people, not for a party.”

Concern about Perez Balladares’ Democratic Revolutionary Party (PRD) is not limited to Gruber and the Arnulfistas.

Founded by Torrijos, the PRD long served as partner to the Panamanian military and was the political arm of dictator Gen. Manuel A. Noriega in the 1980s.

The PRD fell from power in disgrace when Noriega was ousted by a U.S. military invasion in 1989. Perez Balladares tried to distance the party from Noriega by returning to the populist roots represented by Torrijos.

Although Perez Balladares says the party has been purged of its most corrupt Noriega collaborators, several Noriega associates or party militants linked to recent scandals were present at PRD headquarters Sunday night, joining in victory celebrations.

The Arnulfistas have their own questionable history. Arias, while staunchly anti-military, was not exactly a democrat.

A self-proclaimed admirer of European fascism in the 1930s and proponent of policies limiting the rights of Panama’s blacks, he somehow managed to remain a charismatic, mystical figure supported by peasants, the middle class and some elements of the oligarchy until his death in 1988 at age 87.

Torrijos overthrew Arias in 1968. In all, Arias won the presidency three times in the 1940s and 1960s and was cheated out of yet another victory in 1984.

Still, Gruber and the Arnulfistas’ finish in Sunday’s elections--just four points behind Perez Balladares--stunned observers. The Arnulfistas had languished in fourth place or worse in most polls.

“There are still people for whom the memory of Arnulfo, whether they knew him or not, is important,” said Margaret E. Scranton, a political scientist at the University of Arkansas who is in Panama to observe the elections. “It is the concept of Arnulfo--the patron, a party boss who can fix things for you . . . or get you a job.”

Both the PRD and the Arnulfistas have fostered patronage systems, where state bureaucracies were used to create and provide jobs. That practice is harder in today’s economy, and party faithful may be disappointed.

But the bigger unknown is whether the PRD can work with the Arnulfistas and other traditional enemies. Perez Balladares is already trying to allay fears and send messages of reconciliation.

His first act Monday, for example, was to pay a personal visit to Christian Democrat leader Ricardo Arias Calderon, a champion in the fight against Noriega. And the newspaper controlled by Perez Balladares’ running mate, Tomas Gabriel Altamirano Duque, reported that at least five Cabinet portfolios will be offered to people who are not PRD members.

“Panamanians are saying that the dark days are behind us and we are looking to the future,” Perez Balladares said as election returns confirmed his victory. “Now, united despite differing political groups, we must begin to construct the future of the nation.”

Some analysts said the urgency of the canal takeover, the closing of U.S. military bases here and the transfer of thousands of acres to Panama will force Perez Balladares to seek compromise with his opponents. Winning with a third of the vote limits his mandate and will force him to cut deals.

Former U.S. President Jimmy Carter, who negotiated the canal treaties with Torrijos and led a team of international observers monitoring the elections, said he is confident that today’s PRD is changed because Noriega is gone.

“The results of these elections show that the Panamanian people in their own minds and at the ballot boxes distinguished between the presence and influence of Noriega and the new leaders who have now been anointed to lead the country,” said Carter, who also monitored a violent 1989 election annulled by Noriega when his handpicked candidate lost.

Others are less certain. The conservative La Prensa newspaper, Panama’s largest, printed a banner headline proclaiming, “The PRD Returns to Power.”

An editorial cartoon, using Perez Balladares’ nickname, announced that “The Bull” won the election and then added, “I hope to God democracy won’t be gored.”