New decade, new century, new issues for a country that is resting largely on its laurels of the last millennium. The first decade of the ‘00s has only just reached the hump year, but much has happened already to shape, and reshape, the country.
Just five years ago, the ambitious reelection crusade of Nobel Peace Laureate Oscar Arias appeared to have come to a screeching halt when the Constitutional Chamber of the Supreme Court (Sala IV) rejected his first two motions to overturn a constitutional ban on reelection.
After suplexing the Constitution with a favorable Sala IV ruling in April ‘03, Arias wrestled challenger Ottón Solís against the ropes to a twelfth-round decision to come away with slip-decision title last February.
This month he returned to the Casa Presidencial, 20 years after his first term started in 1986.
Arias inherits a new country in a world with a new geopolitical reality. Central America is no longer a Cold War battleground – a situation that defined Arias’ first term in office, and benefited Costa Rica’s economic development for more than a decade.
Global relations, and specifically relations with the United States, are today defined more by economics rather than political ideologies. While the politics of the Cold War made bedfellows of the two countries in the past, the neoliberal economic model of free trade now threatens to be a giant, smelly dog that climbs into bed between the once-cozy couple.
No Snooze Alarm
Costa Rica over the last five years has also experienced a bit of an unpleasant, yet necessary, awakening.
The image of a safe, healthy and peaceful middle-class country has been challenged by an increase of violent crime, citizen insecurity, corruption scandals, the emergence of the child-sex industry, and growing gap between rich and poor.
The collapse of several high-interest rate “loan operations,” coupled with several recent scandals involving the ever-increasing number of sportsbook Internet-betting firms and online casinos, raised concerns that Costa Rica has become a haven for offshore money laundering.
Even the country’s green image has been challenged in recent years, as environmental and conservation groups criticize the government for not walking the walk.
The good news is that Ticos’ sense of social justice and ownership of country remains alive and well as they put democracy in action, not just on Election Day, but throughout the year in marches, protests and demonstrations for change.
It’s not a coincidence that Costa Rica is the last holdout on the U.S.-Central American Free-Trade Agreement (CAFTA). What appears as indecision to some may be due diligence demanded by a democratically savvy Costa Rican public.
Dozens of marches, both for and against CAFTA (mostly against) have flooded the capital streets on numerous occasions over the last few years as government institutions and notable Tico figures continue to weigh in with their opinion on the matter.
At press time, the fate of CAFTA in Costa Rica was still unclear. (For more on CAFTA, read the TT’s 100th-Anniversary Supplement, in May 2056.)
ICE Sí, Combo No
Tens of thousands of Costa Ricans took to the streets for 19 days in March and April of 2000 to protest what they viewed as an effort by the government of then-President Miguel Angel Rodríguez to privatize the electricity and telecom services provided by the state monopoly Costa Rican Electricity Institute (ICE).
In the largest show of public force in recent times here, the citizenry succeeded in shutting down the country and forcing the government to withdraw its “modernization” efforts.
At that time, the country was adamantly opposed to privatizing the state-owned giant, although public sympathies appear to have since shifted, following five more years of often unsatisfactory telecom and Internet service from ICE.
Murders, Crime Shocked Country
A high-profile bank robbery and the murders of two national journalists and three U.S. coeds visiting Costa Rica caused national and international outrage – as well as outpourings of solidarity – over the last five years.
In March 2000, the brutal murders of U.S. students Emily Eagen and Emily Howell, both 19, rocked the sleepy southern-Caribbean beach towns of Puerto Viejo and Cahuita, near where the bodies were found executed by the side of the road. The murders led to an international media blitz, a massive manhunt and the eventual arrest and guilty verdicts for two young men who had killed the girls and stolen their rented vehicle.
A year later, a similarly gruesome story unfolded in the southern-Pacific coastal town of Golfito, where the body of Shannon Martin, a 23-year-old University of Kansas student, was found stabbed to death the morning of May 13, 2001.
The victim’s mother, Jeanette Stauffer, launched a tireless campaign to bring her daughter’s killers to justice. Three years later, two of the three suspects, Golfito natives Kattia Cruz, 29, and Luis Alberto Castro, 33, were found guilty and sentenced to 15-year prison terms. A clear motive was never established.
The murder of two national journalists
here also shook the country.
On July 7, 2001, popular radio personality Parmenio Medina was gunned down in front of his house, galvanizing the nation and awakening fears that a new level of organized crime had crept into Costa Rica.
The journalist was executed at pointblank by a hired gun. For several months prior, Medina, on his radio program “La Patada,” had been investigating the financial bookkeeping of now-defunct Catholic radio station Radio María, headed by controversial priest Minor Calvo, who was fingered as the suspected intellectual author. The case remains unresolved.
In December ‘03, magazine journalist Ivannia Mora was shot to death at traffic light. Police arrested and charged her former employer and four accomplices with ordering the killing.
In March ‘05, it was bucolic Santa Elena de Monteverde’s turn to be touched by violence, during a harrowing and grim bank robbery and 28-hour hostage situation that led to nine deaths – four clients, two bank employees, two bank robbers and one policeman.
The year 2004 saw the arrest of two of Costa Rica’s former Presidents for corruption-related charges; both scandals involved alleged illegal payments to government officials from foreign companies contracted by the Costa Rican government.
Former President Rafael Angel Calderón Jr. (1990-1994) was arrested and investigated by the Prosecutor’s Office for aggravated corruption for allegedly masterminding the distribution of $9.2 million “commission” on a $39 million medical equipment purchase by the Social Security System.
The second case involved an alleged multimillion-dollar payout to former President Miguel Angel Rodríguez (1998-2002) and several of his administration officials from international telecom giant Alcatel, which won a $149 million contract with the Costa Rican Electricity Institute (ICE) in 2001.
The scandal forced Rodríguez to step down from his recently elected post as the first-ever Central American Secretary General of the Organization of American States (OAS).He was arrested and taken into preventive custody when he returned to Costa Rica in October to face the corruption allegations.
Both former Presidents were placed in nearby cells for six-month preventive sentences in La Reforma prison, and later moved to house arrest for several more months.
Today, the investigations are still under way and no charges have been filed. Calderón and Rodríguez are free with certain limitations; for example, they must check in with the Judicial Branch every two weeks and cannot leave the country.
It Ain’t Easy Being Green
When President Abel Pacheco announced shortly after taking office in 2002 that a priority of his administration would be to pass legislation making environmental guarantees a constitutional right, conservationists cheered; the new administration appeared to be green.
Yet four years later, the environmental guarantees have still not been passed by Legislative Assembly and the overall verdict is still out on the Pacheco administration’s true colors.
Like dancing the Foxtrot, for every step made forward to protect the environment, there was also a step backwards.
While much of Costa Rica is protected by the government, funding to enforce protection remains insufficient. The Universidad Nacional in 2004 said that levels of animal poaching in protected areas – particularly Corcovado National Park – had
reached tipping levels.
A new Fishing and Aquaculture Law passed in 2005 was hailed as a positive step forward, although loopholes – including a provision that allows shark fining as long as fisherman tie the cut fins onto a shark’s body before landing the catch – soon appeared, and even won Pacheco the dubious distinction of being named “International Shark Enemy of the Year” by German group Sharkproject.
The fate of visiting sea turtles is also a concern. The Marine Turtle Restoration Program (PRETOMA) calculates that 90% of the leatherback turtle population has been wiped out over the last two decades.
Also – and always – a concern is the relationship between development and the environment.
A Presidential decree in 2004 permits felling of 15% of a coastal property’s virgin forest, and 25% of its secondary forest, if done in the name of an “eco-tourism project.”
Environmentalists claim the decree will permit further deforestation – the likes of which contributed to a massive mudslide in August 2002 in the Atlantic-slope community of Alto Loaizo de Orosí, burying seven people and a dozen homes under 50 feet of mud.
3-4% Monthly Returns!
The collapse of more than a half-dozen high-interest rate “loan operations” over the last few years has hit many TT readers close to home, and put more than a few members of the expat community into a situation of financial dire straits.
After years of running fast-and-loose loan operations and/or tax shelters that promised unlikely monthly interest rates around 3%, the unregulated financial institutions fell like dominoes during an 18- month span in 2002-03.
The first operation to fall was Anderson’s Ark, an offshore tax shelter run by charismatic, Bible-paraphrasing, self-taught lawyer Keith Anderson, whom the U.S. Internal Revenue Service (IRS) identified as one of their most-wanted men.
Anderson, who insisted the U.S. income tax is an illegal war-time measure, ran what he called “an educational society,” and what the IRS called “an abusive tax shelter.”
Anderson’s Santa Ana compound was raided in February 2002, and he was jailed for 10 months before being whisked out of the country by U.S. Marshals during a dubious midnight run following a botched extradition proceeding.
Next to go was the “granddaddy” of the unregulated high-return game: an investment business known locally as “The Villalobos Brothers,” which promised monthly returns of 2.8-3% on “personal loans” of $10,000 or more. The Brothers, which some claim was in business for 20 years, closed July 4, 2002, when prosecutors raided the San Pedro office and froze $7 million, leaving some 6,000 clients in a lurch totaling an estimated $800 million.
One of the Villalobos brothers, Osvaldo, was arrested, while Bible-quoting Luis Enrique skipped town.
Many investors are still awaiting closure on the issue (and their money).
Next to fall was The Genesis Fund, a high-interest rate offering that once actively sought clients in Costa Rica, before going quietly into the night by mid-2002.
VINIR, the country’s oldest currency exchange house, packed it up in September after suffering serious liquidity problems.
Next down, a Villalobos-copycat operation known as Savings Unlimited, run by Cuban-born Luis Milanés, who quickly shut the doors to his San José office on Nov. 23, 2002, taking everything except for the wallpaper.
Savings Unlimited once boasted 3-4% monthly returns on deposits starting at $5,000. Like Enrique Villalobos, Milanés remains at large.
Another Internet-based operation, known as Costa Rica Green, apparently logged off for good in December of ’02.
Six months later, in June of ’03, the self-proclaimed “last man standing,” Roy Taylor, president of The Vault, killed himself during a police raid of his downtown San José office. That raid was the culmination of a six-month investigation and subsequent $3-million fraud allegation filled by the Vault’s minority partners.
One day before the government intervention, the flamboyant Taylor told The Tico Times in an exclusive interview that he was planning to go straight and repay investors by liquidating 75% of his company’s alleged $20 million in assets.
Tough Year for Tough Love
2003 was a tough year for “tough-love” facility Dundee Ranch Academy, a controversial behavior-modification facility for wayward youth located on the secluded grounds of a former hotel in Orotina, on the Pacific slope.
The academy, home to 200 students from the United States and part of the Utah-based WorldWide Association of Specialty Programs (WWASP), was closed in May, following a government intervention to investigate allegations of rights abuse and torture. A series of TT investigative articles that started in October 2002 uncovered some questionable disciplinary practices, including allegations of children being forced to kneel for hours in solitary confinement, march in the sun, and physical restraint, among other things.
The articles led to an investigation by national child welfare agencies, non-governmental organizations and even the United Nations Special Committee on Torture.
The government finally intervened on May 23, prompting a chaotic revolt among the students, some of whom attacked the counselors, while others vandalized the facility or escaped into the surrounding fields.
The school was forced to close, as the children were taken back to the United States by their parents.
The owner of the school told The Tico Times he planned to reopen a kinder and gentler version of the academy – a plan the government said it would not allow.
Rebirth of a Nation (sort of )
A 100-year-old surveyor’s error that resulted in several border stones being placed too far south into Costa Rican territory resurfaced in 2003, when the Tico government put down another set of border markers, reinforcing the century-old mistake.
The government’s unwillingness to admit the error prompted the rebirth of a tiny independence movement to form the Republic of Airrecú on the small swath of land misplaced by the borders. Airrecú’s two main – and perhaps only – separatist leaders, “President” Augusto Rodríguez and “Vice-President” Omar Jaen (both of whom live in San José) announced that they were giving Costa Rica one last chance to reclaim their rightful land, before they claimed it for Airrecú.
Airrecú, home to some 5,000 campesinos, first attempted independence in 1995, prompting the government of Nicaragua to send troops down to the area (known in Nicaragua as Los Guatuzos nature reserve) to quiet the “rebellion.”
Eight years later, the movement resurfaced in the form of Rodríguez and Jaen, when the Costa Rican government threatened to relocate a village that was living too close to the border (or the mistaken border, as the case may be). The courts eventually ruled to leave the village alone, and Airrecú’s nation ambitions again quieted.
Yet not only separatists are claiming the border is wrong. Also in ’03 a group of Tico patriots, led by former President Rodrigo Carazo, started a movement to recall all
Costa Rican maps for showing the wrong border.
According to the 1856 Cañas-Jerez Treaty with Nicaragua, the border should parallel Lake Nicaragua at a distance of 2 miles. In very simple terms, the triangle part of the border under the Lake is wrong.
‘Virtual Country’ Gets the Heave-Ho
President Abel Pacheco in August 2002 decided to expel leaders of The Global Country for World Peace, following reports that the spiritual cult had infiltrated the south Atlantic indigenous region of Talamanca and crowned one of its members “king.” Angry Bribri tribal leaders said the bogus monarch had no authority or support from the community.
The “virtual country” was started in The Netherlands by the Maharishi Mahesh Yogi in 2000 and claims to have “domain of consciousness, authority in the invincible power of Natural Law.”
They also have a fictitious currency, which they offered to the Costa Rican natives for the right to turn Talamanca into their kingdom Pacheco, after consulting with the Minister of Security, ran the “nation without borders” out of Costa Rica’s borders.
Sex Tourism in Spotlight
The growing problem of ‘sex tourism’ and the sexual exploitation of children was spotlighted when five Costa Rican men belonging to a group called the “Anonymous Pedophile Association of Costa Rica” were found guilty of corruption of minors in December 2001 and sentenced to 20-year sentences in Latin America’s first-ever trial of an alleged pedophile ring.
The men were found guilty of giving drugs to minors, sexually exploiting minors and producing child pornography. The ringleader was a 32-year-old former audio/visual technician at the University of Costa Rica.
The group was busted in July 2001 by Casa Alianza and the Ministry of Public Security’s Special Sex Crimes Unit, which infiltrated the group using a fake identity on the Internet to set up an orgy party. The key witness in the trial, Casa Alianza investigator Rocío Rodríguez, received numerous death threats during the judicial proceedings, prompting a massive outpouring of international solidarity.
Casa Alianza’s boss Bruce Harris, a rabble-rousing advocate for children’s rights for years in the region, ended up resigning from his post in 2004 following reports that he paid a former Casa Alianza child – now an adult – in Honduras for sex.
Costa Rica’s Answer to the Berlin Wall
It was compared to the Berlin Wall and the Great Wall of China. This is how the “Great Wall of Costa Rica,” a border wall that was going to close off Nicaragua, was advertised in Managua, where tours were planned to the border to see the “Tico symbol of intolerance.” The TT went to check it out and found a small ditch of water where a small fence was going to be built around the Customs parking lot. Nicaraguans were still crossing the border, no problem.