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On October 31, 2004, Uruguayans broke 170 years of political hegemony by the country's two traditional parties to elect former mayor of Montevideo, Tabare Vasquez, as president, aligning the country with a regional shift to the left. Although he promised to join neighboring Brazil and Argentina in seeking closer relations with Fidel Castro's Cuba, Vazquez nonetheless showed some signs of moving to the political center, appointing moderate senator Danilo Astori as his choice for finance minister. Vasquez's Broad Front coalition also captured a majority of seats in both houses of congress in concurrent legislative elections.
After gaining independence from Spain, the Oriental Republic of Uruguay was established in 1830. The Colorado Party dominated a relatively democratic political system throughout the 1960s. However, from 1973 to 1985, the country was dominated by a military regime whose viciousness earned Uruguay the nickname "The Torture Chamber of Latin America."
In 1998, the country's other traditional party, the centrist National Party, racked by mutual accusations of corruption, joined the opposition Colorado Party in supporting the latter's presidential nominee, Jorge Batlle Ibanez, a five-time presidential candidate whose father and great-uncle had been respected Colorado Party presidents. Faced with dismal economic prospects and a choice between presidential candidates representing the moderate right or an eclectic left, in 1999, Uruguayans gave Batlle 52 percent of the vote, to 40 percent obtained by Vazquez. On taking office, the new president incorporated several National Party members into his cabinet.
Batlle immediately sought an honest accounting of the human rights situation under the former military regime. Batlle also showed equally firm determination to reduce spending and taxes and to privatize state monopolies. In 2001, crises in the rural sector and an increase in violent crime, in what was still one of Latin America's safest countries, dominated much of the public's attention, as did growing labor unrest.
A currency devaluation and default in Argentina at the end of 2001 shrank Uruguay's international reserves 80 percent in six months, with the country losing its coveted investment-grade status on Wall Street. By midyear of 2002 the government was forced to impose a weeklong bank holiday, Uruguay's first in 70 years, to staunch a run on the country's banks. The spillover effect from Argentina's economic crisis was blamed for a day of violence in August, when looters ransacked businesses and labor unions staged antigovernment protests that brought much of Uruguay's capital, Montevideo, to a standstill. In October, the National Party withdrew its members from Batlle's government.
Disputes with neighboring Brazil over regional free trade, and with Argentina over specific human rights issues festering since the 1970s, dominated Uruguay's political debate in 2003. The economy had shrunk by 11 percent in two years, and one of every three Uruguayans was left living below the poverty line in the worst economic crisis in the country's history. A bond restructuring that year avoided a potentially catastrophic economic default and was accompanied by small economic rally.
Batlle also remained the region's only vociferous opponent of Cuba's leader, Fidel Castro. However, the luster of Batlle's human rights record dimmed after he chose as a naval attache to Buenos Aires a navy captain accused of responsibility for the deaths of two Argentines when both countries were ruled by military dictatorships.
The October 2004 presidential and parliamentary elections proved to be a crushing defeat for the Colorado Party, whose presidential candidate, Guillermo Stirling won just 10 percent of the vote, as well as for the National Party and its standard bearer Jorge Larranaga, who garnered 34 percent. Vazquez, whose Broad Front coalition ranged from Christian Democrats to former left-wing Tupamaro guerrillas, captured 51 percent in the first round of voting to be elected president. The Broad Front enjoyed a similar rout in both houses of congress, where for the first time in many years, the party in government could count on a majority.
After fiercely opposing the privatization of state companies and the shrinking of the state's role in Uruguay's economy, the newly elected Vazquez, who during the campaign had promised moderate economic policies and an emphasis on helping the poor, faced the challenge of creating a stable macroeconomic framework and attracting foreign capital. Astori, the new finance minister, sought to reassure the private sector by promising clear rules for investors, a free-floating exchange rate, fiscal discipline, and an inflation-targeted monetary policy. However, questions also remained about the personal ties maintained by the leftist Vazquez to the country's former rightist military dictatorship during the 1980s.
Citizens of Uruguay can change their government democratically. The 2004 elections were free and fair despite isolated acts of violence registered against several parties' local headquarters. The 1967 constitution established a bicameral congress consisting of the 99-member Chamber of Deputies and the 31-member Senate, with every member serving a five-year term. The president is also directly elected for a five-year term. In 1999, for the first time, Uruguayan parties selected a single presidential candidate in open primary elections. Previously, the parties had fielded a number of candidates, and the candidates with the most votes then accumulated the votes cast for the others.
Uruguay has three major political parties: the Colorado Party, the National Party, and the Broad Front. The Broad Front swept to victory in 2004 in coalition with the smaller leftwing social democratic New Space party headed by the son of Zelmar Michelini, a former senator assassinated in 1976 in Buenos Aires by a joint Argentine-Uruguayan military commando unit.
Uruguay, long a haven for anonymous foreign bank deposits as a result of its strict banking secrecy laws, has also taken measures to regulate financial activities in order to reduce the potential for money laundering. October 1998 saw the passage of antidrug legislation that made narcotics-related money laundering a crime. The Financial Investigations Unit (FIU) was established in order to present more complete evidence in narcotics-related prosecutions. On the request of the Central Bank, financial institutions must provide certain information, and banks (including offshore banks), currency exchange houses, and stockbrokers are required to report transactions of more than $10,000. The FIU also requires all entities under its jurisdiction to report suspicious financial transactions to a financial information analysis unit.
The Transparency Law (Ley Cristal) entered into force in January 1999. It criminalizes a broad range of potential abuses of power by governmental officeholders, including the laundering of funds related to public corruption cases. It also requires financial disclosure statements to be filed by high-ranking officials. Public officials who know of a drug-related crime or incident and do nothing about it may be charged with a "crime of omission" under the Citizen Security Law. Uruguay ranks near the top of public transparency ratings for Latin America issued annually by Transparency International and in 2004 was cited by the group for a "perceived ... fall in corruption" compared to the previous year. Uruguay was ranked 28 out of 146 countries surveyed in Transparency International's 2004 Corruption Perceptions Index.
Constitutional guarantees regarding free expression are generally respected. The press is privately owned, and broadcasting is both commercial and public. Numerous daily newspapers publish, many associated with political parties; there are also a number of weeklies. In 1996, a number of publications ceased production because of a government suspension of tax exemptions on the import of newsprint. In addition, a June 1996 decree requires government authorization to import newsprint. Internet access is unrestricted.
Freedom of religion is a cherished political tenet of democratic Uruguay and is broadly respected. The government does not restrict academic freedom.
Civic organizations have proliferated since the return of civilian rule. Numerous women's rights groups focus on violence against women, societal discrimination, and other problems. Freedom of assembly and association are provided by law in Uruguay and the government generally respected those rights in practice. Workers exercise their right to join unions, bargain collectively, and hold strikes. Unions are well organized and politically powerful. Strikes are sometimes marked by violent clashes and sabotage.
The judiciary is relatively independent, but has become increasingly inefficient in the face of escalating crime, particularly street violence and organized crime. The court system is severely backlogged, and suspects under arrest often spend more time in jail than they would were they to be convicted and serve the maximum sentence for their crime. Allegations of police mistreatment, particularly of youthful offenders, have increased; however, prosecutions of such acts are also occurring more frequently. Prison conditions do not meet international standards.
President Jorge Batlle's stance in favor of human rights appeared to waiver in 2003. In November, Batlle announced that the case of the daughter-in-law of Argentine poet Juan Gelman, detained in Buenos Aires in 1976 and later allegedly made to disappear in Uruguay, was included in a 1986 law that effectively granted amnesty to Uruguay's military and police accused of committing rights violations during the military's 12-year regime. Efforts by that regime in the mid-1970s to kill U.S. congressman Ed Koch, a fierce critic of the Uruguayan military, were also confirmed by independent investigators in 2003 after having been first reported in 1993.
The small black minority continues to face discrimination. Uruguay's continuing economic crisis has forced thousands of formerly middle class citizens to join rural migrants in the shantytowns ringing Montevideo.
Violence against women continues to be a problem. However, the government generally protects children's rights and welfare, and has placed the education and health of children as a top priority.