Americas view

FEW sporting rivalries can match the intensity of matches between Boca Juniors and River Plate, Argentina’s two best-loved football clubs. But even die-hard Boca supporters had little to cheer on June 26th, when River, the country’s most successful team, was relegated to the second division for the first time in its 110-year history. The club’s draw with humble Belgrano, from Córdoba, Argentina’s second city, will strip the first division of its chief attraction, the twice-yearly Boca-River matches known as the superclásico. River’s demotion will also probably accelerate the struggling circuit’s descent down the ranks of the world’s top leagues.

Many of Argentina’s greatest players—including Alfredo di Stéfano, José Manuel Moreno, Adolfo Pedernera and Omar Sívori—have donned River’s red-and-white uniform over the last century, although Diego Maradona, the country’s greatest athletic icon, played for Boca. River is Argentina’s most successful club, with 33 league titles to Boca’s 29. In 2000 readers of FIFA World magazine ranked it the ninth-best team of the 20th century. Its 64,000-seat Monumental stadium is located in Buenos Aires’s wealthy northern neighbourhood of Núñez, a far cry from the gritty, southern Boca district that is Boca Juniors’ namesake. Those surroundings, as well as River’s penchant for counting politicians, business leaders and celebrities among its fans, has earned the club the nickname “the millionaires”.

However, River has another sobriquet as well, one that has been far more apt in recent years as the club as tumbled down the standings: “the chickens”, referring to its lacklustre performances in high-pressure situations. Since its last championship in 2008, River has tried to reinvent itself from scratch after every setback, churning through two club presidents, six different coaches and 64 different players. Its management’s desire for a quick fix and need to service its $19m in debt has caused it to sell off young talent prematurely and place too much faith in washed-up, overpaid veterans. Although Argentina’s promotion-and-relegation scheme is designed to prevent clubs from tumbling to the second division following brief periods of poor performance—the formula is based on a team’s record over the preceding three years—River was unable to halt its downward spiral. After finishing 17th out of 20 clubs in the top league, it needed to hold off Belgrano in a two-game series to keep its spot. River lost the away match 2-0, and mustered only a 1-1 draw at home, when it could not hold an early lead and had a penalty kick saved.

River fans, particularly the raucous hooligans known as barrabravas, did not take the news well. Before the match had even finished, they began throwing objects, running onto the pitch, and vandalising the stadium. Outside the building, fires were set and fights broke out. Police responded with water cannons and tear gas, and scores of people were injured.

The cruelest consequence of relegation, of course, is that the demotion itself makes it much harder for a club to work its way back up to the top. River’s annual television revenues will fall from $6.8m to about $4m, and it will have to cut ticket prices. It will probably lose transfer income as well, since few European clubs search for talent in the second division.

In theory, River’s relegation should give hope and faith to supporters of Argentina’s dozens of less storied clubs, by proving that no team is immune from mismanagement. In practice, however, the absence of one of the country’s two biggest draws will reduce fan interest and revenues for clubs across the league. Bosteros, as the Boca faithful are known, may be surprised to find out how much they miss their sworn enemies.

NEARLY two weeks after an outbreak of violence in a Venezuelan prison complex that has left more than 20 people dead, hundreds of prisoners remain in control of a section of the jail. Too heavily armed to be overwhelmed without heavy loss of life, they are surrounded by the national guard, in an operation that at its height has involved up to 4,000 troops. The inmates are refusing to surrender, despite pleas from Tarek el Aissami, the interior minister, and a group of evangelical pastors.

The Rodeo I and Rodeo II jails, just outside the capital, Caracas, were built to house around 1,300 inmates. But when the shooting broke out on June 19th, they held more than three times that many.

Yet such overcrowding is just one of the problems facing Venezuela's penitentiaries, which are by far the most violent in the western hemisphere. According to the most recent official figures, the homicide rate in Venezuela is 48 per 100,000. (That compares with under 1.5 in England and Wales.) But if you have the misfortune to be in the custody of the state, your chances of dying violently are far higher. Last year, 476 inmates were murdered in Venezuela's prisons—well over 1% of the prison population, and almost 24 times the rate outside.

It is not hard to see why. After the national guard took control of Rodeo I, they displayed the drugs and weapons they had seized. These included not only 9mm pistols and shotguns, but hand-grenades, assault rifles and submachine guns, along with 5,000 rounds of ammunition, 45 kilos of cocaine and 12 kilos of marijuana. The prison, like virtually every other penal establishment in Venezuela, was being run not by prison guards but by the inmates. For a price, they could obtain almost anything they wanted from their guards, short of release.

The Venezuelan prison system, already in dire shape when Hugo Chávez (himself a former prisoner, thanks to a coup attempt in 1992) came to power in 1999, is now an integral part of organised crime in the country. Prisoners use mobile phones to organise kidnapping and extortion, often with the help of corrupt cops.

Thanks to a dysfunctional court system and overworked prosecutors, many prisoners endure years of detention without trial. Around three-quarters of the prison population have not been sentenced, but little effort is made to keep them separate from convicted criminals. The government has been pledging to "humanise" the prisons for years. But you can’t humanise what you don’t control.

Following the crisis at El Rodeo, parliament is to investigate how prisoners get hold of guns. The prime suspect is the national guard, whose troops are responsible for perimeter security. But ever since Rodeo I was retaken, state-run television has been praising the guard for its efficiency and self-sacrifice. This casts doubt on the authorities' willingness to tackle what was in any case an open secret even before the latest crisis.

The government's main concern appears to be to control the political fall-out. It has accused the opposition, the media and prisoners' NGOs of exploiting the situation for partisan advantage. All had focused on the plight of the prisoners' relatives, who for over a week were kept in the dark as to who had been killed or injured. Trying to stop ambulances to find out who was on board, they were attacked with tear-gas and water cannon by the national guard.

The Inter American Human Rights Commission (IAHRC) recently called on the Venezuelan government to "immediately adopt any necessary measures to bring detention conditions in Venezuelan prisons in line with international standards". The government will no doubt ignore this, as it has done half a dozen previous IAHRC exhortations. When the trouble at Rodeo fades from public memory, the prisons will simply go back to business as usual.

YET another “cartel” leader has fallen in Mexico’s war against organised crime. José de Jesús Méndez Vargas, known as “The Monkey”, was supposedly the head of La Familia, a drug-trafficking organisation based in Michoacán, the home state of Felipe Calderón, Mexico’s president. Two days ago the Monkey was captured in Aguascalientes, a nearby state, by federal police. No shots were fired, police say.

The arrest comes at a useful time for the government, which is facing war-weariness at home. People have rallied around Javier Sicilia, a poet whose son was murdered by narcos in March, who has organised a series of rallies under the banner “Estamos hasta la madre”—roughly, “we’ve had it up to here”. Mr Sicilia has led marches all the way up to the American border and into El Paso. Polls show that people have begun to worry about security more than the economy. For the first time in his presidency (now into its fifth year), Mr Calderón has an approval rating of less than 50%.

Especially pleasing to the government is the fact that the Monkey was picked up by the police rather than the army, which many people want to see withdrawn from the streets. (Although in some areas people are keen for the troops to stay.) Mr Calderón hailed the success of the “new” federal police force, whose numbers he has boosted substantially while in office.

Still, the capture is unlikely to have the effect on Mexican morale that, say, the killing of Osama bin Laden had in the United States. (Nailing Joaquín “El Chapo” Guzmán, the supposed leader of the Sinaloa cartel, would be another matter.) Why? Because it comes just six months since the killing of La Familia's previous leader, a reminder that removing the head of a cartel often leads only to the promotion of a new boss.

Some now speculate that with the capture of the Monkey, other gangs such as Sinaloa and Los Zetas may decide to move into Michoacán (whose big port, Lázaro Cárdenas, is an important stop on the cocaine trail). Mr Calderón’s spokesman has said that with the capture of the Monkey, La Familia “is destroyed”. We shall soon find out if that's true—and if so, who moves in to take its place.

OLLANTA HUMALA, Peru's president-elect, has suggested that he could pardon Alberto Fujimori, a former president serving a 25-year prison sentence for crimes commited in office, if his health worsens. The idea has proved controversial, with groups like Human Rights Watch suggesting it would be incompatible with Peru's legal obligations.

To judge by the results of last week's poll, most Economist readers agree: 73% thought Mr Fujimori should not be pardoned.

This week we move to Venezuela. Hugo Chávez, the country's long-serving president, is currently running his country from a hospital bed in Cuba. With his country emerging sluggishly from recession, facing high inflation and enduring power blackouts, Mr Chávez's re-election prospects next year do not look as rosy as they once did. Do you think he will win a third consecutive term? Let us know.

THE outcome of Venezuela's 2012 presidential election looked extremely difficult to predict even before Hugo Chávez's most recent trip to Cuba. Now that he has had an emergency operation for a pelvic abscess and is governing the country from his Havana hospital bed, it has become even harder to forecast. This week's issue of The Economist analyses how his medical situation, the state of the opposition and the economy will affect the race. It also looks at a corruption scandal in Argentina and Ecuador's overachieving football teams.

OLLANTA HUMALA won Peru's presidential election earlier this month by recasting himself as a centrist. The Economist's readers, however, are suspicious of his supposed newfound moderation: 54% of them said they did not think he would actually govern from the middle.

This week's poll sticks with Peruvian politics. Mr Humala recently said he would pardon Alberto Fujimori, a former president jailed for corruption and human-rights abuses, if his health worsens. Do you think Mr Fujimori should be released from prison? Let us know.

AFTER falling short in 2006, Ollanta Humala eked out a narrow victory in Peru's presidential election on June 5th. The latest issue of The Economist examines how he beat Keiko Fujimori, and how he is likely to govern. It also looks at the resignation of a top aide to Dilma Rousseff, Brazil's president; how Honduras's economy is recovering from the country's 2009 coup; the unlikely woes of Vancouver's government; and Brazil's murder capital.

AFTER years of frustration, Guatemala recently seemed to have turned a corner in its long struggle to institute the rule of law. For a decade after the end of the country’s 30-year civil war in 1996, well-connected criminals had proved nearly impossible to prosecute, because gangs led by veterans of the security services had thoroughly penetrated the state. In response, in 2006 the UN established an independent investigatory agency, the International Commission Against Impunity in Guatemala (CICIG), which would attempt to root out corruption in the government and judiciary. In 2010 the commission successfully solved the country’s most notorious homicide in years, when it proved that Rodrigo Rosenberg, a lawyer who had recorded a video accusing the president, Álvaro Colom, of plotting to assassinate him just days before he was killed, had in fact arranged and paid for his own murder. CICIG’s former chief, Carlos Castresana, also forced Mr Colom to fire an attorney general suspected of corruption last year by resigning to protest the appointment.

Last month, however, CICIG suffered a devastating setback. When Alfonso Portillo’s (pictured) presidential term ended in 2004, he lost his immunity from prosecution and immediately moved to Mexico. Two years later Mexico approved his extradition back to Guatemala on embezzlement charges, and he returned to be kept under house arrest in 2008. In January 2010 the United States indicted him for money laundering. The next day Mr Portillo tried to flee by boat to neighbouring Belize. But with CICIG’s help, Guatemalan authorities captured him just minutes before he reached the border.

Mr Portillo’s trial represented a big opportunity to demonstrate that the powerful are no longer above the law in Guatemala. He was accused of diverting 120m quetzals ($15m) from the public treasury for “secret military spending”, most of which was later stolen. Prosecutors provided ample material proof of Mr Portillo’s involvement in the transaction, including audit documents from the state comptroller, and called numerous witnesses who participated in the transfer. The judge leading the trial, Morelia Ríos, voted to convict Mr Portillo.

Nonetheless, on May 9th, the tribunal voted to acquit him by a vote of 2 to 1. The court dismissed the testimony of the prosecution’s two main witnesses, because one is currently awaiting trial on fraud charges and the other had been involved with drug traffickers. The judges also argued that the former president did not have direct responsibility for the management of public funds. After the verdict was announced, CICIG released a statement saying that it “reflects the true state of justice in Guatemala”. Shortly thereafter, a local television channel broadcast footage from security cameras in the attorney general’s office, which showed the husband of one of the judges meeting Mr Portillo’s attorney on several occasions.

CICIG is putting up a fight. On May 31st, it formally appealed the verdict. And even if Mr Portillo is not convicted in Guatemala, he is likely to face justice eventually somewhere, since both France and America have also requested his extradition. But Mr Portillo’s case shows that CICIG’s work in Guatemala is far from over. Even with a recent extension of its mandate, it is only authorised to continue operating until 2013.

IN MARCH Mario Vargas Llosa, Peru’s Nobel Prize-winning novelist, compared a hypothetical presidential run-off between Ollanta Humala and Keiko Fujimori to a choice between “AIDS and terminal cancer”. Last month it was indeed Mr Humala, a populist nationalist, and Ms Fujimori, the daughter of an authoritarian former president, who advanced to the second round. A dismayed Mr Vargas Llosa reluctantly backed Mr Humala. By the narrowest of margins, his countrymen appear to have done the same in yesterday’s election. With 84% of ballots counted, Mr Humala is winning by 50.7% to 49.2%, and holds the lead in 17 of the country’s 26 regions.

A 48-year-old retired military officer, Mr Humala swears he is not the same candidate who ran in 2006 with the support of Hugo Chávez, Venezuela’s leftist president. He has distanced himself from Mr Chávez’s radicalism, and hired advisers from the party of Luiz Inácio Lula da Silva, Brazil’s moderate former president. At his closing rally on June 2nd, he pledged to keep Peru’s orthodox economic policies in place while ramping up programmes to spread growth more equally, like a free day-care scheme and a pension plan for people over 65 who lack them. If he can gain congressional approval, he also wants to raise the minimum wage and impose a windfall tax on mining companies. Félix Jiménez, his economic adviser, promised that Mr Humala would lead “a government of national reconciliation, of consensus.”

Ms Fujimori, a congresswoman, tried to cast doubt on Mr Humala’s transformation, accusing him of retaining ties to Mr Chávez. And late in the race Roger Noriega, a conservative American former diplomat, accused Mr Humala’s campaign of taking $12m from the Venezuelan leader. However, no evidence emerged to support the allegation.

Ms Fujimori may not have spent enough time dispelling concerns about her own candidacy, particularly those of rural voters. Two years ago she said she would pardon her father, Alberto Fujimori, who is currently serving a 25-year prison sentence for corruption and human-rights abuses. Although she later backtracked, her running mates and top advisers all served in Mr Fujimori’s government, as did many candidates from her party’s congressional slate. Tony Palomino, a community activist in Villa El Salvador, in southern Lima, said voters rejected Ms Fujimori because they sensed that she was not in charge of her own campaign. “The people around her, her spokespeople, they were all her father’s allies. This created doubts,” he said.

Mr Humala, who will be inaugurated on July 28th, will not have long to celebrate his victory. Most investors would have preferred Ms Fujimori, and Juan Carlos Eguren, a conservative congressman, called on the president-elect to name his economic team quickly in order to avoid upsetting the markets. Mr Humala will also need to piece together an alliance in Congress, where his coalition has just 47 of 130 seats. One potential partner that would give him a majority is Perú Posible, the party of Alejandro Toledo, a former president. With such a weak mandate, Mr Humala will need the consensus-building skills he says he has learned in order to govern effectively.

AFTER being trapped for hours in a hospital during a police mutiny last September, Rafael Correa, Ecuador’s president, bet much of his political capital on an attempt to shore up his power through a constitutional referendum. On May 7th, he put to voters a package of ten amendments that would allow him to increase his control over the courts and media. The early results suggested a split decision, with most of the proposals narrowly passing but two key measures falling short. However, towards the end of the drawn-out vote-counting process, the Yes camp pulled ahead on both questions. Its lead held up: the National Electoral Council (CNE) announced on May 19th that all nine amendments put to a national vote had been approved, albeit mostly by very slim margins. (The final question, on whether to ban killing animals for public entertainment, was settled at the local level).

The opposition has cried fraud, and filed hundreds of legal appeals. Its leaders have honed in on low-income neighbourhoods in Guayaquil, the country’s biggest city, as the likely site of the government’s mischief. Many polling stations there reported more than the maximum of 400 voters. Electoral officials have argued the numbers were caused by high turnout from the police and army. But Martha Roldós, an opposition leader, notes that the rolls from those locations include high numbers of women. Even one of the CNE’s directors, Marcia Caicedo, has accused her colleagues of favouring the government and dragging its feet on the opposition’s complaints. Mr Correa’s rivals say they hope their appeals will at least delay the publication of the official results of the referendum and the implementation of its most controversial measures.

The president, by contrast, has focused on locking in his tenuous gains, touting the outcome as a “ten to zero” landslide. The referendum’s changes to the judiciary will automatically take effect as soon as the CNE releases its final results. But legislative approval is required for its provisions on regulating the media, outlawing “unjustified” wealth, closing for-profit gambling operations and criminalising employers’ failure to register their workers with the social-security service.

The referendum stipulates that those bills be passed “without delay.” However, it is unclear whether Mr Correa, who lacks a congressional majority, can force lawmakers to vote for them. Although he has the right to dissolve Congress, doing so would require him to stand for re-election as well—a highly unpopular move in a country that has had to vote every seven months on average since November 2006. Instead, he is threatening to try to have legislators who vote against the package dismissed for dereliction of duty—a tactic he used successfully in 2007 against lawmakers who opposed a referendum on a new constitution—and to have the Constitutional Court write the laws itself. There is little hope of legislative compromise: the president recently said he would refuse to negotiate with groups seeking the “submission” of the government, and has vetoed such deals in the past. He has enough support in congress to block any attempt to override his veto.

No matter how many of the referendum’s measures are approved, Mr Correa’s bid to use it to strengthen his political position has come up short. Just one of the ten questions got over 50% support; given the numbers of blank or spoiled votes, the rest merely obtained a plurality. And although he remains broadly popular, his approval ratings have been in steady decline this year. If the populist president really wants to firm up his hold on power, he will need to campaign less and govern more effectively.

AS NOTED in last week’s print edition, Brazil’s long-impoverished north-east is catching up fast to the rest of the country. Infrastructure projects like ports and railways, as well as scores of new factories, are going up across the region. Yet no matter how much physical capital the north-east can accumulate, in the end its prosperity will depend on its human capital. And when it comes to education and training, notes Alexandre Rands of Datamétrica, a consultancy, a “crystallised gap” still yawns between the north-east and the rich south. Around one-fifth of the region’s adults are illiterate, twice the proportion in Brazil at large.

The lot of poor nordestinos (north-easterners) has certainly improved over the last two decades. Fernando Henrique Cardoso, Brazil’s president from 1995 to 2002, conquered the hyperinflation that hit their income hardest. His successor, Luiz Inácio Lula da Silva, built on Mr Cardoso’s income-transfer programmes and increased the minimum wage. Nearly six in ten of working-age nordestinos with an income earn no more than the minimum wage—more than twice the proportion in the south-east.

At one mega-construction site in the town of Salgueiro, where two branches of a railway leading to the ports are being built, the least-qualified employees earn around 600 reais ($375) a month on top of their living costs, and sleep four to a prefabricated room. Nonetheless, the rooms are air-conditioned, neat and comfortable. Nearby are shared television rooms and games rooms with pool tables and subutteo. A film is shown every night and at weekends there are religious services.

In education, however, the gains have been more halting. State governments are making an effort. Ceará has already opened 130 professional and technical schools, and has 100 more in the pipeline. The idea is that high-school students will attend classes in the morning as normal and then spend the afternoon learning a trade. If you travel around the interior of Ceará, says Adail Fontenele, its infrastructure secretary, in many towns the nicest building you see will be its new professional school. The state government is also building a Centre for Technical Training at Pecém that is scheduled to open in 2013, and will eventually graduate 12,000 workers a year.

There is so much work to be done, however, that the private sector is trying to fill in the gaps itself. Vale, a big mining firm, runs one programme that takes on 1,200 high-school graduates each year and gives them a year of full-time training: three months of basics, mostly mathematics and Portuguese, and then more job-specific technical preparation. Although there were 50,000 applicants last year, many did not fulfil the basic requirements. In the end the company had to look outside the two states where these employees would be working, Pará and Maranhão, to fill the slots. Another Vale scheme sponsors 170 high-school students each year to go to private school in the morning and technical college in the afternoon. These well-trained young people will end up benefitting the company, either directly if they end up working for it or one of its partners or suppliers, or indirectly, simply by increasing the pool of well-qualified labour. Vale’s regular workers also double as instructors. Americo (nicknamed Capitão—Captain, naturally), who sat in a crane cabin 25 years ago but now operates two machines remotely from an air-conditioned room, supervises 40 trainees a year on the use of the equipment.

The region’s younger workers are also trying to make up for the deficiencies of their schooling and move up a rung in life themselves. Over and over again during my week in the north-east I heard plans to participate in cursinhos, or “short courses”, from everyone from construction workers to drivers to hotel staff. Erica, a civil engineer in charge of quality control at Petrobras, the state-controlled oil company, has been working since age 16, but is on her first job in booming Pernambuco state. Asked about her future, she laughs and says: “I’m at the top now!”, and then tells me that there are two things she wants me to know: that she is proud to be a woman in this job, and proud to be a north-easterner.

Nordestinos are on average poorer, blacker and less educated than natives of the south-east, and prejudice against them is commonplace. One acquaintance in São Paulo to whom I said I had heard that nordestinos were starting to return home because the economy was doing so well up there exclaimed: “Go! Go! Good riddance to them!” Well, they are going—and I feel happy for them and privileged to have witnessed it.