June 5, 2006 2:14PM

Good News (and Some Uncertainty) from the Peruvian and Czech Elections

Citizens in Peru and the Czech Republic rejected the far left in those countries' elections this weekend.

Peruvians gave 54 percent of their votes to former president Alan Garcia against 46 percent for nationalist candidate Ollanta Humala. Garcia is no market liberal, but at least he promises to stick to democracy, orthodox macroeconomic policies and not reverse the gains of Peru's economy since it began liberalizing in the early 1990s. Thus Peruvians rejected Hugo-Chavez style populism and contributed to the regional backlash against the Venezuelan President's desire to unite Latin America under his leadership. A more moderate and modern Latin America is taking shape among the countries along the Pacific Rim (with the possible exception of Ecuador) that are opting for free trade with the United States.

The fact that Peruvians voted for a candidate who is remembered as one of the worst presidents in Peruvian history (1985-1990) rather than for Humala says a lot about how deep anti-populist sentiment goes--at least among those who voted for Garcia. The problem for Garcia, and for governability in Peru, is that Humala won in the majority of Peru's departments, mainly in the andean and jungle interior, thus revealing a divided country. The leftist-populist party also has the largest representation in the Peruvian congress. Already, Humala has declared the formation of a nationalist front, calling for all leftist organizations to unite. This may represent democracy in action, but it is a sign that Humala will remain a major irritant to the next government and possibly to social and political stability if Humala follows Bolivian President Evo Morales's example of forging a path to power by creating unrest and instigating riots and violence to achieve political ends. Populism and the influence of Chavez have not been definitively defeated in Peru.

In the Czech Republic, the communists lost seats in the parliament and the pro-market Civic Democrats won a plurality, with 34 percent of the vote. Normally, the head of the leading party, in this case Mirek Topolanek, would form a government. But the elections resulted in an even split in the parliament--with the Civic Democrats and their allies holding 100 seats and the communists and the Social Democrats holding the remaining 100 seats. It is difficult to see how Topolanek will form a majority, but the coming days and weeks will surely see lots of political negotiations and some degree of compromise. If that doesn't work out, the Czech Republic will have to hold general elections again in the next few months and hope that voters are more decisive in choosing between free-market reforms and euro-socialist polices.