Peruvian national-socialist Ollanta Humala and his center-right populist rival Keiko Fujimori have finally agreed to a televised debate ahead of the June 5 presidential runoff election. Perhaps the May 29 event will reveal how genuinely committed each candidate is to preserving, refining and strengthening the fragile democratic capitalism that has been moving the country out of poverty for the past decade. This is, after all, the crucial question for Peruvian voters.
Liberalization has been good for Peru. Its gross-domestic-product growth averaged about 6.5% annually from 2002-2010. Poverty is half what it was 20 years ago. The government has opened markets, increased property-rights protection, improved transparency in the state's fiscal accounts, and restrained spending.
This success has helped sustain the case for Latin American freedom at a time when Venezuela's Hugo Chávez and the Colombian terrorist group FARC are using money, weapons and ideological outreach to try to overthrow democracy and outlaw private property across the continent. Revolutionary ideals have met with some success among the region's most vulnerable populations. Mr. Chávez's Bolivarian movement was instrumental in bringing the antidemocratic Evo Morales to power in Bolivia. Internal FARC documents indicate the guerrillas helped finance the presidential campaign of Ecuadoran caudillo Rafael Correa. In all three countries civil liberties, including free speech and due process, have been dramatically abridged.
Peru has mostly kept these destructive forces at bay. But the risk of a revolutionary uprising, particularly in the southern sierra, remains real. Discontent simmers in Peru's significant indigenous communities, where people are less likely to be beneficiaries of economic modernization, and where state inefficiency and corruption translate into abysmal public services. Centuries of racial tension also persist in these areas, and the U.S. war on drugs in the face of steady American demand has further alienated the population.
This is the target market of Mr. Chávez, and it is also the stronghold for Mr. Humala's national-socialist Gana Peru party.
A recent special-client report, "The Possibility of an Insurrection in the Southern Andes" by the Peruvian security-consulting firm Peace Keeping Solutions (PKS), lists 14 "acts of insurrection" since 2004, including one led by Mr. Humala's brother Antauro on Jan. 1, 2005, that was supported at the time by the candidate. The report points out that while Mr. Chávez's political structures have played a role in fomenting this unrest, chavismo "doesn't explain the existence of leftist and nationalist ideas among 40% or more of the Peruvian population." That, PKS maintains, is a result of ideological forces within national universities, professional organizations, the Peruvian military and some political parties.
Chavismo has a limited capacity to "organize insurrection" in Peru, PKS says. But that capacity is strengthened by the state's failure to counteract radicalism. The army is "indifferent, bordering on complicity," the National Intelligence Agency is "inefficient," police administration is deficient, and police intelligence is starved for resources. Meanwhile, there has been "a permissive attitude" in the prime minister's office and at times cooperation with militant activists from regional authorities.
Mr. Humala's history is tied up in all this. He is an ex-army officer who has built his political career by tapping into the resentment of the disenfranchised with demagogic speeches against liberal economics and threats of violence against the establishment. Mr. Humala even attempted his own military coup in 2000, and there are credible allegations that he took money from Mr. Chávez in his 2006 presidential bid.
Last week he tried to distance himself from this past by publicly swearing on a Bible to refrain from dismantling the country's democratic institutions if elected. His critics howled that it was pure theater and no more believable than the recent rewrite of his policy agenda. The old one, dated December 2010, was a 198-page anti-market, national-socialist rant. The new one is eight pages of promises to "combat corruption," "reestablish public ethics," and lay down the rule of law. It is as if Mr. Humala was knocked off his horse on the road from Puno.
Either that or he has agreed to an image makeover so he can get elected. The latter seems more likely. Nevertheless, he is being helped by a few Peruvian elites who appear less enamored of him than they are obsessed with hatred for Keiko Fujimori's father, former president Alberto Fujimori. Her defeat, it seems, would be their long-sought revenge for his authoritarian style. How else to explain so-called free-market types backing a national-socialist who six months ago was pledging to eviscerate the liberal economic model?
Ms. Fujimori has a heavy responsibility to defend the measures that have improved Peru's living standards and to explain how she would deepen reforms. A lot is riding on how well she does in the debate. If the only motivated voters come election day are those with scores to settle against her father, the country is in deep trouble.