Argentina Past and Future
By Roberto Guareschi
Argentina is approaching its October presidential elections gasping for air. Cristina Fernández de Kirchner is leaving behind a country in economic recession, with weakened institutions and a tense and polarized society as a result of her confrontational style. The balance of 12 years in power (Cristina alternated power with her husband, the deceased Néstor) is negative.
Néstor Kirchner started his presidency with a tailwind thanks to the spectacular increase in the price of soy, the main crop grown in Argentina. In 2010, the best year, the Central Bank was able to accumulate $52 billion US dollars in international reserves. But today reserves total $33 billion US dollars- a dramatic decline of almost 35% in merely four years.
During the years of growth at Chinese rates, the Kirchners did not mind the industrial decline or the energy deficit that forced them to import fuel. The governing couple squandered the economic bonanza in subsidies, excessive public spending, and also because of simple inefficiency. And today, when the price of soy is down and the times of “easy money” are over, Argentina continues to be, mostly, a producer of raw materials.
There are also serious problems in the political arena:
- Cristina claimed the power to modify the budget as she pleases.
- She took “loans” from the Central Bank to face the fiscal imbalance.
- She stopped investigations on corruption cases.
- She confronted the opposition media and the Supreme Court with a style that had not been observed in democracy since the mid-twentieth century, during Perón’s first administration.
Even worse, she found a loophole that allowed her to share the presidency with her husband without formally breaking the law. The Constitution allows one re-election and they alternated in power every four years until Néstor’s death.
Cristina does not want a successor. She tepidly supports Daniel Scioli, a pragmatic peronist and ex-powerboat racer, who is currently the highest polling candidate. His charisma is built on an accident which cost him one arm, and not on his lackluster administration as governor of Buenos Aires province.
Another candidate who has chances to win is Mauricio Macri, governor of the City of Buenos Aires, where people acknowledge he has been efficient. He has a neoconservative profile.
Both are married to former models. They also share an extreme submission to marketing: they both recently agreed to make fools of themselves on a reality show, the most viewed show in the country. Finally, they face the same challenges:
- Taming the second highest inflation rate in the world.
- Decreasing the currently astronomical public spending: it increased 2,675% since the Kirchners took power.
- Undoing the discredit of politics: in 2003 Cristina declared a personal worth of two million pesos; today she has 55 million (and her vice-president is being prosecuted for taking advantage of his position to carry out business deals).
- Attracting foreign investment and credit, something inconceivable today.
Macri and Scioli are economically orthodox. But will the winner be able to apply the painful remedies that this implies for the most vulnerable sectors? Will he be able to resist the pressure of the powerful peronist unions?
Cristina cannot be reelected more than once. In the case that Scioli wins, she plans to manage him behind the scenes and in this way be a referee of Argentine politics. Will she be able to? Her high popularity rate- approximately 40%, her boldness and her energy in a country that lacks leaders might help her.
Populism is coming to an end today, the way it happens every time the economic expansion is over. But a myth says that every ten years there is a serious crisis in Argentina. If the prophecy is fulfilled, it is possible that populism will return. But in any case this possibility is several years away.
Roberto Guareschi was for 13 years the managing editor for the newspaper Clarín in Buenos Aires. He is currently a columnist, university lecturer and consults for digital media.