With little time left before the Argentine Presidential elections, there is no debate, no euphoria in the streets, and the voters still do not know the opposition candidates.
Source: Americas Program
With little time left before the Argentine Presidential elections, there is no debate, no euphoria in the streets, and the voters still do not know the opposition candidates. Wholesale apathy reigns, and dialogue—in what is traditionally a very politically active country—is glaringly absent.
What one does find is a deep conviction, in both opposition and government sectors, that the current administration’s candidate, the first lady, Cristina Fernandez de Kirchner, will be a comfortable winner on Oct. 28. This conviction is confirmed by recent polls that indicate that somewhere between 45-55% of the electorate intend to vote for the Senator, which would give her a victory in the first round.
In this situation it’s also necessary to look at the role of the opposition candidates, all fallen off the political map. None of them score even 15%. According to the poles, Elisa Carrió of the Civic Coalition, (with a Socialist Party vice-presidential candidate), is the only candidate who could come close to such a figure. Behind her is the ex-minister of economy of the current administration, Roberto Lavagna, with 9-13.5%. Even further behind is the right-wing Ricardo Lopez Murphy who, it appears, has little chance of getting more than 4.8% support.1
Based on these numbers, the government seems to have chosen the same strategy that it adopted in the 2005 elections, when the first lady presented herself as "Frente para la Victoria" (Victorious Front) candidate for a Senate seat in the Province of Buenos Aires. Knowing that she would win, she opted neither to grant interviews nor to accept a "face to face" with other candidates. She is using the same tactic in this election.
Hence it is not unusual to see Fernandez de Kirchner on the campaign trail in Germany, the United States, or Spain but without a hint of her other agenda, which she is putting together with her husband, current President Nestor Kirchner. This silence seems to be bearing fruit: "The best campaign is the administration of the current government," we are assured by Anibal Fernandez, the current Minister of the Interior.
However, despite apparent widespread calm, a few recent events have caused a stir and some annoyance in the Casa Rosada.2 First there were the corruption scandals—a particularly sensitive theme for the current Kirchner government that took great pains to distance itself from the excesses of former President Carlos Menem in the 1990s. These scandals related to the ex-minister of economy, Felisa Miceli, and a mysterious Venezuelan businessman, who tried to bring $800,000 in undeclared cash in his briefcase. With the passing of time, these issues have disappeared from the media’s attention. In its place the government’s weaker flank has been exposed: inflation.
The inflation issue lies not only in the increases in the price of basic foodstuffs from week to week, (upon which the index is based), but also the fact that the government fundamentally denies these increases. Furthermore, confidence in the indices themselves has been compromised by the intervention of the secretary of internal commerce, Guillermo Moreno. This is no small matter when you take into account that by affecting the credibility of the INDEC (National Institute for Census and Statistics) itself, it also highlights the susceptibility of the INDEC’s other statistics. Take the official poverty indices for example, calculated using the consumer price index (IPC in Spanish); this too is suspected of manipulation.
This growing lack of confidence, however, does not alter the opinion that there have been significant social welfare advances. Possibly the most outstanding change has been just that—the poverty levels—which today, according to the INDEC, is at 23%. This is still a high figure, but substantially lower than the 57% levels in 2002 after the crisis of the previous year.
From a macroeconomic perspective, it is beyond doubt that the Nestor Kirchner government has been a success, as evidenced by the 8.8% average annual growth rates (accomplished with the protection of the weak peso) and dual government surpluses.
In the context of national growth rates on par with those of China, the main source of criticism of the president—and one that his wife shows no intention of changing—is the inequitable distribution of earnings. As it happens, after the effects of a decade of neoliberalism, this issue has become a central one. In 2003 the poorest 20% of Argentine society earned only 4.1% of national earnings, the current figure is just 4.6%, and all this while Argentina Central Bank international reserves have risen to $45 billion.
On May 25, 2003, when President Kirchner took power, he spoke of his intentions for the four years ahead: "Central to our plans is the reconstruction of national capitalism which will put back in place the basis for upward social mobility."
Today with the negative climate toward neoliberal economics, the International Monetary Fund (IMF)—Kirchner’s rhetorical enemy—was forced to accept a re-negotiation of the country’s external debt with a 65% reduction. The current president enjoys an overall positive image and approximately 50% approval ratings. Given all of these facts, the two major questions that remain in Argentine politics are: Why did the president decide to step aside and leave his wife as the principal protagonist? And, second, what will be this new Kirchnerian future?
The Changes
Regarding the first unknown: political analyst Isidoro Cheresky puts it this way: "Kirchner came to power accidentally, with limited political resources, intellect, and experience. And now that he faces a period of stability, he is unable to govern as he used to. The Argentine people are no longer, as he put it over and over again, ‘in hell’ and he is starting to encounter problems. One needs to understand that we are not just talking about the existence of a party, but the lack of strategic vision and development policies for sectors which constitute the institutions of the state."
Fernandez de Kirchner, apart from presenting a new face on the battlefield, has proposed changes like a new coalition. One of its clearest manifestations is the choice for vice-presidential candidacy of Julio Cobos, current Governor of Mendoza. Cobos was a Radical Civic Union Party (UCR in Spanish) Governor. For his sins the UCR decided, a few weeks ago, to expel him from their party.
Another novelty of the incumbent party candidate is her new social pacts. The idea is that these new agreements, or social dialogues, will allow the government to play the role of arbiter between Industrialists and Unions. In the Argentine Theatre, in the city of La Plata, the first lady stated: "We need to propose an accord: a social dialogue in Argentina, one in which Argentina has a rich history, where industrialists and workers cooperate with State input. The government role is to formulate and guarantee the macroeconomic conditions of: freedom from debt, current account surplus, budgetary surplus, a competitive exchange rate, and reserves sufficient to avoid any collapse. Those macroeconomic conditions cannot just be provided by the governing president, they must be patrimony of all Argentines, and must be institutionalized."
But according to Alfredo Zaiat, journalist at the daily Página 12, "The proposal, as expressed by the candidate, does not invite debate nor is it font of ideas. Instead it binds in a contract the policies of the present economic policy. The discussion of prices and wages is just an aspect of, and not the essence of, the agreement."3
Another argument in favor of the candidacy of the first lady was the triumph in June of the industrialist Mauricio Macri in the elections for Mayor of the Federal District of Buenos Aires. In the administration that fact was interpreted as a call for change coming from an electorate that had had enough of a political system that is neither representative nor one for which they are enthusiastic.
But the government not only lost in the capital. In a few months the same happened in the provinces of Santa Fe and Cordoba, containing the other two large urban cities of Argentina. "[In the urban centers] Kirchnerism lost because it is not so simple to establish dependent networks of political subordination. However, this will be devastating in the Province of Buenos Aires which, with more than 10 million voters it represents 37% of the total national vote, and where the indices of poverty and homelessness are enormous," says sociologist Atilio Boron.
In ideological terms it is speculated that the candidate eschews a pragmatic center-left tendency. "We reconcile interests and we are never going to superimpose an ideological attitude," as the president puts it in blunt terms.
The political analyst Vincent Palermo agrees that the election is characterized by a lack of policy debate: "This it is not exclusively an Argentine phenomenon; in almost all of the current stable democracies one sees an increasing climate of indifference and apathy. I believe that the Argentine election is an extreme case for the following reasons: first, her triumph is almost taken as a given. Second, not one of the competitors demonstrates a significant allure to the electorate. That is to say we are speaking of an election in which, it seems, there is little in play, and this is taking place within a political, social, and economic framework very much less dramatic than previous elections."
Palermo also adds that "indeed the political scenario being presented to the electorate, is not precisely one of a ‘Peronism that has come back into favor,’ as was the case with ex-president Menem in his campaign of 1989. Instead, what we find is a government juggling its bases of support, attempting to maintain a precarious balance between the Peronist factions and the approach taken to retain the endorsement of the non-Peronists."
Continuity
Apart from one reform inside the Ministry of Economy, which implies effects on the Ministries of the Treasury and Economic Development, the most likely outcome of a Fernandez de Kirchner government will be continuity in the macroeconomic policies of her husband. This will imply a continuity in the policy of a devalued Argentine peso with respect to the dollar, thereby stimulating the internal economy, combined with export levies continuing on soybean, maize, and wheat crops and also meat exports (the current basis of modern developmentalist policies).
In spite of a hint of pro-industrial policies, the economic foundation of a Fernandez de Kirchner government would be continued soybean exports (95% of soy production is exported, or 47.5 million tons). Government soy export taxes are set at 27.5%, whereas maize and wheat pay 20% of their exportable values. This sum represents an annual fund for the Argentina state of $2.5 billion dollars. The total state taxation income in the first nine months of the year, according to the Federal Administration of Government Taxation (AFIP in Spanish), was $45.3 billion dollars.
This is happening in an environment of increased demand for agricultural exports driven by external factors such as constant growth in demand by China and India, and the growing "boom" of the agrofuels market that has led to increased demand for corn in the United States. Also important are the prices of the agricultural edible oils that have reached historical maximums above $300 a ton for the next harvest.
Neither is it likely that there will be changes with respect to the most famous of Argentina’s privatized state assets, the state oil company YPF, today owned by Spanish company Repsol. This is unlikely even though the current economic growth requires increasing consumption of energy resources leading to an inevitable energy crisis.
Argentina today faces a paradox. In the context of growth, there is a break with the old and a culmination of the new—no one offers proposals, nor is a different approach suggested or discussed. Cheresky puts it this way: "We face a surprising situation that all the political sectors, the opposition and the current Peronist government, both offer their own arguments that Argentina faces a new age. One would think that this would spurn some type of debate, some kind of confrontation, but it has not. Even though Cristina presents herself as the candidate for change—in effect the only significant change is the vice-presidential candidacy of Cobos—her evident strategy is one of continuity. She will surely win, but Peronism will face a problem. The way that citizens relate to political policies has changed forever. Approximately 70-80% say they do not to belong to a political party, and the problem is neither one of segregation, nor that organizations or the militants have disappeared, but that of non-participation. Leaders launch projects or political alternatives, but when the leadership lacks participation in its own organization then there is a problem," and those in the Casa Rosada know this.
End Notes
- Argentine Newspaper Página 12 Sept. 30, 2007.
- The Argentine equivalent of the White House.
- Página 12 supplement, Sept. 9, 2007.
Translated for the Americas Program by Tony Phillips.
Diego González is independent journalist in Buenos Aires and an analyst for the Americas Policy Program at www.americaspolicy.org. Translated by Tony Phillips.