Thursday, February 08, 2018

Macrism in Argentina

This is an interview in English with the Argentine political scientist Atilio Boron. Boron is a distinctly left analyst and activist, though he is very much sympathetic to left-center parties in Latin America when they are confronting conservative or rightwing parties. That's not self-evident in Argentine politics; the Socialist Party since the 1940s has generally supported the conservative Radical Civic Union over the left/center-left Peronist Justicialista Party. Argentina's President Macri Withdraws Neoliberal Reforms Due to Massive Resistance The Real News 02/04/2018:



Since taking office in December 2015, President Mauricio Macri has applied a standard IMF/Washington Consensus/neoliberal economic policy of reducing government and social services, cutting real wages and living standards for workers, tax reductions and deregulation for the wealthiest, privatization projects, a drastic boost of public debt, etc.

Eduardo Dvorkin (La agenda del 19 Cash/Página 12 04.feb.2018) describes the result this way:
Desde el 2015 se ha escrito muchísimo para caracterizar y denunciar al gobierno de los CEOs: la desindustrialización, la desocupación, el crecimiento de la desigualdad en el reparto del ingreso, la exclusión, el ajuste en ciencia, la cancelación de los proyectos de desarrollo autónomo de tecnología.

[Since 2015, very much has been written to characterize and denounce the government of the CEOs: deindustrialization, unemployment, the growth of inequality in the distribution of income, exclusion, the cutbacks in science, concellation of the porjects for autonomoous development of technology.]
Axel Kiciloff, the left-Peronist former Argentine Economics Minister and current National Deputy, wrote on his Facebook page (@kicillofok) 02/01/2018 commenting on the following statement by Macri:


My translation: "After more than 100 years, we have managed to lower spending, which reduced the deficit, which lowered inflation, that lowered taxes, and allowed the country to grow for two consecutive years."
En una sola frase Macri batió un nuevo récord olímpico de mentiras.

1. El déficit fiscal fue mayor en los dos años de Macri que en 2015.

2. La inflación de los dos años de Macri es la mayor de los últimos 15 años (IPC CABA).

3. Después de 2 años de gobierno, el PBI recién recupera valores de 2015. Y en su repaso Macri parece olvidar que entre 2004-2015 el crecimiento promedio anual del PBI fue de +3,7%

4. La industria todavía está 2,9% puntos por debajo de los niveles de 2015.

El gobierno de Macri tiene otros “récords” que omite: el endeudamiento más rápido de la historia (usd 80 mil millones en 2 años); el déficit comercial más alto de la historia; y medalla de bronce en bicicleta financiera (3º país en el mundo).

Macri viene de mentir en Davos y en Francia, pero en Argentina la realidad es que cae el salario, recortan jubilaciones y cae el empleo de calidad. #AumentaTodo y hay un sinfín de despidos.

Eso es #ElGranAjuste

[In one single phrase, Macri broke a new Olympic record of lies.

1. The fiscal deficit was larger in the two years of Macri than in 2015.

2. The inflation of the two years of Macri is the high of the last 15 years.

3. After two years of governing, the GDP recently recovered its value of 2015. And in his review, Macris seems to have forgotten that between 2004-2015, the annual average GDP growth was +3.7%.

4. Industry still is 2.9% below the levels of 2015.

Macri's government has other "records" that he omits: the most rapid increase in indebtedness in history ($80 billion in two years); the largest trade deficit in history; and a bronze medal in the financial bicycle (third-place country in the world).

Macri went to Davos and France to lie, but in Argentina the realities is the fall in salaries, reduction of pensions, and a fall in the quality of employment. #AumentaTodo {inflation on everything} and there are layoffs without end.

This is #ElGranAjuste {the big cutback}. ]
The bicicleta financiera ("financial bicycle") is a phrase often used in economics and politics in Argentina. It refers to financial profiteering in the carry trade, which is basically exploiting exchange rates to extract economic "rent". Bert Dohmen (Carry Trade: The Multi-Trillion Dollar Hidden Market Forbes 09/04/2014) defined the carry trade briefly this way, "What is the carry trade? It’s the borrowing of a currency in a low interest rate country, converting it to a currency in a higher interest rate country and investing it in the highest rated bonds of that country. The big trading outfits do this with leverage of 100 or 300 to one."

The Presidential administrations of Néstor Kirchner and Cristina Fernández had imposed capital controls - heresy to the neoliberal gospel - and carefully regulated the dollar reserves to support their policy of promoting domestic industrial development and as part of blocking "imported inflation." Macri reversed that policy. And the predictable consequences have followed.

See also: Daniel Pardo, Qué es la "bicicleta financiera", un símbolo de la Argentina de Mauricio Macri con el que inversionistas de todo el mundo han ganado millones BBC Mundo 27.junio.2017; El Banco Central renueva la "bicicleta financiera" con $380 mil millones en Lebac El Destape 14.nov.2017; Federico Kucher, El regreso de la bicicleta financiera Página/12 30.dic.2016.

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