Paul Krugman in Partying Like It’s 1998 New York Times 08/11/2018 talks about the similarities he sees between Turkey's present situation and Asian crises of the 1990s, which he has studied closely. He sees an admittedly "tricky"
How it works: stop the explosion of the debt ratio with some combination of temporary capital controls, to place a curfew on panicked capital flight, and possibly the repudiation of some foreign-currency debt. Meanwhile, get things in place for a fiscally sustainable regime once the crisis is over. If all goes well, confidence will gradually return, and you’ll eventually be able to remove the capital controls.
Malaysia did this in 1998; South Korea, with U.S. aid, effectively did something like it at the same time, by pressuring banks into maintaining their short-term credit lines. A decade later, Iceland did very well with a combination of capital controls and debt repudiation (strictly speaking, refusing to take public responsibility for the debts run up by private bankers).
He also notes, "Argentina also did quite well with heterodox policies in 2002 and for a few years after, effectively repudiating 2/3 of its debt." Which is certainly right.
Then he adds this, "But the Kirchner regime didn’t know when to stop and turn orthodox again, setting the stage for the country’s return to crisis."
I'm surprised that Krugman would blame Cristina Fernández' government for the economic disaster the current President Mauricio Macri created with his straight-up IMF/Washington Consensus/neoliberal policy recipe.
With authoritarian-minded governments and movements in ascendancy in various places of various types, there's a lot of speculation about an wide-reaching authoritarian trend internationally: the US under Trump and his pliant Republican Party, Poland, Hungary, Turkey, Russia of course, Austria, Brazil, the Phillipines, Argentina to some extent. Most American would probably include Venezuela in that list, and that's partially accurate. But the reporting on Venezuela in the US is pretty pathetic. And with it, we can never forget, "Venezuela claims the world’s largest proven reserves of petroleum, an estimated 298 billion barrels of oil." (Michael Klare, The Desperate Plight of Petro-StatesTomDispatch 05/26/2016)
Such trends are hard to measure. Marc Plattner gives his version of such concerns in Liberal Democracy’s Fading AllureJournal of Democracy 28:4 (Oct 2017). That publication's website states, "The Journal of Democracy is part of the International Forum for Democratic Studies, housed within the National Endowment for Democracy." The NED is rightly suspected of an excessive enthusiasm for regime change in countries in which US neocons and "humanitarian hawks" disapprove of the government in power. I mention that not to suggest that their arguments be disregarded, but rather that they should be understood in the broad context of NED's outlook and practice.
Plattner is looking back at the triumphalist "end of history" narrative after the fall of the eastern European Communist governments after 1989 in what former German Foreign Minister Joschka Fischer once called revolutions by implosion.
Looking at the global situation today, a quarter-century later, we see a vastly different picture. Those same principles and practices, which by the 1990s seemed to have fully regained their former attraction and to have spread to a much wider range of countries than ever before, now seem again to be losing their luster. Today liberal democracy is clearly on the defensive. Authoritarian regimes of various stripes are showing a new boldness, and they appear to be growing stronger as the confidence and vigor of the democracies wane.
Plattner expresses particular concern about the rise of populism in Peru:
In April 2016 in Peru, voters handed a landslide congressional victory to Popular Force, the party of populist former dictator Alberto Fujimori, who is serving a 25-year prison term for severe human-rights violations committed during his presidency. The party’s 2016 presidential candidate, the former leader’s daughter Keiko Fujimori, won a very substantial plurality in the April first round—almost 40 percent, nearly twice the vote share of second-place finisher Pedro Pablo Kuczynski. Yet this still left her well shy of a majority, and she was forced to face Kuczynski in a June runoff. She lost to him by less than a single percentage point, but her party’s legislative majority means that her influence on Peru’s political direction is considerable.
While the Peruvian case is important, the election of the rightwing/oligarchic government of Mauricio Macri in Argentina (end of 2015) and the "soft coup" in Brazil (2016) are currently notably more significant in terms of their effects on democracy and the neoliberal policies that undermine it.
Neither Argentina nor Brazil has abolished elections or political parties. And the "soft coup" that put current President Michel Temer in power in Brazil was more authoritarian in nature than the straightforwardly democratic election that brought Macri to the Presidency in Argentina.
But Macri's government is a great example of predictably bad economic policies - although of the kind approved and insisted upon by the IMF and the "Washington Consensus" - and how they are easier to maintain in more authoritarian conditions than in democratic ones. Macris's government came after 12 1/2 years of kirchnerismo government, i.e., left social-democratic Peronism under the Presidencies of the late Néstor Kirchner and Cristina Fernández de Kirchner. Although Macri in his 2015 campaign made gestures toward Peronist perspectives and was supported by a Peronist faction (Peronism is a complex political phenomenon, to put it mildly), his economic policies have been the textbook neoliberal playbook of budget cuts, privatization, low taxes for the wealthy, and lower salaries and wages for the majority. The results, of course, have been high inflation and a slumping economy.
Kirchnerismo was notable in having broken with the Washington Consensus on free trade and debt by maintaining capital controls and refusing to pay vulture funds for debt that had to be defaulted on after the financial crisis of 2001. The goal was to develop the domestic economy and in particular to develop Argentine industry. Foreign debt has been a problem for Argentina as a block to national development and independence from foreign control since the "unitarian" government of Bernardino Rivadavia took a major loan from the British Baring Brothers bank in 1824. Developments in Argentina would later touch off what became known as the Baring Crisis of 1890-91, which "originated in Argentina but it was felt all over the world, first in London." (Gerardo della Paolera and Alan M. Taylor, Straining at the Anchor: The Argentine Currency Board and the Search for Macroeconomic Stability, 1880-1935 [2001])
The Elliott Management hedge fund of Paul Singer, an American vulture capitalist and one of the largest contributors to the Republican Party, bought up defaulted Argentine debt and sued in American courts, getting a bizarre and genuinely radical decision in their favor from Federal Judge Thomas Griesa in a ruling upheld by the Supreme Court. Once Macri was elected President, he quickly made a settlement that was extremely favorable for Singer's vulture funds, taking on new debt to pay it off. (The Vulture: How Billionaire Rubio Backer Paul Singer Made Billions off Argentina Debt CrisisDemocracy Now! 03/11/2016; Katia Porzecanski, Singer Makes 369% of Principal on Argentine Bonds in Debt OfferBloomberg Markets 03/01/2016)
Time magazine of 05/02-09/2016 included Macri in its list of 100 Most Influential People, with a two-paragraph tribute from Mauricio Macri:
Argentina is rich in natural resources and human capital, but its economic progress has been hobbled by the ineptitude and corruption of its political leaders. Over the past decade, the policies of Argentina's ruling duo, Nestor and Cristina Fernandez de Kirchner, led to rampant inflation, falling currency value and capital flight. The result was the 2015 election of the reformist Mauricio Macri.
Macri has removed Argentina's currency controls, allowing more freedom for trade. He has pledged to reintegrate Argentina into the global economy, seeking private investment from abroad. And he has taken action to end the 15-year default that has kept the country in economic exile since 2001. Macri still has important tasks ahead of him, including taming inflation. But if he lives up to his promise, Argentina may finally do the same. [my emphasis]
At that time, the Macri government was raising regulated prices on public utilities and the economy was slumping. Macri's supporters were telling everyone to be patient and wait for the segundo semestre (second half of the year). Argentina is in the first half of Macri's third year as President. But still waiting for the segundo semestre. This video from the beginning of his second half-year in office mocks, "The second half was born dead." Segundo semestre de Macri 07/01/2016:
There have been some disturbing signs of political repression.
Gastón Chillier and Ernesto Semánmarch wrote about the concerns that were already emerging in Macri's "first half-year" in What Obama Should Know About Macri’s ArgentinaNew York Times 03/23/2016, including the already-iconic case of indigenous activist Milagro Sala. Obama left the general impression with US voters and a political press that's largely oblivious to Latin American affairs that he had a left-leaning policy on Latin America, largely because of his pragmatic abandonment of the long-standing, failed Cuba policy. But actually his Latin American policy was generally conservative, including welcoming the political-military coup in Honduras and the extra-constitutional soft coups in Paraguay and Brazil. Obama's relations with Cristina's government was distant. But he made a point of embracing Macri after his election:
Mr. Obama’s historic trip to Cuba has all the pageantry of a farewell to the Cold War in Latin America. His visit to Havana will serve as a symbolic climax in the normalization of American relations with Cuba’s Communist government. But his excursion to Argentina has a very different resonance.
Shortly before Mr. Obama’s arrival in Buenos Aires, his administration announced the declassification of United States government documents relating to Argentina’s 1976-83 military dictatorship. Yet the visit is not about the current state of human rights, but about free trade and hemispheric security.
An acknowledgment of the malign role the United States played in the early years of the dictatorship is welcome, if overdue. But to ignore the red flags on human rights raised by the recent actions of Argentina’s new ruling party is a worrying reminder of that legacy. For Mr. Macri, Mr. Obama’s visit is already an endorsement. [my emphasis]
There have been some questionable legal investigations of senior officials from the previous government, including Cristina herself. The details of such cases can be difficult to judge from outside. The allegations against Cristina herself always looked fairly thin to me.
But after the 2017 midterm elections which brought her back to Congress and gave her a stronger position as leader of the opposition, the questionable arrests escalated and included the previous Foreign Minister and former Vice President Amado Boudou. And a new legal charge against Cristina Fernández that didn't result in her arrest because of her new parliamentary immunity. But the charge related to a sensational suicide of a prosecutor named Alberto Nisman in early 2016, who had been working for years on the AMIA bombing case from 1994. I know enough about the details of that case to say with confidence that those charges are bogus. So those are not good signs.
There have also been some questionable acts of repression against some of the many demonstrations against Macri's policies. Those are also difficult to judge from afar. But it's a pattern that is certainly disturbing from the standpoint of democracy and human rights.
And the borrowing that has historically been such a burden and trap for Argentina is continuing. Axel Kiciloff, currently a Congressional deputy from Buenos Aires city, the last Minister of Economics under Cristina's government and still a close ally of hers, warns that Macri's government is taking on a "colossal" amount of debt that, in his formulation, is being used for speculative purposes and is of "little benefit for the national economy." Kiciloff also charges Macri with trying to evade constitutional procedures and attempting to govern by decree. ("El DNU es anticonstitucional"Página/12 14.01.2018)
Argentina has legislative elections this coming October. The last Presidential election was in 2015, when the current President Mauricio Macri was elected. Macri's party is called the PRO (Propuesta Republicana), originally set up as a vehicle for Macri himself to be elected as the head of government for the City of Buenos Aires (Jefe de Gobierno de la Ciudad Autónoma de Buenos Aires), an office he held 2007-2015.
Former President Cristina Fernández de Kirchner is now positioning herself for a possible 2020 Presidential run. The step in that that direction she took this week was to announce her candidacy for the Argentine national Senate from Buenos Aires province. [Update: Actually she didn't announce her candidacy directly; a close political ally announced that she would be, but she didn't publicly confirm it.] Her electoral coalition just formally constituted itself as the Unidad Ciudadana, which the Télam agency in this report translates into English as Citizen Unity, Cristina Kirchner announces "citizen unity" will be the name of the front with which Kirchnerism will compete in primaries, outside PJTélam/Yahoo! Noticias 06/14/2017. For Americans, that sounds awfully close to Citizens United, a name that has a bad odor in the United States because of the 2010 Supreme Court decision of that name. Cristina's politics are definitely not like those of the Citizen's United group in the US that brought that case!
Argentine politics is not a two-party affair like we have in the US. But it is a presidential system. The head of government is elected directly and is not a prime minister in the sense of parliamentary systems. And the political alignments at the national level do tend to align on a two-camp basis. One major camp is that of the Peronists, of which Cristina Fernández is very much a part. Peronism is both a party and a movement. The party is the Partido Justicialista (PJ).
The other major alignment since 1946 has been the Radical Civic Union (UCR), which is typically referred to "the radicals" or radicalism (radicalismo), even though they have long since become conservative. The UCR is being absorbed to some extent by the PRO. There is a small Socialist Party, which essentially lines up with the conservatives in the PRO and UCR.
The various parties and splinter groups on both sides ran in 2015 on umbrella tickets. The Peronist ticket headed by Daniel Scioli was called Frente Para la Victoria (FpV). Macri's group was Cambiemos. Macri was also backed by a significant Peronist splinter group called Frente Renovadora, headed by Sergio Massa.
Cristina has now signed a common platform with other left-Peronist (kirchnerista) leaders to create the Unidad Ciudadana electoral front in Buenos Aires province for 2018. And more conservative faction in the PJ headed by Florencio Randazzo will complete in the provincial election as part of the Frente Justicialista, though he will likely have to win an internal primary for the right to head the ticket.
The Argentine economy has been in decline pretty much since taking office in December 2015. And that's a feature, not a bug for the Macri government. They have applied Herbert Hoover "Washington Consensus" economic policies from the start, including big budget cuts, deregulation of business, raising utility and public transit prices, all accompanied by major inflation and rising unemployment.
The inflation is very much related to economic policies of Macri's government. The prior government had used a system of capital controls and price regulations to maintain economic stability, promote the growth of domestic industry and maintain necessary dollar reserves. Macri's government pretty much dumped that whole menu of policies very quickly. High inflation and growing unemployment followed.
Debt for developing countries is different for that of the more developed countries. Because it becomes a tool that foreign governments and corporations can use to keep the debtor country in a state of dependency. The Kirchner governments of 2003-2008 had drastically reduced the debt, which had previously led to the severe financial crisis of 2001. Now Macri has put that course into full reverse: Argentina becomes largest debtor among emerging marketsBuenos Aires Herald 06/14/2017.
There are plenty of political issues to fight about over the next 2 1/2 years.
The present-day stream of Peronism in Argentina that is known as "kirchnerism" takes it's name from the Presidencies of Néstor Kirchner (2003-2007) and his wife Cristina Fernández (2007-2015).
I'm not familiar with the seemingly left-leaning American Herald Tribune. But I came across this article from it which gives a good concise description of kircherismo, Macri and the Argentinian “la grieta” by Frederico Acosta Rainis 02/03/2016.
During that period of development, a Keynesian model was unleashed, promoting “inclusive growth” based on consumer impulses, the increase in purchasing power, full employment, and the extension of the state apparatus coupled with its security. Other fundamental pillars included the strategic reorientations of its international alliances, especially with an emphasis of the Latin American south-south relations; an overarching human rights political doctrine, having helped usher in a minority rights program and the employment of memory-truth-and-justice commissions for crimes against humanity in the era of dictatorship (1976-1983).
Along with these policies, and though the discoursive and symbolic gestures, the Kirchners were able to create a universal sense of culture - nationalist, anti-colonial, and anti-oligarchy - casting itself on a large portion of the youth, and interpolating itself throughout various sectors including those which were unfamiliar to the concepts of Peronismo - its political antecedent. This narrative, attempting to make a unity without fissures, allowed for the emergence of a popular support necessary to make progressive steps addressing a few historical, and fundamental, reparations; external debt reduction, re-nationalization of the oil firm, YPF, and more sustenance for pensions and retirement, among others.
Cristina Fernández, that is, the President of Argentina 2007-2015.
Not that's she really been absent from the political scene since leaving office in 2015. Her successor Maricio Macri campaigned on a moderate program, or at least a moderate-sounding one. Since assuming office in December 2015, he has instead instituted a standard neoliberal/IMF/Washington Consensus economic menu. And the results are what should have been expected: falling real wages, higher unemployment, cutbacks of essential government services, a cave-in to the blackmail from vulture funds that had bought up defaulted Argentine debt, and taking on new debt, some of which reportedly uses Argentine state property as security. Dropping capital controls has contributed to a high inflation rate, even by Argentine standards. (It's not the kind of triple-digit hyperinflation that Argentina experienced in the late 1980s, at least.)
Cristina has been a regular, public critic of Macri's government. And she still has strong support within the Peronist Partido Justicialista (PJ) and the broader electoral coalition of the Frente para la Victoria, (FpV). This photo and slogan has been popping up in hard copies and online.
The slogan says, "The sun of the 25th is appearing." Or, "Sunrise of the 25th is coming" probably works, too. That's a reference to the 25th of May, a national holiday celebrating the official proclamation of a new national government on that date in 1810, displacing the Spanish Viceroy Baltasar Hidalgo de Cisneros (1756–1829). It's known as May Revolution Day, a key event in the establishment of Argentina as an independent nation. Argentine Independence Day is celebrated on July 9, commemorating the formal declaration of independence of 1816.
May 25 took on a particular political and patriotic significance for the kichneristas. Cristina's late husband Néstor Kirchner became President on May 25, 2003, the beginning of a dramatically new reformist direction for Argentina in which neoliberal political prescriptions were largely rejected in favor of a more activist government aggressively promoting Keynesian policies and recovering the language and spirit of left Peronist populism. (Martín Granovsky, “Llegamos sin rencores y con memoria” Página/12 06.05.2003) The 25th of May was treated as a major day of celebration of what they called the "national and popular" tradition of Argentina, i.e., left-nationalist, democratic and militant social-democratic ones.
Cristina took part in a meeting with other political leaders this week working to form an effective political coalition in Buenos Aires Province for the 2017 legislative elections. (Sin definiciones, pero con afichesPágina/12 24.05.2017)
Former Argentine President Cristina Fernández de Kirchner (CFK in shorthand) hardly took a breath between leaving office and actively leading the opposition campaign against the conservative/oligarchic government of Mauricio Macri, who took office in December 2015. She has been in Europea speaking out on various issues. Speaking to the left parliamentary group of the European Parliament, she discussed current human rights issues in Argentina and criticized Macri for not keeping his campaign commitment to maintain human rights policies, especially against criminals who were part of the dictatorship of 1976-83, Cristina Kirchner con eurodiputados del Bloque GUE/NGL en el Parlamento Europeo (Spanish) 10.05.2017:
She and the Peronist opposition she leads are protesting and seeking to rectify a recent decision by the Argentine Supreme Court that could give convicted criminal from the dictatorship early release from prison. 2x1: Activists outraged by Supreme Court rulingBuenos Aires Herald 05/05/2017 explains:
Human rights activists expressed their outrage and shock yesterday, 24 hours after the Supreme Court controversially ruled over the so-called “2x1” law, setting a precedent that paves the way for the reduction of prison sentences and the early release of repressors convicted of crimes against humanity during Argentina’s last military dictatorship (1976-1983).
The justices’ majority ruling, by three of the court’s five members to two, reduces the sentence of 61-year-old Luis Muiña — who was handed a 13-year prison for kidnapping and torture — and creates a precedent that others convicted of crimes against humanity will seek to take advantage of. The court found that Muiña’s time served in prison before his conviction should count double.
As Cristina explained in her European Parliament appearances, two of the three justices voting for the early release were Macri appointees.
In the grand scheme of things, it's hard not to think that removing elected governments by a "soft coup" like those in Paraguay in 2013 and in Brazil 2016 is preferable to the military brand of coup, of which Brazil 1964, Chile 1973 and Argentina 1976 are some of the more dramatic recent examples.
Honduras 2009 is sometimes cited as an example of the "soft coup." But it took the form of a military coup, though civilian government was quickly restored. And even obvious military coups also have a significant civilian political component. The Argentine coup of 1976 is also referred to commonly as a civilian-military coup. Just as the 1955 Argentine coup that styled itself the Revolución Libertadora involved substantial involvement at all stages from the Unión Cívica Radical (UCR) and the Socialist and Communist Parties.
And even the famous nonviolent "regime change" operation promoted by the CIA in Iran and 1953 and Guatemala in 1954 had long-range effects that call into serious question the judgment of the Eisenhower Administration promoting those coups against what in retrospect were, at worst, mildly annoying regimes for Washington. The quick-and-easy coup in Honduras has left an ugly legacy of social violence that continues over five years later. (Thelma Mejía, Journalism in Honduras Trapped in ViolenceInter Press Service 11/28/2016)Latin America in 2016: The Resurgence of the Right ContinuesThe Real News 12/31/2016:
Emire Sader describes in Macri, Temer y Peña Nieto, huérfanos de ClintonPágina/12 25.11.2016 the Obama-Clinton policy in effect in Latin America. Despite the pragmatic opening to Cuba, the Obama Administration's policy toward Latin America has been fundamentally conservative. Conservative in the sense of supporting conservative government's with less than enthusiastic commitments to democracy over democratic governments committed to progressive economic policies instead of the neoliberalism demanded by the Washington Consensus.
The Obama Administration supported the military coup that ousted Honduras' elected government in 2011 and the "soft coup" of 2013 in Paraguay, which was down by means of a cynically politicized impeachment of President Fernando Lugo, a supporter of liberation theology who was the candidate of the center-right Liberal Party. The hard right Colorado Party had not lost a national election since 1947, a period that included the dictatorship of Alfredo Stroessner during 1954–89.
Argentina elected Mauricio Macri President in 2015. He ran at the head of an electoral alliance called Cambiemos, which primarily consisted of Macri's own PRO party and the UCR, the latter party commonly referred to as "the radicals," although they have been a conservative oligarchic party for decades, arguably since 1945 and certainly since 1955.
In 2016, Dilma Rousseff was ousted from the Presidency by an utterly cynical impeachment with no basis that could be considered legitimate for a democracy. The new President, Michel Temer, isn't actually eligible to run for elected office in Brazil as part of his penalty on a corruption conviction. The "soft coup" impeachment against Dilma makes the frivolous impeachment of Bill Clinton by a rabidly partisan Republican House in the US in the 1990s look like a model of legal and democratic conduct.
Sader writes that Hillary Clinton as Secretary of State was responsible for:
la destrucción del gobierno de Manuel Zelaya en Honduras, después de que el último intento de golpe militar clásico en Venezuela, en 2002, hubiera fracasado. Ella y su gobierno apoyaron el golpe en contra de Fernando Lugo, que siguió el mismo guión, así como Hillary y Obama se callaron, de forma cómplice, frente al golpe en Brasil.
[the destruction of Manuel Zelaya's government in Honduras, after the previous attempt at a classic military coup in Venezuela in 2002 had failed. {The 2002 coup attempt was crassly supported by the Cheney-Bush Administrtion.} She and her go0vernment supported the {soft} coup against Fernando Lugo that followed the same guide, just as Hillary and Obama were silent in a complicit form in face of the {soft} coup in Brazil.]
Obama also made his first Presidential trip to Argentina in 2016 to show his support for the rightwing government of Mauricio Macri and "y anunciar una nueva época en las relaciones entre los dos gobiernos, felicitando al presidente argentino por los primeros pasos dados en dirección del viejo modelo neoliberal." ("to announce a new era in the relations between the two governments, congratualting the Argentine President for the first steps taken in the direction of the old neoliberal model.")
Sader sees the Obama-Clinton strategy in Latin America as being based around using the committed neoliberal government of Enrique Peña Nieto in Mexico with the heavyweight Brazil-Argentina combination to impose the neoliberal model onto recalcitrant governments and electorates like those in Bolivia, Ecuador and (of course!) Venezuela. But he notes that the Trump Family Business Administration's likely hostility to Mexico in particular could complicate this plan. "México entró en pánico con la elección de Trump y sus amenazas. De nada sirvió la grotesta invitación que hizo Peña Nieto a que lo visitara, con efectos negativos para la imagen del ya desgastado presidente mexicano." ("Mexico went into a panic over the election of Trump and his threats. The grotesque invitation that Peña Nieto made for him to visit was useless, with negative effective for the already eroded image of the Mexican President.") He also notes that if Trump carries through on his campaign skepticism about corporate-deregulation trade treaties, it could complicate the plans of the current Argentine and Brazilian government to forge a relationship to the United States as subordinate as that of Mexico, in Sader's formulation.
Part of the plan presumably favored by the Obama Administration and being implemented by the Macri and Temer governments was a weakening of the South American trade alliance Mercosur. (Alberto Müller, Erosionar la integraciónPágina/12 24.12.2016) Mercosur has functioned under the leadership of the so-called "Pink Tide" left-leaning governments of the last decade or so as an institution representing continental cooperation among South American government to establish independent regional power and influence against the neoliberal agenda. It has functioned in some of the spirit of the Patria Grande thinkers who encourage such regional cooperation against imperialist influences.
His government is the kind that left nationalists in Argentina refer to as capayo (sepoy), referring to politicians and governments that are subservient to foreign interests, particularly economic interest. (It's not meant as a compliment!)
Even during the left-Peronist governments of Néstor Kirchner and Cristina Fernández (2003-2009), the conservative opposition kept up a steady stream of accusations of massive corruption and authoritarian tendencies, most of them with little or no real content.
The Macri regime is trying to use such accusation now against Cristina and her Partido Justicialista (PJ) and well as the social movements and groups that are a critical part of the kirchnerista base. The case of activist Milagro Sala has received attention from international human rights groups. "The U.N. Working Group on Arbitrary Detention ruled in October [2016] that her detention was arbitrary and ordered Argentina's government to free her immediately. However, the Macri administration considered the decision non-binding." (Argentina Human Rights Hero Milagro Sala Sentenced to 3 YearsTeleSur 12/28/2016; Sala receives first sentence Buenos Aires Herald 12/30/2016)
Macri's government is also going after former President Cristina Fernández on a corruption charge that looks contrived. And on another charge, with which I'm far more familiar and which is about as bogus as they come.
The other charge is a revival of a case that former prosecutor Alberto Nisman tried to bring against her over her handling of the still-ongoing investigation into the 1994 AMIA bombing in Buenos Aires. I blogged about this back in 2015 as the original case was unfolding. The case is ludicrous. Very short version: Nisman was accusing her of doing something that wasn't illegal and for which there is no good evidence she did and very substantial material in the public record to show she did not do it. Nisman himself died of a gunshot wound that by all publicly known indications was a suicide, although the official investigation is still open. But at the time of the likely suicide, his case against the then-President was rapidly coming apart publicly, which could have been a contributing cause of the suicide. (Nisman AMIA complaint against CFK re-openedBuenos Aires Herald 12/30/2016; A history of the judicial back and forth, almost two years in the makingBuenos Aires Herald 12/30/2016)
Other articles on the Nisman charge include the following, some of which show signs of the many uses to which the AMIA case has been put, not least because it's a key part of the American claim that Iran has an advanced ability to project substantial terrorist action in the Western Hemisphere, although lots has changed in 24 years. The case itself has never been solved, though Argentina's official theory of the case is that Iran was behind it. And Cristina herself pursued that theory as President. She was aggressive as a Senator in pursuing the investigation into the attack. For background, see The Unsolved Terror Attack At The Center Of Argentina’s Political CrisisWorld Post 01/30/2015.
Aljazeera also features a sloppy report on Cristina's situation, taking the conservative government's highly politicized accusations of Macri's conservative government, Former Argentine president Cristina Kirchner faces court 01/01/2017. One of the people this report quotes is Marioano Obarrio, identified only as a "journalist." That's true. He's a journalist for La Nación, the rightwing government which has repeatedly over the decades supported military governments and has been the journalistic voice for the Argentine oligarchy since it was founded by former President Bartolomé Mitre in 1870. (Except for a period during Juan Perón's first government when the paper was seized by the government.
It's concerning to see Aljazeera presenting a report made with such credulity to rightwing charges that one would have to be very generous to describe as highly questionable. So far, they look downright frivolous.
Bob McElvaine makes a plea for undecided and even Republican voters to support Hillary Clinton over Donald Trump on the basis of patriotic sentiment in Patriotism over partisanshipClarion-Ledger 10/01/2016. He lays great stress on the economic issues: "The truth is that what Trump proposes is a return to the policies — massive tax cuts for the richest and deregulation of the financial industry — that produced not only the 2008 collapse (which Trump cheered because he could make money off it) but also the Great Depression. The slogan for Trump’s trickle-down economics should be: 'Make America a Great Depression Again!'"
He cites endorsements of Hillary from traditional Republican newspapers like the Arizona Republic, the Dallas Morning News, and the Cincinnati Enquirer.
It's nice to see Hillary getting so many newspaper endorsements. But I can't say I'm thrilled by the reasons the San Diego Tribune gives for supporting her. Like: "As a U.S. senator, the Democrat showed she can collaborate with Republicans, using what Roll Call labeled an 'incremental approach' that 'could help restore a working relationship between the White House and Capitol Hill that has been in tatters' for years."
The only way that's going to happen is if Hillary wins the Presidency and mounts an unprecedented level of Democratic Party effort to beat the Republicans in House and Senate races in 2018. Until the elections take place and Republicans know they're electorally on the run at all levels, the Trumpified Republicans Party will keep up their obstructionism on domestic issues that we've seen the last eight years. Or should I say the Ross-Barnettified Republican Party?
Also: "Argentina is finally coming out of the chaos created by Cristina Kirchner and several of her predecessors. Trump could be our Chávez, our Kirchner." (!!!)
O.M.G.
I wish we could have a 12-year run of solid Keynesian economics like Néstor and Christina Fernández de Kirchner brought to Argentina in 2003-2015. After decades of neoliberal/Angela Merkel/Washington Consensus economics, during the first 10 years of the Kirchner era Argentina had one of the healthiest growth rates in the world, higher even than China's. And the healthiest in Argentina's entire history.
he usual Bipartisan Wall Street drone, I will seriously injure myself doing backflips of joy. As for Trump being "our Kirchner," it's hard to imagine anything less possible. Cristina's successor, the "safe" oligarch Mauricio Macri who took over in December, has returned to the disastrous Merkelist policies of the 1990s, and the Argentine economy has been in a nose-dive ever since. With no prospect of returning to Kirchnerist levels of health under these policies.
Now, Trump could certainly be our Macri. Only he would probably be worse. And he would be in command of a nuclear arsenal. This graphic of Macri is more likely what a President Trump would be.
In discussing US politics, she praises Franklin Roosevelt for his anti-corporate stances. And she professes to be indifferent to Clinton vs. Trump. Understandable, given the support by the Obama Administration and Hillay Clinton for regime change efforts in Honduras, Paraguay, Venzuela and (presumably) in Brazil.
Carlos Camacho revives an old chestnut of an aging pseudoscandal against former Argentine President Cristina Fernández in Venezuela Opposition Sets Sights on Stolen $400 Billion Buenos Aires Herald 07/10/2016.
This is a reminder that incidents like this, once they get incorporated into a propaganda narrative against an "unusual and extraordinary threat to the national security and foreign policy of the United States" can keep popping up for years, even decades, as an ostensible reason for taking controversial actions. In this instance, there is a possibly-true but unproven claim about a 1994 terrorist attack (AMIA) in Argentina newly married to a nearly eight-year-old chestnut about Venezuelan meddling in Argentine politics used as a propaganda club against Argentina's current President.
Mark Weisbrot summarizes the lazy conventional wisdom about the conservative trend in Latin American politics (Has the Left Run Its Course in Latin America?The Nation 05/10/2016):
There is a popular narrative here in Washington and media circles that Latin America’s left-populist turn has finally run its course. It goes something like this: A commodities boom, led by demand from China for Latin American raw materials exports, fueled regional economic growth in the 2000s. This happened to coincide with the election of left governments that were reelected after spending lavishly on handouts to the poor. They alienated foreign investors and their economic policies were unsustainable. Now Chinese growth has slowed, commodity prices have gone south, and with them the fortunes of Latin America’s nationalist, populist left. November’s election of right-wing challenger Mauricio Macri as president of Argentina, the Venezuelan opposition’s landslide congressional win in December, and economic and political crisis in Brazil — including the current effort to remove President Dilma Rousseff—herald the beginning of the end of an era. In this view, the region will continue to elect more right-wing—or, in business-press parlance, “moderate” (and pro-US)—governments that will return to some of the more sensible economic policies of their predecessors.
Horacio Verbitsky (El tercer semestrePágina/12 22.05.2016) writes about Federico Sturzenegger, the current head of the Banco Central de la República Argentina, appointed by current President Mauricio Macri, a devotee of neoliberal economic dogma. Sturzenegger is part of Macri's PRO party and was elected as a deputy (legislator) in the Autonomous City of Buenos Aires in 2013. Verbitsky describes the communication strategy on which Sturzenegger was coached along with other PRO candidates on how to defend their policies in public. As Verbitsky recounts it, this was part of the instructions:
No explicar nada. Si se explica qué es la inflación, habría que decir que la emisión monetaria genera inflación, que entonces debería reducirse la emisión, y que si se reduce la inflación habría que hacer un ajuste fiscal y que si se hace un ajuste fiscal la gente va a perder su trabajo. Eso es lo que no hay que decir. Desde el gobierno se puede hacer lo que se considera necesario, pero no hay que decirlo en medio de un debate. Mejor decir que están mintiendo con los números de la inflación o decir cualquier cosa; hablar de los hijos de uno. No importa.
[Don't explain anything. If you explain what inflation is, you will have to say that the issuance of money generates inflation, that therefore the money supply will have to be reduced, and that if inflation is reduced there would have to be fiscal austerity, and that if fiscal austerity is implemented people will lose their jobs. That's what you don't need to say. The government can do what it considers necessary, but doesn't have to say it in the middle of a debate. Better to say that they {Cristina Fernández' government} are lying with the inflation numbers or say whatever; talk about your kids. It doesn't matter.]
When you have a standard economic prescription that will damage large numbers of ordinary people in order to enrich the wealthiest even more, you have to dress it up some other way. Or, as Sturzenegger's coach recommended, avoid talking about them as much as you can.
Cristina's last Finance Minister Axel Kiciloff in his book Diálogos sin corbata. Para pensar la economía, la política (y algunas cosas más) en el siglo XXI (2015) discusses the dominance of liberal/neoliberal (free market/Herbert Hoover/Angela Merkel) type economic policies, associated especially with the military dictatorship of 1976-83 and the government of right-Peronist President Carlos Menem (1989-99).
Durante el liberalismo esto resultó tarea sencilla porque traían de afuera el recetario económico. Más allá de que tuvieras o no ideas propias, te decían lo que, había que hacer en el Ministerio de Economía, y eran políticas que todos conocen: ajuste fiscal; ajuste financiero, que significa bajar la liquidez, bajar el credito, la politica monetaria contractiva; apertura de la economía, es decir, ningún tipo de resguardo o administración del comercio exterior, dejar que todo venga de afuera ...
[During liberalism, this {finding an economic theory} turned out to be easy work because they brought a recipe book from abroad. Aside from whether they had their own ideas or not, I'll explain what they had to do in the Ministry of Economics, and those were policies everybody knows: fiscal tightening; financial tightening, which meant reducing liquidity, reducing credit, the contractionary monetary policy; opening the economy, that is to say, no type of protection or administration of external commerce, let everything go abroad ...
That latter reference is to the Hail Grail of the corporate-deregulation "trade" treaties like TTIP and PPT, the unrestricted flow of capital, both into and out of a country. This makes a developing country not only vulnerable to financial speculation that can create a run on its currency and and cause a financial panic. It also means that the country's development can be dominated by external political and market forces. The governments of Néstor Kirchner and Cristina Fernández de Kirchner pursued a policy of capital controls that had as its goal promoting domestic industry for the balanced development of the Argentine economy and reduce its vulnerability to economic attacks from other countries.
Kiciloff also gives this brief summary of the standard neoliberal prescription, "Ese plan de cuatro puntos - ajuste fiscal, ajuste monetario, apertura de la economía y endeudamiento - es el plan permanente del liberalismo y de la ortodoxia." ("This four-point plan - fiscal contraction, monetary contraction, opening of the economy and indebtedness - is the permanent plan of liberalism and orthodoxy.")
That prescription is also known as the Washington Consensus because the United States has promoted it assiduously through the IMF and the World Bank and the corporate-deregulation "trade" treaties. That four-point plan is a good summary of what the Macri government has been implementing at a rapid pace since it took office this past December.
Verbitsky's article includes the following table projecting a probable scenario for the growth of public and private debt in Argentina:
The orange bar shows the projected public debt plus the private debt denominated in foreign currency as a percentage of GDP (PIB). The immediate concern about the growing debt is not the percentage of GDP as such. It's that most of the current new debt is going not to long-term investments in Argentina but to paying what is essentially ransom to vulture funds that bought up already-defaulted debt. And the private debt denominated in foreign currency becomes bigger as a percentage of GDP the lower the Argentine peso falls in relation to the foreign currency.
And this is part of the standard neoliberal recipe that Macri's government is applying to the Argentine economy. They justify it by claiming that the economy was previously in bad shape. Verbitsky writes, "Macrì no para de repetir que desde hace cinco años la economía no crece ni crea empleo privado, lo cual es lisa y llanamente falso." ("Macri never stops repeating that the economy hasn't grown for five years nor has employment increased, which is plainly and simply false.")
He cites El Revelador, which provides this table and the text explanation shown below:
Durante la campaña electoral de 2015, la oposición al gobierno de Cristina Fernández de Kirchner, repetía (y lo sigue haciendo) que hacía 4 años que la Argentina no crecía. Y lo decían en términos porcentuales del PBI. Cierto es que dejó de crecer al ritmo en el que lo hizo en los años previos. Pero contextualicemos observando lo que ocurrió en el mismo período sumado (2011-2014) en los siguientes países:
Mientras que en 2014 nos cansamos de escuchar que Argentina hacía 4 años que no crecía, en ese período, su PBI creció porcentualmente más que el de Alemania, España, Estados Unidos, Francia e Italia todos sumados.
[During the 2015 election campaign, the opposition to the government of Cristina Fernández de Kirchner repeated (and are still repeating) that since four years Argentina did not grow. And they say it in terms of percentage of GDP. Certainly it stopped growing at the rhythm that it did in the previous years. But let's put it in context of what happened in the same period in total (2011-2014) in the following countries:
While we kept hearing in 2014 that Argentina hadn't grown in four years, in this period it GDP grew percentage wise more than that of Germany, Spain, the United States, France and Italy all together.]
So when Mark Weisbrot talks about what US elites and mass media talk about "more sensible economic policies," it the neoliberal prescription that they are praising as "sensible."
Weisbrot's point is that economic policies that work well for the majority of people are a strong attraction. And it's left governments, the so-called "Pink Tide," that have been delivering that. As he writes of the Argentine case:
Changes in economic policy were also key to Argentina’s success after its default and devaluation at the end of 2001. The remarkable economic growth and poverty reduction that followed over the ensuing decade — real GDP increased by about 78 percent, and poverty was reduced by more than 70 percent (these numbers are based on independent estimates, as the government’s estimates of inflation are disputed; see http://sedlac.econo.unlp.edu.ar/eng/statistics.php)—had relatively little to do with commodities. It was not even export-led growth.
One necessary condition for Argentina’s robust recovery (real GDP grew by more than 60 percent from 2002 to 2008) was the government’s default on the foreign debt and its taking a hard line in the renegotiation. Right away, this achieved a sustainable debt burden—rather than getting Argentina stuck in a series of recurring crises due to too much debt, as with Greece, for example. And again in contrast to Greece, Argentina freed itself from the demands of its creditors for continuing austerity. The government was also able to tax exporters to capture the windfall from the devaluation, use the central bank to manage the exchange rate, implement a financial-transactions tax, and pursue other policies that enabled the country to emerge from depression. [my emphasis]
In fact, Weisbrot is downright optimistic about the prospects for the democratic left in Latin America:
The Latin American left has led the region’s “second independence” in the 21st century, altering hemispheric economic and political relations, and—even including the economic losses of the recent downturn—presiding over historic economic and social changes that benefited hundreds of millions, especially the poor. Despite the electoral setback in Argentina and the current threat to democracy in Brazil, they are likely to remain the dominant force in the region for a long time to come.
The former (and likely future) President of Argentina Cristina Fernández has been targeted by current conservative President Maricio Macri's party and government with cooked-up but nevertheless vague accusations of corruption. Cristina and her former Finance Minister Axel Kicillof gave statements to Federal Judge Claudio Bonadio last week over a policy her government had instituted called the "future dollar." It was a device by which investors could make a futures bet on whether the currency would go up or down. It was a policy device to stabilize the currency. (CFK faces Judge Bonadio, accuses gov't of 'making' a case against her to 'deprive' her of her 'liberty'Buenos Aires Herald 04/13/2016)
Bonadio was accused them of a crime just for setting up the policy. He didn't even claim that they had violated the law or given inside information to investors to let them cheat the system.
But, as Cristina herself explains at her website, there were people who may have made money on the "future dollar" system who may also have benefited from inside information (Future dollar and the “unscrupulous illegally enriched” 04/19/2016):
Some names of the “unscrupulous future dollars buyers” have been revealed. Do you think they are all K? Look, Caputo S.A. company bought in the Rosario term market 3.56 million dollars between October 8th and 27th, in 2015. Do you know who Caputo is? Nicky, for his friends. Close confidant of Macri, he was his wedding witness and usual attendant in the meetings of the Presidente with the cabinet.
You know who is mentioned too? The Macri family, that via Socma-Chery firm, adquired 8 million dollars at future price, later multiplied –not as bread and fishes- because of the devaluation determined, among others, by Central Bank president, prosecuted Sturzenegger, who paid in spite of the cause presented by his political party.
There are other “unscrupulous”: senior presidential adviser and PRO national party trustee José María Torello, bought 800.000 dollars in future dollar contracts, on October 27th, charged in February. The secretary of Interministerial coordination, former CEO in Farmacity, Mario Quintana, one of the illustrious negotiators in the pay to vulture funds, bought almost 1.5 million dollars, last September, via his Pegasus fund.
But pay attention, there are more “unscrupulous”: media companies. The newspaper La Nación bought 4 millions dollars. Grupo Clarin’s television network, Cablevisión, got 11 million dollars multiplied by the devaluation. That’s right, Clarin is always involved in this kind of things. And not precisely for being the sweetest thing.
Who benefited from the devaluation? Obviously, those who decided to devaluate, that apparently are not only in the Central Bank. Who were perjudicated by the devaluation? As usual, the Argentinian people. Question: when did they buy those millions of dollars? Did they know that in case of winning the elections they would devaluate, as the candidate denied it on TV?
A federal prosecutor, Jorge Di Lello, is opening an investigation into Banadio and Macri's Central Bank president Federico Sturzenegger over their accusations against Cristina and Kicillof. (Dólar futuro: imputaron a Claudio BonadioEl Destape 20.04.2016)
President Obama visits Argentina tomorrow. In preparation for his visit, he did an interview with CNN Español in which he showed his conservative streak on Latin American policy:
Yesterday, US President Barack Obama gave an interview to CNN Español in which he talked about US relations with Latin America. Let’s look at what he had to say about Argentina, which consisted basically of criticizing former President Cristina Fernández de Kirchner and showing optimism for US-Argentine bilateral relations under President Mauricio Macri.
“I think Argentina’s a good example of the shift that’s taken place in terms of US relations with other governments and countries in general,” was Obama’s opening comment.
“I saw President Fernández frequently at the G-20 or similar events. We had a cordial relationship but with respect to her politics she was always anti-American [with a] rhetoric that probably dates from the 1960s or 1970s and not from reality,” he continued.
Obama is in Cuba pursuing a realist policy of putting an end to the long-since-riduculous and failed policy of islolation against Cuba.
In this case, "anti-American" can only mean that Cristina's government wasn't subservient to US policy and not willing to give US banking and business interests a free hand in Argentina.
To be clear, Cristina's government pursued a very successful policy of Keynesian economic stimulus and used price controls and export-import regulations to promote domestic development. She emphasized democratic inclusion and continued her predecessor and late husband Néstor Kirchner's policy of prosecuting former officials who had committed crimes during the military dictatorship of 1976-83.
The current government, on the other hand, very quickly adopted the standard IMF/Washington Consensus program of ending capital controls, drastic devaluation, dropping the previous export and import controls that were a critical part of Cristina's government's successful policies. He has already adopted good Republican/Herbert Hoover austerity policies, reducing government employment and driving down real wages more generally through and drastic and inflationary devaluation. He's appointed a cabinet that the opposition mocks as a cabinet of CEO's. He quickly did away with an important law restricting the monopoly power of media corporations.
And he capitulated to the vulture funds who had bought up defaulted Argentine bonds at bargain-basement prices and blackmailed the Argentine government with the help of a Nixon-appointed federal judge in New York.
In other words, Obama is full of praise for Macri's neoliberal government and its Herbert Hoover economic policies and is trashing Cristina's government and its Keynesian policies. And this is part of a broader American policy against the democratic left in Latin America. (Oscar Laborde, ¿Por qué nos conviene la visita de Obama? Página/12 23.03.2016)
This is one place we see the really conservative side of the Obama/Hillary Clinton foreign policy. He takes the sensible move of normalizing relations with Cuba. But he also demonstratively supports the rightwing parties in Latin America. This is classic Obama. Do something that liberals like, but then continue in an essentially conservative direction in other areas.
It also is a sign of how basically conservative and non-constructive Obama's Latin American policy has been outside of the Cuba normalization. He and Secretary of State Clinton took a friendly attitude toward the military coup in Honduras in 2009 and the "soft coup" in Paraguay in 2012.
InfoBAE provides an interesting related bit of news, that in preparation for Obama's visit, US military planes flew over Argentina in violation of Argentina law, which requires the permission of Argentina's Congress, which the US didn't have. (Aviones de combate de la Fuerza Aérea de EEUU en el espacio aéreo argentino 21.03.2016)
President Mauricio Macri won the Argentine Presidency earlier this month. He certainly cannot be accused of compromising his goals in an Obama-like desire for bipartisan harmony with the now-opposition Peronists. The party of the latter is the Partido Justicialista (PJ) and their Congressional bloc is called the Frente para la Victoria (FpV).
Macri is basically an Argentine version of Mitt Romney, born on third base and thinks he hit a triple. And he's fully committed to One Percenter economics, aka, predator state policies (Jamie Galbraith's phrase), Herbert Hoover economics, the Washington Consensus, neoliberalism, Merkelnomics.
He hasn't yet been in office a month and he's moved ahead rapidly with his radical economic program in good "shock doctrine" fashion. Jonathan Gibert gives an account of the initial measures in Argentina’s New President Moves Swiftly to Shake Up the EconomyNew York Times 12/27/2015. Complete with a photo of Macri looking very like Count Dracula.
A key part of the beginning was a drastic devaluation of the Argentine peso by letting it float freely against the dollar. At the same time, he dropped export controls that had been part of the previous government's strategy to promote domestic development. And as Gilbert reports, it was the traditional oligarchy based on agribusiness that got a windfall benefit from Macri's currency move:
The devaluation and a slashing of export taxes favored influential farmers on Argentina’s Pampas lowlands who had speculated about such moves by hoarding their grain harvests. They struck an agreement with Mr. Macri’s government to immediately sell billions of dollars of grain stocks, like soy, to ease the shortage of funds at the Central Bank.
But while these agricultural exports are now more profitable for the farmers, for people like Mr. Raspa, the devaluation is eroding their salaries and fueling price increases as imports become more expensive.
Gilbert's short piece relies heavily on the classic person-on-the-street interviews, many of which in the United States at least are actually practiced informal spokespeople referred to the reporter by interest groups to repeat their positions as though they were random citizens.
But Gilbert's description is generally pretty good. The immediate effect of the devaluation was a burst of inflation without corresponding adjustments to wages and salaries, immediately lowering the real incomes of millions of workers. In the neoliberal view, this is a good thing.
Gilbert also explains other drastic - and constitutionally questionable - actions of Macri:
Mr. Macri must also tread carefully, analysts said, because of his small margin of victory in the election. A decision to temporarily appoint Supreme Court judges by decree, bypassing Congress during its summer recess, was criticized as an overreach of executive power. This, together with moves viewed as steps toward the dismantling of a media law that is strongly endorsed by Mrs. Kirchner’s supporters, has left him less room for unpopular measures.
Mr. Macri has already moved to cool the simmering economic tensions, keeping Mrs. Kirchner’s [Cristina Fernández de Kircher, Macri's predecessor] price control programs in place for now and offering a small one-time payment to around eight million recipients of state pensions or child benefits.
Still, repercussions are already being felt. “It’s the workers who always pay for these crises,” said Raúl Lemos, 54, who manages a downtown paint store, as he clicked through an online price list showing that the price of some products had risen by 25 percent overnight. “Sales are going to drop.” Similarly, Sergio Camerucci, 52, who manufactures trophies and sells them to sports leagues, said the price of the plastic he needed to make the trophy bases rose by 20 percent after the devaluation. [my emphasis]
The comment that price controls were retained is very misleading. In fact, there was a massive increase in prices after Macri's election even before his inauguration and the devaluation in anticipation of Macri's action.
The "dismantling of a media law" to which Gilbert refers is the Ley de Servicios de Comunicación Audiovisual. Macri's intention to undermine it has both economic and political imperatives. The law basically inhibits further monopoly concentration of news media, which is dominated today by two major media groups, that of La Nación and that of Clarín, both known by the names of their flagship newspaper properties. The Nación group is the traditional media advocates for the oligarchy, agricultural and otherwise. Clarín is almost as bad. Clarín gave Néstor Kirchner favorable coverage during his Presidency (2003-2007), because he didn't try to interfere with their media acquisition activity. But one of the differences between Cristina and her husband was her hostility to Clarín because of their generally conservative tilt. So when she was elected President in 2007, she moved ahead with the media law limiting media monopoly and Clarín became her bitter opponent.
Since Gilbert's article, Macri has gone further and is attempting to reorganize the media regulatory agencies by executive decree and change the law itself by the same means. (Werner Pertot, La victoria de la terapia de shockPágina/12 31.12.2015) This seems especially high-handed since his supporters have a majority in Congress.
Cristina Fernández now has a Facebook account called "Casa Rosada Argentina 2003-2015," in which she has been actively pointing out problems with Macri's new policies and administration. The inflation. Reduction of energy subsidies on homes. The attempt to govern by decree. (Marcela Valente, Macri desmantela la Argentina de Cristina Kirchner a golpe de decretoLa Voz de Galicia 26.12.2015) Macri's Shrub-Bush-like indifference over recent massive flooding in Argentina. Nepotistic appointments. (Agustín Ceruse, Los ministros de Macri que le dieron cargos a familiaresBig Bang! News 30.12.2015) Harsh measures against protesting workers.
What makes this more than a crime story is that two of the prisoners played a role in the election campaign, in which Macri ally María Eugenia Vidal won the governorship of Buenos Aires Province, the country's most populous, in a contest against Cristina's candidate Aníbal Fernández:
The prison break by 40-year-old Martín Lanatta, his 41-year-old brother Cristian Lanatta and Víctor Schillaci, 33, shocked the nation in the midst of the Christmas holidays, as the brothers had made the headlines earlier this year by accusing ex-president Cristina Fernández de Kirchner’s cabinet chief Aníbal Fernández of being the alleged mastermind of the murders of Sebastián Forza, Damián Ferrón and Leopoldo Bina, three businessmen who were kidnapped and killed in a case linked to ephedrine and drug trafficking. [my emphasis]
Quite a coincidence, as various Peronistas were quick to point out. (Triple fuga de la cárcel con un arma de juguetePágina/12 28.12.2015) That fit with the law-and-order theme of Vidal's campaign and, despite the lack of any credible evidence at all to back up the unlikely charge, played a notable role in the campaign. One of the escaped murderers, Martín Lanatta, was interviewed on TV in August.
Aníbal Fernández isn't worrying too much about bipartisan harmony at the moment, either. He said, “Estos tipos ‘fugados’ son asesinos, que formaron parte de la campaña, junto con el actual gobierno” ["These "escaped" guys are murderers who took part in the {election} campaign together with the current government"]. (“Algo iban a cobrar”Página/12 28.12.2015)
The Governor's excuse is pretty inspired, in a bluff-your-way-through kind of way. She says they broke out because she's gotten a lot tougher on crime in the last month! Seriously: "What happened was the result of decisions we made, of clear messages, of our ‘no” to corruption, of the fight against drug trafficking. That message and the actions we have carried out since day one have had costs." You have to admire her chutzpah on this one! (BA governor reports “penitentiary service complicity’ in jail breakoutBuenos Aires Herald 12/28/2015)
Supposedly, the two used a plastic pistol to escape and steal a police car. As the article just linked notes, there are, uh, questions about the validity of the official story. The two brothers among the three had tried to escape in 2013, unsuccessfully. (El ensayo de 2013Página/12 28.12.2015)
Paul Krugman takes on a couple of favorite neoliberal sacred cows in this post, Destructive Long-Termism 12/28/2015:
One of my long-running gripes about much discussion of current economic issues is about what I consider the long-run dodge. By this I mean the attempt to change the subject away from unemployment and inadequate demand toward supposedly more fundamental issues of education and structural reform. Such efforts to change the subject seem to me to be both wrong and, to some extent, cowardly. After all, if the clear and present problem is inadequate demand, then we should have policies to deal with that problem — I don’t care how important you think the long run is, we should deal with the crisis at hand. [my emphasis]
He quotes Tim Taylor, who he criticizes for offering dismissing the importance of fiscal and monetary policy in the present moment in favor of an even longer catalogue of neoliberal perennial platitudes, which Taylor lists as follows: "Thus, I’d argue that the growth-based agenda should focus on a different list of issues: expanding education and training; expanding research and development spending; tax and regulatory reform; expanding international trade; and investments in energy and infrastructure."
And Krugman gets a little snarky on one of the favorite neoliberal buzz-phrases:
Again, I have nothing against structural reform; some of my best friends are structural reforms. But if you have a persistent problem of inadequate demand — which is the secular stagnation argument — then find things that will boost demand. Don’t throw up your hands and whine that you can’t, and/or use demand-side problems to argue for other stuff that has no obvious relevance to the problem. You may think you’re being wise and judicious, but you’re actually engaged in an act of evasion. [my emphasis in bold]
Allianz' Mohamed El-Erian provides his own list of neoliberal prescriptions, but not to criticize them. Instead, he's celebrating the fact that the new government in Argentina intends to implement them (Argentina’s Economic Big BangProject Syndicate 12/21/2015):
Run down the financial reserves and wealth that were accumulated when the economy was doing better.
Borrow from foreign and domestic lenders.
Cut public-sector spending directly, while creating incentives to induce lower private-sector expenditure.
Generate revenues through higher taxes and fees, and earn more from abroad.
Use the price mechanism to accelerate adjustments throughout the economy, as well as in trade and financial interactions with other countries.
El-Erian argues that such measures "can contain the spread of economic hardship among the population, protect the most vulnerable segments, and put future generations on a better footing."
But he criticizes Argentine President Mauricio Macri, whose neoliberal policies he supports, for implementing them in the wrong sequence. El-Erian writes:
Macri took over the presidency with a bang, launching an audacious – and highly risky – strategy that places aggressive price liberalization and the removal of quantitative controls front and center, ahead of the five measures relating to demand management and financial assistance. Already, most export taxes and currency controls have been scrapped, income taxes have been cut, and the exchange rate has been freed up, allowing for an immediate 30% depreciation of the peso.
Historically, few governments have pursued this type of sequencing, much less with such fervor; indeed, most governments have hesitated, especially when it comes to full currency liberalization. When governments have taken similar steps, they usually have done so after – or at least alongside – the provision of financial injections and efforts to restrain demand.
The reason is clear: by taking time to set the stage for liberalization, governments hoped to limit the initial spike in price inflation, thereby avoiding a wage-price spiral and curbing capital flight. They worried that, if these problems emerged, they would derail reform measures and erode the public support needed to press on. [my emphasis]
El-Erian's argument doesn't seem to be entirely coherent. He seems to be upset that Macri's particular approach of drastic immediate devaluation without corresponding adjustments in wages and salaries will too quickly alienate the voters against the neoliberal program.
It's notable that El-Erian prefaces his list of options by claiming vaguely that Argentina's economy has been ailing for many years. Which, to put the most generously possible, is wildly misleading. The government of Carlos Menem gave the country a heavy dose of the neoliberal medicine in the 1990s, leading to the financial crisis of 2001. But since 2001, especially since President Néstor Kirchner came to power in 2003, the economy has grown at a healthy pace with rising real incomes and higher levels of employment.
Yes, Néstor's government and the successor government of Cristina Fernández de Kirchner committed various sins against the neoliberal Gospel: capital controls, wage and salary increases, price controls, fiscal stimulus, expansion of government services, restoring public ownership of the previously privatized Aerolineas Argentina and the YPF energy company, successfully defying the vulture funds, thumbing their noses as the auterity measures demanded by the IMF.
As Krugman notes, the true believers in the neoliberal Washington Consensus and its variants like Angela Merkel's Herbert Hoover/Heinrich Brüning "ordoliberalism" are happy to ignore the immediate needs of ordinary workers and the middle class in favor of their preferred One Percenter policies, using the promise of the benefits of the Long Run to justify economic damage in a short run that may never end.
Cristina Fernández de Kirchner gave her final address as President of Argentina on Wednesday evening, December 9. She addressed a massive crowd in front of the Presidential palace, the Casa Rosada, in the Plaza de Mayo and nearby streets. Visión 7 - Cristina se despide ante una multitud en la Plaza de MayoTV Pública Argentina 12/09/2015
The massive crowds in front of the Casa Rosada were a fixture of the Perón years in the 1940s and 1950s. Most documentaries of that time will show Juan and "Evita" Perón speaking to a grand multitude in the Plaza. Cristina and her late husband and predecessor as President, Néstor Kirchner, put a lot of emphasis on these gatherings for special occasions in the Plaza de Mayo. I had the good fortune to attend two of the four days of the May 25 national day celebrations this year, including Cristina's speech there. I had always wondered what it would be like to be in one of those packed crowds there. So now I now. It was exciting. And not so packed shoulder-to-shoulder as one might imagine from seeing news reports or photos. It was definitely crowded, but you could move around. Not the place to be if you're claustrophobic, though. (On Wednesday going-away rally, see: Nicolás Lantos, “Podemos mirar a los ojos a todos los argentinos”Página/12 10.12.2015)
The transition from Cristina to now-President Mauricio Macri was tense, though not in the sense that the election was at all disputed. It was a close Presidential race, but Macri won it in the final round with a 51-49% majority. But one factor of irritation was that the Argentine courts held that Macri would officially become President at 12:00AM midnight on December 10. Cristina's speech was on Wednesday evening, so she jokes in the speech that she has to finish by midnight or she will turn into a pumpkin.
Since the Peronist party has had 12 years of experience in mobilizing people to come to the Plaza for these events, she was able to turn out the massive crowd she did. And it was large enough to easily overshadow the crowd that turned out Thursday to celebrate Macri's ascension to the Presidency.
If Cristina's health holds up, I fully expect to see her make another run for the Presidency in 2019. The Argentine Constitution does not allow the President to serve more than two consecutive terms, so she was termed out.
I fully expect Macri to implement a stock neoliberal/Washington Consensus program of cutbacks in public services, privatization, tax breaks for the wealthiest, deregulation of capital flows for multinational banks and corporations, run up high debt without getting much durable for it, and generally implement the kind of hyper-crony capitalism that Jamie Galbraith has called the "predator state."
But he's not saying exactly that. In fact, he campaigned on maintaining government services and keeping the two major state companies that were de-privatized under Cristina, YPF and Aerolíneas Argentinas, under state ownership and control. But part of the standard neoliberal script is to bring on a crisis of some kind with the stock prescriptions. Then when debt goes up and budget balancing remains a sacred goal while revenues from tax cuts to the wealthy go down, "necessity" then demands a change of course: cuts in services, more privatizations, etc.
Horacio Verbitsky reports on Macri's inaugural speech (El arte del NomeacuerdoPágina/12 13.12.2015) that he stuck to the triad of goals he had used in the campaign: eradicating poverty, fighting the drug war more vigorously and uniting the people of Argentina. He also emphasized two goals that Verbitsky identifies as goals stressed by Pope Francis: revolutionizing public education (which I'm guessing will involve some sort of privatization) and fighting corruption. The latter is a stock item on the neoliberal list that is meant mostly for show, certainly not interfere with the preferences of the One Percent.
Macri's administration will negotiate with the vulture funds that bought up defaulted Argentine debt and, with the help of a radical Nixon-appointed zombie judge in New York, Thomas Griesa, has caused considerable financial difficulty for Argentina. Paying the amount Griesa has ordered them to, in a ruling that disregarded literally centuries of international debt law would be a serious blow to Argentina's national finances. But Macri previously has indicated he would settle with the vulture funds, while Cristina had fought them all the way.
Macri has also indicated that he will abrogate the agreement Cristina made with Iran to facilitate investigation of the still-unsolved AMIA Jewish Community Center bombing case from 1994. That agreement didn't please the Obama Administration or the neoconservatives because it could possibly interfere with a favorite propaganda point against Iran, which may well have been responsible but which has never been proved.
He also wants to change to Communications Law Cristina got passed that limits the ability of media corporations to build bigger monopolies, a law that particularly disturbs the two biggest such monopolies, the Clarín and La Nación groups, both pro-Macri and anti-Cristina. The kirchneristas
Pointing to Macri's successful political career, Verbitsky warns, "Subestimar a Macrì sería un error grave." ("It would be a serious mistake to underestimate Macri.") But he adds, "No subestimarlo pero tampoco tomar al pie de la letra sus palabras." ("Don't underestimate him, but also don't take his words literally.")
For the immediate future, the kirchnerista and macrista positions are likely to form the major opposing positions in Argentine politics.
Sunday, November 29, 2015
Venezuela has a national election a week from today, December 6.
The general attitude toward the Chavista party headed by President Nicolás Maduro, Partido Socialista Unido de Venezuela (PSUV), has been negative. The Obama Administration has had some moments where they were more critical of Maduro's government, others where it was less so. The network around American Cuban anti-Communists has in recent years taken up opposition to Maduro's government as a major focus.
It is generally the US policy, with rare exceptions, to favor governments in Latin America that are subservient to US desires and accommodating to US corporations. That in itself would be unexceptional, if it weren't for the many occasions in which the US has encouraged or helped install such governments that were also undemocratic, repressive and unresponsive to critical needs of the majorities in those countries.
Ryan Mallett-Outtrim looks at the results of Argentina's Presidential election last Sunday as a trend which should make Maduro's party more assertive in defense (Argentina's Elections Should Be a Wake up Call for VenezuelaVenezuela Analysis 11/23/2015):
Maduro needs to smash corruption and incompetence within his own government, fix what economic problems he can, and actually commit to deepening the Bolivarian revolution. Key to this is reconnecting with the grassroots movements and popular masses. If he doesn't, then Chavismo will follow Kirchnerismo into electoral defeat by the end of the decade. If the Venezuelan opposition doesn't take power in the December 6 elections, they'll likely stand a good chance at a recall referendum in 2016, or take the presidency in 2019. Put simply, time is no longer on the PSUV's side, and Argentina's recent elections should be a biting warning.
But that advice strikes me a basically boilerplate. The main part of the article is about Argentina's election.
Mallett-Outtrim says, "Argentina is also a country facing serious economic problems, including persistently high inflation."
I'm continually struck how inflation is Latin America is reported for American audiences, in this case from a site that is favorable to the Latin American left. Ten percent inflation sounds like catastrophe to Americans or Germans. But inflation tends to be higher in developing countries. Its actual effects on the people of the country depend on how much the general economy is growing and, critically, how much the real purchasing power is spread widely. In Argentina, workers and pensioners have generally seen their employment opportunities and real income rise since 2003, the beginning of the Kirchner era.
There is a psychological effect of inflation, that I recall Lester Thurow discussing with a metaphor. If someone give you $100, you have $100 more than you did before. If someone gives you $100, and then takes away $10 of it, you have $90 more than you did before. But in the latter case, you still feel like something has been taken away from you. Inflation can have a similar effect.
And, despite the econometric models that economists would like believe tell us otherwise, economics isn't the only factor in elections. And even on economic issues, not only does everyone not have the same short-term interests, there are also vastly different understandings and expectations of which policies will produce what result.
National pride and/or chauvinism can obviously play big roles in politics. The final political blow to the military dictatorship of 1976-83 was the junta's defeat in the Malvinas/Falklands War of 1982. Drugs, street crime, corruption, domestic violence, abortion rights, the courts, marriage equality and national debt are all issues that have played some role in Argentina in recent years. Corruption, or at least allegations of corruption, have also been prominent, but how decisive they are, I'm pretty dubious.
And, of course, the quality of the political campaigns do make a difference, too.
Mallett-Outtrim also writes, "On Sunday, Argentina's leftist presidential candidate Daniel Scioli was soundly defeated by the right-wing millionaire and opposition leader Mauricio Macri."
Well, maybe, depending on what "soundly" means. Mauricio Macri's winning margin over Daniel Scioli was 51-49. I would call that a clear victory, even "sound" enough to make a recount pointless. But it's not what I would call a landslide. It's what you would expect in a two-person race that was highly competitive.
But Mallett-Outtrim's description of Macri here is on point:
Macri's victory has already been welcomed in the international business press as a death blow to Argentina's social democracy, and a return to neoliberalism. Make no mistake: Macri is no progressive on any front. He has described homosexuality as a “disease,” believes women should relish being cat-called and once joked African descendants don't show up in photos without flash.
