Authoritarian tendencies in the Argentine government of Mauricio Macri

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-States TomDispatch 05/26/2016)

Such trends are hard to measure. Marc Plattner gives his version of such concerns in Liberal Democracy’s Fading Allure Journal 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 Crisis Democracy Now! 03/11/2016; Katia Porzecanski, Singer Makes 369% of Principal on Argentine Bonds in Debt Offer Bloomberg 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 Argentina New 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 government surrenders to the vultures

Argentine President Mauricio Macri surrender to the vulture funds and has agreed to pay large amounts to those purchasers of already-defaulted debt. Apparently it will require taking on new debt to pay ransom to the vulture funds. It was a decision that not only compromised Argentine sovereignty but will also impose major economic costs on Argentina itself.

Macri's government is an ideal neoliberal, One Percenter government bending over backwards to accommodate the demands of oligarchs national and international.

Alexandra Stevenson and Jonathan Gilber reported on the deal in Argentina Reaches Deal With Hedge Funds Over Debt New York Times 02/29/2016 with a shamelessly pro-vulture-fund spin in the opening paragraphs, including: “'This is the equivalent of a giant albatross being lifted from Argentina’s neck,' said Brett Diment, the head of emerging market debt at Aberdeen Asset Management. 'The litigation and lack of access to international capital has had a sclerotic effect on the country for years but it was facing a real financial squeeze this year,' he said."

But they do provide some basic facts:

The four hedge funds, which include the billionaire Paul E. Singer’s NML Capital, were the last major hedge fund investors among a group that declared legal war on Argentina in the United States courts 12 years ago.

These holdouts, so named for their refusal to participate in Argentina’s two restructurings after the country defaulted on $100 billion of debt in 2001, sought billions in bond repayments and eventually succeeded in preventing Argentina from paying any of its creditors.

And they went to great lengths to compel Argentina to pay — at one point persuading authorities in Ghana to seize an Argentine navy ship as collateral, with a crew of about 300 on board. They also moved to impound other government assets, including a satellite.

Their ultimate victory illustrates the outsize influence hedge funds can have in the countries where they bet their money. And their legal tactics are likely to be used again by other investors contesting the debt obligations of sovereign powers. [my emphasis]

And they do give their readers an idea of the bad consequences of this case:

In 2012, the holdout hedge funds achieved a stunning breakthrough when Judge Griesa ruled that whenever Argentina wanted to pay any of its creditors, it would have to also pay the holdouts. The move and its fallout led Argentina to default on its debt again in 2014.

That move will have far-reaching implications, many analysts say. With his ruling, the judge has laid the foundations for future investors to contest the debt obligations of other countries.

Anna Gelpern, a law professor at Georgetown University, said that the ruling created a new tool for investors.

“The tool is a kind of financial boycott” that would allow creditors to enforce equal payment in other instances, she added.

Mr. Guzman went further, saying that the settlement created “a problem of moral hazard in which this settlement incentivizes this type of behavior because it is profitable.”

Axel Kicilof, the Finance Minister of the last government and currently a Deputy in the Argentine Congress, heavily criticized the deals Macri's government has struck with the vultures.

He said, “Es la primera vez que yo veo alguien festejar que vamos a endeudarnos a lo loco. Todos sabemos lo que pasó cuando argentina abrió la tranquera del endeudamiento. Todos sabemos que eso no va para obras ni para el bolsillo de los que menos tienen” ("It's the first time that I've seen someone celebrating that we are going to go into debt like crazy"). (
Kicillof: "Es la primera vez que veo festejar que nos endeudamos a lo loco" Diario Registrado 29.02.2016)

David Dayen also points out the problems of this deal in
Hedge Fund Creditors' Deal With Argentina Sets Alarming Precedent The American Prospect 03/01/2016:

The Argentine government is certainly happy to crawl out from under the rock of default, and to unlock international credit markets to refresh depleted foreign reserves. A fresh infusion of capital will help with a treacherous inflation situation, and stabilize the country’s economy.

Of course, the first set of borrowing will go directly to paying off the holdouts, not Argentine public services or investment. That the holdouts succeeded this much, with the help of the U.S. judiciary no less, always represented to me a kind of punishment for Argentina rejecting the IMF-led consensus. They defied the world and lived to tell about it. The holdouts gave the international community a chance to punish the country for its intransigence, and only let them out of the vice grip when they elected a pro-business president.

Meanwhile, the precedent for this working out so well for the vulture funds is terrifying. A principle has been firmly established, that you can go around looking for sick countries and corporations and use all necessary means to use their pain for profit. It can be applied to Puerto Rico, where another similar tragedy is playing out. The ability to renegotiate debt, a standard tool in practically all borrowing relationships, will be hurt by the example of stubbornness winning out.

The vulture funds' fight with Argentina, which has now resolved itself in favor of the vulture funds, is a true example of international financial banditry.

Will anyone be surprised to hear that a leading figure on the side of the vulture funds, Paul Singer, is also a major donor and behind-the-scenes political player in the US Republican Party?

Greg Palast discusses him in
Rubio's Billionaire wins ransom from Argentina 02/29/2016:

Singer’s actions are outlawed in most of the civilized world. Hillary Clinton, as Secretary of State, attempted to stop Singer’s predatory act, but Singer did a brilliant end-run: he used his cash to help elect a new President in Argentina that would jump to his tune and pay him billions.

Now, he’s attempting to do the same to the USA: pick a president for us who will feather his vulture's nest. He’s the number one donor sugar daddy for Marco Rubio’s candidacy [See, "Who Hatched Rubio"]. Singer is also the big bankroller of Karl Rove, to make sure that, even if he can’t sell Rubio to the GOP base, at least The Vulture can use "Turdblossom" Rove to ensure that Hillary won’t become President and put him out the of vulture business.

Rubio, in fact, skirted some ethical lines in his attempts to pressure the State Department to side with his corpse-chewing donor against Argentina.

As I’ve said, Singer directs his fellow billionaires’ investments in candidates. So, it is not surprising to see The Koch's lend their top political operative, Marc Short, to Singer's man, Rubio.

Rubio’s affection for carrion-eating birds has no decent bounds. While Clinton and Sen. Bernie Sanders are currently siding with Puerto Rico against a whole flock of vulture financiers. Sanders and Clinton support [Puerto] Rico’s plea for the same bankruptcy protections afforded the 50 states (and afforded to Donald Trump).

Kenneth Vogel and Ben Schreckinger report that Il Duce Donald Trump pitched Singer to support him, unsuccesfully: Trump courted megadonors he now scorns Politico 11/04/15.

Harper Neidig reports on Singer's support for Rubio, who is currently faltering in the Presidential race, in Hedge fund billionaire gives $2.5 million to Rubio super-PAC The Hill 01/31/2016.

Rubio's billionaire backer, vulture fund enemy of Argentina

Eli Clifton has an informative report about Marco Rubio's high-profile supporter, vulture fund billionaire Paul Singer, Rubio Anointed Neocon Choice LobeLog Foreign Policy 11/02/2015. He writes of Singer's company Elliott Management:

Elliott leads a group of holdout creditors who bought up Argentine debt at pennies on the dollar and then sued the country to pay up in full. If successful, Elliott could collect as much as $2 billion. Singer’s philanthropy has often gone to groups — such as the American Enterprise Institute, The Israel Project, and the Foundation for Defense of Democracies - that promote the controversial work of Argentine Special Investigator Alberto Nisman. In 2006, Nisman released a report claiming that top Iranian leaders ordered the 1994 bombing of the Argentine Israelite Mutual Association (AMIA) in Buenos Aires, which killed 85 people. But the report relied almost exclusively on the testimony of members of the Mujahedin e Khalq (MEK), an Iranian opposition group that former members liken to a cult.

Recipients of Singer’s funding frequently level charges of anti-Semitism against Argentine President Cristina Fernandez de Kirchner and accuse her of participating in a cover-up to hide Iranian involvement in the attack while never disclosing their funding from Singer and his strong financial incentives for attacking Kirchner.

Last May, Rubio, mirroring the rhetoric of Singer-funded thinktanks, introduced a Senate resolution demanding a “swift and transparent” investigation into Nisman’s death and accused Kirchner of conspiring “to cover up Iranian involvement in the 1994 terrorist bombing.” [my emphasis]

Right Web has a profile of Singer, who has been trying to drive Argentina into bankruptcy.

It includes references to these two articles: Greg Palast, Uber-Vultures: The Billionaires Who Would Pick Our President Truthout 10/26/2011 ("Über-Vulture" is such a good title for Singer); Charles Davis, U.S. Hedge Funds Paint Argentina as Ally of Iranian ‘Devil’ – Part Two Inter Press Service 07/31/2013. Part 1 of the article is also available; in this post quotes from Davis come from one of the two articles.

Davis writes in Part 1:

That the White House is backing away from its earlier defences of Argentina indicates that the millions of dollars U.S. hedge funds have spent lobbying members of the administration, Congress and the press are starting to change the debate, with Iran about as popular as Iraq was in 2002.

“We do whatever we can to get our government and media’s attention focused on what a bad actor Argentina is,” Robert Raben, executive director of the American Task Force Argentina (ATFA), recently explained to The Huffington Post.

An assistant attorney general under President Bill Clinton (1993-2001), Raben’s group was founded by Argentina’s holdout bondholders and, to date, has spent at least 3.8 million dollars on its efforts to paint Argentina in a bad light. But the money it has spent pales in comparison to what ATFA’s funders stand to gain.

This is one set of private interests conducting a campaign against the current government of Argentina. It's not a secret to Argentina. But it's covered scantily if at all in the US mainstream press.

Davis also notes:

Paul Singer is a very rich man – one of the 400 richest in the world. According to Forbes, the hedge fund manager and founder of Elliott Management has a net worth of 1.3 billion dollars. That wealth has enabled him to become one of the top funders of the Republican Party.

In 2012, he gave more than one million dollars to the party’s failed presidential candidate, Mitt Romney, and millions more to those lower down on the ballot. Employees of his firm, meanwhile, gave more than three million dollars to various politicians, making his company one of the top 100 funders of U.S. politics. And those politics are decidedly to the right.

In 2007, Singer described himself as a believer in American exceptionalism, noting that he has given “millions of dollars to Republican organizations that emphasize a strong military and support Israel.” Speaking to the New York Times, Singer explained that he believes the West “finds itself at an early stage of a drawn-out existential struggle with radical strains of pan-national Islamists.”

Argentine Foreign Minister Héctor Timerman and the AMIA/Nisman/vulture-funds tangle

Raúl Kollmann in “Ellos dicen culpables sí, juicio no” Página/12 29.04.2015 reports on the resignation of Argentine Héctor Timerman from the Jewish organization AMIA and explains the immediate background of his decision:

La renuncia de Timerman es a la AMIA, la mutual a la que están afiliados una parte de los integrantes de la comunidad judía. La AMIA administra los cementerios, la red educativa, algunos comedores, la asistencia social, el respaldo a personas de la tercera edad y muchas actividades culturales. Los socios de la AMIA votan su comisión directiva, hoy en día en manos de los sectores más religiosos y ortodoxos. Al mismo tiempo, para las cuestiones políticas se supone que la representación está en la DAIA, donde convergen las instituciones (entre ellas la AMIA), los templos, las escuelas, los clubes. Cuando se elige la conducción de la DAIA, las instituciones y clubes con más socios tienen varios votos: la AMIA, por ejemplo, tiene cuatro de los 120 totales. Con la carta de renuncia dirigida a Leonardo Jmelnitzky, actual presidente de la AMIA, Timerman quiso dejar en claro que no quiere ser representado por la conducción de la AMIA y tampoco por la DAIA.

En las últimas semanas surgió un grupo importante de integrantes de la comunidad judía que concretaron la primera convocatoria de judíos progresistas que no se sienten representados por la AMIA y la DAIA. El ex director ejecutivo de la DAIA Jorge Elbaum produjo una enorme repercusión con dos notas publicadas por Página/12 en las que mostraba y testificaba sobre las presiones que recibió la DAIA para bloquear el memorándum con Irán. Se alinearon voceros del PRO, de las embajadas de Estados Unidos e Israel y, enseguida, las fundaciones financiadas por los fondos buitre, en especial por Paul Singer. El propio fiscal Nisman se movió activamente como “amigo” de la Fundación para la Defensa de la Democracia, también financiada por Singer. Todas estas movidas fueron rechazadas en el plenario de argentinos de origen judío, que tuvo la conducción de la periodista Miriam Lewin ....

[Timerman's resignation is directed to the AMIA, the mutual society to which a part of the members of the Jewish community are affiliated. The AMIA administers the cemeteries, the educational network, some dining facilties, social assistance, support for the elderly and many cultural activities. The members of AMIA vote for their board of directors, these days in the hands of the most religious and orthodox sectors. At the same time, for political questions the representations is assumed to be in the DAIA, where the institutions converge (among them AMIA), the temples, the schools, the clubs. When the leadership of the DAIA is decided, the institutions and clubs with the most members have various votes: AMIA, for instance, has four of the 120 total. With the letter of resignation directed to Leonardo Jmelnitzky, current President of the AMIA, Timerman wants to make it clear that he doesn't wish to be represented by the leadership of the AMIA nor by the DAIA.

In recent weeks, an important group of progressive members of the Jewish community has emerged that constituted the first announcement by progressive Jews who do not feel themselves represented by the AMIA and the DAIA. The ex-Executive Director of the DAIA Jorge Elbaum produced an enormous repercussion with two notes published by Página/12 in which he demonstrates and testifies about the pressure the DAIA received to block the memorandum on Iran. Spokespeople aligned from the PRO, the embassies of the United States and Israel and, promptly, the foundations financed by the vulture funds, particularly by Paul Singer. Prosecutor Nisman himself actively behaved as "a friend" of the Foundation for the Defense of Democracies, also financed by Singer. All of these moves were rejected by the plenary session of [the progressive group] of Argentines of Jewish origin, which was lead by the journalist Miriam Lewin. ...]

A sidebar article reports on the left-leaning group of dissenters from the AMIA/DAIA positions, Un foro “colectivo y democrático” Página/12 29.04.2015.

Kollmann further reports:

En su diálogo con este diario, Timerman contó los intercambios con los dirigentes comunitarios sobre el memorándum. “Nosotros les dijimos que era un paso adelante, como lo sostuvieron Interpol o Amnesty International. Era intentar destrabar la situación y juzgar a los sospechosos, que Irán no iba a extraditar. Ellos dijeron que sí al principio y después que no. La Presidenta les ofreció que traigan una idea alternativa. Y no trajeron nada, salvo la posibilidad de reformar la Constitución para juzgar en ausencia, algo que en la Argentina nunca se hizo. Por eso insisto en el texto que ellos, los dirigentes de la comunidad judía, no quieren avanzar en buscar formas de juzgar a los sospechosos. Ellos dicen culpables sí, juicio no.”

[In his conversation with this paper, Timerman recounted the exchanges with the community leaders about the memorandum {the agreement with Iran}. "We told them that it was a step forward, as Interpol or Amnesty International maintained. It was intended to unfetter the situation and try the suspects that Iran had not extradicted. They said yes at first and later no. The President {Cristina Fernández} invited them to bring an alternative idea. And they didn't come up with anything, except the possibility of reforming the Constitution to allow a trial in absentia, something that has never been done in Argentina. For that reason, I insisted in the text {of the resignation letter} that they, the leaders of the Jewish community, did not want to have progress in looking for forms of trying the suspects. They are saying guilty yes, trial no."]]

As I've commented on here numerous times, the AMIA case has become deeply involved in efforts by American neoconservatives, the Government of Israel and the Republican Party to get up a war with Iran. Paul Singer is one of the biggest donors to the Republican Party, whose enthusiasm for the Likud Party of Israel's warlike policies he apparently shares. He's also a supporter of neocon policies and is engaged in a landmark legal dispute with Argentina over "vulture fund" investments in defaulted Argentine bonds. And all of this has become embedded into differences of priorities and outlook within Argentina's Jewish community and with the partisan opposition to Cristina's government and her Peronist Justicialista Party.

The Washington Post, whose editorial stance has been staunchly neoconservative for years, in a recent editorial accused Cristina and her government of promoting anti-Semitism in defending itself over the Nisman/AMIA case, Argentina’s president resorts to anti-Semitic conspiracy theories 04/23/2015. From everything I can see, this is a ludicrous accusation.

Jim Lobe and Charles Davis respond specifically to the WaPo editorial in Following the Money: The New Anti-Semitism? LobeLog Foreign Policy 05/01/2015.

Obviously, Foreign Minister Timerman is Jewish, as is Cristina's Economics Minister Axel Kicillof. Those are the two most prominent ministers of her Cabinet on the international scene.

On these themes, see also:

Charles Davis, U.S. Hedge Funds Paint Argentina as Ally of Iranian ‘Devil’ – Part One Inter Press Service 07/29/2013

Charles Davis, U.S. Hedge Funds Paint Argentina as Ally of Iranian ‘Devil’ – Part Two Inter Press Service 07/31/2013

Graciela Mochkofsky, Why Alberto Nisman Is No Hero for Argentina — or the Jews The Forward 03/10/2015, who gives this summary of Nisman's background:

In 1997, when he first became involved in the case — known in Argentina by the JCC’s acronym, AMIA — Nisman was a young and ambitious prosecutor making a career in the newly inaugurated system of open trials.

His task was to make presentable the fabrication concocted by Judge Juan José Galeano. With forged evidence, Galeano and other authorities had accused a ring of corrupt police officers of being the “local connection” in the bombing.

The open trial began in 2001 and ended in disaster in 2004. The forgery was so apparent that it didn’t survive scrutiny. The policemen were exonerated. The judge, the prosecutors, the head of the intelligence service, a high-ranking police officer, former president Carlos Menem and the leader of the main political Jewish organization were eventually indicted for the cover-up (and are going to trial in a few months). Nisman somehow survived, and President Néstor Kirchner (Cristina Kirchner’s now late husband, who took office in 2007) appointed him as special prosecutor for the AMIA case. He had to rebuild it from scratch. In 2006, based mostly on foreign intelligence reports, Nisman accused the Iranians of sponsoring the attack, allegedly carried out by Hezbollah militants.

Argentina, vulture funds and the bond markets

Aldo Caliari has a good update on the state of the Argentine conlict with the vulture funds, the latter being spearheaded by Paul Singer, one of the largest donors to the Republican Party, and his NML Capital, Where the Argentine Debt Case Stands Now, and Why it Still Matters NACLA 04/06/2015:

Some observers speculated that the Argentinean government would agree to settle with the vulture funds after expiration of the RUFO clause. RUFO stands for “right upon future offer” and is inserted in the restructured bonds to promise their holders they will have a right to be offered any better deal that other bondholders receive in the future. If Argentina had settled before the expiration of the clause, it could have faced immediate demands from majority bondholders for payments proportionally equal to those made to NML. But the expiration of the clause in January did not bring any change to Argentina’s offer to the vulture funds. These observers’ speculation failed to recognize that a settlement where NML gets paid the whole amount it demands—even in the absence of the “RUFO effects”—could invite lawsuits from other non-restructured bondholders. In fact, in the wake of the Supreme Court’s ruling last June, some of those bondholders have already filed suit hoping to follow in the footsteps of NML. Since these investors hold claims to some $15 billion, this is hardly an advisable course of action for Argentina.

Regardless of what happens with Argentina, however, repercussions from Griesa’s decision reach much farther. The ruling continues a trend that, legal experts say, has seen holdouts increasingly better treated by courts, at the expense of the soundness of sovereign debt restructurings. What former IMF economist Anne Krueger characterized in 2003 as a gap in the international financial architecture is now wider than ever. By increasing the potential rewards of holdout behavior, this recent judicial precedent will make future debt crises harder to resolve, with unpredictable systemic consequences. [my emphasis]

Fermín Koop interviews Kunibert Raffer, an economics professor at the University of Vienna, ‘Griesa thinks the whole world has to obey him’ Buenos Aires Herald 04/26/2015. Raffer has a harsh judgment on Nixon-appointed zombie judge Thomas Griesa's rulings and actions in this case:

This [Griesa's finding of contempt against Argentina and his threats of sanctions against it] represents one of the great breaches of international law. Griesa thinks the whole world has to respond to his court and that’s not the case in international law. He himself cannot sanction Argentina in anyway. His order is of course problematic but in the end he can’t do anything about it. For example, he can ask Argentina to pay US$1 million but he won’t get the money. ...

There’s some reason to say he has been biased in the case. His supposed frustration regarding the case shouldn’t be reflected in his rulings. After more than 10 years of serving as a judge in this case, he was unaware of very crucial facts such as that not all bonds had New York jurisdiction. This is scandalous and a denial of the rule of law. If he doesn’t know the fundamental points of the case, he can’t have a fair judgment. I was really shocked about this.

Congress should really look at impeaching judges like this who have very obviously gone off the reservation of the law and by all appearances are senile.

Nixon zombie judge Thomas Griesa as depicted on the cover of Pagaina/12 Aug. 28, 2014

But he doesn't think that Singer and the vulture funds will be willing to settle with Argentina:

I don’t think a negotiated solution is possible. On one hand, you have Argentina that isn’t willing to pay more to the “vultures” because of a moral and legal point of view. On the other hand, you have the creditors whose business model is to be paid in full plus the interests. They might settle for 90 percent but they will certainly not settle for less than that. I see it as very unlikely that these two sides can meet. But if Argentina continues selling bonds successfully, the problem is solved.

And, in fact, Argentina is able to sell bonds, although they are not attempting to do so on a large scale. The Buenos Aires Herald also reports (Reserves soar as bonds bring relief 04/24/2015):

Successful debt issues are bringing relief to Central Bank coffers, with Tuesday’s US$1.4-billion bond sale boosting reserves by US$1.25 billion to reach US$32.675 billion, the highest level of foreign currency reserves since November 2013.

[State-owned oil and gas company] YPF also received good news from the debt markets yesterday as its planned US$500-million bond sale ended up turning into a US$1.5 billion issuance. The state-controlled oil company received money at slightly better rates than the government, 8.5 percent compared to 8.75 percent, and rejected several bids from a market that seemed eager to invest in the company, having offered US$4 billion overall. ...

Combined with the soybean harvest season, the debt sales have given authorities more room to authorize imports.

“We are increasing the payment of imports significantly, in March they were up 30 percent,” Central Bank chief Alejandro Vanoli said yesterday.

The tangled AMIA/Nisman case

Argentine President Cristina Fernández at her webpage reprinted this article that reports on connections between the (probable) suicide of prosecutor Alberto Nisman, the AMIA case and the vulture funds trying to drive Argentina into bankruptcy: Jorge Elbaum, Buitres, Nisman, DAIA: la ruta del dinero Página/12 18.04.2015.

And apparently her office liked it some much they decided to publish their own English translation, Vulture funds, Nisman, DAIA: The money trail 19.04.2015. Nisman's link to hedge/vulture fund magnate Paul Singer, who is also one of the largest contributors to the US Republican Party, according to this report was closer than previously known publicly:

July 2nd 2013, ATFA, funded mostly by Paul Singer, president of NML Elliott, published an advertisement titled “Shameful allies”, that shows a picture of president Cristina Fernández close to the, at that moment, persian [sic] president Mahmud Ahmadinejad. In catastrophe fashion the ad reads:“Time has come the time to stop Argentina from breaking American and international law”. June 16th 2014, the Supreme Court of the United States of America decides not to take the case of Argentina’s debt, giving free way to the Judge Griesa to continue protecting the international speculative funds.

July 9th 2013, republican Jeff Duncan, responsible for the Homeland Security Committee of the House of Representatives (who received the “contribution” of US$10 thousand from the Political Action Committee of the organization “Each Republican is Crucial”, funded by Paul Singer, in September 2012), sent a letter to President Cristina Fernández, claiming that he was disappointed by the decision of Attorney General, Gils Carbó, of not allowing Nisman “come forward” before the Capitol.

Two days after the letter was sent to the President, Duncan sent another missive to Secretary of State John Kerry with the warning that “Argentina may be trying to support Iran’s illegal nuclear program” and demands that Kerry consider possible ties between Fernandez’ government and “the greatest world sponsor of terrorism”. Around the same time, Republican Senator for Illinois Mark Kirk sent yet another letter to President Kirchner questioning her dealing with Iran. Postage of this missive and other large expenses of the Senator were financed by Paul Singer through a USD 95.000 donation, according to the International Press Service’s report from August 7th 2013, quoting the Center for Responsive Politics, an organization that monitors political donations in the USA.

Two days after these three letters were sent, prosecutor Nisman began a round of meetings with the heads of the Jewish organizations DAIA and AMIA in which they agreed steps to prevent the implementation of the memorandum with Iran. During these meetings, which took place in a coffee shop on 1601 Juana Manso St. in Puerto Madero (Buenos Aires), Nisman fervently repeated that he was willing to put money “out of his own pocket” to help DAIA destroy the memorandum. “If necessary, Paul Singer will help us”, he declared to his astonished café companions. [emphasis in the English translation]

Cristina also made her own statement taking off from the news report (CFK warns about 'global modus operandi' against 'sovereign nations' Buenos Aires Herald 04/19/2015):

President Cristina Fernández de Kirchner has warned about a “global political operation” that threatens “sovereign nations,” following an article published in Pagina12 newspaper that links the so called “vulture funds” with late AMIA special prosecutor Alberto Nisman, the DAIA Jewish organization, and the political opposition’s rejection of the Iran memorandum. ...

Based on the article, CFK questioned local journalists that put pressure on AMIA and DAIA to oppose the Iran pact, and criticized the way Singer funds lobby groups disguised as NGOs that operate to influence international politics. She also recalled these NGO “hired Argentine politicians” to spread their views.

“We are in front of a global modus operandi that not only damages sovereign nations, interfering and coercing different branches of government, but also generates international political operations of several kinds,” she said in a Facebook post published today in her account.

“Everything has to do with geopolitics and international power. Sometimes this modus operandi has global effects, like banning the possibility of a peace agreement between the US and other powers with Iran over nuclear proliferation, and sometimes it prevents agreements that could contribute to finding the truth about the AMIA terrorist attack,” Ms Kirchner added.

Citibank throws in with the vulture funds against Argentina

The latest twist in the ongoing story of the hedge funds, appropriately called vulture funds by Argentine officials, trying to drive Argentina into bankruptcy over long-defaulted debt is that Citibank has decided to side with the vulture funds whose most visible spokesperson is Paul Singer, one of the largest donors to the Republican Party. Nixon-appointed zombie Federal Judge Thomas Griesa made dubious legal history by his radical decisions in favor of the vulture funds that disregarded centuries of law and practice in sovereign debt.

The Buenos Aires Herald summarizes the latest this way ('We will maintain Citibank’s suspension' 03/29/2015):

Economy Minister Axel Kicillof said the suspension of Citibank Argentina, ordered by the National Securities Commission (CNV) financial watchdog, will stay in place until the bank revokes its agreement not to appeal US Judge Thomas Griesa’s ruling that interest payments on Argentina's restructured local law bonds could not be processed if the bank was allowed to make two one-off payments to help it exit its local custody business.

The official condemned the deal between the bank and the “vulture funds” and said that Citibank is trying to please the vultures and Griesa at the same time but he pointed out that it is leaving its clients (bondholders) helpless.

“(Judge) Griesa in his attempt to extort the country along with vulture funds, has told US Citibank to not let Argentina Citibank to operate with Argentina’s public debt securities in Argentina,” Kicillof explained in an interview with Tiempo Argentino newspaper. “This is a mess because Citibank has opened a branch in this country and it has to comply with this country’s laws.”

The title of this article by Alfredo Zaiat refers to it as "the Citi-Singer Pact," El pacto Citi-Singer Página/12 29.03.2015.

This set of actions has the usual tangle of legal, financial and political complications. But the basics are that Citibank has been caught between its legal obligations to Argentina to process payments to creditors who have renegotiated their debt and Nixon zombie judge Griesa's order blocking them from making the payments. So Citi wants to wash its hands of the whole thing and get out of the custody-payment business in Argentina altogether.

Apparently Citibank figured they stood to lose more money from trying to comply with Argentine law and their custody payments agreement with it than by going along with the vulture funds and their Nixon zombie judge.

Singer and the vulture funds stand to gain money from their position. But they won't go broke or suffer in any meaningful way if they loses. Argentinians, on the other hand, have a great deal to lose, economically, socially and politically.

Not unlike Greece's position in negotiating with Germany over debt and austerity issues, the side that's closer to having nothing to lose has a negotiating advantage in that fact.