By Michael Soltys

Buenos Aires Herald Senior Editor

The improvements in institutional quality promised by President Cristina Fernández de Kirchner in her 2007 election campaign have hardly been uppermost in the four weeks between the January 7 emergency decree removing Martín Redrado from the Central Bank helm and yesterday’s autocratic announcement moving Banco Nación President Mercedes Marcó del Pont over to the Central Bank. After going through all the rigmarole of submitting the fate of an official who had both been fired and had himself resigned (not to mention being simultaneously denied the right to resign and to enter Central Bank headquarters) to the recommendations of a non-binding bicameral commission, she then abruptly names a new president with zero consultation. No doubt the option of Redrado’s second-in-command Miguel Pesce as a stopgap to serve out Redrado’s term until September was doomed by his links to Vice-President Julio Cobos (even if the later lowered his thumb on Redrado).

Rapidly overtaken by events, Tuesday’s painstaking bicameral recommendations (requiring six hours with two adjournments) were nevertheless not academic (despite Redrado’s dismissal and resignation) because of the differences exposed within the opposition. What had been heading towards a 3-0 vote against Redrado ended up as 2-1 because the Civic Coalition’s Alfonso Prat Gay was persuaded by his party leader Elisa Carrió that he could not endorse Redrado’s dismissal by emergency decree for defending Central Bank reserves, whatever his misgivings about Redrado’s overall stewardship. This position seems more consistent than the decision of Cobos to join Victory Front deputy Gustavo Marconato in voting out Redrado but for different reasons — will the general public appreciate the difference in arguments alongside the bottom line of voting with the Kirchners and whatever other objections there might be to Redrado, what kind of message is sent out by backing his dismissal at the wrong time on the wrong grounds when he was doing the right thing for once in defending the reserves? Yet rather than Carrió being the clear winner, it seems more likely that Cobos will be the loser for his confused resolution of his dilemma.

But at the end of the day neither Redrado nor Marcó del Pont matter so much as whether the days of Central Bank independence are numbered — whether by hook or by crook (subordination to the Economy Ministry or the Economic Council announced yesterday by CFK, reform of Central Bank statutes or crude annexation) the reserves become a presidential current account.