April 23, 2014
Thursday, January 2, 2014

Questions for 2014

The year 2014 which began yesterday is all too easy to forecast for the immediate future but considerably more complex for the full 12 months. Right now we can safely predict a continuation of a long hot summer which will very likely project into the labour arena as the collective bargaining season begins. The intensity of these wage demands will very much depend on the velocity of an inflation which also eats into company costs (posing a question-mark over the remarkable job stability of the last decade) — and tackling this inflation will surely be by far the biggest challenge facing the government this year.

Thus far the forecasts can be issued with considerable confidence but uncertainty sets in when we begin looking at the interaction between leading personalities and the various institutional factors where so much depends on the role played by each one. Starting at the top with President Cristina Fernández de Kirchner. The events of October (her operation and the subsequent medical restrictions along with the psychological blow of her party’s midterm defeat) explain the extreme infrequency of her public appearances since then but she will soon have far more choice as to whether to play an active or passive role — will she revert to the highly centralized decision-making of the hyperpresidential style sustained for six years or will she delegate (with a continued preference for the new Cabinet Chief Jorge Capitanich or seeking some other quasi-premier or perhaps more widely)? These questions also extend to the Cabinet revamped only five weeks ago which has thus had insufficient time to prove the experiment’s value — we will now see if the changes (which include Economy Minister Axel Kicillof as well as Capitanich) stand the test of a full year in 2014 and what the Cabinet looks like at its end. But CFK is not the only lame duck — so is Buenos Aires Governor Daniel Scioli (among various others) and a key question for 2014 will be the role he plays within the traditional Peronist problem of succession and its consequences for ruling party unity. These questions in turn raise the role of Congress this year — much will depend on how much the party lines according to last October’s results are respected. If so, the government maintains the working majority in both Houses which it enjoys in theory — if not, the election winner Sergio Massa might well control the balance of power.

Other questions remain to be asked even now but surely many more will arise in the course of the next 363 days.

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