December 20, 2014
Where is CFK?
The president still has some cards left to play this year
Police forces go on strike. Power fails in the middle of a heat wave. Taxman goes on plush holiday to Rio. What next? 2014.
The usual way of dealing with what goes on in Argentina, and the turmoil has been here from at least 1930, is to blame the entire situation on some specific party. But is this place now beyond that point? You can blame President Cristina Fernández de Kirchner all you like for your woes, especially if you were hit by the blackouts. But what if Argentina in general is now, somehow unconsciously, doing its very best to drag itself back into the state of crisis it knows so very well? The nation has been hit by one crisis after another ever since a constitutionally-elected government was toppled in 1930.
At stake now is what kind of legacy the Kirchnerite years, which started when the late Néstor Kirchner took office in 2003, will leave behind. The president’s second consecutive mandate ends in 2015. Last year’s midterm election defeat for the Victory Front, the president’s coalition, in all the major districts has quashed any dreams she might have had of reforming the Constitution to seek a third mandate. Yet the president’s critics now seem interested in ruining her last two years in office. Or, you might argue, the Kirchnerites are trying to ruin it for themselves. But then again maybe the problem is not one specific party. Argentina, after all, has been to hell and back before there ever was such a thing called Kirchnerismo.
Power failed badly during what will go down in history as one of the hottest Decembers in living memory. Yet the public’s exasperation was more about the many days that it took the private power utilities, and the national government regulators, to deal with the problem, especially in some Buenos Aires City neighbourhoods and parts of Greater Buenos Aires. Angry residents, left in the dark for days on end in highrise buildings, blocked roads and lit bonfires. There were still some protests over the outages taking place yesterday.
Yet the heat wave is no more. The situation is gradually getting back to normal in cooler weather.
Federal Planning Minister Julio De Vido, during a lengthy press conference on Friday, directed his wrath at the private power utilities Edenor and Edesur, saying that what had failed was not the amount of electricity available but the capacity to distribute it locally. You can believe De Vido’s line or not. De Vido on Friday vowed that clients will be compensated and that the utilities will be fined for the blackouts.
More significantly, De Vido also once again threatened to play the nationalization card. If the private companies can’t get the work done, De Vido said, then the Kirchnerite administration will not hesitate to rule a state takeover of Edenor and Edesur. Such a nationalization of the utilities has not happened just yet. But the card is there to be played. The Kirchnerite administrations have nationalized the Post Office, water company, the airline Aerolíneas Argentinas and the energy company YPF.
That’s the thing with this government. The political situation is volatile, yes. But the CFK administration still seems to have a few cards left to play.
Rául Alfonsín, the late Radical candidate who won the presidency when Argentina returned to democracy in 1983, had no cards left in his hand (or in his pack) when he was forced to resign before the end of his mandate in 1989 when the nation was engulfed by the flames of hyperinflation.
Fernando de la Rúa, the Radical who won the presidency in 1999 leading a centre-left coalition, also had no cards to trump the financial meltdown of 2001 when he quit.
Fernández de Kirchner was on a gruelling schedule until she was forced to stop in October, just ahead of the midterm defeat, to undergo head surgery to drain a clot lodged between her skull and her brain. The president’s profile, after making a much-talked about official public reappearance in November, has been low even when she is now in charge of the nation and has reshuffled her Cabinet.
The president has chosen to keep such a low profile that the the opposition is now complaining about her being “absent” during the difficult times the nation needs to be steered through. This prompted one Kirchnerite official to quip that the opposition complained when the president was ever present and is now also complaining when she chooses to keep mum. Possibly CFK is now deliberately playing hide and seek with the opposition to highlight this contradiction.
Fernández de Kirchner has already overruled the ultra-Kirchnerite lawmaker Carlos Kunkel who had declared that the president would be a candidate to “something” in 2015.
Fernández de Kirchner is currently away in Patagonia. But possibly she is planning to eventually reappear.
Here’s another card Kirchnerismo can play. You can expect Fernández de Kirchner to deliver the annual state of the nation speech to Congress on March 1. The president’s goal now seems to be trying to avoid the kind of political humiliation that downed Alfonsín and De la Rúa. All the problems highlighted by the opposition are still there: the underreported inflation rate, the corruption allegations, the currency exchange controls, the energy implosion. Yet problems are one thing and political humiliation is entirely another.
The Kirchnerites are not home and dry just yet. The critics would very much like to humiliate this administration. The president has possibly sensed that this is the case and is now trying to survive in one piece until 2015.
The economy collapsed both under the feet of Alfonsín and De la Rúa. But it has not collapsed just yet under Fernández de Kirchner. Metropolitan bus fares were increased 66 percent over the new year. A 6-10 percent increase in fuel prices has also been trumpeted. Domestic flight rates are also up. The peso has lost about 32 percent of its value against the dollar in a year. The Central Bank reserves, once at over 50 billion dollars, now roughly amount to 30 billion dollars. All bad signs? Maybe. But maybe also, with the newly-appointed Economy Minister Axel Kicillof in charge, these are also signs that the economy can still let off some steam without the country actually going up in flames entirely. Orthodox economists will no doubt ridicule the “price watch” plan launched by the new Domestic Trade Secretary Augusto Costa on Friday. The plan, which is not technically a sweeping price freeze, aims at controlling the price of about 200 products. Yet Costa, who replaces the notorious Guillermo Moreno, still has the long-term challenge of trying to tame inflation.
Institutionally, the country also let off a lot of steam last year when the Supreme Court ruled in favour of the Media Law approved by Congress in 2009 and fiercely opposed by the media group Clarín. A lot can be said about Argentina’s shoddy institutions. But the nation survived institutionally after the massive sovereign debt default of 2001 when Congress elected a caretaker president (Eduardo Duhalde) early in 2002.
The thing about political humiliations is that you can’t really fabricate them. They either happen or they don’t. Fernández de Kirchner can still go the way of Alfonsín and De la Rúa. But she hasn’t just yet — much to the disappointment of her critics.
The negative stories abound. Ricardo Echegaray, the AFIP tax agency head, held a long press conference on Friday to deny allegations that he had witnessed how a television crew of the cable news channel Todo Noticias was attacked by his associates while on holiday in Rio de Janeiro.
Argentines wanting to travel abroad have to go through a lot of red tape to qualify for exchanging their hard-earned pesos for dollars.
Echegaray argued that he is wealthy enough to travel abroad and that he did most of his spending with his credit card. End of story? Not if you ask the cable news channel, which has held Echegaray responsible for the attack against the television crew.
Clarín group reporters also questioned Echegaray’s ethics, because he chose to vacation abroad (flying on a foreign airline and not by Aerolíneas Argentinas) in times of strict currency exchange controls and with a lot of the population enduring blackouts and lootings.
Echegaray has voiced his defence. Many in the opposition are still calling for his resignation. But the ultimate story will not be about the timing of the taxman’s holiday.
A lot can be blamed on Rio. CFK’s reputation could no doubt suffer over this latest scandal involving Echegaray. But Fernández de Kirchner’s humiliation, if it indeed does happen eventually, will have to brought about by weightier issues and by the opposition getting its next moves right in Congress.
The year 2014 will see Fernández de Kirchner fighting not for her immediate political future — there’s nothing she will run for in 2015 — but for her legacy and her reputation.