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November 22, 2014
Sunday, March 2, 2014

State of the decade

The president’s speech reads like an ode to the role of the state in a capitalist economy

Presidents must really relish the exposure they get in State of the Nation speeches. They speak for a long time. The speech is relayed nationwide on all television channels as a national broadcast. You have to shut up and listen. In your face, opposition.

Well, not quite. But there were many new faces in Congress when President Cristina Fernández de Kirchner delivered her seventh State of the Nation speech since taking office on 2007. At one point, Fernández de Kirchner told a cameraman to move out of the way so she could “see the face” of the opposition lawmakers.

Those new faces, that were shown live on television during a national broadcast, are the product of last year’s midterm elections. The ruling Victory Front coalition lost the midterm elections in all the major districts, but it still controls Congress.

Those now holding a cushy seat in parliament include the rebel Peronist Sergio Massa, the former Tigre mayor who defeated the president’s candidates in Buenos Aires province.

CFK’s speeches are not a novelty. But this was the first State of the Nation speech after that thumping electoral defeat. It is also the first State of the Nation address since the president last year underwent head surgery to drain a clot that was lodged in her skull. The president, despite the rumours about ongoing health problems, looked fit and even displayed a softer side.

There were still many trademark confrontational moments, but Fernández de Kirchner sprinkled the opposition with drops of praise.

Opposition PRO party lawmaker Laura Alonso rose to applaud the head of state when she told the congressional assembly that a new law was needed to deal with street demonstrations that often lead to roadblocks by protesters to voice demands. All political parties, she said, should agree on a law to regulate street demonstrations regardless of their ideology.

Fernández de Kirchner also revealed in Congress that she had a telephone conversation with Buenos Aires City Mayor Mauricio Macri, the leader of PRO, on Friday to discuss the occupation of land by a large group of squatters in the Villa Lugano neighbourhood.

Macri, a potential opposition presidential candidate in 2015, opened sessions in the Buenos Aires City Legislature on Friday by making a call to secure “social peace” this year.

Macri was one potential presidential candidate who was not in the Congress building yesterday. Massa, also a potential opposition president challenger, was. And so was Buenos Aires Governor Daniel Scioli, a moderate Kirchnerite who does not count with the president’s blessing, but who has announced that he will make a bid to clinch the Victory Front’s presidential nomination in 2015.

The faces were long in the PRO caucus (including that of Alonso) when the president spoke out against what she called a “soft coup” in Venezuela, which she said was designed to topple the Bolivarian administration of Nicolás Maduro. But Fernández de Kirchner even then said that what she was defending was democracy and not a government with a specific ideology. The fall of Maduro, she said, would be “fatal” for the region.

Fernández de Kirchner, a leftwing Peronist activist in the seventies, said that her generation had been taught the value of democracy by the rise to power in 1983 of Rául Alfonsín’s Radical Party.

CFK has served as a lawmaker for many years before winning the presidency in 2007 so she usually cruises through these demanding speeches and even has the time to throw both jabs at the opposition and share jokes with her allies. The Kirchnerite lawmaker Eduardo de Pedro, the president told the nation, is soon to get married. All the lawmakers could do was pull faces. De Pedro broke into laughter at the comment about his wedding. At one point PRO Deputy Miguel del Sel, a comedian by trade, dozed off.

Fernández de Kirchner made a point of highlighting the nationalization of the energy company YPF. The company was very much in the news recently because Argentina has signed a “friendly” agreement with Repsol to pay five billion dollars for 51 percent of YPF with bonds maturing through to 2033. Fernández de Kirchner publicly congratulated Economy Minister Axel Kicillof and Legal Secretary Carlos Zannini for hammering out the deal with Repsol.

Dr Kicillof is short, CFK said, but he gets the job done. Kicillof “fought like a lion,” in the negotiation with Repsol, Fernández de Kirchner added.

There was no such congratulation in public for Cabinet Chief Jorge Capitanich. Capitanich (the Peronist governor of Chaco province currently on leave) and Kicillof were appointed in the reshuffle that followed last year’s election defeat. Kicillof, in what could come as a bit of a surprise, has displayed more political reflexes than Capitanich, who has been often overruled by the president’s inner circle (for instance when he said during the blackouts of December that the power utilities should schedule outages).

Fernández de Kirchner said that Argentina has a bright future ahead with YPF under its belt because the nation’s huge shale oil and natural gas reserves are world class. The president used the YPF story, and also that of the state-run airline Aerolíneas Argentinas, to deliver an ode to the state management of the economy (“national capitalism,” she called it).

There was no reference to the blackouts during a heat wave in December. The argument that Argentina was self-sufficient on energy before 2003 was a “fallacy,” Fernández de Kirchner said, because the nation was bankrupts and 54 percent of the population was poor.

The context of this State of the Nation speech is not an easy one. Inflation in January officially clocked in at 3.7 percent. Also in January, the peso lost 18 percent of its value.

Fernández de Kirchner made no direct reference to inflation even now that the official rate has the seal of approval of the International Monetary Fund (IMF). But she did utter the word “devaluation” once during the speech. It was when she accused the car industry executives of jacking up the price of their products in general to compensate for the tax recently slapped on luxury cars.

Still this speech was delivered at a time of relative calm in what could still turn out to be a stormy year.

Kicillof and Central Bank chief Juan Carlos Fábrega have managed to stop the slide of the peso (a dollar now trades officially at just under eight pesos). The Central Bank is not losing foreign currency reserves on a daily basis.

Yet at times yesterday’s speech was not about the immediate state of a nation, but more like the state of the Kirchnerite decade.

The Kirchnerite administrations, the president complained, had endured “eight bank runs” worth at least 70 billion dollars. She implied that the bank runs were designed as “obstacles” to sabotage growth.

The president also directed complaints at the world’s most powerful nations who are recovering from the financial crisis of 2008.

Latin America’s leaders, Fernández de Kirchner said, are convinced that there is a “commercial war” and “currency war” that has been launched against emerging nations.

Yet despite what she said were these looming “wars,” the president often and rapidly returned in her speech to what she sees as a decade of achievements.

Trade union membership, especially in the metal and construction sector, had increased in ten years. She listed the trade unions as one of the achievements of Peronism.

The comment comes as the trade unions, many now in the opposition but most still backing the CFK administration, are readying for the annual round of wage bargaining. The national government has failed to reach a salary agreement with the teachers unions to name a starting salary, which then serves as reference in negotiations with provincial administrations.

The talks between the national government and the teachers adjourned and are scheduled to continue this week. The teachers unions “suspended” a strike, but they said they were unhappy with the national government’s decision to include in the offer a bonus of 2,000 pesos for teachers with perfect work attendance. Absenteeism, the president insisted yesterday, was a problem in education and the offer stood.

The comment will not go down well with the teachers’ unions and could even prompt a strike, but the president has not shied away from the argument (even when she has the backing of many teachers’ union leaders).

The end of the speech was dominated by the latest political developments directly concerning Congress. The president on Thursday tapped Santiago del Estero Senator Gerardo Zamora, a Kirchnerite Radical, to be appointed as the provisional head of the Senate. Zamora, the former governor of Santiago del Estero, formally took oath on Friday, and he is now in the line of presidential succession only behind Vice-President Amado Boudou.

The president told Congress that she had decided to once again back a non-Peronist in an effort to continue with the Victory Front’s cross-party spirit. Julio Cobos, CFK’s vice-president during her first term in office 2007-2011, is a Radical. Cobos was one of the new faces now sitting in Congress yesterday as an opposition lawmaker. Cobos famously cast the tie-breaking vote against the president’s grain export duty bill during a Senate session in 2008. Cobos’ vote was the cross-party experiment blowing up in the face of CFK and her late husband Néstor Kirchner. But the president told Congress that the “defection of one” (meaning Cobos) should not put an end to agreements with other political parties.

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