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October 2, 2014
Sunday, May 18, 2014

Complain now, vote later

Problems have not gone away, but the election is next year

If politicians fail to understand that this is not an election year then the public will make sure they get the message. Interest in television news channels seems to be waning. It makes sense. The presidential elections are next year. The soccer World Cup, scheduled to start next month, is nearing. This doesn‘t mean to say that there aren’t any big stories out there.

Vice-President Amado Boudou, an appeals court has ruled, should still be probed for influence-peddling allegations involving the rescue of the bankrupt money-printing company. General César Milani, the Army chief named by President Cristina Fernández de Kirchner, is also under investigation over accusations that he was involved in the disappearance of a conscript during the last military dictatorship. Another court has ruled unconstitutional a memorandum of understanding Argentina signed with Iran to probe the 1994 bombing of the AMIA Jewish community building in Buenos Aires. (The CFK administration has said it will appeal.)

There’s also plenty of economic stuff to write home about. The economy dropped 0.9 percent in March, according to the state-run statistics bureau INDEC. The news has not gone away. It will not even go away even if Lionel Messi scores a hat-trick in every World Cup game he plays for Argentina next month. But the politicos must understand that it makes no sense for them to continue to behave like this is an election year.

Election races in modern politics, and Argentina has not been any different of late, play out like a television drama. That’s what happened in last year’s midterm elections. Sergio Massa, a 42-year-old centre-right rebel Peronist who ran against the president’s Victory Front coalition in Buenos Aires province last year, won the election. Massa is now a competitive presidential hopeful. The only problem for Massa is that the competition is in 2015. He must find ways to keep the electorate interested. But the electorate only really behaves like an electorate when it feels that an election is nearing.

Last year’s defeat for the Victory Front in all the major districts pretty much put an end to any dreams Fernández de Kirchner might have had of reforming the Constitution to seek a third consecutive mandate. But the president’s Victory Front still controls Congress, meaning that she is likely to hand over power next year in relatively good political shape. Other democratically-elected presidents of the recent past weren’t so lucky.

That Fernández de Kirchner looks like she will be in charge until 2015 is news in itself. The president hasn’t changed her confrontational style much. Yet polls show that public opinion now considers her a bit of an icon, even when a big chunk of voters dislike her.

Fernández de Kirchner is still keeping her guard up. She argued bitterly in public with a Catholic Church statement complaining that Argentina is “sick with violence.” The president fired back that Argentina had been crippled by violence during the dictatorships of yore and during the financial crisis of 2001, but not now.

The Catholic Church’s statement was possibly oversimplified by the press because it was also critical of crime coverage and it was never specifically about the national government. A critic would be right to argue that Church and state shouldn’t mix in the first place and what the venerable bishops have to say about reality is not that significant. But think about the context.

Pope Francis, as you well might know, is Argentine-born. The pope has met with Fernández de Kirchner and there is rife speculation that Francis is not interested in seeing the president suffer any kind of humiliating political exit next year. Voters, of course, can still choose to punish Fernández de Kirchner by, say, voting Massa for president.

Massa served briefly as Fernández de Kirchner’s Cabinet chief in 2008-2009, but is now very critical of the Kirchnerite administration. CFK will also be embarrassed if Julio Cobos, her former vice-president between 2007-20011, wins the presidency in 2015. Cobos is a Radical who famously cast the tie-breaking vote in the Senate against Fernández de Kirchner’s bill designed to increase grain export duties. Cobos’ Radical party is now part of the Broad Front-UNEN coalition.

Cobos is a presidential hopeful and polls show that he has a fighting chance of winning the Broad Front-UNEN nomination.

But even if Fernández de Kirchner has to place the sash on Cobos or Massa it’s entirely possible that her legacy and reputation will not be in tatters.

The president is currently trying to exercise power even when on the way out. The Catholic Church hierarchy, after the spat, met with Fernández de Kirchner at the Olivos residence on Thursday. The meeting was called specifically to discuss that document issued by the Church with the line about Argentina being “sick with violence” (at a time crime is a growing concern for voters). Again, there were rumours that the pope had wanted the meeting to take place.

A meeting with bishops will not make all problems go away.

The peso had to be devalued by about 20 percent in January. And now INDEC has reported that the economy contracted 0.9 percent in March. INDEC has been underreporting inflation since it was reformed by the Kirchnerite administration in 2007. But INDEC, in a move designed to put an end to the criticism, has hammered out a new nationwide inflation rate with the blessing of the International Monetary Fund (IMF).

Economy Minister Axel Kicillof on Wednesday reported an inflation rate of 1.8 percent for April. Kicillof said that food price hikes had slowed down to 1.1 percent. Those inflation numbers still look scary. Inflation clocked in at 11.9 percent in the first quarter of this year. Argentina has one of the highest inflation rates in the world. Yet Kicillof is trying to drive home the message that inflation is now under control.

The opposition begs to disagree. The inflation rate as measured by private economists under the protection of opposition lawmakers was 2.7 percent. The Buenos Aires City government of Mayor Mauricio Macri, the leader of the centre-right party PRO, reported an inflation rate of 3.1 percent. INDEC is under fire once more. Yet the general impression is that inflation is slowing down.

Economic woes have usually come with turmoil attached in Argentina. Fernández de Kirchner’s voyage to 2015 will still be choppy. The opposition Peronist trade union leaders Hugo Moyano and Luis Barrionuevo staged a demonstration in Plaza de Mayo on Wednesday to protest crime and inflation. Moyano and Barrionuevo, who are not popular with middle class voters, tried to woo independent demonstrators by declaring that only Argentine flags would be waved in Plaza de Mayo. The turnout was not unimpressive. But the brief march was mainly attended by trade union activists.

Fernández de Kirchner, as usual, showed some reflexes. Once the demonstration was over the president delivered a national broadcast to announce a 40 percent increase in child welfare benefits. The Universal Child Allowance (AUH) will take the subsidy for unregistered and low-income workers from 460 to 644 pesos per child starting in June.

The big trade unions, even the pro-government ones like the UOM metal workers union, are demanding income tax breaks. But Fernández de Kirchner on Wednesday defended the tax on national television at a time the 15,000 peso floor had been criticized by the opposition, including Massa. Opposition lawmakers unsuccessfully tried to hold a Lower House session to approve income tax breaks for workers without the government’s backing.

Kicillof on Thursday insisted that the opposition was “lying” when declaring that income tax can be lowered and pensions increased at the same time. He said that the government’s accounts are in order.

INDEC has been criticized for its dubious inflation rate. Also at issue now is the poverty rate, which is currently not being reported by the statistics bureau. The pro-government faction of the CTA union umbrella group on Tuesday reported that poverty stood at 17.8 percent last year. The CTA’s rate is an effort by the national government to pour cold water over the poverty controversy. INDEC is not issuing an official poverty rate, alleging that it has changed the way it measures inflation and must now come up with a new way of measuring poverty.

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