Former editor of the Buenos Aires Herald (1979-1986).
As well as making it easy for them to blame widespread poverty, crime, inadequate
public services, the many defects of a once-admired educational
system – which, to judge by the results, is now
among the worst in Latin America – and much
else on their adversaries whom they accuse of
letting themselves be browbeaten by fiscal
purists obsessed with nasty things like numbers, they assume it saves them from having
to tell us exactly what, should there be less
money available than they expected, they
would do if they were to reach power.
During the election campaign, Peronist
spokespeople made it clear they thought that
kicking out Mauricio Macri and his team would
restore economic “normality” and allow the
country to boom. As far as such people were
concerned, removing from office the Scrooge-like individuals
who went on and on about the inflationary effects of overspending and the alleged need to keep financial variables in line
would be more than enough to get the economy moving again.
About half the electorate agreed.
As much of the population – including men and women who
voted for Macri because they disliked Cristina Fernández de
Kirchner and distrusted her nominee, Alberto Fernández – is
fond of the notion that Argentina is richer than her rulers admit
so there really is plenty of money around that should be put to
good use, many assumed that, once in power, the new government would immediately start ladling out large amounts of cash
as it promised it would before the last votes were counted.
Unluckily for them, and for Alberto, soon after the new government took over its members realised that the cupboard was
bare and was likely to say that way for some time to come. For
a good Peronist who had made much of his determination to
solve Argentina’s many social problems by going on a spending
spree, it must have been a disconcerting experience.
Instead of starting his term in office by increasing all pensions
by 20 percent and stuffing people’s pockets with crisp banknotes so they could consume like mad as he had said he would,
Alberto found himself in much the same position as did his
predecessor Macri after the economy went belly-up in April
2018, when a run on the peso put an end to his “gradualist”
programme. Much as he dislikes the idea, the way things are
turning out he will have to cut government spending to the
bone, and then some.
The president is still reluctant to face up to this unpleasant fact.
However, although prolonged wrangling over the foreign debt
gave him what he thought was a good reason to delay making
public just how he proposes to manage the economy in the coming months and years, what he has done so far does not encourage optimism. After making “fighting poverty” with handouts
of one kind or another an absolute priority, he has spent his first
80-odd days in power trying to gouge more
money out of people involved in the rapidly
shrinking productive bits of the economy. Instead of going for growth as he said he would, he
is throwing up more barriers in its path.
Perhaps “the plan” Alberto and his Economy
Minister, Martín Guzmán, swear they have
under wraps until the time comes to reveal it
will astonish the world by showing that it is
perfectly possible to make the economy grow
mightily by increasing social welfare spending
while squeezing farmers, businesses big and
small and many other people until the pips
squeak, but few would bet on it. Rightly or
wrongly, many both here and abroad think the policies apparently favoured by the president and his key advisors are suicidal and that, if applied too vigorously, they are bound to put an
already sick economy on its deathbed.
For well over half a century, most Argentine politicians – who
have good personal reasons to like the way things are – have
kidded themselves that the problems the country faces are not
that serious because they themselves have managed to do quite
well. This presumably is one reason why they have staunchly
refused to undertake the “structural reforms” that economists
derided as “orthodox” or “neoliberal” say are necessary.
The political pros know that as well as costing them votes,
such reforms would require them to take on powerful trade
unions whose bosses are experts in
organising massive street protests, as
well as business lobbies dominated by
protectionists who are more interested in keeping on good terms with the
government of the day than in producing articles they could profitably sell
on the international market.
Throughout the years, the political
establishment’s efforts to keep
meaningful change at bay have been
remarkably successful. By doing so,
they helped ensure that output remained stagnant for the last 10 years. If
Alberto’s government sticks to its
guns, the next 10 years will be equally
depressing and the likelihood of an
eventual successor putting an end to
the downward spiral will get smaller.
While in some countries the evident failure of an approach long backed by most Peronists would have
cost those supporting them dearly in
the polling-booths, here the impoverishment of many millions of people
has had the opposite effect. Instead
of discrediting the Peronist movement in the eyes of the poor, it has
helped it conserve its popularity.
People who fear they will be unable to feed themselves and
their children next week cannot be expected to pay much attention to those who warn them that, in the long run, the piein-the-sky policies they find appealing will make them even
worse-off. What is more, politicians are well aware that, as last
October’s presidential elections reminded us, the povertystricken millions who live as best they can in the rundown
townships of Greater Buenos Aires get to decide who rules
Argentina. For understandable reasons, most of them want
benefits now, not long-term schemes which, if they worked,
would bear fruit in years to come. This gives a big advantage
to candidates like Alberto and Cristina, who make a virtue of
short-sightedness and are more than happy to make promises
they know they will be unable to fulfil.