By Monica Shah
Christina Fernández at the Helm
Four months after being sworn in as the first elected female president of Argentina, President Cristina Fernández de Kirchner is now facing the most hectoring of times since taking office on December 10, 2007. Argentine farmers only recently ended a three-week strike protesting a tax increase on grain exports, saying that the strikes will be suspended for only thirty days in order to allow time for the four major farm groups to hold negotiations with the government. Farmers had been blocking local roads as well as major highways in order to prevent trucks from transporting agricultural produce. Taxes on soybeans, which today are Argentina’s principal export, along with other products, like wheat, were increased from 35 percent to almost 45 percent, in an effort to curb rising inflation levels and high prices on domestic food supplies. President Fernández currently faces grave challenges because she holds the country’s well-being in her hands.
By the time that the strike was lifted, there were shortages of meat, fresh produce, and dairy products, as well as a shut-down of grain and livestock shipments. On March 25, there was a nationwide rally in support of the farmers, in which thousands of their supporters banged pots and pans in the streets of the capital, while Fernández adamantly maintained her position that the tax increase was necessary in part to redistribute wealth in a country where a little under 24% of the population already lives below the poverty line.
Two Argentine commentators took note of what can be considered an unfortunate paradox, “that a country that produces food for 300 million people cannot meet the needs of its population of barely 40 million,” (http://americas.irc-online.org/am/4757). Argentina, which according to the CIA World Factbook has an export-oriented agricultural sector, now must also deal with a falling currency, which is linked to the farmers’ strike.
Argentina’s institutions also were being criticized for their lack of credibility, and the government for its fraudulent statistics. This made measuring the real effect of the strike on the country’s economy difficult at best because few had confidence in the heavily politicized official figures. Top economists and consumer’s groups, along with employers of INDEC—the national statistics agency that was recently overhauled— accuse the government of manipulating inflation figures; official government tabulations state that in 2007, prices rose in Argentina by 8.5 percent, though the true rate of inflation was estimated to be more than 22 percent. Because of substantial dollar-purchases made by private financial institutions as well as by the central bank, the Argentine peso dropped to its lowest value in close to six months.
Though the country’s economic status has improved radically since her husband’s time in office, and after having to deal with the end of the economic crisis, deficits, debts, and high inflation, Cristina Fernández’s government is now taking on the country’s all-powerful agricultural sector. Recently, she spoke in front of 20,000 supporters and denounced the farmers’ prolonged work stoppage, which is likely to cause long-lasting budgeting problems for the country. She reminded the public of a similar situation that arose in Argentina in 1976, when farmers brought on food shortages one month before the birth of the 1976 military coup that led the nation to the tragic Dirty War.
Presidents Néstor & Cristina Fernández de Kirchner
Before entering the Casa Rosada as the president in her own name, Cristina Fernández had been elected senator and a member of the Chamber of Deputies. Her rise prompted comparisons to Eva Perón which she didn’t consider as flattering as those to U.S. presidential candidate, Hillary Clinton. This is because both ladies have been lawyers with successful careers in public and private life, and with both having been first ladies to their husbands who had been elected to office. In a Center for International Policy report, by researcher Alan B. Cibils, he evaluates Fernández’s actions during the first few weeks of her presidency and comes to the conclusion that she will continue with policies similar to those of her husband, but with some “cosmetic changes.” In fact, Cibils cites the Buenos Aires and La Nación, that President Cristina Kirchner “kept 75% of [Néstor] Kirchner’s political appointees in their posts, including five ministers with substantial allegations of corruption.”
However, Fernández de Kirchner is approaching her presidency with more of an international orientation, as compared to her husband, who primarily focused on domestic issues when he came into power in 2003. At that time, the country barely had begun recovering from the 2001-2002 economic crisis—considered to be one of the worst in Argentine modern history. At an inter-American meeting held in Mar del Plata, Argentina, then-president Néstor Kirchner harshly criticized the United States for sponsoring neo-liberal economic policies which saddled Argentina with billions of dollars of indebtedness to the IMF and the Paris Club.
The long-lasting negative effects prompted by these international mandates have been viewed by their critics as being the causative agents of the high rates of poverty and unemployment in the country during those years. Directly attacked by Kirchner, Bush left the Mar del Plata meeting with rather cool feelings for Kirchner and Argentina. Soon after the start of President Fernández’s term, Argentine-U.S. relations again fell to an all time low, in part due to allegations made by a Miami Federal District Court over the legality of her presidential campaign funding in a matter known as the “suitcase scandal.” Argentine authorities had sequestered a suitcase in 2007 with over U.S. $800,000, which had been seized after it had been illegally flown into the country. U.S. officials had insisted that the funds were intended to be a contribution to Kirchner’s campaign, allegedly by the Hugo Chavez Venezuelan government.
The Wanseele Affair
Several Venezuelans with links to the country’s state-owned oil company, PDVSA, were detained. Causing further suspicion about the case was the April 23rd confession of Rodolfo Wanseele, a Uruguayan who, “pleaded guilty to acting in the United States as an illegal foreign agent and admitted working with Venezuela’s intelligence service,” according to the New York Times.
Unhappy over Washington’s initial charges of corruption, Fernández stated that the U.S. was trying to sour relations between Venezuela and Argentina. In December, she showed her displeasure by restricting the meetings of Argentine authorities with the U.S. embassy in Buenos Aires. Relations remained cool in March, when Condoleezza Rice missed an opportunity to calm matters by failing to change her schedule and visit Argentina, after making stops in Brazil and Chile. However, there is hope in Washington that relations with Buenos Aires that had begun deteriorating during Néstor Kirchner’s presidency, could be repaired. According to the L.A. Times, a top U.S. Latin American policy maker met with Fernández, which was an indication of possibly improving ties between the two countries. Such benign possibilities could be increased due to the fact that Hector Timmerman, a brilliant Buenos Aires intellectual and journalist, has been appointed as Argentine ambassador to the U.S. He should be more than a match for any kind of negative diplomatic firepower the State Department may decide to aim at Argentina or its Washington embassy.
At this point, Fernández seems to want to focus on diplomacy as well as issues at home in order to work towards achieving a more effective persona abroad for her country. However she is being criticized by many Argentines for paying more attention to foreign policy issues than focusing on pressing domestic matters such as the energy crisis.
In 2007, energy shortages reached serious levels and this situation is continuing into 2008. According to Cibils, at the end of 2007, the Argentine government has implemented an energy saving plan that included the adoption of daylight saving time, after many years of declining to do so. It is uncertain what else the government is ready to do to solve its energy crisis. Energy and food shortages, tax increases, farmers’ strikes, inflation, and the recent confession over the suitcase scandal, are all becoming critical issues facing the early phase of the Fernández de Kirchner presidency. Most recently, she was faced with the fact that farmers illegally set fires to help in clearing their lands, causing large areas of the country to be engulfed in clouds of smoke, and contributing to the degradation of the country’s air quality.
Up to now, the winds have not been blowing in the benign direction that Fernández de Kirchner may have had in mind, but fair winds (Buenos Aires), may nevertheless still be encouraged to blow, bringing with them sound policy-making in their wake.
By Monica Shah