Argentina 2023 election

[Estrella]

Meanwhile the bulk of the Radicals and the Civic Coalition would rather explicitly attack Milei but so far they haven't found any silver bullet.

Kind of related to this: what is still keeping Civic Coalition alive? They don't have a power base of governors like UCR, or an identifiable ideological purpose like PRO, or a strong personality like they used to have when Lilita was relevant, so it's a little surprising they still have 11 deputies.

[Estrella]

Starting election threads more than one year before the elections take place is in bad taste, as well as contrary to the custom in this board. There is the Argentina general discussion thread, placed in the International General Discussion board

This might be the custom but it's hardly a universal standard. The Brazilian election thread was started over a year in advance after all.

If the mods disagree they could always merge the threads but until then I feel like election related news should go here and anything else should go in the "general discussion" thread.

Anyway, a new poll came out measuring where each of the top 4 opposition candidates (Macri, Larreta, Bullrich and Milei) are most positively viewed and the results were very interesting

Larreta leads in 6 provinces representing over half of the population, Milei leads in 14 provinces representing around a third of the population and Bullrich is ahead in 3 provinces representing about a fifth of the population (poor Macri doesn't lead anywhere).

The provinces where all the major figures are most positively viewed also gives some interesting insight into the nature of their support. For the most part approval tracks pretty well with past election results: CFK and the President both have the most support from the Peronist stronghold of Santiago del Estero, the best province of the hawks Macri and Bullrich is the anti-Peronist stronghold of Córdoba and Larreta is strongest in CABA. The only outlier is Milei, whose best province is Salta () and whose support seems to cut across Peronist and anti-Peronist lines.

What do you attribute Macri's support in Peronist areas to?

It probably should be noted that Argentine polls tend to be scams worthless crap of dubious quality, especially these bizarre scenario ones - obviously Larreta, Macri and Bullrich aren't all going to run at once. I would ignore all polls made before we know who actually runs. Even close to an election, pollsters get it wrong very often - see Macri's unexpected disastrous result in 2019 PASO and his unexpected recovery in the general election. I wouldn't overthink this.

[Estrella]

The Minister of Economy, Sergio Massa, will announce in the next few days the first provisions of his administration to implement the axes he announced after taking office. The measures would be mainly focused on the reduction of public spending, which he had anticipated when he gave his inauguration speech.

Among other things, he's going to freeze public sector wages, introduce spending caps for each ministry, increase utility payments for those who use more (e.g. more than 400 kWh of electricity per month) and mandate large companies to pay 15-25% of taxes on last year's income in advance.

These measures are fairly minor compared to the the 2001/2018 rounds of austerity, but I still wonder how long he's got until he's fired.

[Estrella]

https://twitter.com/CFKArgentina/status/1562515585715830786

Look at this obituary in La Nación from May 2021. "Pepín" Rodríguez Simón, a fugitive from justice in Uruguay in the case of Macri's judicial board, sends his condolences for the death of the brother of the wife of prosecutor Luciani. Everything is falling into place.

[Estrella]

(my grandfather almost got shot during a completely different assassination against a president during a crowded event

Alfonsin?

Sadat

That sounds like a terrifying but fascinating story.

On a different note, I've heard talk from media (and Alberto) about "the judges investigating the case". Have I misunderstood something, or do Argentinian judges also work as investigators or prosecutors?

[Estrella]

Very depressing that Peronism has, once again, destroyed Argentina, this time through locking the country down for 6 months in 2020. I'm pretty convinced that this, above anything else Fernandez did, is the real source of the ruin Argentina finds itself in. No other country went this far...

Utterly untrue, the real reason is a mix of structural damage done during the prior administration, the unwillingness of the current government in telling the IMF to f••• off, and the rollback of social democratic policies and erosion of the state in the conjuring of Menem’s ghost.

Armchair revolutionaries want nationalism, normal people want something to eat.

(and Alberto doesn't want to leave Casa Rosada in a helicopter)

[Estrella]

In the latest dispute about coparticipación (federal tax revenue distributed to the provinces, think Canada's equalization), the Supreme Court struck down a law that would halve the amount of funds the oppositon-run city of Buenos Aires is entitled to, which means it gets to keep around $1 billion in funding. Other provinces would still receive literally 97% of the coparticipación money, but the government and Peronist governors reacted by going into a full "f/ck the law, I do what I want" mode. Alberto declared he will just... straight up ignore the ruling.

Trump ain't got nothing on this.

[Estrella]

This article is mostly a summary of Alberto's legal strategy (we can't give them the money because the budget has already been passed) and Cristina calling the judges coupists, but hidden in the last paragraph is this gem:

El jueves, en una reunión en Casa Rosada, hubo mandatarios provinciales que reclamaron iniciar un juicio político contra los ministros de la Corte, directamente, pidieron que el Gobierno desconociera, sin más, el fallo dictado por el máximo tribunal. Fernández y sus funcionarios replicaron con la propuesta de recusar a los jueces - en lugar del juicio político - y pedir la revocatoria del fallo.

If what the government is doing seems anti-democratic, the (to borrow a great phrase from Alex) perpetual meme governors wanted to impeach the Supreme Court justices.

[Estrella]

Many politicians within Todos are calling for Cristina to be let to run in the elections, despite her worthless promise that she doesn't want to run.

Are they just cultists being cultist, do they think Cristina would get Todos a decent result and help save the furniture in the legislature, or do they want her defeated to finally get rid of her?

[Estrella]

Dólar blue is in free fall: it will likely hit 500 in the next few days, perhaps even hours. Compared to this time ten years ago, the peso has lost (checks notes) 98.1% of its value. According to Alberto, the blame for the collapse should go to (checks notes) right-wingers who use their traditional tactic of spreading unsubstantiated rumors on the markets and criticizing the government abroad. He said all of this in the middle of a press conference with (checks notes) the visiting Romanian president.

[Estrella]

I regret to tell you that Guillermo Moreno is at it again.

https://twitter.com/therealbuni/status/1685005425266049025

Catchiness of the Peronist March + general insanity of Vamos Menem. 10/10.

[Estrella]

Massa is said to be getting only 10% or so in Córdoba. Which is slightly less pathetic than it seems at first (it's pretty much the most anti-Kirchnerist place outside the capital) but still, lol.

[Estrella]

Massa is said to be getting only 10% or so in Córdoba. Which is slightly less pathetic than it seems at first (it's pretty much the most anti-Kirchnerist place outside the capital) but still, lol.

With this caveat again, these are the numbers in Córdoba according to Schiaretti's people: Milei 33%, Schiaretti 28%, Bullrich 19%, Larreta 7%, Massa 6%, Grabois 2%.

[Estrella]

[Estrella]

Can anyone explain Cordoba then? It seems that it was a JxC stronghold(or whatever their predecessor was) Why is it generally pro JxC. From what I can glean this time the local right wing Peronist governor also took a large share but what exactly is its ideology?

It's really hard to find answers to this that aren't blinded by ideology from one side or other - I've tried to look into it before and I found articles ascribing it to the province being full of conscientous people who recognize the value of hard work or the legacy of detention centers during the dictatorship. It's true though that culturally, it's something of a Texas/Bavaria - large area, large population, sees itself as different from the rest, perhaps thinks too highly of itself.

Córdoba has always been more friendly to Radicals than other interior provinces. UCR nearly won even gubernatorial elections held during Perón's heydays in the 50s and 70s, and in the 80s it was governed by the leader of the party's conservative wing Eduardo Angeloz. Recently it's perhaps been specifically anti-Kirchnerist rather than anti-Peronist. Apparently this is motivated by Cristina's mishandling of the 2013 police strikes and the resulting looting and riots that affected Córdoba particularly hard. The province is also the centre of a boom in soy cultivation, so presumably much of the working class is employed by big private agribusiness rather than the public sector, as is the norm in most of the interior. Cristina's proposed punitive export taxes on soy and the resulting rural protests probably didn't help her here either.

Of course, none of that answers why it's been such a consistent trend for as long as Peronism existed. After a certain point political traditions keep going just out of inertia, but something must have started them and I don't know what it was. A related interesting question would be why is the northwest of Córdoba so friendly to Peronists of all stripes: Schiaretti last weekend, Alberto in 2019 or Duhalde way back in the 90s.

[Estrella]

The US is hardly acting out of the goodness of their hearts, but it might be worth considering why so much of Sub-Saharan Africa is swimming in debt owed to China and why China is viewed with such distrust among the people (not oligarchs) of these countries.

As for Mercosur — and, for that matter, BRICS — imagine a meeting of the European Council attended by Le Pen, Corbyn, Abascal, Mélenchon, Salvini and the corpse of Milošević. Sure, maybe some small country would send someone who has their head screwed on right, but you’d sooner teach a Peronist economic theory than get this menagerie to write a page of coherent common policy.

[Estrella]

* For some reason when you map out JxC vs Milei support by municipality it turns out the overwhelming majority of JxC-leaning areas form a contiguous C-shaped mass stretching from Buenos Aires to Formosa. I have no idea why this is or what significance it has but still found it interesting

Spoiler alert! Click Show to show the content.

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https://twitter.com/maps_black/status/1694106330993238044

There's something of a correlation between JxC strongholds and the most productive agricultural regions of the country.



Of course Argentina was never a country of smallholders, so you could never get a divide like that between the north and south of Spain and Portugal with conservative family farmers against revolutionary landless peasants, but it would make sense if there was a similar, if weaker divide under the surface. Provinces that are relatively well off thanks to export-oriented agriculture will probably be less #populist than those dependent on unionized industries and/or federal transfers.

The province where this can be seen best is La Pampa. There's a strip of departments on the eastern border that have been voting for UCR/JxC while the rest of the province supported Peronists/Milei. You can see it on the maps of the last two presidential elections, and even on the map above. That eastern strip also happens to be the part of the province that belongs to the fertile pampa húmeda, as opposed to the dry pampa seca in the west.



A few pages earlier I mentioned how NW Córdoba is much more Peronist than the rest of the province. Take a look at where it is on those two maps. Same goes for northern Santa Fe.

[Estrella]

A cold shower from Maia Mindel

tl;dr + my own opinions: Argentina is structurally f/cked because of the completely insane functioning of its taxes, spending, social security, labor law, coparticipación, everything. Basically the whole country is an exercise in combining the worst features of every economic system known to man, but let's just focus on currency now. There are many theoretical problems with dollarization, but let's assume you're sure it's the best solution and decide to go ahead. You will stumble upon one massive practical problem: there are X billion pesos in Argentina and the central bank has a net reserve of Y billion dollars, so the exchange rate will be X÷Y.

Simple, right? Except that gets you about 2000 pesos to a dollar and makes the median wage about $150. Such a dramatic reduction in money supply would cause a crisis on the scale of Great Depression – and for the same reasons, albeit magnified by a factor of thousand. And you can't just declare a lower rate than is realistic, because then everyone will try to get rid of their pesos all at once, and you end up with a catastrophic hyperinflation.

So the central bank needs to get extra money from somewhere, and here we run into even bigger problems. You can confiscate bank deposits, but 1) that's not very libertarian 2) it's been tried once 3) it's been tried twice 4) it would destroy people's trust in the banking system and the government even more than now. You can't borrow because you're up to your ears in debt to the point you're on the verge of default and borrowing money from the IMF so that you can pay back the IMF the money you borrowed so that you don't default etc. You can't use any of the myriad creative bullsh/t government bonds because they're just worthless scraps of paper acting as an excuse to make money printer go brr. You can just sit back and hope things get better, which will cause even bigger problems but you at least won't be making things actively worse like every government since, I don't know, Arturo Illia?

But all of this obscures the elephant in the room: if you're doing any of this and looking in every drawer and under every rug for a lost penny so that you can keep your country functioning, you aren't doing anything new or radical, you're back to the same delusional and desperate quick-fick voodoo economics that brought Argentina into this mess in the first place.

Of course, maybe none of this will matter; maybe Milei will just go ahead and there will be enough people with nothing to lose.

[Estrella]

A cold shower from Maia Mindel

tl;dr + my own opinions: Argentina is structurally f/cked because of the completely insane functioning of its taxes, spending, social security, labor law, coparticipación, everything. Basically the whole country is an exercise in combining the worst features of every economic system known to man, but let's just focus on currency now. There are many theoretical problems with dollarization, but let's assume you're sure it's the best solution and decide to go ahead. You will stumble upon one massive practical problem: there are X billion pesos in Argentina and the central bank has a net reserve of Y billion dollars, so the exchange rate will be X÷Y.

Simple, right? Except that gets you about 2000 pesos to a dollar and makes the median wage about $150. Such a dramatic reduction in money supply would cause a crisis on the scale of Great Depression – and for the same reasons, albeit magnified by a factor of thousand. And you can't just declare a lower rate than is realistic, because then everyone will try to get rid of their pesos all at once, and you end up with a catastrophic hyperinflation.

So the central bank needs to get extra money from somewhere, and here we run into even bigger problems. You can confiscate bank deposits, but 1) that's not very libertarian 2) it's been tried once 3) it's been tried twice 4) it would destroy people's trust in the banking system and the government even more than now. You can't borrow because you're up to your ears in debt to the point you're on the verge of default and borrowing money from the IMF so that you can pay back the IMF the money you borrowed so that you don't default etc. You can't use any of the myriad creative bullsh/t government bonds because they're just worthless scraps of paper acting as an excuse to make money printer go brr. You can just sit back and hope things get better, which will cause even bigger problems but you at least won't be making things actively worse like every government since, I don't know, Arturo Illia?

But all of this obscures the elephant in the room: if you're doing any of this and looking in every drawer and under every rug for a lost penny so that you can keep your country functioning, you aren't doing anything new or radical, you're back to the same delusional and desperate quick-fick voodoo economics that brought Argentina into this mess in the first place.

Of course, maybe none of this will matter; maybe Milei will just go ahead and there will be enough people with nothing to lose.

Why can't you choose to let the value of the peso fall initially only for it to recover later in response to the increased demand for dollars? Also, doesn't this analysis ignore the widespread use of dollars in the Argentine economy already?

There are lots of dollars in circulation, but from the point of view of people who own them they'd be trading them for an increasingly worthless peso. You might be right if you mean that the dollars that are now (often literally) stuffed in mattresses would help kickstart the economy, but most dollars in Argentina are already in circulation, so not much would change there. I'm not sure if peso would be able to get back up after a fall that big: nobody trusts peso now, and an annoucement of dollarization would mean that not even the government does. Everyone would just try to get rid of it even quicker. Tbh dollarization would probably work out in the end, certainly as a way to stop inflation, but the way to get there would be very painful and it still wouldn't solve the fundamental structural problems.

[Estrella]

Somehow they need to make imports more expensive than local products, and make local production easier.

This has been the policy of every single Argentinian government for the past century, and where has that gotten them?

Dollarisation would force Argentina to try to run a budget surplus.

This, though, is true. In fact, dollarization isn't even Milei's most revolutionary proposal; it's his promise to take a motosierra at government spending. Of course, whether he's going to have the power to force it through is another question.

[Estrella]

(And even in 2002 it was just 10.4%. The 12.4% reached in August is the highest number since 1991)

[Estrella]

There’s been a big storm after Milei’s proposed Foreign Minister said about Falklands that “the will of the islanders should be respected”. Much of Argentine media (especially left-wing, Página/12 and such) reacted by writing articles full of fire-breathing ethnic nationalism seemingly straight out of 1990s Balkans that put “self-determination” in scare quotes and talked about “a population of occupiers”. The Secretary of Falklands (an actual government position!) said that “Milei wants to impose the desires of 3,000 islanders on 46 million Argentinians.”

Really, this confirms that the Argentinian obsession with Falklands is just a hilariously pathetic attempt to imitate 19th century European imperialism.

[Estrella]

I will say, for a more Argentina/LatAm related topic, that I suspect a lot of the strange Falklandsism found in Argentina/various related colonial "upsets" that you will sometimes hear in third world politics (ie Red Velvet complaining about how Portugal "stole" Brazil's gold) would go away in a flash if these countries weren't poor. I have little evidence for this save the vaguely comparable (but rich) examples of former British colonies in North America and Oceania not expressing these sentiments despite the far longer lasting and to this day more interconnected relationships there, as well as more broadly the lack of these complaints from developed Middle Eastern/East Asian countries and the observation that the Falklands were not an issue of similar prominence when Argentina was a (by the standards of the time) wealthy country.

Yeah, why do impoverished nations that were subjected to all sort of exploitation and oppresion resent the imperial powers responsible for it, why can't they be like the wealthy white settler nations that didn't suffer the same mistreatment, so strange.

Can't really go to a villa miseria and give every family a kilo of Falklands for lunch and a litre of resentment for dinner.

[Estrella]

Honest question for Argentines out there: Do people there remember what happened last time Argentina tied the peso to the dollar?

Yes. The Peso was worth $0.30 instead of less than half a cent

It was 1 usd=1 ars, and it caused the worst crisis in our history.

After a boom thanks to the end of inflation, convertibility made Argentine exports more expensive and slowed down growth. Not good, but hardly the reason for the 2001 cataclysm. That was caused by Peronists doing what they can do best: combining the worst of Reaganite neoliberalism and money-printer-go-brr pseudo-socialism. Menem fxcked over the working class while unions were swimming in money, fxcked over business while his CEO friends were swimming in money and violated pretty much every single rule of proper management of convertibility.

By the early 2000s, the Argentine economy was pretty much a Ponzi scheme only kept alive by an influx of money from abroad. Thanks to Peronist creative economics the money that was supposed to guarantee the peso-dollar parity has been wasted or chased away, the peso was massively overvalued, Argentina was up to its neck in dollar-denominated debt and the only thing keeping the house of cards from collapsing was foreign investment. That ended in 2001 and the party was over.

tl;dr it was Peronism that did it — it always is

(incidentally the lesson Kirchners took away from this debacle wasn’t “don’t get in debt”, it was “instead of getting in debt, try printing money!”. Which is why Argentine inflation is the way it is.)

[Estrella]

A bit more about the 90s, kinda oversimplified and written in layman's terms because I'm a layman (any actual economists here please don't kill me).

The basic problem with convertibility was that even though it had the same advantages as dollarization (stopping inflation by preventing Argentina from having its own monetary policy, i.e. printing money), it also had the same disadvantages (inability to calm an overheated economy or kickstart an economy in recession by preventing Argentina from having its own monetary policy). It seemed like a good idea because it allowed Argentina to keep its own currency, but it also meant that the Central Bank needed to have a reserve of at least as many dollars as there were pesos in circulation: after all, if ARS 1 = USD 1, then for every peso there must be a dollar. This, by the way, is basically a return to the gold standard except with dollars, and there a some very good reasons why every country in the world abandoned it. After all, the Great Depression started picking up at a stroke of FDR's pen when he abolished the gold standard.

And here Peronism comes in. Menem didn't spend the billions flowing to the treasury thanks to the 90s boom to build up infrastructure or improve the welfare state; he spent it on funding corrupt governors in the Peronist hinterland and stuffing the mouths of union leaders with cash so that they would stop their workers from protesting. And, of course, corruption. He privatized everything he could get his hands on, kept taxes at a relatively high level and he was still short of money, but convertibility stopped him from doing what every Argentine president eventually ended up resorting to: turning on the printer. The only option (other than being fiscally responsible, of course) was to borrow heavily. And because it was on international markets, the debt was in dollars.

Convertibility spurred economic growth because it finally allowed wages to catch up with inflation and enabled people to have disposable income, but it also started a huge influx of foreign investment. It's much easier to open up shop in a country where you know that if you invest a million dollars' worth of local currency, it's not going to turn into a thousand dollars overnight because the president got up on the wrong side of bed. But if the government has to pay off debt, decreasing the amount of dollars, things start to look dicey. Let's say that in the early 90s there were 100 billion pesos in circulation and 100 billion dollars in reserve, but in the late 90s there are only 80 billion dollars representing the same 100 billion pesos. This is how convertibility turned into a Ponzi scheme: investors knew that if it comes to the crunch someone will inevitably lose money because for all the talk about how 1=1 the reality is that 0.8<1, they just hope that as long as investments keep coming in the thing will keep going and they won't be the one who loses.

The economic crises in developing countries in the late 90s made the problem worse by decreasing demand in Argentina's trading partners and increasing the value of dollar (and therefore peso). Argentine exports were now more expensive, there was less demand for them, and so trade decreased and with it the flow of dollars into the treasury. Let's say that there are now 50 billion dollars backing 100 billion pesos (not the actual numbers, but let's make the math easy). In reality, one peso is worth only half of the number written on the bill. De la Rúa desperately tried to fix the lack of dollars by introducing harsh austerity measures and Cavallo delayed debt payments at the cost of paying more later on (the megacanje) but it was too late. A so-called sudden stop happened: all investors realized that there's no way they'd be able get back the money they invested and they, well, stopped. Even worse, Argentinians realized the same thing - that peso was a ticking timebomb - and panicked. They started removing pesos from their accounts and exchanging them for dollars, increasing the number of pesos in circulation and decreasing the number of dollars in reserve, making the disparity even larger.

To oversimplify, a currency is either worth little and there's a lot of it (say USD 1 = CLP 930) or it's worth a lot and there's little of it (say USD 1 = JOD 0.71). Argentina ended up trapped in a paradox: it's currency was worthless because nobody wanted it and yet there wasn't nearly enough of it because you couldn't print more. Usually if the currency becomes worthless at least you can do it like they did in Weimar Germany and buy a loaf of bread with a stack of cash... except now there aren't enough of those stacks because officially they're still worth your yearly wage. Provincial governments took matters in their own hands and started issuing cuasimonedas, complementary currencies with such romantic names as Patacón, Quebracho, Federal or Bocanfor to get around the acute shortage of cash. In a frankly absurd move even the Central Bank started doing so with the Lecop, but these currencies quickly experienced a more standard hyperinflation (not least because many of them lacked any security features and you could literally print them at home if you had a color copier) and the problem became even worse.

So, how does the economy work if there's no money? It doesn't. In 2001 and 2002, Argentina experienced the most catastrophic economic crisis in its history, dwarfing even the Great Depression. GDP fell by 4% and then 11%, unemployment reached 20%, 65% of the population was living in poverty and 40% did not have enough money to eat. At this point, De la Rúa and Cavallo introduced the infamous corralito: placing strict limits on withdrawals of dollars from bank accounts to shore up the reserves and stop the fall of peso. Of course, this meant forcing people to keep their hard-earned dollars in worthless pesos, in practice the same thing as ripping out someone's life savings out of their mattress and setting them on fire. The starving working class and the robbed middle class teamed up to call for De la Rúa's head, joined by governors who couldn't pay their armies of public employees and Peronists desperate to come back to power. And so to the helicopter he went.

After the whole Puerta-Rodríguez Saá-Camaño interlude, Duhalde became President. In January 2002 he introduced the corralón. Technically it just adjusted convertibility with a slightly more realistic exchange rate of USD 1 = ARS 1.40, but in practice it was curtains. The 1:1.40 rate applied only to savings and debts were kept at 1:1, an ingenious idea that erased 40% of Argentina's domestic debt at a stroke of a pen but screwed over the people those debts were owed to. A month later the peso was floated and began to be freely traded for the first time since 1991, stabilizing at something like four pesos to dollar. In December all restrictions on bank withdrawals were removed and the economy slowly began to recover.

A final note: the reason why the government was so desperate to avoid exiting convertibility was Menem's massive pile of dollar-denominated debt in foreign markets. If you aquiesce to reality and say that the peso-dollar rate isn't 1:1 but (let's make the math easy) 2:1, one billion pesos of debt suddenly turns into two billion. You're gonna have to get that extra billion from somewhere: increasing taxes (in the middle of a depression? yeah, right) or cutting spending (when two thirds the country lives in poverty? yeah, right) or borrowing (when you can't even pay the debt you have now? yeah, right) or... printing money. And suddenly we're back to the problem we were trying to get rid of in the first place. Combined with Cavallo's megacanje this would later become something of a headache for Néstor and Cristina, but that's a different story and much of their economic problems were self-inflicted anyway.