When the dollar starves you in Argentina

As if it were a great tsunami wave, the country awaits the inflation figures for March with horror. Although the consequences are experienced before the figures, the impact will be powerful. This time the effects of the war in Ukraine will be felt more than in February. And while the rest of the world worries about access to food, Argentina suffers because it produces it. Argentines earn in pesos, but they must pay for food at dollar prices and those who get rich with this shortage threaten destitution actions.

A sector of the opposition, with which the main organizations that group rural employers refer to, directly proposed repeating the experience of Domingo Cavallo and dollarize the economy. If that experience were repeated (one peso = one dollar), whoever earned in dollars could pay for food at the dollar price, but those entrepreneurs would find it very difficult to exportas happened during the mandate of former Argentine President Carlos Menem.

In the United States, prices in dollars are high and rural production is unprofitable, so the government subsidizes agricultural activity. In Europe, food production is also expensive and with uncompetitive prices, so products from other countries are not allowed to enter. But Europe and the United States prohibit others from granting subsidies or protectionist measures, which they apply.

The media corporation managed to get broad sectors of the urban middle classes, who are among the main victims, to defend the interests that harm them and view the Government as solely responsible for their misfortunes. In this way they achieve a double result: they make the middle sectors defend those who exploit them and also put them against the Executive, which would be the only one that could protect them.

Instead of subsidizing, which it could not do due to the figures involved, the Argentine government maintains a favorable dollar price ratio for the country’s producers and exporters. They receive privileged treatment from the Executive. But, when international food prices skyrocket due to the war, this privileged sector wants to leave the majority of Argentines without food because dollarized prices become inaccessible.

The dollarization promoted by Cavallo led to great inequality to the exclusion of the majority, who were pushed into informality and poverty while a small group made up of privatized banks and companies grew richer. But the grain and meat exporting country, which was the conservative country of the Centennial and to which the Rural Society and the Argentine Rural Confederations (CRA) want to return, also expelled the majority and favored an elite: the billionaire oligarchy.

The Government is facing a situation of great injustice that, if not resolved, may also be its death certificate. There are already estimates for March of around 6% inflation, although the rate of increases slowed in the second fortnight. Alberto Fernández’s position is not to take any action without dialogue with the parties involved. And the measures that have been taken, especially the price agreements, only achieved temporary triumphs that were quickly reversed until this avalanche caused by the war occurred.

There is bad humor in the street, but also bewilderment and expectation, even in the opposition electoral base, for the measures that the Government may take. The ruling party has the leading role in a situation where any movement that is made outside of this problem -internal or Chicana- will be seen as a sign of misapprehension, as happened with Gustavo Beliz’s proposal on social networks or with the presidential allusion to group therapy. Attention is put there under a lot of pressure.

The Government is in the center and has to play against the bosses of the countryside, the big exporters, the macrista opposition, the food corporations and the supermarket chains. The full stands of the Monumental or the Bombonera are waiting for the play, it is the worst time to stand still or throw the ball out.

The International Monetary Fund, through his spokesman Gerry Rice, acknowledged that the war conditioned the goals established in the agreement with Argentina. It is one less concern for the Government, which, in any case, does not have many alternatives if it wants to get out of this dilemma by putting more money in people’s pockets. The paritarias have uneven results that favor the largest unions, but leave the smaller ones behind and totally exclude the informal workers of the popular economy.

The debate in the front of all for the agreement with the Fund seemed to lower the tone after the act of March 24, when the peak of inflation jumped. The concern remains that throughout this debate, Vice President Cristina Fernández de Kirchner (CFK) was the center of three violent attackswhich highlighted the interest of some sectors in deepening the cracks that were produced by the internal discussion.

It is not the first time that the president has been the target of attacks. But after a long time had passed in which this did not happen, there were three in a row in the context of the strong internal debate. Nor were there widespread actions of this type against other leaders. She was the only one affected.

The climate generated by the hate speech of the media corporation is not enough to explain these attacks. They were at a certain time and against a particular person. They have all the appearance of something orchestrated. It is difficult for these to be spontaneous actions. In these cases, concentrated media hate speech justified a form of political violence.

Máximo Kirchner proposed the exceptional tax on large fortunes, due to the pandemic. And Cristina Fernández de Kirchner promoted the fine to pay the IMF to those who fled and evaded. The surname Kirchner appears next to measures that affect powerful sectors. The attack on the statue in Santa Cruz occurred around the same time CFK’s proposal was being raised in the Senate.

In addition to the specific material objective, the intention of the slogan “let those who escaped pay” has a didactic meaning towards society, just like the first letter addressed to Alberto Fernández in which he called for more social policies. The attacks against her also have a didactic sense towards society, but in the opposite direction. They appear as a response, although they also aim to create chaos within the ruling party.

In any case, the priorities that were marked in that first letter are maintained: now more than ever it has to be a government focused on social problems, you cannot deviate from that line of action. And it is no longer enough to explain or promise it, but rather it has to reach that base of social expectation with a battery of concrete measures, such as the bonus for retirees, and not as isolated measures but as a policy that seeks results.


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