At 6.7%, Argentina’s monthly inflation rate is now at the level of the highest figures of the early 1990s, when then-President Carlos Menem and the Minister of Economy, Domingo Cavallo, were forced to resort to a currency board known as “convertibility”, which tied the value of the peso to the US dollar on a “one-to-one” basis to control hyperinflation. As President Alberto Fernández tends to his newborn son, Francisco, as well as First Lady Fabiola Yáñez at the official residence in Olivos, civil war within the ruling Frente de Todos coalition rages on, now the country is on the verge of a nervous breakdown. With Cristina Fernández de Kirchner making it clear where the real power lies in a speech this week, the president is looking to reshuffle his cabinet and revive his administration once again – but he’s unwilling to give Martín Guzmán the lead. to the Kirchnerites. by doing it.
The latest inflation figures released by the INDEC national statistics office are extremely disturbing. In a global context of rising prices, a consequence of the pandemic and the war between Russia and Ukraine, the figures for Argentina are among the highest in the world. They are also the result of internal tensions that have not been resolved at least by the three previous administrations, including this one. Guzmán and his team have recorded an annual inflation rate of 55.1% over the past 12 months, pushing annual expectations as measured by the Central Bank’s REM Expectations report north of 60% – the worst numbers seen since hyperinflation. While these numbers were expected, they raised the stakes for everyone involved.
The recent debt restructuring agreed with the International Monetary Fund provided for an annual range of 38-48% for price increases in 2022, meaning that one of the pillars of the agreement had been torn down even before the plan. does not come into action. Guzmán, who sits in the warmest seat in the house, looks confident. In a TV interview during the week, he reiterated the president’s support, saying it’s “obvious” he will stay in his post. The strongest words, spoken with his traditional sweetness, were aimed at the aforementioned internal adversaries, with Guzmán noting that they would govern “with those who are aligned with our economic plan”. The direct blow to the Kirchnerite bloc was preceded by calls for unity and political support, but it drew a line in the sand.
As journalist Rosario Ayerdi recently reported in Profile, Alberto was already working on a plan to “relaunch” his administration after the Easter weekend. He had no intention of consulting his vice president and political partner, and apparently was unwilling to move to the front line of his economic team, which also includes Productive Development Minister Matías Kulfas and Labor Minister Claudio Moroni. . Chief of Staff Juan Manzur is another tightrope walker, but President Fernández sees him as a “trophy minister” to show Peronist governors that he leads a federal administration. So, it looks like Alberto and his team may have second- and third-line officials in their sights. This could mean a direct confrontation with Vice President Fernández de Kirchner if he indeed plans to fire people like Secretary of Commerce Roberto Feletti or the recently formed “energy trio” of Secretary Darío Martínez, Undersecretary Federico Basualdo and the director of Enargas Federico Bernal. All three will be responsible for carrying out the aggressive hike in energy bills Guzmán agreed to with the IMF and which Cristina vehemently opposed, calling it an election killer. They all receive their political instructions from the Instituto Patria, the Kirchnerite think tank.
In the Kirchnerite field, no one responded directly to Guzmán’s apparent provocation. It was none other than The Dame herself who came to speak this week, however. Inaugurating the Assembly of the Euro-Latin American Congress, Fernández de Kirchner took the stage at the CCK Cultural Center in Buenos Aires to deliver one of her usual monologues on global geopolitics with thinly veiled darts aimed at the United States and other Western powers. Also, as usual, she used the international stage for domestic politics by noting that “receiving the presidential sash and baton” is not what real power is. “Trust me, I say this from experience,” she added, adding ironically that it’s even less powerful “not to do the things you’re supposed to do.” The implication was clear. “I’ll leave it there,” she added in an obvious message to Alberto. By making it clear to the president who holds the votes and the real power, CFK also brought attention back to her first term which found her in a similar position, with her husband Néstor passing on the job title but not the last word. Towards the end of his speech, for good measure, Fernández de Kirchner brought him back to his own personal issues. reminding the public that she had been persecuted by the “Judicial Party”, sending another message to the President. As long as the judiciary is on her heels, she will never let her guard down.
The civil war between Albertists and Kirchneristas paralyzed Argentina’s political agenda. Congress and the opposition are waiting for some sort of resolution. The President of the Lower House, Sergio Massa, the third wheel of this dysfunctional relationship, continues his balancing act. Without hiding his presidential aspirations before 2023, the idea of a triumphant entry into the Cabinet to save the day has been circulating since the early days of the Fernández-Fernández presidency. Manzur beat him to the post of chief of staff, but turned out to be absolutely irrelevant, and the possibility of a centralized “super ministry of economy” under the control of the head of the Tiger seems to contradict the idea of not to give up the head of Guzmán. As usual, Massa keeps his cards close to his chest. Within the opposition coalition Juntos por el Cambio, the mayor of the city of Buenos Aires, Horacio Rodríguez Larreta, continues to try to build a consensual candidacy around him, but everyone, from the neurosurgeon Facundo Manes to the former President Mauricio Macri is trying to pull the rug out from under him.
In the meantime, Alberto can continue to enjoy his baby Francisco and Cristina can spend time with her granddaughter Helena. The rest of us will just have to wait for them to find out.