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forest444

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Member since: Tue Dec 30, 2014, 06:11 PM
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Argentina's Macrinflation.

President-elect Mauricio Macri, elected last Sunday on the right-wing "Let's Change" coalition, is still two weeks from taking office. But already there were widespread increases in wholesale food prices and of inputs from different sectors of the economy. Shortages are, moreover, beginning to develop as well because wholesalers and suppliers are now reluctant to ship goods to retailers and manufacturers on fears of a sharp devaluation once Macri takes office on December 10.

Macri's promise to eliminate exchange restrictions and export taxes on raw materials has generated an escalation of prices on key products from across the economy. A 50-kilo (110 lb.) bag of wholesale wheat flour for bakeries began rising the day after the runoff, going from 150 pesos ($15) to 220 pesos by Thursday - and wholesalers have already announced their intention to raise it next week to 240 pesos ($24), an increase of up to 70% from just a month ago.

Farmers and slaughterhouses are not only speculating on the devaluation itself; but also on the elimination of export taxes and export quantity restrictions, which of course creates a strong incentive to limit local consumption. "The other day I heard a PRO Congressman (Macri's party) say that if people couldn't afford bread, they should look in another bakery," Jorge Alonso, owner of the Elca Bakery, said. "They refer to this as a 'shock of confidence'. Is that all they have to say!? As a businessman I need concrete answers."

According to Alberto Williams of the Chamber of Butcher Shops, wholesale meat prices have also jumped recently: various cuts of beef by 30% this week alone; and chicken, by 25%. Feed corn prices, a key staple to ranchers (most of whom, ironically, were enthusiastic Macri supporters), are also rising sharply, which only adds to the cost of meat in a country known for having the highest per capita beef consumption in the world.

Argentina's growing vegetarian population isn't faring much better: fruit and vegetable prices have also come under pressure by speculators, especially in large supermarkets. A kilo (2.2 lb.) bag of potatoes, retail, rose Thursday to 9.90 pesos ($1.10) - a 300% markup. Squash, another popular Argentine staple, was retailing for 15 pesos a kilo (70 ¢ a pound) last week; it's now averaging 22.90 pesos - a 50% jump. Tomatoes have also skyrocketed 200% this past week.

There are alternative to supermarkets, however, even if less convenient. "I'm afraid of the oligopoly supermarkets and hypermarkets control," said Fabián Zeta of the Horticulture Chamber at the Central Market in suburban Tapiales, which supplies grocery stores across the Buenos Aires metro area and retails to the public as well. "They operate on high profit margins to begin with, and are now marking up prices all they can 'just in case'. The greengrocers who work with us at the Central Market aren't raising their prices."

Recent price run-ups are by no means limited to groceries. Dow Chemical, the largest supplier of plastic to Argentina's toy industry, stopped selling a week and a half ago. "They claim they have no material; but are actually waiting for the devaluation promised by Macri," said Matías Furio of the Toy Industry Chamber. Steelmakers, for their part, are shipping product normally; but Juan Carlos Lascurain of the ADIMRA metal product industry chamber confirmed that they're hoarding raw materials and are forcing their customers to accept being billed after December 10 (at a much higher price).

Manufacturers of industrial inputs for finished products, meanwhile, have begun to reference their prices at 16 pesos to the dollar (rather than the current rate of 9.70). "They have generally increased prices and slowed deliveries. Those who do fill orders have reduced collection times from the customary 45 days to 7," said Fernando Lascia of the APyME small manufacturers chamber. Lascia explained that most industrial sectors are rushing to adapt to the new circumstances created by Macri's promised devaluation. "Polypropylene has already increased 26%. Perfume and stainless steel makers are still filling orders normally; but billing buyers in January and at a 16-peso price reference. Stainless steel makers, in fact, are attaching a rider to their sales stipulating that if the dollar rises above 16 pesos a surcharge may apply."

Argentina's supply chain is highly concentrated in a number of monopolies or oligopolies over each sector of the economy, and this allows them to more or less control prices. Many of the executives at these monopolies are also regulars at the right-wing Idea Colloquium events, and are close to Mauricio Macri and his economic team. It is therefore plausible that many of these recent price increases have been made with the consent of the president-elect.

The equation is simple: that the inflationary impact of Macri's promised devaluation be felt before he takes office on December 10.

At: https://translate.google.com/translate?hl=en&sl=es&u=http://www.pagina12.com.ar/diario/economia/2-287137-2015-11-28.html&prev=search
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The mere forecast of a devaluation is already causing wholesale prices to jump further and faster than any anyone, even the staunchest Kirchnerists, had feared.

How long before Macrinflation, become a Macrisis?

What might Macri's public health policy be like? Just ask at the Garrahan Children's Hospital.

The Dr. Juan P. Garrahan Children's Hospital is the largest of three public pediatric hospitals in Buenos Aires, and one of the largest in Latin America. Inaugurated by President Raúl Alfonsín in 1987, the 1.2 million ft² center annually hosts 534,000 doctor visits, 25,000 outpatient visits, and 131 transplants; its average occupancy rate is 98%. It even includes a guest house for loved ones of hospitalized children who've been transferred from elsewhere in the country.

Its importance as the largest pediatric hospital in Argentina, and as one which primarily serves disadvantaged Southside Buenos Aires children, was underscored by a 1989 bill signed by President Carlos Menem stipulating that the City and the National Government share equally in funding its budget that today is nearly US$300 million a year.

For the last two years however, Mayor Mauricio Macri - who was elected President this Sunday on the right-wing "Let's Change" ticket - has routinely underfunded the City's statutory obligations to Garrahan Hospital. His 2014 budget did so by 113 million pesos ($14 million), and the 2015 budget by 216 million pesos ($24 million). The shortfall thus rose from 12% of the City's share, to 18.5%.

According to Oscar Trotta, a member of the Garrahan Hospital Board, these cutbacks "will be reflected in the suspension of numerous ongoing improvements, including greater generator capacity to handle power needed by new MRI scanners, the hybrid operating room for interventions in cardiology and hemodynamics, and for hiring additional nursery staff." "We were counting on the additional nursery staff because many mothers whose babies were born with defects are being transferred from Ramón Sardá Maternity Hospital," said Dr. Trotta.

Sardá Maternity, like all 33 Buenos Aires public hospitals, has also suffered from funding shortfalls during Macri's second term as Mayor. "While the infant mortality rate nationally is declining, Buenos Aires' is increasing - and yet budgets for pediatric hospitals are being cut," added Dr. Trotta.

Marcelo Scopinaro, the Chairman of the Hospital Board, added that "work will also have to be suspended on the new oncological day ward, the hospital pharmacy expansion, new operating rooms and outpatient clinics, the expansion of the bone marrow transplant wing that should double capacity to 14 beds, and other building improvements. All these works were important because the number of children needing them is increasing."

To Dr. Trotta, the problem is simple: "the Nation is bearing its 50% share of the costs; but the City has reduced its share of the costs by 18.5%." The shortfall worsened by September, when hospital authorities reported that of 158 million pesos ($17 million) the City had been required to contribute toward salary costs, it had disbursed but $44 million ($5 million).

President Cristina Fernández de Kirchner attempted to mitigate this impact by havinf the Nation's budgetary outlay for the hospital raised by 50% for FY2016 - to 1.72 billion pesos ($180 million, currently). She also signed a bill transferring the land itself - a 23 acre lot originally owned by the Army - to Garrahan Hospital, something its Board had been requesting since it opened in 1987.

Macri, however, responded (after the election) by slashing 350 million pesos from the City's coequal share for 2016 - a 20% cut which differs sharply from his policy of awarding no-bid, unauthorized political advertising contracts to supporters such as sportscaster Fernando Niembro (who netted 21 million pesos this way).

Dr. Scopinaro nevertheless prefers to accentuate the positive. "We are happy and proud to finally have the definitive title to the land." "This will regularize various contracts, ensure proper operational risk coverage, normalize utilities, and other much needed changes."

At: https://translate.google.com/translate?hl=en&sl=es&u=http://www.telam.com.ar/notas/201412/89529-denuncian-que-la-reduccion-presupuestaria-del-gobierno-porteno-al-hospital-garrahan-afectara-obras-e-insumos.html&prev=search

And: http://www.diarioz.com.ar/#/nota/hospital-garrahan-preven-un-recorte-del-20-para-el-2016-47752/
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Shortly after Garrahan Hospital opened in 1987, a dystopian film - Lo que vendrá ("What's to Come" - was released in Argentina. In it, a civilian but highly authoritarian state in the near future keeps wages low, reacts brutally to protests, and of course critically underfunds public health and education.

The movie was partly filmed inside the then soon-to-open Garrahan Hospital.

Macri plays dangerous game with Argentine peso.

Analysts abroad largely agree removing restrictions too quickly could spark trouble.

If there’s one point president-elect Mauricio Macri has been crystal clear about, it’s that he hates all the regulations throttling the country’s currency market. So on Tuesday, Macri reiterated his pledge to do away with the foreign-exchange controls immediately upon taking office next month.

It’s an audacious plan, one that could jump-start his efforts to lure much-needed investment to the country but it also comes with great risk. With the official and black-market exchange rates currently 58% apart, lifting the controls will almost certainly trigger a plunge in the value of the peso. That could cause a surge in consumer prices in a country where inflation is already running above 20% (inflation in November has already doubled to 3% a month - 40% annualized - on devaluation fears), force an economic downturn, and spark a public and political backlash against the new government.

The plan is so fraught with risk and so logistically difficult that many outside observers insist that he won’t really try to pull it off so quickly. They chalk it up to campaign rhetoric. But Macri isn’t toning down his language as president-elect. When asked Tuesday how fast he’d move, he replied: December 11 - one day after he’s sworn in.

History is littered with the corpses of countries that have abandoned capital controls precipitously,” said Barry Eichengreen, an economics professor at the University of California at Berkeley and former senior policy adviser to the IMF during the 1997-98 Asian financial crisis. Should Macri, two-term mayor of Buenos Aires and wealthy businessman, follow through on the rhetoric, the US$600 billion economy could suffer a big blow.

Assuming he devalues the peso by 39% to 15.8 pesos in three months (a 64% jump in the value of the dollar in Argentina) and removes utility subsidies, the Central Bank will have to raise short-term interest rates to 40% by September to control inflation, according to Oxford Economics, a UK research firm. Under such a “shock therapy,” the economy will shrink by about 3% annually in the next two years before picking up in 2018, Brazilian economist Luiz Kessler wrote.

Venezuela, a Mercosur trade bloc partner and long-time ally, has been there before. In 1989, newly-elected President Carlos Andrés Pérez abruptly lifted foreign-exchange controls and let the currency plunge after finding that the Central Bank was running out of foreign reserves. Consumer prices soared 21% in one month alone, leading to the “Caracazo” riots that killed hundreds and spurred Hugo Chávez, then an Army officer, to stage a coup attempt that launched his political career.

Instead of shock and awe, Macri should adopt a gradual transition to a free-floating exchange rate, said Paulo Vieira da Cunha, a former Brazilian deputy Central Bank governor. That would give the government time to pass measures that will soak up extra pesos, implement a credible fiscal plan and draw in cash from abroad, he said.

“There is a difference between doing something gradual with credibility, and doing something haphazardly into a void,” said Cunha, now chief economist at Los Angeles-based money manager Ice Canyon.

No one is saying Macri shouldn’t start implementing changes quickly. The economy is currently growing at 2.8%. Foreign exchange reserves, however, are the lowest in nine years at US$25.8 billion. The budget deficit is the largest in three decades (6-7% of GDP). In the last four years, the peso has fallen 55%. And while wages have kept up consumer prices have more than doubled according to private estimates, with annual price increases of more than 20% since 2011.

But for Macri, the margin for error is thin. As 49% of voters went for his opponent, the Victory Front (FpV) candidate Daniel Scioli, unpopular measures of large devaluation, coupled with spending cuts and tax increases, would only alienate Argentines and erode his political support.

Mario Blejer, former Central Bank head who devalued the peso in 2002, said capital controls should only be phased out and lifted sector by sector, starting with importers. To mitigate the impact, Macri will have to increase interest rates on Central Bank notes and spur demand for pesos, said Blejer, who was forced to boost those yields to 140% thirteen years ago. “We used to think about it as an equation in which the greed for higher interest rates would trump the panic of holding pesos,” Blejer, who was most recently advising Scioli, said. “They’ll see that it’s difficult. You can’t just change everything from one day to the next.”

Ultimately, Macri’s narrow victory over Scioli may be the loudest call for a gradual approach, said Vargas. “What I’m seeing is that they’re becoming aware of the magnitude of the adjustments, maybe because of how close this race was, and that’s going to impact how aggressive they are,” Blejer said.

At: http://buenosairesherald.com/article/203790/macri-plays-dangerous-game-with-peso
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Seems like old times...

Pictured: Dictator Roberto Viola swears in Economy Minister Lorenzo Sigaut in March 1981. Sigaut's 30% devaluation just days later touched off a chain reaction that crashed the economy. His response to soaring inflation was to raise interest rates to a depression-inducing 20% a month.

As in Macri's case, these policies were welcomed by large landowners and speculators to whom they became a veritable windfall. Amid the worst recession since 1930 they were rescinded 15 months later, and the dictatorship stepped down the following year.

Macri Economy Minister Alfonso Prat-Gay and his shady dealings with the billionaire Fortabat estate.

The Congressman transferred US$1.025 billion from the sale of Amalia Fortabat's cement firm Loma Negra to tax havens. Upon her death in 2012 he was appointed as executor of her estate, estimated at US$1.6 billion.

The image was eloquent, but the media and the entire political spectrum failed to see it as such. On February 19, a few hours after the death of Argentine billionaire Amalia Lacroze de Fortabat, Alfonso Prat Gay was one of ten pallbearers at the funeral of the "Lady of Cement" at the renowned Recoleta Cemetery. Visibly distressed, Prat-Gay, the Ranking Member of the House Finance Committee, knew he would have a hard task to carry out. Fortabat's heirs had designated the former JP Morgan wealth manager as executor of an estate that Forbes magazine estimated at US$1.6 billion - a role incompatible with his duties as Congressman, since Fortabat's cement maker, Loma Negra, is also a leading state contractor.

However, the link between Prat-Gay and Fortabat family has a long history: in 2005, when the Loma Negra cement was sold to the Brazilian conglomerate Camargo Correa, Fortabat chose him to handle the sale valued at US$1.025 billion. Despite her own misgiving toward JP Morgan for having undersold Loma Negra in order to collect a quick commission, Prat-Gay was presented by her survivors as "the most transparent option" to manage the administration of the fortune.

Prat Gay refused to involve his former partners in an opportunity of this magnitude. He ultimately wired the proceeds from the estate to four flagship tax havens: the United States, Britain, Hong Kong and Switzerland. According to data obtained by Tiempo Argentino from banking sources, the first transfer was US$100 million in 2005; the second for US$430 million 2006; US$600 million in 2007; and another US$600 million in 2008.

The financial engineering Prat-Gay used was the same for each transfer: the use of a diversified basket of currencies, short-selling the peso, and not a penny invested in the country. He then closed, and then reopened, Fortabat's UBS accounts merely to line his own commissions, since intermediaries are entitled to kickbacks of up to 40% for new financial products they help the bank sell. The commissions may have accounted for hisbeing denounced in 2007 for offshoring personal funds totaling US$800,000 - his many Congressional speeches criticizing capital flight notwithstanding.

Tilton Capital, a wealth management outfit he co-founded with Pedro Lacoste (son of the late Admiral Carlos Lacoste, who held top posts during the 1976-83 dictatorship), is also suspected of arranging tax avoidance schemes. "Tilton is one of nearly 20 offices of its kind in Buenos Aires," a Prat-Gay collaborator said. "They are called 'financial intermediaries' but their only characteristic is opening offshore accounts."

His foray into charitable activities has likewise come under scrutiny. A year after the Loma Negra sale, Congressman Prat Gay formed the Andares ('Paths') Foundation, "for the development of microfinance." Currently closed, the foundation's stated aim was to "contribute to the eradication of poverty and social exclusion by, supporting the development of microfinance." Andares was primarily underwritten by the Amilia Lacroze de Fortabat Foundation. The charity was managed not by people with experience in non-profits; but by corporate accountants who would have experience in managing tax writeoffs - including Lacoste. Among its other managers was Luis Cedrola, adviser to the Christian Association of Business Managers - an advocacy group tied to the far-right Catholic sect Opus Dei - and Orlando Salvestrini, the CFO of the leading Argentine wire transfer and bill pay service Pago Fácil - which is owned by the Macri family.

At: https://translate.google.com/translate?hl=en&sl=es&u=http://tiempo.infonews.com/nota/104947/los-oscuros-negocios-de-prat-gay-con-el-millonario-patrimonio-de-amalita&prev=search
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Besides being the author of one of the greatest tax frauds in Argentine history, Prat-Gay's funds have put options against the peso - which of course means that he would personally stand to gain by his own order to devalue if Macri goes through with it.

Outgoing Argentine President Cristina Kirchner: 'A country and a business are not the same'.

President Cristina Fernández de Kirchner headed a rally to inaugurate a new wing at Posadas Hospital, in the Buenos Aires suburb of El Palomar. Today’s was Ms. Kirchner’s first public appearance after Sunday’s runoff that narrowly consecrated Mauricio Macri of the "Let’s Change" (Cambiemos) right-wing alliance as Argentina’s new head of state.

Joined by Buenos Aires Province mayors, provincial governors, and representatives of the Justicialist (Peronist) Party, Cristina Kirchner assumed the responsibility of leading an opposition that will challenge the Mauricio Macri administration in the upcoming years.

“I want to tell everybody, those that voted for us and those that did not, we will not do the things they did to us (referring to the many smear campaigns). We will watch over the rights of all Argentines, to be acknowledged and respected. We will cooperate because we are men and women who know about government responsibilities,” the head of state said today warning that when governability is interrupted it impacts those who have least.

Affirming she will "never leave" and "will always be with you," Cristina Fernández de Kirchner highlighted the current unemployment rate of 5.9% and praised the human rights abuse trials that have convicted hundreds of former military officials that tortured and killed thousands during Argentina’s bloody 1976-83 dictatorship.

“We arrived in an Argentina where there was impunity, and we leave having initiated the most important reconstruction of memory, truth, and human rights in the history of the world. I dare say in the world because few countries have tried their own crimes,” she said and later condemned a front-page op ed in La Nación, published a day after Macri’s victory, demanding the release of the military officers sentenced for violations against human rights.

Among other state policies, Cristina Kirchner also stressed the significance of the Universal Child Allowance (AUH) that guarantees that “kids have schooling and health” because “they are not to blame for what was done to their parents."

President Fernández de Kirchner recalled the work done by the over 1,000 Argentine scientists who have returned to the country after being forced to leave Argentina in search of a better future and job opportunities in the aftermath of the 2001-02 crisis. “We leave with more than a thousand scientists that have returned, with the most important investment in science and technology in the history of Argentina,” she said and hailed the recent launching of the ARSAT 1 and ARSAT 2 satellites.

“I'd also say that we have done something much important than all this. We have empowered people as to their rights. People know what their rights are. We will be there defending the conquests in rights; and the sowing of national, popular and democratic conscience across Argentina, in all who believe that the homeland is your fellow man.”

At: http://buenosairesherald.com/article/203754/cfk-a-country-and-a-business-are-not-the-same
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Whatever mistakes she made over the last 8 years (and who hasn't!) she's been good to business, and the working man. The way it should be.

Average profit margin in publicly traded companies was 39% in 2014; 57% in public/private partnerships.
https://translate.google.com/translate?hl=en&sl=es&tl=en&u=http%3A%2F%2Fwww.tiempofiscal.com%2Fvernota.asp%3Fid_noticia%3D4539

After stellar 2013 and 2014, stocks up 53% so far in 2015 (until Macri's election, that is).
http://www.buenosairesherald.com/article/140375/merval-breaks-new-record

Purchasing power of wages up 72% since 2003 - using private inflation estimates.
https://translate.google.com/translate?hl=en&sl=es&tl=en&u=http%3A%2F%2Ftiempo.infonews.com%2Fnota%2F39354%2Fel-poder-adquisitivo-crecio-72-desde-2003


Press shills and right-wing ideologues may be happy; but I think Argentine business is starting to miss the old girl already. Since Macri was elected, stocks are off 9%.

Susana Malcorra, Cabinet Chief to Ban Ki-moon, to be appointed Argentine Foreign Minister.

Argentine President-elect Mauricio Macri today revealed one of the members of his future cabinet. In a press release, Macri announced Susana Malcorra will head the Foreign Affairs Ministry.

“She is intelligent, vigorous, and wise,” Macri said about her, adding she comes to “add her vision about the international issues in this phase of change we will begin soon.”

“I am very glad and proud. She is a person with a very vast and detailed knowledge of the international agenda that moves the world today,” Macri posted on Facebook. “Argentina needs to connect with other nations in the world to develop growth and prosperity opportunities for all the Argentines,” he added.

Born in the city of Rosario (Argentina's third largest), Malcorra is the current United Nations Chef de Cabinet to the Executive Office. She was appointed to the post by UN Secretary-General Ban Ki-moon in March 2012.

Malcorra, 61, had served as the United Nations Under-Secretary-General for Field Support. Prior to that, she had been CEO and Deputy Executive Director of the World Food Programme, where she oversaw emergency and humanitarian operations in more than 80 countries, including UN operations during the 2004 South Asian tsunami.

She also had more than 25 years of experience in the private sector before joining the WFP.

Malcorra started her career in IBM Argentina in 1979, and joined the recently privatized Telecom Argentina in 1993. She was appointed CEO of the company in 2001.

She is not affiliated with any particular political party in Argentina.

At: http://www.buenosairesherald.com/article/203682/macri-announces-susana-malcorra-to-be-appointed-foreign-minister
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A silver lining in the Macri cloud, I believe. Considering some of the other names being floated for Macri's cabinet, Malcorra will bring much needed credibility. I wish her all the best.

Why Macri’s win is bad news for Argentina - and the entire region.

By Mark Weisbrot.

The election of right-wing candidate Mauricio Macri as Argentina’s president on Sunday, which was unexpected just a few months ago, is a setback for Argentina and for South America.

In the past 13 years, Argentina made enormous economic and social progress. Under the Kirchners (Néstor, until 2007, and since then Cristina Fernández de Kirchner), real GDP doubled, poverty fell by about 70%, and extreme poverty fell by 80% - even based on independent estimates of inflation. Unemployment likewise fell from more than 17.2% in 2003 to 5.9% in 2015, according to the International Monetary Fund.

But Daniel Scioli, of the populist Peronist Front for Victory party currently led by outgoing President Fernández de Kirchner, did not do a good job defending these achievements. He also didn’t articulate what he would do to fix the country’s current economic problems. In the past four years, growth has been slow (averaging about 1.8%), inflation has been high (25%), and a black market for the dollar has developed. This gave Macri (and his Cambiemos, or “Let’s Change” coalition) an opening to present himself as the candidate of a better future.

With skilled marketing help from an Ecuadorean public relations firm, Macri defined himself as something far more moderate than he is likely to be, winning over voters who might otherwise be afraid of a return to the pre-Kirchner depression years.

Some of the things Macri has indicated he would do could have a positive impact, if done correctly. He will likely cut a deal with vulture funds that have been holding more than 90% of Argentina’s creditors hostage since New York judge Thomas Griesa ruled in 2014 that the government is not allowed to pay them. If the cost isn’t too high, it could reopen a path for Argentina to return to international borrowing—something Scioli would likely have also done.

A liberalization of the exchange rate that got rid of the black market could be a big step forward. But much depends on how it is done: If it causes inflation to spike and the government does nothing to protect poor and working people, they could lose a lot.

Macri may also take measures to bring down inflation, which is something that needs to be done - but he’s likely to do so by shrinking the economy. He wants to reduce the central government budget deficit, which will instead grow as a percentage of GDP once austerity triggers recession. Given his ideology, there is serious risk of a downward spiral of austerity and recession, as the country suffered from 1998 to 2001. If there is inflation from the devaluation, this could make matters worse.

In his campaign statements, Macri made it clear that he is against a government role in promoting industry, so the country’s economic development is likely to suffer as a result. He has proposed tax cuts for upper-income groups. That suggests that budget cuts are in the offing, since Macri has pledged to reduce the government budget deficit. The majority of Argentines are likely to suffer from such an economic transition.

Macri won’t have a working majority in Congress, so it’s unclear how much he can do.

Macri has demonstrated his loyalty to the United States government - something previously made clear in confidential U.S. Embassy cables published by WikiLeaks (in which Macri personally asked the State Department to harass Argentina for his own benefit).

One of his very first statements after the election was to denounce Venezuela and threaten to have the country suspended from the Mercosur trading bloc of South American nations. The issue wasn’t of concern to Argentine voters, so it may very well be related to a U.S.-led international campaign to delegitimize Venezuela’s government and its Dec. 6 elections - something no other South American president would do. Macri runs a serious risk of damaging relations in the Western Hemisphere if he continues down this road.

Washington has maintained a policy of “rollback” and “containment” against almost all of the leftist governments that have won elections in the 21st century. So there is quite a bit of excitement among the business and foreign policy elite over the wave of setbacks among Latin America’s left, with Brazilian President Dilma Rousseff facing a recession and political crisis and Venezuela’s ruling Chavistas even more so. Articles are already sprouting up, welcoming the long-awaited "demise" of the Latin American left.

But reports of this demise, to paraphrase Mark Twain, are somewhat exaggerated. A more likely outcome is like what we saw in Chile, where a lackluster candidate was unable to take advantage of Socialist Party President Michelle Bachelet’s 80% approval rating and lost to a right-wing billionaire in 2010. He lasted four years, and then the country went back to Bachelet.

Argentina and the surrounding region have changed too much over the past 15 years to return to the neoliberal, neocolonial past. The Washington foreign policy establishment may not understand this, but Macri’s handlers did. That’s why they took the trouble to package him during the campaign as something very different from what he is.

At: http://fortune.com/2015/11/24/mauricio-macri-presidential-win-bad-for-argentina/
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Nevertheless, my hope is that Macri may yet find it in himself to show moderation and restraint. If not for his country, at least to avoid the same fate the last IMF devotee had.

Employees repudiate 'La Nación' op-ed advocating end to human rights abuse trials in Argentina.

Workers at the right-wing Buenos Aires newspaper La Nación held an assembly yesterday afternoon at its headquarters to repudiate an editorial published today at the daily entitled "Stop the Revenge," which posits that Sunday's election of Mauricio Macri as president "is a propitious time to finish with the lies about what happened in the 1970s" and to "put things in their place."

The op-ed piece, published anonymously, called on President-elect Macri to put an end to ongoing trials for crimes against humanity involving around 1,000 former officers implicated in Argentina's Dirty War. The offensive resulted in up to 30,000 people tortured and killed between 1975 and 1979 and hundreds of millions in absconded property.

The most urgent issue affecting the defendants, according to the piece, is "the shameful suffering of those convicted, prosecuted, and even suspected of crimes committed during the years of repression against subversives, some of whom (the former officers) are in prison despite advanced age."

"We are proud to see so many coworkers repudiate the publisher. Today we are meeting at 4:00 pm to discuss the issue," stated Guido Molteni, delegate of the newspaper's internal commission, in his Twitter account. Reporters and editorial staff from numerous other Argentine newspapers joined La Nación staff in repudiating the op-ed in their social media accounts and in today's edition of their newspapers.

The Buenos Aires Press Union (SiPreBa) also expressed its strongest condemnation against the editorial as does this publication, Info News:

"We likewise vindicate our colleagues at La Nación who publicly differed from their employer's editorial line. We the members of the press say ¡Nunca Más! - Never Again! - and will continue fighting for memory, truth, and justice."

At: https://translate.google.com/translate?hl=en&sl=es&u=http://www.infonews.com/nota/265746/trabajadores-de-la-nacion-repudiaron-la&prev=search
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The op-ed was published anonymously because in all likelihood the author was Carlos Pagni, a longtime La Nación contributor who has openly vindicated the Dirty War numerous times in the past, called for the military ouster of President Cristina Kirchner, was convicted of buying and selling information from hacked government computers, and was filmed receiving bribes from a Repsol operative (the "Spanish" oil company partly owned by narcos) in return for writing attack pieces against the Argentine state oil firm YPF.

Every one of these acts is illegal in Argentina, and every one of these has been proven. But Pagni and La Nación (known locally by its critics as La Traición - the 'Treason') have many friends in the courts, so La Nación goes on skating on a 50 million-dollar tax debt and Pagni the skinhead writes away - anonymously, of course.

First official results confirm Mauricio Macri wins historic presidential runoff in Argentina

Source: Buenos Aires Herald

Today’s historic runoff that had Daniel Scioli of the ruling Victory Front (FpV) competing against Mauricio Macri of the "Let’s Change" (Cambiemos) opposition coalition dominated by Macri's right-wing Republican Proposal (PRO) to become the successor of President Cristina Fernández de Kirchner has come to an end: according to initial exit polls, Mauricio Macri has won. Sources in the National Electoral Chamber informed that 66% of the electoral roll had already voted at 4.45 pm, with the election unfolding normally.

Results are expected to be ready starting at 7:30 in the evening, with trends likely to be consolidated by 10:30, according to statements by National Elections Director Alejandro Tullio.

Starting at 8 am, citizens began to cast their ballots in 13,000 different polling stations across the country. In the October 25 elections, Daniel Scioli and Carlos Zannini got almost a 3-point lead (37.1%) over Mauricio Macri and Gabriela Michetti (34.2%), a tighter-than-expected margin that led to today’s landmark runoff - the first in Argentine history.

Victory Front candidate Daniel Scioli, will await the final results at his bunker placed at NH Bolivar Hotel, near the Plaza de Mayo square, while Macri will show up at 8 pm in Costa Salguero.

After a year-long presidential campaign that reached fever pitch after last month’s general election, Argentines finally headed to the polls today. For the first time in history voters had only two ballots to choose from: Let’s Change (Cambiemos) candidate Mauricio Macri, or ruling Victory Front (FpV) contender Daniel Scioli; most past Argentine presidential elections have had five or six major candidates, and a number of minor ones.

Macri would take office on December 10. The center-left FpV retained an absolute majority in the Senate and a relative majority in the Lower House.

Read more: http://buenosairesherald.com/article/203520/mauricio-macri-wins-historic-presidential-runoff



Here's to Daniel Scioli, the centrist who despite his differences with Cristina Kirchner ran on the social-democratic Front for Victory ticket widely credited with revitalizing Argentina since they were first elected in 2003.

Like Al Gore, he had a good personal reputation and a fairly strong economy (2.8% growth, near-record consumer confidence) on his side. He was also supported by Pope Francis, who's asked him to "fight savage capitalism" in his campaign for the presidency.

But like Dubya, Macri had the local Catholic hierarchy (particularly the Opus Dei), the banks, big business, and, most importantly, big media on his side - not to mention a relentless and well-financed Limbaugh-style attack machine.

Much will depend on how many of his IMF policies he will be able to - or, frankly, want to - implement. These new policies would include, but are not limited to:

*quashing collective bargaining,
*curtailing benefits and public mortgage programs,
*cutting health and education,
*privatizing and outsourcing,
*and a sharp devaluation which would bring a windfall to the rich at everyone else's expense.

Already, consumer credit is being curtailed and wholesale prices reportedly soaring on the mere expectation of a devaluation.

Many are the same IMF recipes that caused the country's much-publicized collapse in 2001.

Argentina resembles the U.S. ethnically and culturally. They have a lot of the same political problems with the right the U.S. has: many white, middle-class voters will support the far right - even at their loss - because they see progressives as people who coddle "lazy blacks" (sound familiar?). That, of course, worked in Macri's favor.

But in Argentina especially, those who forget history...

Stiglitz: "Argentina is one of the few successful countries in reducing inequality and poverty"

The 2001 Nobel Prize in Economics laureate, Joseph Stiglitz, said in an interview with Página/12 that Argentina "is one of the few successful countries in reducing inequality and poverty," adding that our country "has a lot to teach the rest of the world in terms of resolution of macroeconomic crisis and sovereign debt restructuring. "

The former chief economist of the World Bank and Columbia University professor said that "the current scheme to resolve the crisis in sovereign debt does not work and allows the emergence of vulture funds", which he defined as "the scum of the international financial markets". He also considered the nine principles adopted by the UN General Assembly and promoted by the national government as "an important step" in a "long process" to solve this problem.

"Austerity during a recession generates social catastrophes. Fiscal austerity in times of recession, when the private sector is also reducing spending, only exacerbates the contractionary scenario," said Stiglitz. "Argentina has much to teach the rest of the world in terms of resolution of macroeconomic crisis and sovereign debt restructuring. The way in which Argentina solved its crisis of 2001 and 2002 led to high growth rates until 2011. Argentina has been one of the few successful countries in reducing inequality and poverty after the crisis. "

Finally, Stiglitz said that "the consequences of market fundamentalism have been devastating, as it has created more unstable economies and more unequal societies." He also explained that the markets "do not operate in a vacuum," adding that in response to the 2008 crisis, the economic discussion should focus on "how to rewrite the rules in ways that promote more inclusive growth."

At: https://translate.google.com/translate?hl=en&sl=es&u=http://www.politicargentina.com/notas/201511/9866-stiglitz-la-argentina-es-uno-de-los-pocos-paises-exitosos-a-la-hora-de-reducir-la-desigualdad-y-la-pobreza.html&prev=search

The full interview: https://translate.google.com/translate?hl=en&sl=es&u=http://www.pagina12.com.ar/diario/economia/2-286619-2015-11-21.html&prev=search
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But the group of people who benefited the most - the middle class (http://www.buenosairesherald.com/article/194579/argentinas-middle-class-doubled-in-ten-years-us-report-shows) - are for the most part obsessed with "lazy indians on welfare" (sound familiar?).
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