The sonorous cracks that gave off 2021 brought to the surface the tectonic imbalances that shake Argentina. From power outages even the dollar rush emerge as symptoms of the accumulation of problems in the economy, which with increasing persistence peel off the scenery of government optimism.
The pressing needs, the terror of the outbreak, preserve within the governing coalition the Minister of Economy, Martin Guzman, they cover him with cotton wool despite disagreements and mistrust. And they explain the cordiality that he professed Cristina Kirchner when he received it on Wednesday in the Senate, out of the public lights and on the same day in which, with the capture of other people’s wills, he had guaranteed to limit the reduction of Personal Property.
“You have to take care of the kid”, a leader of La Campora in reference to the minister, aware of the brittle ground that holds to the government of Alberto Fernandez. Kirchnerism protects Guzmán like a band of captors who feed a hostage until rescue arrives. They want him alive until agree with the International Monetary Fund. “Later we will see”, they grant.
Guzmán is aware of the contempt that nests in the orbits closest to the vice president and that the clock will stop when it reaches an understanding with the Fund. But the minister takes advantage of the last oxygen to graduate in Peronism. He understood that he must ingratiate himself with Cristina Kirchner, the final terminal of all the appendices of La Cámpora; But he also understood that the electoral defeat weakened Kirchnerism and, therefore, its internal enemies.
At Ministry of Economy they warn that “there is no univocal position anywhere” within the eclectic space of the Frente de Todos. Without a dominant position, no power is absolute, they conclude in the Treasury: therefore, there may be life for Guzmán following the IMF if the necessary allies are found.
The reply is cruel. “Kirchnerism is an expert in taking you away and hitting you with a club when it suits them,” they respond from La Cámpora with pragmatism. In short, when March arrives, the month in which the money runs out to pay the debt and the time for negotiations with the IMF ends, it will be seen if the rationalism of Columbia University or camper logic.
The countdown march also emboldened unexpected candidates for replace Guzmán, What the Minister of Productive Development, Matias Kulfas, that released figures on rate increases and economic prospects in reserve as if their aspirations had possibilities.
The news of Kulfas’s candidacy reached the Ministry of Economy last week. “If there is a minister that Kirchnerism shoots from the hill, that is Matías,” they dismissed. It is enough to listen to a camper in private to recognize that the answer is well founded.
When she became president, Cristina Kirchner concealed the progressive breakdown of the economy, as surpluses were exhausted and subsidies increased, with the permanent epic tale, the invention of adversaries, the profusion of crusades that announced themselves momentous and when, with time, languished into nothingness, they had already been forgotten and replaced by others. They didn’t change the declining economy, but they covered up responsibilities. The administration of Alberto Fernandez it suffers from similar upheavals, but epic is an elusive quality for presidential oratory.
Thus, the Government wanders, without narrative or resources, in the heart of an unknown dimension for Kirchnerism. Meanwhile, imbalances and creaks deafen. Amid the tug of war between factions, inaction dominates. Problems are piling up waiting for you the agreement with the IMF be a turning point, a reduction of the Kirchnerist epic to a minimum. Quite a presidential achievement.
In 2021, the drain on subsidies to sustain frozen rates in the metropolitan area exceeded 900 billion pesos. A Mauricio MacriThe gradual release of subsidies generated the first great wear and tear of his government. Financial malpractice and devaluation would finish the job.
But for Kirchnerism, a rate increase among your universe of voters it can be deadly, so much so that in early 2021 Cristina Kirchner publicly humiliated Guzmán by preventing him from firing the undersecretary of Energy, Federico Basualdo, for their disagreements regarding the increases in services. Nothing like it might be heard in the middle of an election year. Guzmán might not dismiss the undersecretary and ended up understanding how the internal forces of the coalition operated. Since then, he has worried regarding validating his steps with Cristina Kirchner before with the President.
Beyond the political lessons, that rate inaction had economic consequences. It led to an exponential increase in subsidies and a lethal bomb, silent, that hides in the chain of payments of the electrical system. It is a snowball alien to the general public, but one that Basualdo knows perfectly well.
The phenomenon has its history. During the government of Cristina Kirchner, distributors had also been impeded to apply increases. As a consequence of the blockade, the companies sacrificed the maintenance of the system, but kept up with payments to Cammesa, the electric wholesaler that presides over the State. When the power cuts came, Kirchnerism blamed the private sector; a mechanism similar to the one currently used to explain inflation, that is, attributing all the blame to the business sector and detaching itself from responsibility for macroeconomic imbalances.
But the distributors learned their lesson. With the Return of Cristina Kirchner to power, the State stopped them once more the updating of its costs, a price that in the electricity market is known as Distribution Added Value (VAD). This time they stopped paying Cammesa, where Basualdo dominates. Thus, the poisonous boomerang returned to the state.
Last week, Basualdo announced that in 2022 the rates they were going to increase 20%. And that users with higher incomes must pay the entire bill, without subsidy from the State. The next concern was to show that Guzmán, the minister who might not dismiss him, endorsed the mechanism. A day following learning what was reported by the undersecretary, Guzmán visited the vice president in the Senate. He had also learned to accept the irremediableness of Kirchnerism.
For Cristina Kirchner, the energy area is a own talisman from the Menem days in which he militated to subsidize the users of Santa Cruz, to the dam projects with family names. But there is no magnanimity in announcing raises. That doesn’t work for you. Economic balances are not your image that the mirror returns.
Therefore, uncertainty reigns. No one knows for sure if targeting is applicable. The law prevents the State from charging different prices for the same service. Justice would bring him down in a heartbeat. Therefore, the Government can only justify it legally as a withdrawal of subsidies. But the necessary studies to avoid injustices they are a chimera. The only certainty, for now, is the 20% increase. No one knows, either, how much of that increase will be a reduction in subsidies, that is, state savings, and how much will remain for companies, where there is a bankruptcy of more than 50%. In principle, to alleviate the black hole of energy subsidies, it is insignificant. Without resources or a roadmap, the government is advancing like a blind swimmer in increasingly turbulent waters.
