Argentina's economic slide


Just to share some ideas and news.

1. George Soros has, at last, declared the Argentinian peso overvaluated.

2. President Menem is watching his power dwindle as the date of the elections comes nearer. The whole establishment considers him a "dead man". The large newspapers, sniffing the changes in the breeze, begin to whip him more and more.

3. It is a queer moment in Argentina, but a repetitive one: when the establishment begins to condition the eventual winner of the next election in the person of the current President. It happened with Alfonsin, and now it is happening with Menem. I am beginning to feel pity for the miserable Carlitos!

4. As a part of the whipping, the closest friend of Menem, Antonio Erman Gonzalez, has been forced to resign as Minister of Labor through the diffusion of the news that he had been given an outrageous retirement of u$s 8000 per month, retroactively. So that he will get some u$s 200 000 immediately. The "pressure" not only forced him to resign as a Minister (which opens the way to legal prosecution for the scandal of the sales of arms to Croatia, and other beauties) but also to resign to the retirement.

5. This is not necessarily something we should cheer. Erman Gonzalez, rotten as he is, was an opponent to Roque Fernandez, the IMF man in the superpowerful Ministry of Economy, Carlos Silvani, the taxman of the IMF, and Pedro Pou, the IMF man at the Central Bank. The corrupt leaders of the CGT (General Federation of Labour) were leaning on him in order to get some minor concessions against the bloodsuckers. The leader of the CGT, Daer, declared immediately after Erman Gonzalez was ousted that "they [the establishment and the press, notably the _Clarin_ group] want Menem to end his term the same way as Alfonsin".

6. All this is setting the scenario for a terrible devaluation. Devaluation of the Argentine peso is to take place within less than a year. Whether during Menem's government or after it, is still to be seen. But it is obvious that positions are being taken by the IMF in order to face a non-opponent scenario within the cabinet. Recent budget cuts, however, have enraged the middle and lower classes, and _for the first time_ the Minister of Economy had to step back due to popular pressure. So that this unity of the cabinet is a must, if they want to devaluate in the sense they want, that is against us.

7. The consequences are still to be seen. But the Alianza is nervous (they do not want to begin, if they win, with the same panorama they left when Alfonsin had to resign months before the legal date), and Duhalde will doubtlessly recoil from his recent definitions against "the model". The radicalization of his discourse (nothing to be scared about, but radicalization it is) may be one of the targets of the current moves, also. Duhalde must be disciplined. "Que este peronista no se haga el loco, cuidadito!".

8. In this sense, another sign of the times (besides increasing though elementary student unrest, which I gleefully wind up during the courses I deliver in the University) is the recent election in San Juan. The Alianza is essentially a Buenos Aires City based structure, and has no true representatives in the Inland provinces, but for a few Radical governors. In Salta they signed an agreement with a politician of the worst origin: the Proceso, the military dictatorship after 1976. They lost against a devalued Peronista, Romero. In San Juan they struck an alliance with Avelin, a very interesting old politician who made all his campaign on clear nationalist and democratic ideas. Avelin is a heir to a very particular party in San Juan, the Bloquismo, on which I must explain you all some things. His tradition is the tradition of industrial nationalism and protection of the 50s and 60s, and on this platform he trode on his opponent (a former man of the Proceso turned Peronista) roughsod, getting around 55% of the votes. The two main Alianza leaders -De la Rua and Chacho Alvarez (the latter being the "progressive")- immediately flew to San Juan in order to (publicly) salute the winner but (privately, though this is a secret everyone knows) warn him to bend down his flags. It will be very interesting to watch what Avelin will do. These imbeciles will not be able to deal with him.

9. So that, social unrest is beginning (though not at the workshop level, yet), there is a clear offensive against the eventual winner of the next election but focused on the current President and his men (Menem will, if he stands true to his evil nature, resign all of his ministers and friends in order to comply with what the IMF and Washington expect of him), the "moderate" mood is beginning to fade away, the enemy is preparing for large battles, the whole scenario is set for a devaluation then. We shall suffer, and suffer very badly. But at last history will begin to move on again.

10. And as a background, the usual Europeanized cast of mind of the Argentinian middle classes has played against the Empire this time: horror at "what is happening in Yugoslavia" is the backcloth that permeates it all. People are really beginning to discover the truth that lay behind the lies. This may be a one-winter-spring, but ice is slowly thawing. The enemy knows this, so that probably they will strike before things get worse. Menem may be doomed.

Nestor Gorojovsky