Argentina Economic Crisis Part 2

Argentina Economic Crisis 2

Precariousness and marginalization undermine the connective tissue of the great Argentine cities with an elegantly European appearance, such as Buenos Aires, Córdoba, Rosario, in which the Italian presence at an entrepreneurial level has been consolidated for over a century. The cities of the North – such as Salta and S. Maria de Tucumán, inter alia linked to the Italian intellectual emigration between the two wars (Rodolfo Mondolfo, Beppo Levi, Renato Treves, Benvenuto Terracini) and before that to other personalities of Italian culture of the 19th century (Paolo Mantegazza, Edmondo De Amicis) – are less affected by demographic gigantism and therefore immunized at least in part from the connected phenomena of serious social transgression. In both areas, although we are witnessing the growth of villas miserias, the comparison is in favor of Argentine cities compared to some other Latin American metropolises. Urbanization of poverty is less pervasive in the Argentine provinces, where agriculture and livestock farming ensure an unsatisfactory level of survival. Indigence almost everywhere retains that minimum of dignity that prevents it from escalating into open revolt. However, the retching of intolerance of the less well-off and most sacrificed by economic imbalance (a quarter of the population holds almost 80% of the country’s total resources) are expressed when the atony of tutorary power is configured as morally, besides that legally, unqualifiable.

The shanty towns unfortunately lend themselves to party management. They are the political laboratories of the consensus collectors, who inevitably exercise themselves in compromise and therefore to the detriment of the marginalized themselves. “The new ‘wretched of the earth’ have nothing to envy to their 19th century European predecessors. The insecurity of their living conditions makes these olvidados of urban society particularly sensitive to any outward manifestation of interest. One understands then the benefit that shrewd politicians or organizations in search of a social base have drawn from it. Although very often the authoritarian regimes see in the habitat irregular only a source of harmfulness, disorderly urban space, if not even violation of the right to property and social danger caused by the accumulation of poverty, some political forces perceive the slums as a maneuverable mass ready to sell itself to the highest bidder. They prefer to co-opt humans instead of eradicating the habitat. To this end, selective benefits are proposed to the most deprived and organized in such a way as to weave lasting patronage ties “(Alain Rouquié, cit., P. 322).

Marginalization and destitution can therefore lead to revolt, apathy and conformity. A significant detail is given by the ferocity with which some agents of public order lash out against the demonstrators, who represent, in most cases, their own class of extraction or origin. Not to mention – as some Latin American intellectuals argue – that the level of corruption in the cities is more serious and dangerous than the crime (as a survival strategy) that prevails in the slums.

Paradoxically, the awareness of a Latin American deterrent, compared to the disintegrating forces operating within the area by the beneficiaries of the rents established on the basis of the mixture of political interests with economic interests (so much so that Henry Kissinger asserts that America Latina is an abstraction), becomes more and more evident, as happens in the first months of 2002 in the squares and streets of Argentina. The unhappy conscience of a community, no longer subjugated by the esoteric suggestions of the open and uncontaminated space, struggles around the most appropriate ways to put an end to the irresolution and cognitive inconsistency of the strategists of an archaic politics,

The center of the protest is Plaza de Mayo, which is the result of the unification of the Victoria and Venticinco de Mayo squares, commissioned, in 1883, by the mayor of Buenos Aires, Torcuato de Alvear. “It was proposed – writes Adrian Gorelik (The beauty of the homeland, in 900, 4, p. 136) – a spatial change on a monumental scale for the heart of the city and a change of habits: although the square had always been the favorite place of civic festivals, ceremonial parades or public protest, the presence of the Recova not only circumscribed the views, but, due to its function as a market, also created a sensation of everyday life and multiplicity of functions that distanced the square from the ceremonial ».

The first date trade union, as an effect of the Mercosur meeting in Buenos Aires, on February 17, 2002, it is precisely in the squares that witness the restoration of an organized popular will, inclined to react immediately to the resolutions of the Duhalde government. The secretary of the Federación Sindical del Petróleo y Gas Privado (FASPYGP), Alberto Roberti, calls for a strike against government burdens on the export of crude oil (20%) and its by-products (5%), for fear that the oil companies (Reposol Y PF, ExxonMobil, Shell, Chevron, BP and TotalFinaElf) lay off more than 10,000 employees. Roberti does not share the assurances of the Minister of Labor, Alberto Atanasof, according to which no worker will contribute to raising the unemployment rate, which currently exceeds 22%. The union refutes the government resolution, weight.

After nearly twelve years of fixed parity one to one between the weight and the dollar in the first fortnight of February 2002, Argentina gives free rein to the bill of exchange fluctuation: more ominous in the period, the change of the weightagainst the dollar gets to 2, 3, to go back up to 1.95. In January 2002, the consumer price index (CPI) rose by 2.3%. The Duhalde government therefore believes that, for the whole of 2002, inflation could reach 32%. According to the forecasts of investment banks, however, inflation will reach 80%. José Ramón Díez, from the Research Department of the Madrid Cassa says that, if the Argentine government fails to curb inflation, the value of the peso against the dollar it is destined to collapse. In the last weeks of February 2002, the Argentine Association for the Defense of Consumers (Adelco) notes that the price of many products, especially food, goes up in a disorderly way, oscillating between 20 and 25%. For this reason, the establishment of a government body is envisaged, in charge of monitoring consumer prices, especially for food, pharmaceuticals and services.

The containment of inflation, consequent to the scarcity of circulating money, due to the so  called corralito (restrictions on access to bank deposits), has the aim of increasing – moreover virtual – international investments. This resolution demonstrates the incompatibility of a receding economy with a hard currency: “an impossible combination,” according to David Cano, a member of the International Financial Analysts (AFI).

The International Monetary Fund (IMF), considering the reduction of the Argentine debt in 2002 to 3000 million dollars (equal to one third of that recorded in 2001) as an effect of the expected revenues for the same period unrealistic, recommends a drastic reduction in expenses and strict control over the issue of circulating money.

The inevitability of particularly serious measures for the entire social context provokes the reactions of small savers and pensioners above all; and generates a widespread sense of bewilderment even in the younger generations. According to the Bonaerense newspaper Page 12, in the two-year period 2000-01, 140,000 citizens left Argentina, and, in the month of January 2002 alone, 23,200 people fled abroad (6000 of which in Italy).

According to Sergio Ciancaglini (El País, 23 March 2002), the ‘planned misery’ is due to the absence of a political management which promotes trust in the country’s resources and which, with the rules of competition, saves those of civil coexistence.

Argentina Economic Crisis 2