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OP-ED | 13-09-2019 22:58

Contradictions, convictions and convergence

Contradictions have been constant in the five weeks since the PASO upset conferred frontrunner status on Fernández – an upset which has triggered sporadic market mayhem and massive downtown picket protests.

One of the many problems facing democracy today is the way general elections are being upstaged (or might we say trumped?) by other and supposedly inferior voting mechanisms making the real decisions – Britain’s Brexit referendum of 2016 would be one case in point and last month’s PASO primaries in Argentina another. The confusion here was quickly compounded by a rather older problem conditioning democracy – the fact that while the people usually vote for their governments every few years, the markets vote every day. Before the PASOs the battle lines seemed clearly drawn between a pro-market administration whose fiscal orthodoxy had been reinforced by recourse to an International Monetary Fund mega-credit and a populist coalition with the outcome even steven between them while a third force urged consensus – today we have what we might call a convergent polarisation, despite which consensus is more distant than ever.

This oxymoron of convergent polarisation is fully reflected by the main candidates with the electorate being asked to choose between two walking contradictions, but there is also an important distinction to be made here. Even if President Mauricio Macri’s first real U-turn was the return of export duties a year ago last month (a rare example of a campaign promise made being kept and then unmade rather than the innumerable broken promises), this last month has seen him break all bounds in turning orthodoxy upside-down – not only restoring the capital controls whose Kirchnerite version he scrapped in the first week of his Presidency but also welshing on local bonds of his own issuance (unprecedented even in an Argentina with a history of at least eight defaults, including the biggest sovereign default ever in 2001). Yet all these contradictions with his message are born out of adversity as electoral tactics rather than economic conviction – this consideration does nothing to retrieve the credibility of Macri’s campaign platform (or the 2020 budget submitted last week) but it ultimately reduces the charges against him to little more than pragmatism.

Pragmatism might be the middle name of Alberto Fernández (far more than his actual middle name of Ángel) but he nevertheless represents a very different phenomenon. In his case the many contradictions are no accident, but true to the essence of Peronism in general and his Frente de Todos coalition in particular. “When I define, I exclude,” was a favourite maxim of Juan Domingo Perón – more valid than ever now when heading a coalition including such different strands of populism as the highly ideological Kirchnerism in its entirety and most of moderate or traditional Peronism.

These contradictions have been constant in the five weeks since the PASO upset conferred frontrunner status on Fernández – an upset which has triggered sporadic market mayhem and massive downtown picket protests, both of which he has sought to calm down (also intermittently). In part this is a tactical question of timing (should Fernández become president-elect, the difference bet- ween financial or social chaos breaking out beforehand or afterwards is far from minor) but it also obeys a more permanent strategy – taking the sectors dependent on state sub- sidies for granted and wooing the disenchan- ted middle classes. To this end he has violated sacred Kirchnerite taboos by talking to the farming lobbies, addressing Clarín Group CEO Héctor Magnetto on a first name ba- sis and sounding out for an economic plan no less than Carlos Meclonian – the ultra- orthodox economist who lasted little over a year as Banco Nación president because of his impatience with gradualism. But today Fernández is the new gradualist with his idea of real wages catching up with prices over a six-month social pact.

In summary, Macri and Fernández are in- creasingly saying the same things even with different words – the latter wants to “rene- gotiate” the public debt and the former “re- profile” it – but in the process are moving in opposite directions. Rather than convergent polarisation, this is convergence to polarise.

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