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OP-ED | 02-10-2021 07:47

The poverty of patronage

The defeat of the Frente de Todos government snapped a cruel paradox prevailing all this century whereby rising poverty represented a vicious socio-economic cycle for the nation but a virtuous circle for populist politics.

The Gospels have long asserted that the poor are always with us while the official confirmation of dire poverty figures by the INDEC national statistics bureau is far from being any novelty in this century and yet Thursday’s data potentially break new ground. And not because they are the worst ever (indeed the percentage of those below the poverty line is slightly down from the second half of last year, even if destitution is inching alarmingly up) but because their political context has changed dramatically since last month’s PASO primaries.

This is because that upset defeat of the Frente de Todos government snapped a cruel paradox prevailing all this century whereby rising poverty represented a vicious socio-economic cycle for the nation but a virtuous circle for populist politics since their captive vote was thus constantly multiplied. But now the circles are moving in different directions. According to the previous populist logic, the more the state crowded out the private sector, the more dependent people became on public employment and the patronage of welfare handouts with several inland provinces and Greater Buenos Aires as perfect examples of this paradigm. But judging from the mass desertion of erstwhile Frente de Todos voters in many of the poorest districts (losing fully a third of their 2019 vote last month nationwide) many of the poor are reading this scheme as a far more vicious circle – the more money they print to give us social plans, the more inflation and the more worthless these plans become. Some might even reason that if the government could squeeze pensions and terminate special pandemic assistance while on top in the first half of this year whereas now in the wake of defeat they are breaking the bank and throwing money at their problems to the tune of some 150 billion pesos in electoral goodies, then perhaps it makes a lot more sense to vote against them.

Yet to speak of a change in paradigm is to run ahead of events. There are still plenty of unknowns – the actual results of next month’s midterms, whether the primitive game plan of “putting money into pockets” will suffice to turn the election around (as it did in San Luis in 2017) and whether the Cabinet changes replacing the delegates of the presidential coalition wing in particular with more pragmatic territorial party bosses represent a change of strategy and identity or merely tactics.

Meanwhile a closer look at Thursday’s poverty data. The slight dip from last year should in no way diminish concern that the percentage below the poverty line remains above 40 despite emergence from quarantine and economic rebound, including a healthy trade surplus. Last Thursday’s data reported almost 50,000 more poor people within the 31 urban centres covered by the INDEC survey, even if the percentage fell and also the nationwide projection of these figures to the entire population (from 19.2 to 18.5 million). Even more alarmingly the destitute within those below the poverty line rose in both percentage and absolute numbers – from 10.5 to 10.7 percent and from 4.5 to 4.8 million people.

The regional distribution of these latter figures is far from even – well over 11 percent in Greater Buenos Aires and the Northeast, just under 10 percent in the Northwest (the region of the new Cabinet Chief Juan Manzur) and five or six percent in the rest of the country. The overall poverty figure inching down from 42 to 40.6 percent of the population also hides a more complex reality – instead of a slight shift of 1.4 percent, it might well mean millions of people bouncing back above the poverty line amid this year’s growth rate of seven or eight percent while almost as many slide below (especially the informally employed and the middle classes from the most battered services sectors).

As always when poverty data is published, the experts call for structural solutions and the creation of quality jobs but this time it might actually happen – because the lesson of last month’s PASO primary (yet to be confirmed next month) might well be that the political dividends of poverty are no longer there while all the socio-economic problems it brings are more burning than ever.

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