When it seemed clear, by mid-1999, that Fernando de la Rúa would win that year’s presidential race against the Peronist candidate, one of the Herald’s star reporters of the time, a Brit, told a few of us at the newsroom on Azopardo Street that he thought it was time for him to leave the country. “Everything will become dull and ordinary from now on,” he predicted. We all agreed.
Two years later, as a correspondent in the Casa Rosada on that traumatic December 20 – the day of de la Rúa’s resignation – the picture was awkwardly different. I spent that entire day running to and fro, between the hectic corridors of the Pink House, where nobody knew exactly what was going on and/ or who was in charge, and the hellish streets of downtown Buenos Aires, where five people would be killed in the clashes (over 30 died nationwide).
The former president’s funerals were an example that death – and history – is not always redeeming. The political establishment gave de la Rúa a lukewarm and purely formal farewell, limited to condolences to family and friends and an acknowledgment that he was pro-democracy. Just a handful of people stood in line to pay him their last respects in Congress, where de la Rúa served elected seats in both Houses before becoming the first elected mayor of Buenos Aires City and, later, president. Few people vindicated his peccable administration, which was cut short by half amid a crippling economic recession and a debt crisis, which that December had snowballed into a run on banks and the freeze of deposits popularly known as the ‘corralito.’
But de la Rúa’s life, however, does provide lessons that the politicians of Argentina today should not turn a deaf ear to. Here’s two of them, one we continue to ignore, and another that we seem to have learned the hard way:
Lesson 1: Never underestimate the speed at which an economic crisis can escalate.
A year before his resignation, de la Rúa seemed to be in one of his presidency’s best moments. He appeared on TV, “happy” to deliver “the good news” that the country had obtained an ext r a o r d i n a r y US$40-billion aid package from the International Monetary Fund (IMF) and other multilateral lenders to “shield” Argentina financially. In Spanish it was called ‘blindaje,’ and the ruling party launched a marketing campaign arguing that “blindaje would equal growth, education and prosperity,” among other wonders.
This is of particular importance in the current context. President Mauricio Macri’s ruling party is enjoying its best political moment of the year and behaves as if the worst is over, to the extent that it is now growing confident it can walk away with a victory in October’s presidential election in the first round. Macri’s approval ratings are improving, largely thanks to the foreign exchange lull that began in late April. Some polls are now even showing the race heading for a neck-to-neck finish. But is this serenity attributable to domestic government action or overall international market trends, especially at the prospects of the Federal Reserve slashing interest rates later this month and thus boosting the outlook for emerging markets?
With the country now in a two-year recession, for the first time since the crisis that led to de la Rúa’s exit, Argentina’s economy is still very fragile. The behaviour of the country’s wealthiest sector, the farmers, is an indication of that. Despite this year’s record harvest, their crop sales in the first six months of this year have totalled US$10.7 billion, nine percent lower than the average of the last 10 years and 7.3 percent lower than the same period last year, which was marked by a severe drought.
Keep the exchange rate steady for a few weeks and the country’s leadership begins to behave as if nothing was wrong. A lesson not learned.
Lesson 2: Political isolation is your ticket to retirement.
Two months before de la Rúa announced the “good news” of the financial bailout, in late 2000, his vice-president had resigned. Carlos “Chacho” Álvarez was also the head of the Frepaso centre-left party, the main partner of de la Rúa’s Radicals in the governing Alliance. The resignation over the kickbacks scandal in the Senate left de la Rúa in political isolation.
Macri and his allies seemed to have learned from that lesson. Despite evident and growing differences, the ruling alliance – of his PRO party with the centrist Radicals and the more maverick Civic Coalition of Elisa Carrió – has survived and is even expanding to incorporate the Peronist Miguel Ángel Pichetto as its vice-presidential candidate this year.
At the opposite end of the political divide, former president Cristina Fernández de Kirchner has also realised the second of her two administrations suffered from political confinement and has opened up to a more moderate version of the Kirchnerite years, with Alberto Fernández as her presidential candidate.
How the power dynamics in a Fernández-Cristina Fernández government would play-out remains a mystery. But gradually, Argentina seems to be starting to behave like a parliamentary system, which means that alliances guarantee governability. That is probably a sign of maturity.