With debt negotiations at both national and provincial level dominating the headlines, the Economy Ministry is again the frontrunner for this week’s ‘Ministry Positions’ column but it will have to await its turn until the talks reach some kind of conclusion (even at the cutting edge in Buenos Aires Province, D-Day has been deferred until next Wednesday). Instead, we will look at another sector facing a cross-roads – public works – because here the moment of truth within the limbo of its courtroom arena will not be so clear-cut, or rapid. No point in waiting.
Nominally speaking, the Public Works Ministry ranks among the new creations of President Alberto Fernández as there has been no portfolio bearing that name since 1991. But public works never went away as a department and in 2003 Néstor Kirchner removed them from the aegis of the Economy Ministry to make them the nucleus of a Federal Planning Ministry under Julio De Vido (the only minister to go the distance of the 12 Kirchnerite years, apart from his Labour colleague Carlos Tomada). Within a year accusations of misallocation were proliferating and public works had become such a byword for corruption by the time Mauricio Macri took office in 2015 that they again lost ministerial status, being divided up between two of Macri’s most powerful ministries, Interior and Transport.
Within this context the revival of a Public Works Ministry after almost three decades suggest a direct defiance of the accumulation of court corruption cases during the Macri years – a barrage centred not so much on De Vido as his ultimate boss during twothirds of his ministerial career, current Vice-President Cristina Fernández de Kirchner (photographed this week at a Santa Cruz hydro-electric dam with two of her co-defendants). Therein lie the cross-roads facing public works – will these cases continue to leave the whole sector under a cloud, dooming public-private partnerships (PPPs), or can they be dismissed as malicious “lawfare,” thus permitting the new ministry to make a fresh start within the fiscal constraints?
The outcome of these cases is not easy to see – on the one hand, there is plenty of documentation and on the other, too much seems to depend on shuttlecock judges and whistleblowers. Neither the aim nor the scale of the alleged corruption is clear – was it merely the personal enrichment of various officials and businessmen or was public works spending converted into one gigantic slush fund to feed the political machine keeping the Kirchner family in power? Nor is the money at stake clear because not only is a direct allocation to this sector lacking in the budget but estimated revenue lags so far behind the real thing thanks to inflation that there is ample scope for discretionary funding.
This context has also conditioned the choice of minister. While reviving the ministry might form part of a denialist strategy, President Fernández could never carry this to the extreme of naming a vice-presidential sidekick, never mind bringing back De Vido, given the widespread public credence still commanded by the perception of Kirchnerite corruption (including almost half of last year’s Frente de Todos voters, who admitted it in some form while giving priority to other, mostly economic issues). Instead the choice fell on an intermediate figure between the presidential and vice-presidential wings of the ruling coalition – Gabriel Katopodis, 52, the Peronist mayor of the northwestern Greater Buenos Aires suburb of San Martín since 2011 until recently.
Politically Katopidis has backed a different horse in each election. After toppling the Radical Ivoskus dynasty (also Greek), he was a backbone of Sergio Massa’s dissident Peronist Renewal Front in the 2013 midterms before becoming the last of Massa’s eight mayoral allies deserting his 2015 presidential bid to leave him for the Kirchnerite Frente para la Victoria (“Victory Front”) – his name remains linked to current lower house Speaker Massa to this day (as does that of his colleague in the closely related Transport Ministry, Mario Meoni, also an ex-mayor).
But in the 2017 midterms Katopidis shunned Cristina Fernández de Kirchner’s new-fangled Unidad Ciudadana (“Civic Unity”) creation to back the traditional Peronist Partido Justicialista (“Justicialist Party,” PJ) senatorial ticket of ex-minister Florencio Randazzo – whose campaign manager was none other than Alberto Fernández, thus smoothing his path into the national Cabinet. With both the Fernández and (eventually) Massa all enlisted in Frente de Todos, last year’s choice was a no-brainer.
Early days for Katopidis but last Monday he announced a “transparency unit” to control tenders and monitor construction in real time, an opening bid to distance his rebranded ministry from the shady De Vido past. He was also scathing about the Macri administration, magnifying its failures to epic levels – he reported two-thirds of public works as paralysed (which might well be true given the anxiety to meet the primary fiscal surplus targets agreed with the International Monetary Fund) but he reported the almost zero implementation of the Rutas Seguras programme (which aimed at widening 4,000 kilometres of existing roads) in such a way as to imply that there was no highway construction at all under Macri.
Turning from the minister to the ministry, the Public Works Ministry has now existed in three centuries under that name – it was created by Julio Argentino Roca for his second term in 1898 (when much of the belle époque architecture feeding this city’s claim to be the Paris of South America had already been built). Not many famous names among the 46 ministers between Emilio Civit (1898-2004) and José Roberto Dromi (1989-1991) – Roberto Ortiz later reached the presidency, Juan Pistarini founded the Ezeiza international airport which still bears his name, Ingeniero (Carlos) Maschwitz is remembered in local geography, while both Roque Carranza and Rodolfo Terragno were prominent Radicals.
Then-economy minister Domingo Cavallo’s annexation of this ministry in 1991 was a typical power play on the part of the superminister but Dromi (a prime mover in Carlos Menem’s privatisations) was also in deep trouble over the so-called “Swiftgate,” when a bid to gouge bribes out of the Chicago meat-packers Swift Armour for the installation of a plant went public – falling into disgrace, Dromi nevertheless bounced back years later as an advisor to De Vido and was instrumental in the 2012 privatisation of YPF oil. Evidently corruption is an old story for this department.
The ministry is now up and running but what about public
works – can this basically political appointment start making his
mark on a clean sheet or will judicial overhang and fiscal constraints hamper his best efforts?