How are we and where are we going?

How are we and where are we going?

In that financial scenario, in the midst of almost 2 years of economic recession and doubling of the inflation rate, salaries were destroyed, in a context of increasing unemployment and extravagant levels of poverty and indigence. Economic activity in 2019, GDP fell 2.5%, industry 6.4%, private consumption 7.8%, investment 17.8% and the use of industrial installed capacity with 59.6%. Annual inflation increased to 53.5% in 2019 when it had reached 26.4% in 2015, while the real salaries of workers registered in the private sector fell between 18% compared to November 2015 according to various evaluations.

Added to this incomprehensible economic situation were the economic footprints of COVID-19, the war in Ukraine and a drought of fabulous scope. Even so, and contrary to the difficult context, the level of economic activity surpassed the trance with a vigorous recovery in 2021 and 2022, so much so that the level of activity in 2022 was at levels similar to those of 2015, when the mandate of Cristina Kirchnerrecovering the 4 years of decline of Macri.

Here and now Argentina’s GDP has suffered 4 years of low growth with Cristina Kirchner, 4 years of decline under Macri, and 4 years of low growth with Alberto Fernández. Therefore, the GDP per capita at the end of Macri was around 11% lower than that of Cristina Kirchner and around 2% less during the Alberto Fernández period. The year 2023 will end with an inflation rate greater than 150% annually.

To the question of why other countries had a pandemic and did not have the problems of Argentina? It is easily answered, we Argentines are clearly divergent in relation to the countries that suffered from COVID-19 and war, because we previously suffered from the government of Mauricio Macri, in addition to a drought that in one year caused us to lose US$21 billion in export income. As a result of the different coups d’état that interrupted the connection of short-term and long-term policies, with conservatism and neoliberalism, our GDP currently represents only 12.5% ​​of the GDP of the entire region, when it was 40% a year ago. beginning of the last century. Incidentally, when we only had 2 million inhabitants. In addition to the permanent failure of neoliberal policies, the pandemic, the war, the drought and the IMF were added, the next Government will have to fight with a complicated situation, which has worsened from 2016 onwards.

The country needs a complete and credible stabilization plan, a program to resume the path of economic growth that marked the 107 consecutive months of growth of Néstor and Cristina Kirchner (until the Lehman Brothers crisis), trying to avoid another blow of social cost. , which would consist of the payment of the “deferred check” of the Macrista party and the plagues of Alberto Fernández.


If Milei wins, with her new boss; At a minimum, it releases and deregulates all the variables of the economy, unconditionally. Milei made a serious commitment to lower public spending by 15% of GDP. This fiscal discipline against society, to achieve a primary surplus, requires an extravagant reform of the State, pension reform, low tax reform of taxes on the rich (to “supposedly” encourage private investment), labor reform, deregulation, mega devaluation , then the promised dollarization, in a manner consistent with the rest of the macroeconomic policy and the haphazard economic organization. Milei would try to introduce the structural reforms by decree, without a minimum of consensus from any political, social force or from the labor confederations, to be able to be implemented. Without a doubt, as Javier Milei, Macri and Patricia Bullrich said, they want the economy to explode.

But Argentina has already tried that concoction. It does not work. It is socially unviable. It could not be a democratic Government that continues the advance against the rule of law.


It created a new transitional regime until the ballot for dollar settlement for all exporters, who will be able to enter 70% through the official market at $350 and the remaining 30% through the CCL (Cash With Settlement). This is a significant improvement for those who did not access the “gear dollar” and 6% for those who consented to the 75/25%. It achieved the activation of the second tranche of the swap with China for the equivalent of US$6.5 billion. These dollars will be used to intervene in the official and alternative dollar markets, pay debt maturities with the IMF until the end of the year.

As the rise in the interest rate was not enough to stop the “blue”, it chose to intervene in the blue market, offering dollars at a wholesale level with blocks of a minimum of US$50,000 per transaction or $50 million pesos, with Below market prices: at $880 with a 25% gap. Futures markets were betting last week on a strong devaluation of the official dollar, whoever wins. By the end of November they expected $407, by the end of December $617 and by the end of July 2024 at $1,220, around 250% above the current value, and the inflation that the consulting firms crow about.

Since last week (paying all exports almost $500 per dollar, Massa managed to lower the financial dollars and managed to strongly decompress the blue dollar to $890. From the extravagant $1,150, before the largest cave in the downtown area was discovered and its ramifications, he lowered it 23% in a few days.

The Argentine society consulted about whether it can pay $3 million per year for university or take away medicine from the elderly says no. Some will vote for Milei, but they demand the irreplaceable role of the State and only UxP can guarantee it. With the anarcho-capitalists there is no mercy, Law, or order possible. Peronism always guarantees social peace and the rule of law.

The democratic crisis of the “assault on the Capitol” and Bolsonaro’s excesses can be explosive in an Argentina that put a limit on neoliberalism with a State of Siege. Macroeconomic imbalances must be fixed with more State and not less. The anarchy of the Milei-Macri team, if it is not broken in the coming days, although Milei can be broken or “lowered” in the face of so much pressure, there are no solutions. We are faced with a liberal who “eats glass”, without any experience in public or private management (he is not known to have important hierarchical positions), without teams and without team management or experience in conflict resolution, he can end quickly.


Massa anticipated income and deferred payments like a private sector Financial Manager. It concludes with a total fiscal + quasi-fiscal deficit of more than 10 points of GDP, high monetary financing to the Treasury, economic subsidies that in the fourth quarter will be 3% of GDP, negative net reserves in the BCRA, debts in dollars: “ Macri did it”, debt with external suppliers for imports, high inflation and poverty.

Real wages fell 12.1% between 2016 and 2022, while prices in concentrated industrial sectors grew 21.3% above the CPI. The trajectory of wholesale prices, oligopolistic companies, prices expanded 34.9% above retail prices in the period 2016-2022 (FLACSO).

This imbalance is recognized with both Mauricio Macri and Alberto Fernández. Under Macri, real salaries fell 18% between 2015 and 2019, while the prices of oligopolistic companies and concentrated groups increased on average 9.5% above the CPI. Under Alberto Fernández, real wages stagnated by +0.5% between 2019 and 2022, in a context in which the prices of concentrated companies rose almost 10% above the CPI. In the microcosm of highly concentrated activities, the prices of the “economic groups” rose 25% above consumer prices between 2019 and 2022. This year has not been better, for now it is up to the next CHRO (Chief Human Resources) that assumes a recomposition of income, in a manner consistent with the financial restructuring that corresponds to the (CFO) and, resume the economic growth that must be achieved by the new (CMO) Minister of Economy who, as he announced, does not belong to their political space.

The challenging tasks that we will see following the eventual election of Massa as president are those that need to meet certain characteristics that lead the politician to his maximum deployment of capabilities and in which, a Minister of Political Economy will require connecting with these skills to enhance them.

Director of Esperanza Foundation. https://fundacionesperanza.com.ar/ UBA Postgraduate Professor and Master’s Degrees at private universities. Master in International Economic Policy, Doctor in Political Science, author of 6 books

Source: Ambito

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