ARGENTINE UPDATE – Nov 23, 2015


1. ARGENTINA’S POLITICAL EARTHQUAKE (The Wall Street Journal)

2. MAURICIO MACRI ELECTED PRESIDENT OF ARGENTINA (The Washington Post)

3. KIRCHNER ERA’ ENDS WITH OPPOSITION WIN IN ARGENTINA (The Washington Post)

4. A GLANCE AT ARGENTINA AND ITS PRESIDENTIAL ELECTION (The Washington Post)

5. ARGENTINA’S SURPRISE FRONT-RUNNER WORKS TO BROADEN APPEAL BEFORE VOTE (The Washington Post)

6. NO MATTER WHAT HAPPENS IN SUNDAY’S ELECTION, ARGENTINA WILL BE GOVERNED BY THE RICH, HERE’S WHY THAT MATTERS (The Washington Post)

7. IN REBUKE TO KIRCHNER, ARGENTINES ELECT OPPOSITION FIGURE AS PRESIDENT (The New York Times)

8. UPSTART’S RISE HAS ARGENTINA CONSIDERING POLITICAL SHIFT (The New York Times)

9. ARGENTINA ELECTS CENTER-RIGHT PRESIDENT, REPUDIATING FERNANDEZ DE KIRCHNER (Los Angeles Times)

10. MAURICIO MACRI WINS ARGENTINA PRESIDENTIAL ELECTION (Financial Times)

11. MAURICIO MACRI’S CHOICE FOR ARGENTINA: SHOCK TREATMENT OR GRADUAL CHANGE (Financial Times)

12. THE ULTIMATE POLITICAL GOAL (Financial Times)

13. ARGENTINES ELECT OPPOSITION CANDIDATE MACRI AS PRESIDENT (USA Today)

14. OPPOSITION CAPTURES ARGENTINE ELECTION, ENDING ‘KIRCHNER ERA’ (San Diego Union-Tribune)

15. WARNING SIGNS ON THE ROAD TO ‘CHANGE’ IN ARGENTINA (The Huffington Post)

16. MACRI TOPPLES ARGENTINA’S PERONISTS, TOUGH REFORMS AHEAD (Reuters News)

17. ARGENTINA IN FOR A RADICAL POST-ELECTION GRAINS OUTPUT INCREASE (Reuters News)

18. ARGENTINA ELECTIONS: MAURICIO MACRI POISED TO BE NEXT PRESIDENT (CNN)

19. WHY WALL STREET CARES A LOT ABOUT ARGENTINA’S ELECTIONS (CNN Wire)

20. ARGENTINA ELECTS PRO-BUSINESS PRESIDENT; BIG CHANGE EXPECTED (Bloomberg News)

21. SCIOLI HANDS VICTORY TO OPPOSITION’S MACRI IN ARGENTINE RUNNOFF (Bloomberg News)

22. ARGENTINA FEVER IS BACK FOR INVESTORS AFTER WAIT OF 14 YEARS (Bloomberg News)

23. ARGENTINA ELECTS PRO-BUSINESS PRESIDENT; BIG CHANGE EXPECTED (Bloomberg News)

24. CHANGE COMING TO ARGENTINA AS POPULIST POLICIES RUN OUT OF STEAM (Bloomberg News)

25. GOOD MORNING MACRI: WHAT ARGENTINA’S NEW DAWN MEANS FOR INVESTORS (Forbes)

26. WITH A NEW PRESIDENT ARGENTINA MIGHT GET A DECENT ECONOMIC POLICY AGAIN (Forbes)

27. CHALLENGER WINS ARGENTINE RUNOFF (Dow Jones Institutional News)

28. ARGENTINA’S MARKET RALLIES AHEAD OF SUNDAY ELECTION (Investor’s Business Daily)

29. ARGENTINES HEAD TO POLLS TO DECIDE PRESIDENTIAL RUN-OFF (NPR: Weekend All Things Considered)

30. FACTBOX: ARGENTINA’S PRESIDENTIAL CANDIDATES AND THEIR POLICIES (Reuters News)

31. COULD A SOLUTION BE CLOSE FOR ARGENTINA’S STANDOFF WITH HOLDOUT FUNDS? (Business News
Americas)

32. 6 BIG WATER PROJECTS AWAITING SCIOLI OR MACRI (Business News Americas)

33. ALBERTO NISMAN CONSPIRACY THEORIES FLY AS ARGENTINE ELECTION NEARS (NPR: All Things Considered)

34. ARGENTINA TEMPTS BIG MONEY MANAGERS AGAIN; STOCKS AND BONDS HAVE RALLIED AHEAD OF
PRESIDENTIAL ELECTION ON HOPES OF MORE STABLE ERA FOR INVESTORS (The Wall Street Journal Online)

35. QUIET DATA CRUNCHER AIMS TO BRING SENSE TO RAUCOUS ARGENTINE RACE (The New York Times)

36. FROM THE BEAGLE CHANNEL TO BUENOS AIRES, ARGENTINA IS LAND OF VIVID CONTRASTS (The Philadelphia Inquirer)

37. BUENOS AIRES STREET ART IS CRYING TO STOP OIL DRILLING (GlobalStream)

38. PRESIDENTIAL ELECTION PROMISES CHANGE IN ARGENTINA, BUT HOW MUCH? (World Politics Review)

1. ARGENTINA’S POLITICAL EARTHQUAKE (The Wall Street Journal)
By Mary Anastasia O’Grady
Nov. 22, 2015

Mauricio Macri, the new president, pledges to end the conflict of the Kirchner years.

In the midst of double-digit inflation and a stagnant economy, Argentines on Sunday handed victory in the presidential runoff election to 56-year-old Buenos Aires Mayor Mauricio Macri of the Cambiemos (Let’s Change) coalition.

With 76% of the vote counted as we went to press, Mr. Macri led with 52.87% against 47.13% for President Cristina Kirchner’s Peronist Front for Victory (FPV) candidate, Daniel Scioli.

The 58-year-old Mr. Scioli—the Peronist governor of Provincia de Buenos Aires—ought to have coasted to an easy victory. But his association with Mrs. Kirchner was a liability he couldn’t overcome. After 12 years of the Kirchners’ socialist economics, eight under this president and four before that under her late husband Néstor, Argentines want change.

Mrs. Kirchner’s uncivil rants against her political opponents, and a substantial loss of judicial independence and press freedom during kirchnerismo also contributed to Mr. Scioli’s defeat.

The big winner in this election is political pluralism. The Kirchners entered national politics in 2003, during a period of great economic hardship. Over time they tried to replicate the strategy used by the Venezuelan strongman Hugo Chávez to destroy institutional checks on presidential power and to install a one-party state. The election outcome means that the nation has managed to repel this power-grab.

But Mrs. Kirchner also hands Mr. Macri a fiscal and monetary mess in a period of global economic weakness and during a recession in Brazil, Argentina’s lead trading partner. He will have one shot at creating a comprehensive set of policies to inspire confidence, the sooner the better.

Recovery has to start with stabilizing the peso, which is pegged at 9.4 to the dollar but trades in the black market at 15:1. Mr. Macri promised to lift all capital controls and let the price of the currency settle in line with its market value. But to achieve stability he will also have to restore the rules of a market economy, and that means putting an end to the practice of printing money to finance the government. Huge deficits—6%-7% of gross domestic product this year—are unsustainable.

Mr. Scioli tried to frighten Argentines during the campaign by telling them that the peso “adjustment” would reduce the purchasing power of their earnings. The scare tactics didn’t work, perhaps because the nation is well aware that the central bank no longer has the dollars it needs to prop up the peso. The next government will face that reality.

The good news for Mr. Macri is that much of the economy is already operating at the black-market rate, and many prices for consumer goods have already adjusted. This would explain why nongovernment estimates put annual inflation at around 25%, well above the official estimate of 10%. In other words, working Argentines have already taken a cut in purchasing power.

An official recognition of the devalued peso coupled with credible tax and regulatory liberalization might even lead to capital inflows as Argentine assets become more attractive to investors. Export revenues are also likely to increase if Mr. Macri keeps his pledge to liberate farmers and ranchers from punishing export taxes and quotas, and thereby restore their incentive to produce.

Closing the government deficit won’t be easy because the Kirchners did so much to destroy investor confidence and increase the public’s dependence on the state. Regulatory strangulation and expropriation drove capital out of key markets like energy, transportation and utilities. Today Argentina is a net importer of oil and natural gas despite rich reserves. And the government heavily subsidizes transportation and energy.

Greater investment leading to more reliable energy supplies and more competition can solve this problem but not overnight. Certainly any phase out of subsidies has to be coupled with instantaneous and wide-ranging deregulation so that businesses confidence returns.

Argentina won’t be able to access the international capital markets until it resolves the long-standing dispute with creditors who hold bad debt from the 2001 default. Mr. Macri has promised a pragmatic approach, but he’ll have to sell his proposal to the Argentine congress, which he won’t control.

The president-elect has said he would denounce Venezuela before the Organization of American States for its violation of the 2001 democratic charter. He has also pledged to shred the “memorandum of understanding” signed between Iran and the Kirchner government regarding the investigation of the 1994 terrorist attack on the Buenos Aires Jewish community center because it violates international law. If so, foreign policy will change for the better.

Argentina’s recovery won’t be easy. But with the electoral overthrow of Kirchner authoritarianism, the nation already has a lot to celebrate.

2. MAURICIO MACRI ELECTED PRESIDENT OF ARGENTINA (The Washington Post)
By Joshua Partlow and Irene Caselli
November 22, 2015

BUENOS AIRES — Mauricio Macri, the wealthy Buenos Aires mayor who catapulted to prominence on a wave of discontent over government scandals, a feeble economy and combative nationalism, was elected president of Argentina on Sunday, according to preliminary results.

By 9:30 p.m., with Macri leading by seven points, the ruling-party candidate, Buenos Aires Gov. Daniel Scioli conceded the victory.

The stunning opposition victory marks a major shift in Latin American politics, ending a dozen years of leftist rule, first by Nestor Kirchner and then his wife, Cristina Fernández de Kirchner, a tenure marked by increasingly fiery anti-American rhetoric and protectionist policies that isolated Argentina and diminished its influence in the hemisphere.

Macri, a 56-year-old engineer raised in a prominent business family, was given little chance to win before the first round of voting last month, as many assumed Fernández’s Peronist party, with its heavy spending on social welfare programs, had an iron grip on power. But he tapped into the widespread anger about corruption in the ruling party, as well as rampant inflation and anemic growth, with his proposals to reform the state-run economy to attract foreign investment and soothe disputes with the United States and the rest of the world.

Macri’s campaign slogan was direct: “Let’s change.”

Even before the results were announced, the atmosphere at his closing event in a convention center in the capital had an air of celebration, with cheering crowds and waiters in bow ties passing out hors d’oeuvres. Macri had been leading in the polls going into Sunday’s vote and by 6 p.m., television stations were calling the race in his favor.

“With your vote, you made the impossible possible,” Macri told the cheering crowd in his victory speech. “Together, we can create the Argentina we dream about.”

Argentines say that a sunny day is a Peronist day. But this warm, blue-skied Sunday with purple jacarandas in bloom turned out to be anything but.

Macri’s victory ends a historic chapter for the political movement led by Kirchner and Fernández, the country’s most influential power couple since their role models and party namesakes, Juan and Eva Perón, half a century earlier. Following the devastating financial crisis that began in 2001, first Kirchner and then Fernández led the country back to economic life after a brutal period of mass poverty and tear-gas protests. Voters on Sunday spoke of how their tenure, for all its flaws, prioritized the poor and stood up against the International Monetary Fund and other symbols of exploitative first-world capitalism.

“Even though many people may not like Scioli as a candidate, we know that on the other side there is a candidate that represents Argentina’s right and neoliberalism,” said Rafael Rodriguez, 18, who was volunteering as a poll observer in San Isidro, an upper-middle-class northern suburb of Buenos Aires. “You’re voting for a national project. You either vote for a project that includes the redistribution of riches and the strengthening of national industry, or a project where free market rules the country. I think it’s a clear distinction.”

As Ximena Perez, a 41-year-old housewife and mother of two, put it: “The Kirchners managed to pull us out of that dreadful past, and I want this to continue.”

But public fatigue with Fernández’s tenure had been growing. There was deep frustration about the troubled economy. Fernández relied on state-run economic model — she nationalized the oil company YPF — and painted a rosy picture with economic statistics that were widely distrusted. The vast gap between the two exchange rates, the official rate and the black market one, have led many to believe that Macri will devalue the currency. He has said he won’t curtail social spending or begin a privatization binge.

“Even though they raise our pensions every year, it’s not enough,” said Elisa Perez, 69, a retired math teacher who still gives private lessons to make ends meet. “Lately all prices have gone up so much that I can hardly make it through my pension.”

Fernández also pushed Argentina into the camp of South American leftists who have been harshly anti-American, alongside Bolivia, Ecuador and Venezuela. But that “pink tide,” as some called it, seems to be receding as more centrist or conservative voices are gaining ground across the region. She has been battling U.S. creditors — what the government refers to as “vulture funds” — over debts incurred in the financial crisis more than a decade ago. Lilian Tintori, the wife of jailed Venezuelan opposition leader Leopoldo Lopez, showed up at Macri’s victory celebration.

This year, Fernández was further criticized for her response to the mysterious death of prosecutor Alberto Nisman, who was found slumped in his bathroom just a day before he was scheduled to testify to congress about Fernández’s role allegedly conspiring with Iran to cover up the perpetrators of the worst terrorist attack in Argentina’s history. Fernández gave differing accounts of Nisman’s death in rambling speeches and Facebook posts rife with speculation. She was never charged, and the investigation of Nisman’s death has stalled. Macri supporters hope to revive it.

Coming into the race, Scioli had been the clear favorite, but he narrowly won the first round of voting last month. The former powerboat racer who served in administrations dating to Carlos Menem in the 1990s, branded himself the torchbearer for Fernández’s political movement and calls Macri’s proposals “savage capitalism.”

Scioli’s dejected supporters gathered Sunday afternoon in Plaza de Mayo outside his hotel. One of them was Juan Garcia, a 69-year-old retired hospital worker, who felt embittered that Macri, born into an auto and construction fortune, had a privileged upbringing.

“Macri never knew what sacrifice is,” he said. “Not like us workers. He was born with a silver spoon in his mouth. I worked for 30 years in public hospitals and he did nothing to improve the services there during his eight years as mayor.”

But across the city, and the country, voters responded to Macri’s call for a fresh phase in Argentine history. Coming out of the polling booth in a downtown public school Sunday, Felisa Lastra held up her hands in triumph.

“Let’s change,” she said, echoing his slogan. She is 86, with a husband who is 95, and they have 22 grandchildren to think about, she said.

“My country is destroyed. The quantity of poor people. The amount of robbery by our government,” she said. “I told my husband, ‘Alberto, I hope we don’t die without seeing our country rise again. But we don’t have much opportunity left.’ ”

Francisco J. Dotto, a 37-year-old restaurateur and caterer, said that the national project had veered off course. Standing behind the bar at Pascal, a small restaurant on an upscale block in the Recoleta neighborhood, he discussed the challenges of running a small business, including high taxes and aggressive unions that require a percentage of employees’ incomes.

“If you don’t pay, they come and break your windows. It’s crazy,” he said. “We want to have a normal country. We want to be free.”

Dotto voted for Macri to bring this Peronist “bullying” to an end.

“We’re hoping to have a great change in our country,” he said. “A change we need.”

3. KIRCHNER ERA’ ENDS WITH OPPOSITION WIN IN ARGENTINA (The Washington Post)
By Peter Prengaman
November 23, 2015

BUENOS AIRES, Argentina — President-elect Mauricio Macri’s promises to revitalize Argentina’s sagging economy with free-market reforms and improve strained relations with the United States resonated with voters, carrying him to a historic win that ended 12 years of often-conflictive rule by President Cristina Fernandez and her late husband.

But when the business-friendly opposition candidate takes office Dec. 10, he will inherit a country with around 30 percent inflation, near-zero economic growth and entrenched government social spending that private economists warn is not sustainable. He also lacks majorities in either chamber of Congress to pass his deep reforms.

“Macri will begin his mandate in a difficult political position,” wrote Daniel Kerner from the Eurasia Group, a political risk consultancy. “He will have to make difficult economic adjustments and face serious political constraints.”

With 98 percent of the vote counted from Sunday’s election, Macri had 51.5 percent support compared to 48.5 percent for ruling party candidate Daniel Scioli, Fernandez’s hand-chosen successor. Scioli conceded defeat and Macri claimed victory.

“Today is a historic day,” Macri crowed while his supporters celebrated. “It’s the changing of an era.”

The era he hopes to end is that of Fernandez and her late husband and predecessor Nestor Kirchner who rewrote Argentina’s social contract and dominated the nation’s political scene with a mix of patronage, charisma and withering attacks on opponents. Fernandez battled international creditors, had strained relations with Washington and allied her country with late Venezuelan President Hugo Chavez and his successor Nicolas Maduro.

During the election campaign, Macri vowed he would listen more and talk less than Fernandez.

Addressing thousands of supporters late Sunday, Macri said his presidency would not be about “revenge” or “settling scores,” but rather helping the country progress.

“I feel so happy because today we put an end to the mafia” of ruling party rule, said Felisa Sanchez, a Macri supporter waving an Argentine flag. “They claimed to be Robin Hood helping the poor with social welfare plans when the poor are really helped with jobs and education.”

But fulfilling his campaign promise to reform Argentina’s economy may prove difficult.

Macri, 56, has pledged to lift unpopular controls on the purchase of U.S. dollars and thus eliminate a booming black market for currency exchange. Doing that would likely lead to a sharp devaluation of the Argentine peso. With foreign reserves around $26 billion, low for such a large economy, the government would desperately need an immediate infusion of dollars.

That could come from many different places, but ultimately would require structural changes to a largely protectionist economy, solving a debt spat and developing warmer relations with the United States and other nations.

He has also vowed to jumpstart the economy by lifting many tariffs, lowering taxes and attracting foreign investment. He promised to solve a long-standing New York court fight with creditors in the U.S. who Fernandez called “vultures” and has refused to negotiate with, which kept Argentina on the margins of international credit markets.

Many of these moves could face resistance in a hostile congress and Macri’s own background will feed into Argentina’s political polarization after more than a decade of left-leaning government.

He hails from one of the country’s richest families and rose to prominence as president of the popular Boca Juniors soccer club. On the campaign trail, he sometimes talked about being kidnapped in the early 1990s, an experience he said helped him understand the needs of others and he credits with pushing him into politics.

Later, as major of Buenos Aires, he was known for a technocratic manner that stressed efficiency over style.

Scioli, the former governor of Buenos Aires province, had been expected to win by 10 or more points in last month’s six-candidate, first round of presidential voting. His failure to do so set up Sunday’s runoff with Macri.

Scioli tried to regain his momentum by frequently attacking Macri. He said a Macri win would subject this nation of 41 million people to the market-driven policies of the 1990s, a period of deregulation that many Argentines believe set the stage for the financial meltdown of 2001-2002.

“This is a painful day for Argentines,” said Rocio Robador, a government supporter who was crying in the iconic Plaza de Mayo. Robador, 36, said she was able to get pregnant and have a child thanks to a government that helps poor women get fertility treatments.

Macri’s win signals a clear end to the era of Fernandez and her late husband. During their years in office, the power couple gained popularity by spending heavily on programs for the poor, raising tariffs to protect local economies and passing several progressive laws, including the legalization of gay marriage in 2010.

Macri frequently repelled Scioli’s attempts to paint him as a 1990s neoliberal, saying he would lead with “21st century development” as opposed to “21st century socialism.”

In recent weeks, Macri increasingly talked about international relations, signaling some of his foreign policy priorities.

He said he would push to expel Venezuela from the South American trade bloc known as Mercosur because of the jailing of opposition leaders under Maduro. That would be a huge change for a continent where many countries, including neighbors Chile, Brazil and Bolivia, have left-leaning democratic governments that have maintained close ties with Venezuela.

4. A GLANCE AT ARGENTINA AND ITS PRESIDENTIAL ELECTION (The Washington Post)
November 23, 2015

A glance at Argentina and its runoff presidential election on Sunday:

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THE COUNTRY: About four times the size of Texas, Argentina has 41 million people and is Latin America’s third-largest economy. Population is largely of European descent and at least nominally Roman Catholic. Its most famous citizen is Pope Francis. The country remains traumatized by its 2001-2002 economic crash under free-market governments that wiped out many people’s savings.

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CURRENT GOVERNMENT: The election ends 12 years in power for the Kirchners: first Nestor Kirchner in 2003 and then his wife Cristina Fernandez, who was elected in 2007 and 2011. (He died in 2010.) They expanded welfare programs and allied Argentina with leftists such as Venezuela’s Hugo Chavez. Economic growth was strong during much of the previous decade, but the economy has stalled in recent years, with high inflation and a slumping national currency.

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THE CANDIDATES: Fernandez’s movement backed former Vice President Daniel Scioli, a 58-year-old businessman who lost an arm as a boat racer. His opponent was Buenos Aires Mayor Mauricio Macri, 56, also a businessman and former president of the Boca Juniors soccer club.

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WHAT’S AT STAKE: Scioli promised to continue the Kirchners’ welfare state policies while making corrections to get the economy back on track. Macri campaigned on promises to make large reforms to the protectionist economy installed by the Kirchners while retaining key welfare benefits. Both candidates said they would try to solve a longstanding dispute with U.S. bondholders that has frozen Argentina out of international credit markets.

5. ARGENTINA’S SURPRISE FRONT-RUNNER WORKS TO BROADEN APPEAL BEFORE VOTE (The Washington Post)
By Joshua Partlow and Irene Caselli
November 21, 2015

HUMAHUACA, Argentina — When Mauricio Macri took the stage in this poor, neglected corner of northern Argentina on Thursday for his last campaign rally, he was no longer just the private-jet-flying Buenos Aires mayor with the fashion-celebrity wife.

Standing under an independence monument in work jeans, his sleeves rolled up, Macri assured the rural crowd that he would “work every day so that you can have a better life.” Earlier, he had taken part in a ritual sundial ceremony at the Tropic of Capricorn, facing indigenous women in ponchos and chewing coca leaves.

On Sunday, Argentine voters will go to the polls, with Macri the surprise favorite after he came in a close second in the initial round of voting last month on the strength of a campaign to break with the country’s Peronist past. The election, which pits him against President Cristina Fernández de Kirchner’s chosen successor, Daniel Scioli, will test Macri’s new image as a man for all Argentines — despite critics who call him an uber-capitalist with scant regard for the poor — while also gauging the national appetite for more Kirchner-style policy after a dozen years under Fernández and her late husband, Néstor.

Ahead of this year’s election, many thought the Kirchners’ political movement would be tough to derail. Despite Argentina’s stagnant economy, its loss of influence in the hemisphere and a string of damaging political scandals, Fernández remained popular, particularly among the lower classes, who received government welfare programs and responded to her combative brand of nationalism. Scioli, the 58-year-old governor of Buenos Aires province and a former vice president, was the clear favorite either to win in the first round or at least get enough votes to show overwhelming support.

But the tight race in October surprised even Macri’s advisers and reenergized his campaign. Down by just three percentage points in the first round, polls show Macri now leading by six to eight points.

“The results caused a political earthquake,” said Waldino Cleto Suarez — a political analyst and director of Lado B Consultores — who is close to the government. “The surprise has to do with the fact that those with split allegiances ended up voting against the government.”

Scioli, a former power-boat racing champion, sought to recapture those allegiances in the final days. He held his closing rally in La Matanza, a poor neighborhood with strong ties to the ruling Peronist party and the biggest district in the greater Buenos Aires area. He spoke amid waving blue-and-white flags in the Juan Domingo Perón Sports Center, which Fernández had inaugurated this year.

Scioli has cast Macri as a throwback capitalist in the neoliberal mode, a man who will raise taxes, cut subsidies, devalue the peso, privatize state-run companies, cave in to the U.S. creditors who are demanding that Argentina pay its debts and capitulate to the International Monetary Fund.

“The option is clear,” Scioli told the crowd in La Matanza on Thursday night. “The devil of savage capitalism” or “the founding base of Peronism that brings it into these new times.”

That message seemed to resonate with some residents, who noted that the area had improved during the Kirchners’ dozen years in power. In the aftermath of the devastating financial crisis of 2001, Néstor Kirchner helped stabilize the country and won supporters with a program of social spending on the poor and jobless. Fernández succeeded her husband as president in 2007.

“There used to be no drinking water, no paved roads, no schools. Lots of people were unemployed,” said Maive Coria, a 27-year-old English teacher. “But now at least half of the people around me have a job, have a house, a car. Their children go to school. I believe that we have to continue this way.”

The Peronist hold on the Buenos Aires suburbs appears to have slipped over the years. Fernández’s controversial cabinet chief, Aníbal Fernández, lost the race for Buenos Aires governor to a young ally of Macri’s, María Eugenia Vidal. But Scioli has still pushed a message of continuity, warning that gains of the past decade will be lost if his opponent wins.

“I am sincerely afraid of a Macri victory,” Gerardo Guerrero, a 54-year-old shoe salesman and father of five, said at the Scioli rally. “Macri represents the rich.”

Macri’s team has countered that Scioli’s campaign amounts to fearmongering and that Macri wants to return Argentina to the fold of normal nations. As mayor of Buenos Aires for the past eight years, he has been credited with sprucing up Latin America’s most elegant capital, with new metrobus lanes, a new police force and investment in the city’s poorer south side. Marcos Peña, Macri’s chief campaign strategist and former mayoral staffer, said Macri had increased taxes on wealthier areas to pay for that investment.

“The idea that we’re only going to work for the rich is a childish caricature,” Peña said. “Our intention is not to show that we are right ideologically. We want to work so that people can lead better lives.”

Macri, a 56-year-old engineer from an Italian family that built an auto and construction empire, seeks a more pro-business climate. He sees Argentina drowning in a muck of economic problems, from high inflation and a large deficit to unreliable government statistics on a range of economic indicators, including poverty. He wants to push the country away from alliances with leftist Latin American governments such as Venezuela and settle creditor disputes with the United States and others, while making reforms that would attract foreign investment and spur economic growth.

Because of government “lies,” Macri said Thursday, “we don’t know what the reserves are, what is the value of the dollar . . . what is the reality about how many Argentines are in poverty.

“To the foreigners I want to say, ‘We will clarify things,’ ” he added. “We will establish our currency. We will combat inflation. We will work together with everyone for an independent judicial system.”

One factor is where the votes for third-place finisher Sergio Massa will go in Sunday’s election. In the northern state of Jujuy, where Macri closed out his campaign, the ally-turned-
opponent of Fernández had fared well, and Macri hoped to seize those swing votes while also reaching out to the poor and indigenous in the area along the Bolivian border. Residents who came out in support seemed to be motivated by weariness with the current government.

“The corruption, the impunity — each day it gets worse,” said David López, a 53-year-old local government employee who showed up outside a hotel Macri was visiting. “People are looking for options that are outside of the government. Now that option is Macri.”

6. NO MATTER WHAT HAPPENS IN SUNDAY’S ELECTION, ARGENTINA WILL BE GOVERNED BY THE RICH, HERE’S WHY THAT MATTERS (The Washington Post)
By Noam Lupu
November 20, 2015

This Sunday, Argentines will go to the polls to choose between two candidates vying for the presidency in a runoff election. The choice they face is being billed as a choice between continuity and change.

Daniel Scioli, the hand-picked successor to President Cristina Fernández de Kirchner, portrays himself as the candidate of continuity, promising to maintain the achievements in economic and social policy credited to Kirchner and her predecessor and late husband, Néstor Kirchner.

Meanwhile, Mauricio Macri, the mayor of Buenos Aires, calls himself the candidate of change; he even named the alliance of parties supporting him “Let’s Change.”

Since Macri’s surprisingly strong showing in the first-round election on Oct. 25, politicians and pundits in Argentina have talked incessantly about one question: Will Argentine voters opt for continuity or change?

But in some crucial ways, that decision has already been made.

On Oct. 25, Argentines elected a new Chamber of Deputies, the lower house of Congress. Some seats changed hands; Scioli’s party lost 26 seats, and Macri’s gained 21. And of the 257 seats in the chamber, 130 will be held by new deputies. What does this new Chamber of Deputies look like? What kinds of people will set national policy in Argentina for the next two years?

Like the previous Chamber, the new one will be overwhelmingly affluent. As Figure 1 shows, only nine percent of deputies in the new Chamber will come from working-class backgrounds. In a country where roughly 70 percent of voters work in manual labor or service industry jobs – as construction workers, day laborers, or maids – 91 percent of the newly elected deputies are white-collar professionals – lawyers, engineers, doctors and business people.

And 100 percent of the contenders for the presidency are affluent, too. Scioli is a successful and wealthy athlete turned entrepreneur. Macri, born into a family fortune, is a millionaire businessman and the former manager of one of Buenos Aires’s biggest soccer teams.

No matter what happens on Sunday, Argentina will continue to be governed by the rich.

https://img.washingtonpost.com/wp-apps/imrs.php?src=https://img.washingtonpost.com/blogs/monkey-cage/files/2015/11/LUPU-NL-Figure-1.png&w=1484
Caption: Occupational backgrounds of members of the 2016-2017 Chamber of Deputies of Argentina. Data: author’s coding. Figure: Noam Lupu.

But scholars are increasingly noticing that politicians respond much more to the opinions of wealthy constituents than to those of poor ones.

In Argentina, Zach Warner and I studied a unique survey that was put to Argentine voters and to a sample of Argentine politicians. Using these data, we looked at the degree to which voters and politicians held similar opinions on a range of policy issues; that is, we measured the degree of what political scientists call congruence between voters and their elected representatives.

Crucially, we also disaggregated mass opinions between poor and rich voters. What we found is disheartening: Argentine politicians’ attitudes are consistently closer to the views of wealthy voters.

Of course, these are just the views politicians express in a survey. When it comes to making policy, legislators face a wide range of external pressures that mute the influence of their own views: parties, constituents, interest groups, social movements and so on. Even so, Nick Carnes and I find that these personal views shape the policy agenda.

When we looked closely at one legislative session in Argentina, we found that legislators from the working class tend to introduce substantially more progressive economic bills. In a typical legislative session, the shortage of Argentine legislators from the working class translates into roughly 50 fewer progressive bills being introduced.

It is impossible to know exactly how these missing bills might have affected economic policies, but we do know that the policy agenda would have looked more progressive.

It turns out that having so few working-class people in public office skews policy toward the preferences of the rich. The fact that legislators come disproportionately from affluent backgrounds biases the economic agenda.

None of this is unique to Argentina. Governments all over the world are disproportionately run by rich politicians. Across Latin America, only 10 percent of national legislators come from working-class backgrounds, even though 80 percent of the electorate hold working-class jobs. This phenomenon is also not new.

Argentina’s deputies have probably always been far more affluent than the people they represent. At least since the early 2000s, the proportion of working-class deputies has hovered in the single digits.

Sunday’s vote may have some important consequences for Argentine politics. In some ways, Scioli and Macri offer different policy options. But no matter who wins the presidency, Argentina will still be governed by people wildly more affluent than the voters who elected them. And that has real consequences for who wins and who loses in democratic politics. On that score, continuity has already prevailed.

Noam Lupu is assistant professor of political science and Trice Faculty Scholar at the University of Wisconsin-Madison.

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7. IN REBUKE TO KIRCHNER, ARGENTINES ELECT OPPOSITION FIGURE AS PRESIDENT (The New York Times)
By Simon Romero and Jonathan Gilbert
23 November 2015

BUENOS AIRES — Argentine voters handed a victory to Mauricio Macri in the country’s presidential election on Sunday, delivering a mandate to an opposition political figure seeking to roll back some of the protectionist economic measures of the departing president, Cristina Fernández de Kirchner.

With votes from 99 percent of polling places counted, Mr. Macri, the mayor of Buenos Aires and a former president of Boca Juniors, one of Argentina’s most popular soccer teams, was leading with 51.4 percent of the vote, according to election officials, against 48.5 percent for Daniel Scioli, a former speedboat racer and vice president under former President Néstor Kirchner, who died in 2010. Mr. Scioli conceded defeat on national television on Sunday night.

Running a largely nonconfrontational campaign in a society that has grown increasingly polarized under Mrs. Kirchner, who succeeded her husband in 2007, Mr. Macri, 56, stunned the political establishment in October by forcing the race into a runoff and maintaining his surge in recent weeks. He ran to the right of his rivals, blending plans to overhaul the economy and promote the tolerance of various points of view on social issues.

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