Argentina Christmas update








By Matt O’Brien
December 22, 2016

Argentina could have been the United States.

Like the U.S., it was one of the world’s 10 richest countries at the turn of the last century. And also like the U.S., that made it a New World magnet for Old World immigrants. But unlike the U.S., that was as good as it ever got. There was no Argentinian Dream. Just a nearly never-ending nightmare of either falling behind gradually or falling behind suddenly. All of which was self-inflicted.

Its fundamental problem was how unequal it was. About 300 families controlled most of the land, the economy, and the government. Everyone else was just a cog in their beef-and-grain-exporting machine. Or, as the Financial Times’s Alan Beattie has put it, Argentina is “what North America might have looked” like “if the South had won the Civil War and gone on to dominate the North.” Which is to say that it was a semi-feudal aristocracy dependent on a steady supply of cheap labor.

If this sounds like a good way to start a class war, that’s because it was. Up until recently, Argentina had spent most of the last 100 years alternating between left-wing populists who promised to share the country’s wealth, and right-wing military dictatorships that tried to stop that from happening. And, of course, with the stakes so high, neither side was willing to play by the rules. The Peronists tried to tip elections in their favor by locking up the opposition’s leaders, shutting down their newspapers, and getting rid of unions that weren’t loyal to the regime. The army, meanwhile, didn’t bother with any kind of democratic pretense. It launched coup after coup after coup, outlawing the Peronist Party, and, in the 1970s, “disappearing” tens of thousands of activists and ordinary people too.

Argentina is a reminder of one of the most forgotten caveats in history. Class struggle, Marx said, would either end “in a revolutionary reconstitution of society at large” or “in the common ruin of the contending classes.” We might want to put a little more emphasis on that second part.

Argentina, though, hasn’t just been hurt by people fighting over power. It’s also been hurt by what people have done in power. Right-wing governments had no interest in educating the workers or investing in anything other than the landowners’ exports. And left-wing governments just nationalized industries, protected others with tariffs, and made promises they could only afford by printing money. The result was a century of inflation and stagnation. As The Economist points out, Argentina went from having an income per capita that was 92 percent of 16 of the richest countries in 1914 to just 43 percent today. The irony, of course, is that even when Argentina did open up its economy and try to cure its congenital inflation in the 1990s, the way it did so—pegging the peso to the dollar one-to-one—made it unable to respond to even the smallest shock. So when one came along, Argentina ended up in its own private Great Depression.

The point is that nothing is inevitable. The arc of the political universe is long, and it doesn’t have to bend toward progress or justice or anything else good. It can point backwards if that’s where we aim it. And we might. Like Argentina, we have high levels of inequality. And also like Argentina, we have pretty extreme political polarization. But what really might make us like Argentina is if we have politicians who deride expertise, who think that policy is something that fits into 140 characters, and who hint that elections are only something you have to respect if you win.

The United States, in other words, could still be Argentina.

By Luc Cohen
Dec 23, 2016

Argentina’s economy shrank in the third quarter, remaining in recession as inflation ate into consumer purchasing power and weak activity in top trading partner Brazil hurt manufacturing, government data showed on Thursday.

Economic activity fell 0.2 percent in the July-to-September period, marking the fourth straight quarter of contraction. Compared with the same period in 2015, the economy shrank 3.8 percent, the second straight quarter of year-on-year declines, government statistics agency INDEC said.

Growth has been elusive during the first year of center-right President Mauricio Macri’s administration. Since taking office last December, ending more than a decade of leftist rule, Macri has implemented free-market measures to revive the economy and attract foreign investment.

Earlier this year, Finance Minister Alfonso Prat-Gay said the economy would likely grow in the third quarter. But investments have been slow to arrive and inflation reaching 40 percent this year has hurt domestic consumption.

Cumulatively, the economy fell 2.4 percent during the first three quarters of the year compared with the same period last year.

“This confirms that the recovery has been delayed longer than we expected,” said Alejo Costa, chief strategist at Buenos Aires-based brokerage Puente.

The government expects the economy will expand 3.5 percent next year, though private economists’ forecasts are lower at a median of 3.0 percent.

The quarter-on-quarter contraction was less severe than the previous three quarters, boosted by higher public works spending and a more expansionary monetary policy from the central bank, Costa said.

He added that November data showed signs that a rebound was beginning, with public works boosting construction activity, increasing demand for materials like steel and cement. Government data on November economic activity is expected next week.

Macri is counting on public works spending to drive growth next year ahead of legislative elections in October to prevent his “Let’s Change” coalition, which lacks a majority, from losing ground in Congress.

The public sector grew 1.2 percent in the third quarter, while social services and health care grew 2.4 percent.

The country’s key agriculture sector fell 2.8 percent in the third quarter compared with the same period last year, while manufacturing activity fell by 8 percent. Construction fell 12.9 percent year-over-year.

INDEC revised its GDP figures for the first and second quarters to contractions of 0.8 percent and 1.9 percent, respectively, compared with 0.5 percent and 2.1 percent previously.

By Luc Cohen
Dec 22, 2016

Argentina’s congress approved a reform to the country’s income tax code on Thursday after President Mauricio Macri’s government reached a deal with unions and governors to quash a competing proposal from opposition lawmakers.

Last month, Macri’s center-right administration proposed a reform in line with its goal of trimming next year’s budget deficit to 4.2 percent of gross domestic product. But in a rare show of unity, the lower house opposition passed its own version with far more generous tax cuts, forcing the government to negotiate.

The lower house passed the measure by a 166-5 vote, after it easily passed the Senate 55-2 on Wednesday.

Economists said the law passed on Thursday was closer to the government’s original proposal than the opposition’s project and would not threaten Macri’s efforts to trim the 2017 deficit.

But the episode nonetheless unnerved investors by raising the likelihood that a divided Peronist opposition can unite to prevent Macri, whose “Let’s Change” coalition lacks a legislative majority, from passing additional market-friendly reforms ahead of midterm congressional elections in October.

“With this law, investors discovered how vicious the Peronist part could be when they smell blood,” said Jorge Piedrahita, CEO of broker Torino Capital. He noted that Macri remains politically vulnerable if he cannot revive an economy that is still in recession a year after he took office.

At issue in the income tax debate was how much to raise the minimum taxable income level, as rampant inflation seen at 40 percent this year and 20 percent next year has eroded Argentines’ purchasing power.

The law passed on Thursday raises the minimum taxable income level by 23 percent to 37,000 pesos ($2,377.93) a month for a married couple with two children, more than the government’s initial proposal but less than the opposition plan. The government will make up for some of the shortfall with a tax on gambling.

The revised law will reduce government revenue by 7 billion pesos ($443.88 million) next year compared with the initial proposal.

While not disastrous, the rise in interest rates globally has raised the stakes for Macri’s ability to meet fiscal targets, said Marcos Buscaglia, founding partner at consultancy Alberdi Partners in Buenos Aires.

“The financing of 2017 is an uphill task,” Buscaglia said. “They still have to issue a lot of bonds, and the international situation has become more challenging.” ($1 = 15.7700 Argentine pesos) (Reporting by Luc Cohen and Buenos Aires newsroom; Editing by Dan Grebler)

By Martin Langfield
Dec 22, 2016

Latin America’s rightward turn will face serious tests in the next few months. Several countries in the region have shunned leftist populism of late as a reaction to leaders’ economic ineptitude. But if their pro-business successors deliver all the pain of austerity without decent growth, they’ll face renewed opposition, whether at the ballot box or on the streets.

Argentina’s President Mauricio Macri took office in December 2015 on a promise to undo the damage wrought by his statist predecessor, free-spending Peronist Cristina Fernandez. He hasn’t skimped on the pain, lifting currency and trade controls and slashing government spending in a blitz that has sparked regular protests. Growth has not picked up as he promised, however. Economists polled by the central bank in November estimate GDP will shrink 2 percent in 2016. That may flip to a 3.2 percent expansion next year, but Macri needs recovery to be front-loaded: mid-term elections are in October.

His counterpart in Brazil, Michel Temer, has similarly been pushing through a dose of economic orthodoxy since taking over from his impeached leftist predecessor, Dilma Rousseff, in August. He will try to get unpopular reforms to the country’s unsustainable pension system through Congress in 2017, a key plank in his bid to restore investor confidence. Such bitter pills would be sweetened by recovery after a huge downturn under Rousseff, but economists reckon 2017 GDP will grow less than 1 percent. If Temer can’t show results, a like-minded pro-business candidate could struggle in 2018 presidential elections.

Chile may provide the biggest surprise. It boasts a long-running duopoly of fiscally prudent center-left and center-right coalitions. But there’s a risk this may unravel in the country’s presidential and legislative elections in November. If the region’s rightward swing holds, conservative former President Sebastian Piñera will succeed the outgoing Michelle Bachelet, a moderate leftist. But independent parties did unusually well in October’s local polls and Chileans are increasingly disenchanted with conventional politicians of all stripes. That may open the door for an anti-establishment politician like left-leaning Senator Alejandro Guillier.

Populism is harmful, whether of left or right. The passing of Cuba’s Fidel Castro laid to rest a certain kind of self-appointed savior. Latin America, like the rest of the world, needs fewer authoritarian blowhards, not more.

By Almudena Calatrava
23 December 2016

The children said they wailed as the two Roman Catholic priests repeatedly raped them inside the small school chapel in remote northwestern Argentina. Only their tormentors would have heard their cries since the other children at the school were deaf.

The clerical sex abuse scandal unfolding at the Antonio Provolo Institute for hearing impaired children in Mendoza province would be shocking enough on its own. Except that dozens of students in the Provolo Institute’s school in Italy were similarly abused for decades, allegedly by the same priest who now stands accused of raping and molesting young deaf Argentines.

And the Vatican knew about him since at least 2009, when the Italy victims went public with tales of shocking abuse against the most vulnerable of children and named names. In 2014, the Italian victims wrote directly to Pope Francis again naming the Rev. Nicola Corradi as a pedophile and flagged that he was living in Francis’ native Argentina. Yet apparently, nothing was done.

At least 24 students of the Provolo institute in Argentina have now come forward seeking justice for the abuse they say they suffered at the hands of Corradi, 82, another priest, the Rev. Horacio Corbacho, 55, and three other men. The five were arrested in late November by police who raided the school and found magazines featuring naked women and about $34,000 in Corradi’s room.

All the suspects are being held at a jail in Mendoza and have not spoken publicly since their arrest.

“From the pope down … all of the Catholic Church hierarchy is the same. They all knew,” one of the Mendoza victims told The Associated Press through a sign language interpreter.

Another victim said the priests would rape again if released.

“This happened in Italy … it happened again here, and it must end,” the victim said, insisting on speaking anonymously. “Enough!”

Victims and prosecutors say the anal and vaginal rapes, fondling and oral sex by the priests took place in the bathrooms, dorms, garden and a basement at the school in Lujan de Cuyo, a city about 620 miles (1,000 kilometers) northwest of Buenos Aires.

The school has “a little chapel with an image of the Virgin and some chairs where the kids would get confession and receive the communion. That’s where some of the acts were happening,” Fabrizio Sidoti, the prosecutor who has been leading the investigation since the scandal broke, told the AP.

Children from other regions of Argentina who lived at the dorms were especially vulnerable and often targeted by the abusers. The tales are harrowing: One of the victims told the AP she witnessed how a girl was raped by one priest while the other one forced her to give him oral sex.

The prosecutor is expecting more than 20 other people to provide testimony and more victims to come forward.

Pope Francis has not spoken publicly about the case and the Vatican declined to comment.

Advocates of sex abuse victims by priests question how Francis could have been unaware of Corradi’s misdeeds, given he was publicly named by the Italy victims.

“No other pope has spoken as passionately about the evil of child sex abuse as Francis. No other pope has invoked ‘zero tolerance’ as often. No other pope has promised accountability of church superiors,” said Anne Barrett Doyle, co-director of BishopAccountability, an online resource about clerical abuse. “In light of the crimes against the helpless children in Mendoza, the Pope’s assurances seem empty indeed.”

On Dec. 11, the pope appeared in a video using sign language to wish deaf people worldwide a merry Christmas — a gesture that fell particularly flat in Argentina as Catholics struggle with the enormity of the scandal.

“Either he lives outside of reality or this is enormously cynical … it’s a mockery,” said Carlos Lombardi, an attorney who specializes in canon law.

The Provolo case first exploded in Italy in 2009, when the Italian victims went public with stories of abuse after what they said were three useless years of negotiations with the diocese of Verona, where the institute has its Italy headquarters.

The 67 victims alleged sexual abuse, pedophilia and corporal punishment at the hands of priests, brothers and lay religious from the 1950s to the 1980s. At the time, 14 of the victims wrote sworn statements and videotaped their testimony detailing the abuse they suffered. They named 24 priests, lay religious and religious brothers in a list that was published online.

Corradi was one of those included in the list, which specified he was in Argentina at that time.

In 2010, the Vatican ordered the Verona diocese to investigate the claims. One of the victims named Corradi during the inquiry.

But he apparently was never sanctioned. Five other accused were.

The Italian victims didn’t stop.

On Dec. 31, 2013, they wrote to the pope asking him to institute an independent commission of inquiry to investigate clerical sex abuse in Italy.

On Oct. 20, 2014, they wrote Francis and the Verona bishop naming 14 priests and lay religious from the institute who were still alive and in ministry who allegedly had sexually abused them. They named Corradi, and noted that he and three others were in Argentina.

“We must point out that the behavior of the church is not in the least bit in line with the ‘zero tolerance’ stance of Pope Francis,” they wrote, listing the 14 priests and their current locations. “Such behavior makes us think that the church has no interest in the suffering provoked by priests who sexually abused deaf children, priests who continue to live their lives normally, priests who never apologized to victims, priests who never asked forgiveness and for whom the church itself attempts to let the time pass in hopes that everything is forgotten.”

No response was immediately received.

More than two years later, the Vatican’s No. 3 official, Monsignor Angelo Becciu, acknowledged receipt of the letters. In a Feb. 5, 2016, response, he said that as far as the Provolo victims’ request for a commission of inquiry was concerned, he had forwarded the proposal to the Italian Bishops’ Conference.

The Italian Bishops’ Conference didn’t respond to an email seeking comment on whether such a commission was under consideration.

“I’m convinced that some hierarchy covered this up. They sent the wolf to take care of the sheep,” said Alejandro Gulle, the chief prosecutor in Mendoza.

The Mendoza Archbishopric says it was unaware of the accusations against Corradi. “A religious man comes to a diocese and you trust the legitimate superior,” spokesman Marcelo De Benedectis said.

He said that allegations aired by the case have been “so outrageous,” the Mendoza diocese has taken measures like demanding a sworn statement from religious people stating that they don’t have “backgrounds” under canon or civil law.

The Vatican’s Congregation for the Doctrine of the Faith has been informed about the Mendoza accusations, he added.

Unlike the Verona case, the alleged crimes in Mendoza have not expired due to the statute of limitations and could lead to up to 50-year jail sentences for a conviction.

A prosecutor is also probing accusations by a man who says he was abused at the Provolo Institute in the city of La Plata when Corradi first arrived in Argentina in the 1980s.

“We want justice to be served. We might be able to get long sentences. I hope they’re the maximum,” said Gulle, the Mendoza prosecutor. “But we’ll never compensate the spiritual damage suffered by these children.”

By Victor Caivano and Almudena Calatrava
23 December 2016

BUENOS AIRES, Argentina (AP) — A court in Argentina has indicted Justin Bieber for allegedly sending his bodyguards to beat up a photographer and take his camera equipment outside a Buenos Aires nightclub three years ago.

Court clerk Soledad Nieto confirmed the decision to the Associated Press on Thursday. She said Judge Alberto Banos did not issue an arrest warrant and the Canadian pop idol can appeal the court decision, which was signed Wednesday and surfaced late in the day.

Argentine photographer Diego Pesoa alleges he was chased down and beaten on Nov. 9, 2013, by Bieber’s bodyguards outside the INK nightclub, where the singer and his entourage partied during his South American tour. Pesoa also said the bodyguards took some of his camera equipment.

Pesoa’s lawyer, Matias Morla, celebrated the judge’s decision, saying that he had acted without being pressured by Bieber’s fame, and instead “treated him like anyone else.”

Morla also said that the judge has ordered the preventive seizure of about $28,000 from Bieber to cover potential legal costs. To collect the money, Morla said he would ask the judge to request U.S. authorities to embargo some of Bieber’s goods in Los Angeles.

An email message sent to Bieber’s manager, Scooter Braun, was not immediately returned Thursday.

Bieber apologized during his Argentina trip for defiling the national flag on stage and got into trouble with police elsewhere during the tour for allegedly spraying graffiti in Brazil and Colombia.

In June, Bieber said on his Twitter account that he would like to play in Argentina on his Purpose Tour but “until the legal conditions change there I can’t.”

Hundreds of his fans, known as “Beliebers,” then marched in Buenos Aires carrying signs saying “Argentina Needs Justin” and “Right To Music,” asking the judge to let the singer perform in Argentina.

Bieber has not returned to answer questions about the alleged attack. His tour goes to Latin America in 2017 but there are no dates published for Argentina.

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