Alberto Fernández has decided not to run for re-election. He has done so after months in which his intention to seek a new mandate precipitated a confrontation with Kirchnerism, one that he sought to avoid.
The president stood firm against the vice-president's supporters in the face of their move to suspend the Simultaneous and Compulsory Open Primary Elections (PASO primaries), set to be held in August. Through this, Fernández has displayed a firmness he has not displayed before.
At the same time, however, an alliance has been forming between Cristina Fernández de Kirchner and Economy Minister Sergio Massa, who coincide in their criticism of the Casa Rosada. In the days leading up to the resignation of his candidacy, tensions between the president and his economy minister grew, with Massa alluding to "operations" to deliberately precipitate his departure from the Cabinet.
The markets showed their affinity with Massa, expressing it with uncertainty, with a rise in the parallel ‘blue dollar’ exchange rate and Argentina's country risk rating. Faced with a Fernández-Massa option, they opted for the latter, seeking to reinforce the official's role as "de facto prime minister" of Argentina’s government.
The president's withdrawal from competition in the 2023 presidential election has also been precipitated by the internal dynamics of the ruling Frente de Todos coalition. He was probably contemplating stepping down closer to June 24, the deadline for submitting candidates for the PASO primaries. Instead, the president is doing so almost a month after opposition leader Mauricio Macri also stepped aside. In the case of the latter, the reasons that led him to anticipate a decision that in fact has ended up diluting his leadership are still unclear.
In the case of Alberto Fernández, the circumstances are clear: the meeting of the Partido Justicialista (PJ) council that was called for last Friday afternoon. The president – who also presides over the PJ nationwide – is clearly in a minority with respect to Kirchnerism. The latter, in turn, had anticipated that it would push for a discussion of the government's general strategy at the meeting.
The president probably wanted to avoid this situation, which would probably have highlighted his political weakness and increased doubts over the economy, which last week’s photo with Massa did nothing to dispel.
The situation facing the president now is far from easy. On the one hand, the subject of his candidacy – the cause of the conflict with Kirchnerism – is now resolved. But on the other hand, his strength and ability to govern has been weakened.
The problem is that there are six months to go before the presidential election and a hundred days until the PASOs. It's a long time, given the complex economic situation, growing social tension and pending electoral definitions for Argentina's two main political spaces. Meanwhile, the growth of libertarian deputy Javier Milei generates concern both inside and outside the country.
Experience shows us that in Argentina, the combination of electoral processes and economic crisis is dangerous.
In 1989, a crisis began in February, with the presidential election scheduled for May. Raùl Alfonsín’s government believed that, given the fear that Menem's coming to power generated in the White House and Wall Street, the financing the government needed to get to the election with the economy under control would not be interrupted. But this was proved not to be the case – the government went into the election having lost control of inflation and the exchange rate. In the context of hyperinflation, the president ended up handing over power five months early.
Twelve years later, in 2001, facing a legislative election, there was a gamble that the US government would maintain the flow of funds from the "financial shield" negotiated at the end of the previous year. The election was scheduled for October and funding was cut off the month prior. There was an electoral defeat and a subsequent crisis that led to the resignation of President Fernando de la Rúa halfway through his term.
The third case was in 2019, the year in which Macri, then as president, was running for re-election. Economic uncertainty began in the early months of 2018. The government first sought to contain it by resorting to external financing, but the effort proved to be insufficient. As the election approached, the price of the dollar and the country-risk rating (as is happening now) spiralled out of control, taking the country to the brink of default. It was only Donald Trump's support, with US support helping to grant an exceptional US$44-billion loan from the International Monetary Fund, that allowed Macri to finish his term, but even that was not enough to help the Cambiemos leader win re-election.
History, of course, does not repeat itself mechanically, but it can be useful to remember what passed, in order to avoid mistakes.
* Rosendo Fraga is a political analyst and director of the Centro de Estudios Unión para la Nueva Mayoría.
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