Transparency’s Demise in Argentina
“You are immensely lucky to be living in a full democracy where each of you can say, feel, express, and shout whatever you wish.”
—President Cristina Fernández de Kirchner, April 29, 2012
At a rally commemorating the ninth anniversary of the electoral victory of her late husband, former president Néstor Kirchner, President Fernández sang the praises of Argentina’s vibrant democracy and political progress. Under the slogan “United and Organized,” her fiery 45-minute speech was enthusiastically received by the estimated 100,000 supporters in attendance. However, most in the Argentine media would beg to differ with their president’s depiction of the current level of democracy in the country. Indeed, contrary to Fernández’s idealistic portrayal, freedom of speech in Argentina is in a dismal state, and is poised to worsen before it improves.
Legal maneuvers and harassment of the press
For the past few years, the Fernández administration has actively taken advantage of its congressional majority to push through media reforms. A bill passed in 2009 was designed to help break up the media giant Grupo Clarín and limit monopolistic abuses by large media corporations. While positive in its goal of diversifying media providers, the bill also contained provisions that limit freedom of expression, including the creation of a politically appointed media regulatory body tasked with interpreting and implementing the law.
In December 2011, the National Congress passed two additional laws. The first declared that the production, sale, and distribution of newsprint were of “public interest.” This effectively gave the government control over Papel Prensa, the country’s only newsprint manufacturer. The second law broadened the definition of “terrorism” to include any news or commentary seen as threatening to the government. The Brazilian newspaper O Estado de São Paulo called the measure an “antiterrorism law made to terrorize journalism,” concluding, “A dictatorship couldn’t have done it better.”
On December 20, a group of 50 armed members of the military police raided the Buenos Aires headquarters of cable television channel Cablevisión. The station belonged to Grupo Clarín, which was involved in a bitter dispute with the government over allegations of unfair competition. This constituted just one incident in a larger pattern of official intimidation of the media. The government has also damaged its critics and rewarded its supporters in the media landscape by manipulating the distribution of state advertising. In a detailed report released in October 2011, the country’s principal private media association, ADEPA, wrote that while one can formally express one’s thoughts in Argentina, whoever does so is subject to reprisals and persecution.
The clampdown on press freedom is not the only way in which the executive branch has sought to concentrate power and diminish transparency. In the economic field, the government has consistently misrepresented the level of inflation. To mask rising rates caused by heavy public spending and energy subsidies, the president replaced statisticians working at the National Institute of Statistics and Censuses (INDEC) with political appointees beginning in 2007. And in the face of fines and government threats, independent economists have been forced to stop publishing their own estimates, which place the real rate of inflation at close to double the official rate. The Economist went so far as to remove Argentina’s official inflation rate from its indicators page, calling the INDEC figures a “bogus” attempt to “deceive voters and swindle investors.” In addition to the unsettling reality that holders of inflation-linked bonds have been shortchanged by billions of dollars, the government’s silencing of independent inflation statistics represents censorship in its most blatant form.
Separately, in an effort to finance growing fiscal deficits, the Fernández administration has raided pension plans and central bank reserves, destroying the central bank independence that was once the envy of Latin America. The president’s most recent move to plug the fiscal hole was the expropriation of 51 percent of the oil and gas giant YPF, owned by Spain’s Repsol. Announced on April 17, the expropriation bill quickly passed through Congress and was even supported by opposition legislators from the Radical Civic Union (UCR) and the centre-left Broad Progressive Front (FAP). Reminiscent of the slogan “the oil is ours” used by Brazil’s President Getúlio Vargas in the early 1950s, the populist measure is widely supported in Argentina. However, YPF will likely meet the fate of Venezuela’s state oil company PDVSA, whose output has actually dropped dramatically since a series of nationalizations under President Hugo Chávez. The poor management of Aerolineas Argentinas, which was renationalized in 2008 and received approximately $2 million in daily subsidies during 2011, should also give little solace to Argentines. The YPF case will end at the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) in Washington. Argentina already accounts for 50 percent of the cases registered at the ISCID.
Means to an end
The YPF takeover has prompted comparisons to Bolivia, where President Evo Morales nationalized a Spanish-owned power company in May. Both Morales and Fernández have worked to increase the reach of the state, and both need the short-term political points associated with nationalizations. But the similarities between the two leaders stop there. Knowing that Bolivia can’t afford to alienate foreign investment, Morales has implemented somewhat more orthodox macroeconomic policies than his Argentine counterpart. He was even referred to by one analyst as “the poster child for multilateral institutions,” a title that few would apply to Fernández these days.
Ultimately, the principal goal of the Fernández administration is to perpetuate the power of its Peronist movement, whatever the cost to transparency or long-term national prosperity. To this end, the president has increased the profile of her eldest son, Máximo, who leads one of the country’s strongest political youth organizations, La Cámpora. Fernández has also deliberately emulated the image of her political predecessor and hero, Eva Perón. Surprisingly perhaps, there is no love lost between labor groups—traditionally the Peronists’ strongest allies—and the populist youth groups. Indeed, Hugo Moyano, director of Argentina’s largest trade union, has called La Cámpora’s members a bunch of “rich kids.” Nevertheless, the Fernández government sees the recruitment of the country’s youth, rather than the cultivation of organized labor, as the most effective way to entrench the presidential family at the center of both the Peronist movement and Argentine politics in general.
* Britta Crandall is an analyst for Latin America for Freedom in the World.