Reflections on an Historic Election: Argentina Enters a New Crisis

Reflections on an Historic Election: Argentina Enters a New Crisis

The Defeat of Kirchnerism

That Kirchnerism, the political strategy of first Nestor and then Cristina is over is evidenced by the vote total obtained by the Front of Victory, the electoral apparatus of a renovated Peronism. In 2011 at the time of the presidential elections, Cristina Kirchner won with 54% of the national vote. Now a brief two years later she struggled to reach 33%. At a regional level, where the byzantine web of alliances between mayors, governors and national figures are expressed, Kirchner was defeated in the all-important province of Buenos Aires by the Renovation Front of Sergio Massas, the exponent of the neo-liberalism of the industrial and agrarian establishment, by a margin of more than 10%.

The defeat of Kirchnerism is not however a victory for a coherent alternative policy. Posing as a center left alternative, Kirchnerism arose as a response to the years of social tension, economic chaos and massive political resistance to neo-liberalism following the fall of the military dictatorship. It was an attempt to appear to rise above the class struggles taking place and to offer a solution to the nation’s problems, a mediation between the classes and fractions of the ruling class which would place the salvation of Argentinean capitalism ahead of sectoral interests.The electoral defeat which it has just suffered is a sign that not only has its political strategy failed, but the policy initiatives which it undertook to solve the economic crisis are a failure as well.

A Bankrupt Policy in a Bankrupt State

The context in which the election took place is prefigured by two reinforcing processes: the global crisis of capitalism in its neo-liberal variant, and the specific features of the fiscal crisis of the state. While crisis is a much over used term generally, in the case of Argentina it really does apply.

Argentina is a developed industrial economy relying on internal consumption and exports of its agricultural and manufactured goods, the latter primarily within Latin America. More than 90% of the population lives in urban areas including Mendoza, Cordoba, Tucuman, Salta, and of course Buenos Aires and the surrounding municipalities. It has a highly educated working class relatively speaking and a long history of workers and popular struggles, with students playing an important political role as relays for socialist ideas and analysis.

Since 2002, when the depression of 1998 to 2004 caused the collapse of the Argentinean economy and an outright default by the short-lived Saa administration, the effects of the neo-liberal prescriptions applied by the International Monetary Fund have only exacerbated the structural problems of Argentinean capitalism. Although Argentina paid off its full IMF debt in 2006, in no small part as a result of the peso devaluation by Duhalde in 2002 and the resulting influx of foreign investment and export revenues, the world wide crisis of 2008 set off internal processes which now emerge as another crisis with debt as the core determinant.

Since 1975 Argentina has paid over $600 billion in debt and interest payments to foreign lenders. Kristina Kirchner, when faced with mounting opposition to paying a portion of the debt which many economists see as dubious if not illegitimate, has personally supervised the paying of $173 billion during her administration. Despite this, the net Argentinean debt has risen by over $100 billion to now stand in excess of $200 billion in US dollars.

In order to service this debt, the Kirchners engaged in a policy of robbing Peter to pay Paul, with Peter being the Argentinean people. The process of partial nationalisations of the private pension pools was a method to strip them of their hard cash assets and replace them with Argentine government bonds of obvious dubious quality. Similarily, the partial nationalisation of the petroleum assets was to ensure enough foreign reserve flows to feed the debt monster.

So while the sacred obligation of debt repayment was honored by Kirchner’s policies, the burden of this was borne by the Argentinean working class. The fact that Kirchner’s policies were class based and class biased was made clear to Argentineans by the treatment of the holding of US dollars. One of the currency controls introduced by Kirchner was to forbid the holding of US dollars, requiring that any dollars entering the country were to be exchanged for pesos. According to Cristina Kirchner, this policy was to apply to all sectors as a method of squelching the parallel market, and halting the outflows of foreign denominated currencies.

The hypocrisy of this measure was exposed when it was revealed that the administration had signed a deal with Chevron allowing them to repatriate their profits in dollars in exchange for investments in the partially nationalised YPF oil firm. This deal became a symbol of the corruption underlying the policy initiatives of the Kirchner regime, and has resulted in a tangible loss of legitimacy.

Despite the best efforts of the regime to try an engage in a policy whose heart is debt service (Kirchner herself famously described herself as a “serial payer”), the end of the road has come. In a landmark case in a New York courtroom this past month, the “rights” of a group of bondholders who refused to accept the restructuring of their Argentine bonds in 2003 were upheld and the court ordered full and immediate repayment. The Argentinean government has refused to recognize the authority of the court but is caught in a legal trap. If they don’t pay this group of bondholders, who represent 24% of the total debt in 2005 dollars, then Argentina is in technical default. If they do repay they will then have to come up with a sum which they don’t have and can’t afford to borrow, given the declining revenue base and the level of absolute debt. The policy options have become very narrow indeed.

The Workers and Left Front

Within this ongoing economic and social crisis whose rhythms have been uneven and variable, the struggle of the Argentinean working class and popular sectors to maintain their standard of living and their labour and social rights has produced a militant and class conscious political and social vanguard layer which is increasing in size and self confidence. This was expressed by the size of the vote for the Workers and Left Front (WLF – Frente Izquierda y de los Trabajadores), an electoral coalition involving three Trotskyist political organisations.

The WLF received almost one million, two hundred and fifty thousand votes from all areas of the country, with a few scattered exceptions. This vote resulted in the election to the national parliament of three MP’s, and in addition resulted in the election of eight more members of provincial legislatures plus dozens of members to municipal councils.

The WLF was formed to contest the national elections of 2011. Its three components are the Partido Obrero (Workers’ Party), the Partido Trabajadores Socialistas (The Socialist Workers Party), and the Izquierda Socialista (Socialist Left). All three come from the tradition of Latin American revolutionary Marxism inspired by the politics of legendary Argentinian Trotskyist leader Nahuel Moreno. Indeed all three originated in the MAS, the Movement to Socialism founded by Moreno which at one time grouped 12,000 adherents.

The consequences of this historic vote were summed up by the national newspaper El Clarin in the headline “The combative left now has its October.” Despite the ironic nod to the month of the Russian revolution, the fact that the WLF was able to emerge as a significant force to the left of “left Peronism” is a sign that the traditional political relays of the Argentinean workers movement are breaking apart.

The vote for the WLF was impressive. Running on an explicitly revolutionary platform, the candidates of the WLF received 19% of the total vote in Mendoza, 16% in Salta, and almost a half million votes in the national capital region. For the first time ever the revolutionary left was able to credibly present itself as a radical alternative to Peronism.

The WLF vote signals a rising combativity of the Argentinean working class whose tendency was established at the time of the 2011 elections where the WLF received around 600,000 votes. In the space of two years the revolutionary left has doubled the size of its vote. In fact, in the primary elections of July, the WLF received around 900,000 votes. The increase in support in 3 months has risen by 30%. But the WLF was not the only revolutionary organisation running. When all the organisations which presented themselves as radical left alternatives are added together, the vote total rises to over a million and a half votes.

The immediate consequences of the successes of the WLF have been within the fractured Argentinean left itself. The great bulk of the revolutionary left in Argentina identifies with revolutionary Marxism of the Trotskyist tradition. There were at last count 21 different organisations identifying themselves as Trotskyist. The day following the election results Jorge Altimira, spokesperson of the PO, and Christian Castillo, leader identified with the PTS, both issued a call for the rest of the left to unite around the WLF project, and to engage in talks aimed at unifying the revolutionary Marxist left.

This has brought pressure to bear on one of the major organisations of the revolutionary left, the Socialist Workers Movement (MST), whose strategy of attempting to build a new broad left is seen in contradistinction to that of the WLF’s more orthodox Trotskyist politics. This strategy now appears to lie in tatters as some of its former allies, such as filmmaker Pino Solano and his Proyecto Sur (Southern Project) ditched the MST without warning just weeks prior to the July primary elections.

This being said, the WLF cannot afford to ignore the MST. Unlike the three components of the WLF, the MST has permanent observer status at the Fourth International, and its politics could be described as closer to that of the French New Anticapitalist Party. It has relations with the Venezuelan revolutionary Marxist current Marea Socialista (Socialist Tide) and together both organizations held a revolutionary youth camp and political school in March of this year, attended by over 2,000 young people from five different countries of South America.

Immediately following the election results, the leading spokesperson for the MST, city of Buenos Aires deputy Alejandro Bodart, issued a plea to the leadership of the WLF to begin to find ways to unite the entire left around the project on a democratic basis.

If the WLF is able to show the leadership skills and political maturity to find a method to incorporate the MST, as well as the other significant tendencies within the Argentinean revolutionary left in its project, the Front would be strengthened politically as well as organisationally. The MST, for example has many worker leaders in its ranks and it is an integral part of the leadership of the Argentine Workers Central, the second largest workers central in the country.

Outside of Argentina, the call for Marxist unity and the results which would possibly be achieved because of it will have an effect on the revolutionary left from Mexico to Chile and from Brazil to France. Each one of the component organisations of the WLF has sister organisations in a host of countries in Latin America, in some countries all three organisations compete with each other to build “their” revolutionary international. If the experience of Argentina is translated and mediated in a framework and spirit of building a democratic process of unity capacity, the impact will have enormous and favourable consequences for each of the national lefts and workers’ movements.

This will not be easy, given the history of organisational disunity, personal feuds, sectarian practice and a lack of a strategic consensus in the revolutionary left. It will take a great deal of political skill, tact, respect and trust building on the part of the leaders of not only the WLF to make this goal a reality.

In the meantime, the combative workers and popular sectors now have a small but significant national voice across Argentina. It is a voice and political instrument which will be soon be put to the test as the near term unfolds and the Argentinean ruling class attempts to find even more ways to make the workers pay for their crisis.

The article was written by Robert Lyons, a long time (very long time) Latin American solidarity activist living in Central America. He is a former New Democratic Party member of the Saskatchewan Legislative Assembly and trade union organiser.