After more than a dozen years of Leftist rule which brought their economy to an inflation-plagued standstill and relations with the US to a low ebb, Argentinians have voted to clear the decks of the Kirchner legacy. Mauricio Macri, a pro-business and pro-US candidate whose campaign looked like a long shot, has won a decisive victory over the Peronist candidate who pledged to continue in Cristina Fernandez de Kirchner’s footsteps:
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, Buenos Aires Gov. Daniel Scioli, the ruling party candidate, conceded.
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.
Economic discontent played a large part in Macri’s upset win, but the strange death of prosecutor Alberto Nisman did as well. Fernandez de Kirchner may not be done explaining it, either:
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 Argentina’s Congress about Fernández’s role in allegedly conspiring with Iran to cover up Tehran’s involvement in 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.
Macri supporters hope to revive the economy first, though, and that will be more difficult to do. The difference between Argentina’s official currency exchange rates and its black market rates have widened considerably, as the previous administration tried to ignore the obvious about the results of its socialism and nationalization policies. Foreign investment has slowed as a result, leaving Argentina with few options except to bite the bullet and tell the truth about the value of its currency. Bloomberg’s panel curiously chose to invite Scioli’s adviser Mario Blejer on as an analyst, and asks him whether “devaluation” will be the policy. Blejer said it will be necessary, and predicts that Argentina will have to reintegrate itself into the Western economy in order to attract desperately needed investment:
What will be more curious will be whether this pro-Western policy will impact the Argentinian-Iranian relationship. Nisman was killed before he could reveal his findings about allegations that Fernandez de Kirchner had hushed up Iranian responsibility for the terrorist attack on a Buenos Aires Jewish center. If Argentina opens up to the West, that will remove the need to deal with Iran, and presumably the full truth can then come out. However, a turn to the West will almost certainly require Macri to deprioritize claims on the Falkland Islands, a favorite issue of the Peronists to stir up nationalist fervor as a distraction from their widespread failings. Perhaps if Macri can improve the economy quickly enough, his government won’t need those kinds of distractions.