The Argentina that is coming

The Argentina that is coming

By Fernando Esteche * and Pablo Rodolfo Treber **, reporting from Buenos Aires, Argentina

How will the new political power be built?

The unique character who will govern Argentina defines himself as the first liberal-libertarian president in the history of the world.

With a notable precariousness in terms of knowledge of geopolitics and the tectonic movements that have been occurring in the world at the geoeconomic level, president-elect Javier Milei cultivates an automatic and disciplined alignment with the United States and Israel, despite the fact that he was not the electoral variable on which neither the American embassy nor the Israeli government had placed their bet.

With movements that come and go, the elected candidate announces members of the future cabinet, and then dismisses them, which makes his government management more unpredictable. However, there are some already established structural alliances that allow us to outline some issues.

Businessman Eduardo Eurnekian, one of the heads of the Armenian American lobby, head of Corporación América that extends its interests in the airport industry (airports and air cargo terminals in South America and 50 countries), agroindustry (Unitec Bio), energy, infrastructure (Helport), and financial services (Converse Bank); has become one of the obvious pillars of the new government. He places a trident of its bishops in the power scheme of the coming administration (Guillermo Francos, Nicolás Posse and Mariano Cúneo Libarona). The businessman of Armenian origin is one of the main keys of the incoming government to connect with the North American deep state. He has also been the one who opened the possibility of building transition meetings between the outgoing government and Milei’s team. It is appropriate to consider the tension and competition that the head of Corporación América always maintained with the core of Macriism that tried to corner and persecute him during Macri’s government.

The penetration of the Corporación América into the Milei government is absolutely functional to the Atlanticist and specifically North American alignment of the new management.

The former Secretary of Internal Commerce of the outgoing government, Roberto Feletti, contributed his view on another global support of the new government, stating from his X network account that behind the libertarian “are Blackrock and other investment funds that have Argentine debt securities in their pocket and are betting on keeping our country’s assets at bargain prices.” We explainthis later.

The Fund of Israeli American Larry Fink, in addition to holding Argentine debt securities, also has shares in YPF, Bunge, Glencore, and Livent, among others. It has energy, nutritional and mineral assets, the three elements that the world needs for its development. The connection between Javier Milei and Blackrock is through Darío Epsteín, representative of this Fund in the company Pampa Energía.

In order to avoid confusion: It is not that stated here that Milei is a man of Blackrock, because the corporation has its agents in all parties; it has multiple, simultaneous, and probably some antithetical interests and bets. What we are saying is that Blackrock will clearly know how to take advantage of the radical liberalism of the new Argentine president.

Another of Milei’s alluvial supports, although more discreet, is that of the influential Clarín group through one of its favorite political operators; Florencio Randazzo (who will occupy the presidency of the Chamber of Deputies). The former candidate will try to build the legislative consensus necessary for some of the structural reforms that are being proposed. Randazzo’s group is also given the most important niche in terms of management and budget availability. His partner Juan Schiaretti will place his own soldiers in the administration of ANSES, the retirement and pensions administration that will be the primary objective in the necessary adjustments demanded by the International Monetary Fund. This shows the incorporation of anti-Kichnerist Peronism on the one hand and a medium-term media truce on the other. Both present elements of governability.

The entry of Patricia Bullrich, former presidential candidate of the Macrismo, to the security staff, a position she already held during the Macrismo, presents a temporary concession to the Macrismo but that also has the endorsement of the other partner idealized by Milei, the government of the State of Israel.

The arrival of Luis Caputo to economy, in addition to immediately blowing up the dollarizing staff of La Libertad Avanza, can be read as a concession to Macri’s regime, although there are those who maintain a tension between the debtor couple (Macri and Caputo) and then limit the designation to Caputo’s proposal to resolve the disarmament of the leliqs and other bonds, guaranteeing the profit rate of the banks; a temporary appointment for a specific, necessary task. A man of finance to solve the maintenance of the profit rate of the world of finance. More governability.

What is clear in principle is a certain displacement of the vice president and expression of the praetorian right Victoria Villarroel, who is reduced to the task of presiding over the senate for now.

The announced arrival of the Mexican super-millionaire Carlos Slim by purchasing or assuming the concession of ARSAT, the national aerospace industry, also results in an open challenge to Clarín and several of the other actors who are today weaving their networks in the coming government. In addition to the alienation of national sovereignty that we will notice in every movement of the new government.

The outright handover of YPF (Argentine oil and gas) to Paolo Rocca (Techint), to prepare its re-privatization, displaces the “Lord of Oil”, Miguel Galuccio, whom Cristina Kirchner had imported to Argentina, from power all-embracing that he had been having in the vigorous and strategic area.

Other concessions such as the delivery of mining to the legal firm of Bruchou and Funes de Rioja, through the appointment of its partner Sergio Arbeleche, who is not an industrialist but a lawyer for mining industrialists (industrialists who have no problems investing their capital in the financial game and not in production), accounts for a kind of subdivision of areas of power and sovereignty, in the desire to build a certain governability that satisfies the different actors of the so-called red circle.

Of course, in a similar scheme where the content of opposites is evident, one must know how to read the minimal movements that occur because they can result in desertions, associations or whatever could happen.

What is going to happen economically?

The recent electoral victory of Javier Milei, which will make him president of the Argentine Republic, represents a reconfiguration of national economic policy. It will go from being a dependent and raw-material-economy country to a factory of exclusive use for the geopolitical interests of the North American empire.

For almost 50 years, beginning with the military dictatorship of 1976, Argentina transformed its economic matrix – which until then had a high degree of industrialization and, therefore, independence – to become dependent on primary production and its exports.

Without a doubt, this was the main objective of that dictatorship financed by its final beneficiaries abroad. Then, with the return of formal democracy, the different administrations were distinguished by the degree of depth and level of distribution of wealth and social investment (health, education, services, housing) generated by that same dependent model, without returning, by lack of will, strength or mere complicity, the idea of an industrialized Homeland, with genuine work, sovereign and independent of external factors.

Taking into account his campaign proposals and first announcements before inauguration, Javier Milei’s victory can translate into a deepening of this same scheme and its disastrous social consequences, along with an unrestricted alignment with the geopolitical interests of the United States in a context of undoubted weakening of Washington’s hegemony at a global level.

The pillars of his political campaign were to achieve economic stability, through total dollarization, and the closure of the Central Bank of the Argentine Republic, to completely free the market. This departs from the false hypothesis of the presence of the State as the main cause of the economic and social problems.

Strictly speaking, both proposals cannot, nor do they want to, solve any of the local problems, but rather respond to the objective of being functional to what the United States requires at this historical moment given its hegemonic decline and the beginning of a new multipolar era.

Firstly, and without going into the enormous problems that come with using a currency that is issued and controlled by other countries, the idea of dollarization is raised in a framework where that currency has lost 20% of its share in global trade in the last 10 years and, currently depreciates at a rate of more than 3% annually. This event comes hand in hand with the operational implementation of payments in local currencies in much of the world, which caused many countries to choose to transform their official reserves into baskets of currencies made up of different currencies and metals (previously made up, almost exclusively for US dollars).

This massive detachment from the dollar has the immediate effect of a growth in its degree of liquidity and, consequently, together with the loss of participation in global trade, a permanent devaluation of the dollar in real terms throughout the world.

This is the geopolitical context that motivates the United States to deepen its interference in Our America through a process of over-colonization. Only by understanding this reality can we decipher the main objectives of the proposals of Milei’s libertarian party.

1) Dollarization to be able to invest, place, your dollars to reduce their depreciation and, at the same time, extract wealth and natural resources to strengthen your position on the industrial/energy level.

2) The closure of the Central Bank to ensure that 100% of what was invested in the country is withdrawn / transferred abroad, leaving Argentina without any benefit since it would not have any financial regulation or credit guidance institution.

This is the political-economic combo that would end up classifying Argentina as a colony and producer of raw materials at the service of a foreign empire.

Adding data to this hypothesis, a change in Argentina’s trade relations is to be expected given that the president-elect has spoken on different occasions in favor of strengthening his ties with “the free world” of the United States and Israel. He also proposed cutting all commercial links where regulations or agreements between states exist- completely against the clear global trend towards increased state intervention, protectionism, and cooperation and development agreements between nations.

This breaking of agreements would include leaving Mercosur which, currently, with Brazil as the main actor, represents 25% of Argentine exports while, if the intergovernmental agreements with India are added, the total of exports amounts to 40% of the total and more than 30 billion dollars. Without a doubt, this shift in Argentine foreign policy would distance us from the possibility of increasing commercial exchange with a large part of the world, which today is organized around the BRICS, and would limit us only to uneven and highly unfavorable ties with the United States and its partners.

However, and taking into account that the United States is a large food producer, it is possible that what was mentioned above focuses on heavy industry and the exploitation of minerals and natural resources for energy (mainly gas, oil and lithium), with the intention of taking over the productive potential of the areas of Vaca Muerta, the Argentine Sea and the Andes Mountains.

So much so, that the intention to privatize the largest hydrocarbon exploitation and production company, Yacimientos Petrolófilos Fiscales (51% state-owned YPF) has already been announced, and Horacio Marín, from Tecpetrol and part of the Group Techint, will be appointed for this purpose. Techint is a multinational company that currently has the majority of its capital located in the United States, whose CEO, Paolo Rocca, was one of the main financiers of Milei’s campaign.

These are just some aspects of what can become the largest looting process that Argentine history has ever suffered.

In the daily life of our people, it is clear that there will be a drop in purchasing power and an economic recession, a phenomenal drop in consumption that will radically change the living conditions of millions of compatriots.

Foreign policy

At this point in the transition, it would seem evident that the person appointed to head the Foreign Ministry will be the university professor and economist Diana Mondino, a figure without any experience in foreign policy. She has a work history at Pampa Energía, the company that Mindlin runs on behalf of Larry Fink and Joe Lewis.

As part of the most closed team of President-elect Javier Milei, Mrs. Mondino proclaims a profound reform in the Argentine foreign service, prioritizing the economic dimension of foreign relations, for which the Secretary of Foreign Trade will be transferred from the Economy to the Foreign Ministry.

Mondino has been very industrious and, among other things, is already planning Milei’s trips to the United States and Israel. Regarding this second destination, Milei has already met with the Zionist ambassador to Argentina Eyal Sela to finalize details and assumed the unnecessary commitment of including Hamas as a terrorist group persecuted in Argentina.

Greetings from Nayib Bukele (El Salvador), Santiago Peña (Paraguay), Lacalle Pou (Uruguay), Macron and Mattarella (France and Italy), in addition to Jair Bolsonaro, the Francoist Spanish party Vox, and the promise of a visit by Donald Trump show the alignment with the conservative right and a foreign policy tributary to this alignment.

Regarding relations with China, the second largest economy on the planet, with less ideological virulence than in the electoral campaign, it is now considered maintaining trade at the private level, while Mondino demands to know what the agreements on the Chinese aerospace base are about. She also wants to address the consequences of the use of the Chinese swap by the Massa government.

Milei continues to affirm his refusal to join the BRICS + 6 in January, arguing that trade relations do not need that area to develop as they have until now and that, on the other hand, joining the BRICS Development Bank would only imply taking on more debt. He will depend on the career officials who are advising Mondino that the country does not go through regrettable self-isolation.

Regarding Mercosur, we already said all above. The fundamental concern is to resolve the possibility of building trade agreements between private parties and a “modernized” Mercosur. They will seek to liberalize customs and trade obstacles, eliminate restrictions (the SIRA designed by Massa), and reformulate the current common external tariff in the bloc to which Bolivia would join.

Mondino’s limited team preaches the urgent need for a bilateral free trade agreement or through Mercosur with the European Union.

Finally, through a phone call, Milei offered Zelensky Argentina as the venue for a meeting to find a peaceful resolution “in accordance with international norms and law” of what they both call “Russian invasion” of Ukraine.

Specifically, foreign policy would seem on the verge of being reduced to a mere foreign trade office without greater political projection unless some specific demand from the North American Department of State appears.

Fernando Esteche *, political leader, Doctor in Social Communication and general director of PIA Global.

Rodolfo Pablo Treber ** Economic analyst who works for the Central Bank of Argentina.

United World International

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February 2024