GOVERNMENT AND OPPOSITION, FORTHCOMING WINTER 2000

 

Torcuato S. Di Tella

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Argentina Becoming "Normal": The 1999 General Elections

 

 

 

The October 1999 elections have seen the second change ever from one political party to another since the inception of mass politics in Argentina in 1916. The first one was when in 1989 the Peronist Carlos Menem took over from Radical[1]  Raúl Alfonsín. This time the same Menem, after two terms in office, and incapable to twist the arm of the law in order to compete for a third term, as was his intention, has transferred power to the Radical Fernando de la Rúa. The significance of this is that the Peronists have a manner of not abiding too much by the Constitution, and being tempted to repeat Juan Domingo Perón's several stints at the presidency (1946-52, 1952-55 and 1973-74), which were tainted by continuous violations of political rights and maltreatment of the opposition. Peronism has changed, almost as much as the European Communist parties, East and West, but this mutation requires some effort, as not all its followers believe it is necessary, and its opponents doubt its authenticity. In fact, President Menem and his closer associates have been involved in some serious tinkering with legal restraints, especially in packing the Supreme Court with cronies, and attempting to use that majority to overrule clear constitutional prohibitions against a third term. Even a Fujimori-like break with legality was at some point feared by a wide sector of public opinion. If the attempt failed, it was mainly because of resistance within Peronism, from the party's candidate to the presidency, Eduardo Duhalde, governor of the province of Buenos Aires, the second power in the republic. So Peronism is after all changing from being an authoritarian-oriented, "verticalista" party with caudillo-like leadership, to a more pluralist association of local machines, not too different from, say, the American Democratic party.

           

The resentment between Menem and Duhalde will remain a major feature of the political scenario. The defeated presidential candidate believes -- with a lot of evidence -- that Menem's attempts at interfering with due process, not to speak of the many corruption and police scandals, have destroyed his own chances for success. Thus, a major factor of division within the movement will remain for years. As we will presently see, this responds also to more basic features of the Argentine party system, which probably has run its time.

           

But what about the new ruling coalition, based on the centrist Unión Cívica Radical (UCR), and the left-of-center Frente País Solidario (Frepaso)? The Unión Cívica Radical, a century-old moderate party, has a widespread structure of local leaders and activists, and the prestige of being relatively clean and law-abiding. However it has to fight tendencies to polarization between Right and Left, or Right and Populism, which in other countries have savaged such similar centrist parties, as the British Liberals or the French and Chilean Radicals, and more recently the Italian Christian Democrats.

           

Raúl Alfonsín, up to this day leader of the party, was responsible for agreeing to support in the 1994 Constitutional Convention Menem's bid to be allowed at least one reelection, in exchange for other progressive changes, as ballottage, revamping of the Judiciary, and elements of Parliamentarianisn through the introduction of a Coordinating Minister who needs legislative approval. This "Pacto de Olivos" was not well received by public opinion, which considered it a sell out to Menemismo, and punished the UCR in the immediately ensuing presidential elections of 1995 by throwing it to third place, after the victorious Menem, and a newly-knitted coalition, the Frepaso, which included several left-of-center parties and some dissident Peronists led by Carlos Chacho Alvarez. The UCR was shamed into a 15% portion of the electorate.

           

As a reaction to this, the Radicales decided to enter into an alliance with the rising star of the Frepaso, hoping that it would soon be reduced to size, once the electorate "pardoned" Alfonsín, which more or less has happened. So after open primaries this coalition, the Alianza, adopted a Radical, Fernando De la Rúa, as its presidential candidate, and a Frepasista, Carlos Chacho Alvarez, for vice president, plus another Frepasista, newcomer Graciela Fernandez Meijide, a human rights activist and political sufferer, for the governorship of Buenos Aires, which she lost against a Peronist supported by the Right.

           

The Alianza looks, ideologically, very much like Chile's Concertación of Christian Democrats and Socialists, or Italy's similarly-based government. The difference, however, is that those coalitions include solid working class and trade union support, while the Argentine Alianza is very weak in that area, monopolized by Peronism. And this involves a serious threat of ungovernability, as the Alianza also lacks support from the business Establishment.

           

Let us now take a look at the predicament of the Right in Argentina. Believe it or not, in these days of globalization and world-wide conservatism, no self-assumed conservative party -- by that or any other name -- exists with a presentable electoral record. As a matter of fact, there are four or five hoping to don that mantle, some of them merely provincial. At present the main representative of this political sector is Acción por la República, led by Domingo Cavallo, a technocrat who, after having had important positions during the military regime, became Menem's miracle-working Finance Minister in 1991. As a presidential candidate he now got 10% of the vote, crushed between the two mammoths of the Alianza (49%) and Peronism (38%), leaving a paltry 3% for the more extreme Left.[2]

 

It is sometimes argued that the real conservative, or "popular conservative"  party in Argentina is Peronism. I do not believe this is so, though there are no doubt rightist elements, even fascist ones, in its composition. However -- even if one shouldn't quarrel about names -- it must be branded rather as populist, a category well known to readers of this journal.[3] Populism, being quite Protean, can move in many directions, but in Argentina and several other Latin American countries (as in Brazil under Joao Goulart, or in Peru with Aprismo) it has had a tendency to plunge into radical confrontations with the Establishment. No conservative movement, however "popular", would have been capable of spawning the Montonero guerrillas, or burn the Jockey Club and the four main churches of Buenos Aires (in 1953 and 1955).

           

However, Peronism has always had a conservative wing, and this has grown out of proportion under president Menem, as a result of his reorientation towards "neo-liberal" (i.e., neo-conservative) economics, and his peace-making with the business community. The bigger entrepreneurs, native and foreign, changed their deeply-felt rejection of Peronism for an appreciation of Menem's efforts to tame the monster. They ended up being a part of his entourage and a solid support for his policies, even going to the unbelievable extreme of selecting the hated ballot paper in the voting booth. For a while it even seemed that Menem was transforming his movement into something more akin to Mexico's Partido Revolucionario Institutional (PRI) in its days of glory, when it encompassed so many different groups under its aegis. But this was partly due to the fact that in Mexico the bourgeoisie was a daughter of the regime, and the working class quite feeble, so it was much easier to hitch them both to the same cart than what is the case in Argentina.

 

 

 

THE BREAKUP OF THE MENEMISTA COALITION

 

 

Menem's coalition, which in any case was mostly tactical and superficial, has now been broken, as the business interests which had welcomed his turnabout have reverted to their traditional animosity against the populist antics of Peronism. They no longer fear it, as they did in the past, but they certainly do not love it, quite apart from what they may think about Menem. Maybe the nearest case in Europe is the attitude of the Italian or Spanish Right to the chastised ex Communists or Socialists: they have become acceptable, but birds of another feather.

           

The dissolution of the Menemista coalition with the Right involves in the long run also a crack in the Peronist party. Not necessarily that this party will divide into two. This may happen, but more probably it will slowly lose supporters, and create local caudillo-led independent groups, as has happened with Varguismo in Brazil.

           

There is, then, a window of opportunity for the formation of a self-assumed conservative party or coalition, most probably centered on Cavallo, but this will take time. If this happens, Argentina would give a step towards becoming more like other developed or semideveloped countries, including nearby Chile, where a clearly defined Right easily gets 40% of the vote. Also in Brazil the two existing conservative parties (Partido Progressista Brasileiro, PPB, and Partido da Frente Liberal, PFL) collect one third of the votes for Congress. And even in Mexico the Partido de Acción Nacional is becoming the main option for the upper and upper-middle classes, which in increasing numbers are abandoning the PRI.

           

In fact, the defeat of the Peronist candidate was to a very large extent due to the refusal of the conservative forces to continue underwriting that party. A look back is necessary here to understand what has happened. Menem had won his first elections with approximately 50% of the vote en 1989. He was reelected in 1995 with the same proportion of the electorate. But this was a different electorate. I would estimate that he lost at least 10 percentage points to the Left (Frepaso), while gaining the support of a similar amount of right-of-center opinion, symbolized by his then chief Minister Domingo Cavallo. Now that Cavallo has broken lances with Menem, abandoning his job about a year or so before the elections, his troops no longer supported Menem's party, thus determining its defeat. In the province of Buenos Aires, where the Alianza candidate, Graciela Fernandez Meijide, was seen as "excessively" concerned with human rights abuses and demanding justice for past misdeeds (she lost a son during the repression), Cavallo and his electorate supported the Peronist candidate for the governorship, Carlos Ruckauf, making it possible for him to win the contest, which he would have lost otherwise.

           

So now there is a great deal of "criss-cross" in coalition building. The Right has acted independently at the national level, but has supported Peronism in various provinces, especially Buenos Aires (which does not include the inner-city Federal Capital, a strong Alianza bastion with Frepaso dominance).

           

The coexistence within Peronism of Menem, who harbors aspirations for 2003, and his rivals, several of whom head the main provinces, will be highly precarious. Their personal rivalries, important as they are, also reflect the difficulty of including in the same political party the organized popular sectors and the main entrepreneurial forces. Menem was supported by the latter, and would like to continue associated to them. But they are no longer happy with the Peronist party, that is, they have returned to their old antipathy -- even if no longer enmity -- against it, so the field will be mine-infested for Menem's aspirations. It would not be impossible for him to lead a breakaway faction of Peronism, based on the easy electorate of the less prosperous provinces and on his entrepreneurial friends. But it so happens that these people now have Cavallo as their leader, who for apparently personal reasons has seriously quarreled with Menem after being the linchpin of his cabinet. Menem is a more charismatic and politically-oriented potential leader of that coalition than Cavallo, so after all they may become reconciled. However, for the moment this is pure speculation.

           

For the "normalization" of Argentina one should also look to the Left. A Socialist presence exists since a long time in Chile, now clearly on a moderate path, and Brazil also boasts a Partido dos Trabalhadores, clearly trade-union based, and slowly evolving towards accepting the accoutrements of reformism. In Uruguay the quite radical Frente Amplio almost won the latest presidential elections. The main barrier against this happening in Argentina is the persistence of Peronism, and of the antagonisms between it and the ideologically more sensitive Left. The formation of the Frepaso, uniting almost a dozen small political parties, is a sign of maturation in this area.[4]

 

 

 

THE SCENARIO FOR THE NEW GOVERNING ALIANZA

 

 

The economic panorama is not encouraging. The foreign debt has increased exponentially, from 63 billion dollars in 1992 (the first year of Cavallo's "miracle") to 150 billion in 1999, that is, from 27% of the Gross Domestic Product to 48%, and from 5 times to almost 7 times exports. This is despite the sale of most State-owned enterprises, from railways to oil. The 1999 fiscal deficit was double what the International Monetary Fund expected in order to stamp its seal of approval, and the prospects for 2000 are such that the new authorities will have to decide either a reduction in State salaries or an increase in taxes. The international trade balance is negative, and not only due to inflows of productive capital. The Mercosur agreement with Brazil, Uruguay and Paraguay, and partially Chile, which has been a great success in increasing mutual trade (up to sixfold) has recently run into some problems, due to Brazil's devaluation early in 1999, and will require some controls in the free flow of goods, notably cars, textiles and shoes.

           

However, the country has changed remarkably during Menem's ten years at the helm, especially in creating an investment-friendly climate, and stopping inflation, even if at the price of pegging the peso to the dollar, which implies overvaluation of the local currency. Economic growth and other variables were quite promising up to the impact of the various international crises, beginning with the Mexican tequila effect, felt in 1995. Unemployment shot up from a moderate 6% to 20%, and has remained at quite high levels, still at about 15%. Social welfare has been reduced, work flexibility enhanced, insurance for the jobless was never very significant, and the abyss between rich and poor has widened, in a country which had one of the most equal distributions of income in the region. Whether this is good or bad for the economy in the long run, most people do not like it, and thus Menem's popularity, quite high till 1995, dropped to very low levels towards the end of his second presidential term. Duhalde, the Peronist candidate, trying to differentiate himself from Menem, harked back to traditional Justicialista policies, like asking the Pope to intercede for a reduction of the foreign debt, and public spending regardless of the fiscal balance.

           

By contrast, the Alianza has been overcautious in not antagonizing the Establishment, which is apprehensive about a return to heterodox programs, rampant during Alfons¡n's presidency (1983-89), and purportedly responsible for the hyperinflation of his last year in office. Actually, voluntaristic economic policies which do not pay heed to market realities were introduced in Argentina by Perón himself, in the forties. Since then, they have been a constant feature of the local economy, and have created so many vested interests that it became impossible to change them, even under the most repressive dictatorial regimes. It was necessary to wait for a Peronist in power to call the cards and start a new dispensation, through what may be termed the "Nixon in China" syndrome.[5]

           

The Alianza will not be able to fulfill all expectations, and the mid-term legislative elections of 2001 will surely reflect a loss of support among some of its more demanding segments. To make things more difficult, the complex electoral results have created a great deal of checks and balances in the institutional structure, almost to the point of paralysis. The Alianza lacks a majority in Congress, where it is short of it by a few seats in the Lower House, and by a wide margin in the Senate. It also faces a very partisan Menemista Supreme Court. The three main provinces (Buenos Aires, Córdoba and Santa Fe) have Peronist governors, even if in Buenos Aires the Alianza holds a majority in the Legislature.

There is a tradition, almost second nature for most political actors and observers, that a Radical government is usually thrown out of balance by vicious opposition from the Peronist trade unions and by other popular pressures, while it lacks support from the business community, thus falling between two stools. This happened to Arturo Frondizi (1958-62) and Arturo Illia (1963-66) during our times of troubles, and to Raúl Alfonsín (1983-89) during the present democratic regime. Will it materialize again under president Fernando de la Rúa? There is a high likelihood that this will be the case, though with some provisos.

           

First of all, De la Rúa now has the support of a moderate Left, including some trade union sectors, which may help warding off the assault from hard-line Peronists.

           

Second, trade unionism is much weaker now. This is so to the point that many proclaim its death, but in this they distort and exaggerate some real trends. During Menem's presidency trade unions have been rather quiescent, partly due to deindustrialization, but also because they were a part, however postponed, of the ruling party, and did not wish to throw bolts into its machine.

           

Finally, there is the Fernando Henrique Cardoso syndrome: forging a working alliance with the Right, to oppose an archaic, or demagogic, Left, or an equally impenitent populism. This solution may be functional in the present economic world conditions, as it would have the support of international financial sources and investors. At least it would guarantee that attack would come only from one side, but it would be rather contradictory with the Alianza's proclaimed intentions, and hotly denied by its leaders.

           

In trying to avoid a three-pronged contest, another strategy is conceivable: a convergence with a renovated Peronism, banking on the resentment Duhaldista and other classical Peronist forces will harbor against Menem and the Right. For the moment, most politicians and political scientists would rule this out, arguing that Peronists often quarrel but never actually part company, or if they do they soon come together again, with a very few exceptions. In fact, such a convergence between the Alianza and popular Peronism would create an excessively broad coalition, if measured in votes. But in terms of social power, the score would be much more even. In fact, there are elements, especially within the Frepaso, who are bent on developing a "Peronist leg" of the Alianza, incorporating a major sector of that movement. This is easier said than done, as the chasm is still quite deep, even if being slowly filled. For most people such an expanded coalition, which would have as its main opponent the self-assumed Right, is as unbelievable as a collaboration of Christian Democrats and Communists was till a few years ago in Italy. The future will tell whether Argentina follows this Italian path, which, among other things, requires a major crisis and the formation of a strong conservative party structure on the other side. This would involve "interesting times", especially for social scientists, and less so for the rest. For the moment, local politicians are at the cross roads: they are no longer as aggressive as they used to be, but they can easily remain mutually stalled, unless they learn to iron out their differences, even if only through the menace of mutual sabotage.