Argentina, Hard

The Stainless Steel Masses

Saturday, March 29, 2008  

no carneIt is an unusual moment here in Argentina. There is no meat. In a country famous for beef, most markets are without. It would be like Japan without fish, or Italy without pasta. I recently wrote about a trip through the province of Entre Rios. Right now that province is in-passable. Farmers and their supporters have been blockading roads to prevent the transit of all goods to the markets.

At the same time, in the streets in Buenos Aires and other cities throughout the country there have been many seemingly-spontaneous rallies, called cacerolazos, named so because people leave their homes with casseroles/pots and pans, and bang on them to make noise. It is synonymous to a popular uprising, and I understand it was a common occurance during the economic crash of 2001 when things were truly bad here.

Though it appears to be a popular uprising, I have noticed that these cacerolazos have been filled almost exclusively, not with the huddled masses, but with well-dressed, middle or upper-middle people in generally upper-class barrios. A local daily, Pagina 12, describes how the protesters this time around are banging on high quality stainless steel pots and teflon-coated woks in place of the cheap beat-up aluminum pots of years past. As I walked past one the other night the attitude was more like a street party or soccer rally, than something really critical to these people. Also, it is obvious from viewing coverage of the events in the farming areas that the protesters are not salt of the earth struggling farmers, as you can see their shinny 4×4′s parked nearby and that the protesters are all well dressed.

What is going on?

CARRITOSince the economic crash in the year 2000, the Argentine peso has maintained a low value relative to other currencies. This is partly just the course of economics but also the policy of the federal government. Anytime the Argentine peso begins to rise against the US dollar, the national bank buys dollars to bring the peso back down, maintaining more-or-less a 3 to 1 ratio between the peso and the dollar. This has been hard on the public, but also it has helped the country climb out of huge debts by increasing worldwide demand for Argentine goods and services. Accompanying this, the government has put pressure on the prices of basic goods to allow everyone to keep eating meat and everything else. And aside of the usual corruption and efficiencies of this banana republic, the people are getting by.

Argentina is a big world-wide exporter of agricultural goods: beef, corn, sunflower, soybeans, etc. Soybeans? I never have even seen a single tofu cake in any market here, and most are owned by asian people. Well, Argentina grows a lot of soybeans, and all of it is exported. It is a very important exporter of soybeans in the world. This has been accompanied by a decline in production of other food items that are consumed more within Argentina: less corn, wheat, and other agricultural products. Obviously there are farmers who are converting to soy for the export demand.

What seems to be happening is that the soybean farmers are getting rich because of the low value of the peso. Plus the price of soybeans has been rising worldwide. There are independent farmers in the mix, but the soybean market has helped more to grow large agro-corporations. Meanwhile, other people of all walks of life are dealing with high inflation, unemployment or sub-par wages, and very expensive goods from abroad. And this includes rising prices on food. The government is raising the export tariffs on soybeans to moderate its production in favor of other crops, so now those farmers are pissed cause they can’t get as rich as easily.

republica sojeraThe Presidenta angered people when she referred to the strikers as holding the country hostage. She has also threatened to halt the exports of any goods which are being withheld from the general public. (By the way, I happened to hear one of her recent speeches on the radio, and Cristina Fernandez de Kirchner, aka CFK, is a great public speaker.) She pleads that these measures are for helping all Argentines more. I am not sure if the government’s overall strategy with the under-valued peso is the best route, and if all the tax dollars from these tarrifs end up in the right hands, but given the where things are now, I have to agree with her. These farmers are getting rich because of the cheap peso, and production is declining on essential crops, so things need to be balanced for the general public. This is about food, not luxury items. The government has a responsibility to act.

Meanwhile, the Argentine people are getting testier from their beef withdrawals. Plus, who likes paying taxes, so now people everywhere are pissed at the government. This reminds me of the whole politic a few years ago around inheritance taxes in the US. It sounded truly unfair the way G.W. Bush presented it, but its repeal ended up helping only people at the very very top of the economic ladder. (At least, though, in the US the soccer-moms didn’t shut down the interstate highways.) I don’t think that the soybean farmers will suffer much due to an increase in their tariffs, and it could really help if that money is used to better things for others in the community. Meanwhile, let them eat fish and chicken.

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2 comments for “The Stainless Steel Masses”

  1. Ethan G. Salwen says:

    Nice going, Mike! I’ve been reading the Clarín, talking to people, watching a little CFK on TV (good speaker is right!) and, or course, running into a lot of cacerolazos, and yet I haven’t really, truly been able to make heads or tails of this mess. I mean I get it, but I dont’ GET it. Your explanation is definitely the best I’ve come across that makes sense to the the GP (Gringo Perspective.)

  2. mikeque says:

    Since I wrote this, I have learned that the same agricultural groups (or their leaders) were behind a similar strike in the mid 1970′s that was instrumental in getting the military involved. The leaders of the strike were too happy to see the military subsequently overthrow the government, part of what we know as the Dirty War. This time around the government is stronger and more popular than it was then, and the military is more copasetic. So I don’t think today’s events will lead to 30,000 political assassinations as happened in the 70′s.