Argentina: high-handedness

Following three months of agricultural strikes and protests, marked by a rising risk of violence, Argentine President Cristina Fernandez de Kirchner has promised to send the controversial export tax increase imposed on grains and oilseeds to Congress. It was yet another improvisational move that suggests that her government remains focused on damage-limitation exercises rather than clear policy initiatives.  The Lower House will consider the issue when it meets this week. 

Agricultural leaders have cautiously welcomed the move, although as yet it is not clear that the dispute is over, or that the farm strike will end.  The government apparently hopes that its majority in both houses will allow the tax increase to be approved without debate, and plans to send the bill for approval or rejection only, while the opposition and farming groups are demanding that the issue be reopened for broader debate. 

In practice, it is not clear that approval will be automatic, given increasing disquiet over the political impact of the law even among some government allies, especially among representatives from farming constituencies. 'Rubber-stamp' approval would probably not resolve the agricultural strike, nor reduce public anger over the government's perceived autocratic bent. 

Fernandez de Kirchner's decision may be astute:  congressional approval of the law would make it more difficult for farmers to resist on grounds of the tax rise's legitimacy, and may circumvent more court rulings on whether the tax rise was constitutional, some of which have already been unfavourable to the government.  Yet the decision represents a climbdown by the president, and one that follows not only farm strikes and protests, but a rising tide of demonstrations around the country that seems to have taken the government by surprise. 

While these suggest popular anger over the president's high-handedness -- and the divisive and high-profile meddling of her husband, former President Nestor Kirchner, in government policy -- they do not yet represent an attempt to force the government out.  Nevertheless, further similar measures affecting other sectors could produce just such a backlash, and indeed are possible, given that export taxes will not begin to flow again in the short term and revenue shortfalls will remain a problem.

This is especially risky if the government continues to dismiss all opinion expressed outside its own closed circle, or to accuse all dissenting voices of 'coup-mongering' or of pursuing their own anti-democratic interests at the expense of government efforts to redistribute wealth to the poor.   Even if the vexed question of export tax increases can be resolved, the government has lost much political capital, with the president’s approval rating now hovering around 20%, and looks unlikely to regain the initiative and reverse the perception of political and economic instability.