By Federico N. Fernández*
The results of the second round of Argentina’s presidential elections will very likely provoke a major reconfiguration both in the country and in South America. On the one hand, the very structure of power of the Peronist party has been severely damaged. On the other, Argentina has provided a region victimized by populism with a success story on overcoming the tragedy.
On the national front, the victory of “Cambiemos” (“Let’s Change” in English) may be signaling the beginning of the end of the social and political preeminence Peronism has had since 1946. After this election cycle, which not only brought a new president but renewed municipal and provincial governments as well, Peronism shows a completely different face. Argentina is an extremely unbalanced country regarding the geographical distribution of its population. In the densely populated center of the country, the Peronists have suffered a historical defeat. Even their historical stronghold of the Buenos Aires province –with approximately 40% of voters nationwide– is now in the hands of Cambiemos.
Peronism is starting to look as a loose confederation of Northern and Southern chieftains from backward and unpopulated provinces. Rough estimates indicate that starting in December just 32% of voters will be ruled by a Peronist governor. This dark picture sharply contrasts with the excess of power they enjoyed some years ago when a plan to make Cristina Kirchner “eternal” was strongly pushed.
An effective government by Cambiemos is probably the Peronists’ worst nightmare. A large part of their political success was based in what Juan Domingo Perón himself explained: “It is not the case that we are good administrators but that the others are even worse.” Indeed most of the Peronist political power has been based on the incompetence of the alternatives.
But Peronism seems finally exhausted. These elections nationwide had been a huge public outcry that the populist king is in fact naked. While the elected president Mauricio Macri spoke of an Argentina reclaiming its place in the world, making good use of its competitive advantages, and opened to the possibilities globalization offers, Daniel Scioli’s proposals were a combination of fear mongering and anachronism. Thus, Mr. Scioli made constant references to issues such as the good provision of gas and electricity. Scioli faced a 21st century constituency with the same empty promises his party has been breaking for more than seven decades.
The relevance of Mauricio Macri’s election is perhaps even greater on a regional level. The single most important message is that populist regimes can be democratically defeated. One of Hugo Chávez’s best pupils have just been outvoted when Venezuela is facing crucial elections next December. Mr. Macri has already promised that he will make diplomatic efforts to isolate Venezuela due to its lack of democracy. The wife of Leopoldo López –a Venezuelan political prisoner– was in Argentina celebrating the victory with Macri’s supporters during the night of the elections.
Moreover, left-leaning governments such as the Chilean may think twice before accelerating her populist agenda. In the case of Brazil, all the class warfare rhetoric of president Dilma Rousseff has backfired and she is very likely to face impeachment in the following months. A completely different scenario is unfolding with the populist forces at bay.
From the very the beginning Mr. Macri’s own party and later on his coalition looked like a very centrist and rational alternative. Its leadership seems committed to a combination of pro rule of law and republican values and a political economy that gives more space to individual initiative and limits the role of the state to certain areas. One of their main objectives was to stop the populist oligarchy which ruled Argentina for twelve years. They have succeeded in that. Now Macri’s coalition has to face the harsh realities of a country with rampant inflation, deteriorating social levels, and with a completely failed monetary policy. If they are up to the challenge, the political scene of Argentina may change forever.
* Federico N. Fernández is Senior Fellow of the Austrian Economics Center (Vienna, Austria) and Vice president of Fundación Bases (Rosario, Argentina)
The views expressed on austriancenter.com are not necessarily those of the Austrian Economics Center.
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