Global Insight Perspective | |
Significance | President Cristina Fernández de Kirchner has accepted the resignation of the head of her Cabinet, Alberto Fernández, who also occupied the position under the 2003-2007 presidency of her husband Néstor Kirchner. |
Implications | The Kirchner couple is losing a key ally with the exit of Fernández, whose active involvement in the whole agricultural tax episode left him little room for professional manoeuvre. |
Outlook | Further ministerial changes are in the pipeline in Argentina as the president focuses on rejuvenating her government, improving its image, and healing the wounds inflicted on its popularity over the last few months. |
Kirchnerist Heavyweight Out
Cabinet Chief Alberto Fernández brought to an end some five years of close co-operation with the Kirchner couple yesterday. His resignation, accepted by President Cristina Fernández de Kirchner, sent shockwaves through the government and the ruling faction of the Peronist party, the Justicialist Party (PJ). Alberto Fernández occupied the key post during the whole of Néstor Kirchner's presidency (2003-2007) and kept his place under Kirchner's wife and successor, President Fernández. Despite reports of heightened tension within the government at the political heavyweight's departure, the president seized the opportunity to replace him with a younger and dynamic Peronist affiliate, Sergio Massa, currently the head of a municipality within Buenos Aires. Massa confirmed he would prioritise on improving dialogue and reducing confrontation—the main shortcomings of the government's current management style. Rumours around the departure of Alberto Fernández had grown in recent days. The head of the cabinet was the main figurehead in talks on, and defence, of the notorious agricultural tax that prompted the most severe political crisis for the Kirchners since 2003. The Senate's rejection of the tax package last week left him in a vulnerable political position, with his authority damaged.
Further changes are afoot in the Fernández administration. Controversial Trade Secretary Guillermo Moreno is rumoured to be on his way out too. The departure of the architect of the controversial new consumer price index (CPI) and a promoter of interventionist and heterodox policy could be a positive signal for the private sector, though all will depend on his replacement. The communication and environment secretaries could also be removed from their posts, along with the Secretary of the Presidency Oscar Parrilli. A new Agricultural Secretary, Carlos Cheppi, was sworn in yesterday amid the striking absence of leaders from the rural sector (see Argentina: 22 July 2008: Tax Debacle Prompts Resignation of Agricultural Minister in Argentina). There is still much discord between the executive and that sector, and further policy changes will condition any smoothing-over of relations there in the short to medium term.
Outlook and Implications
The president's defeat in the Senate was the making of one of her own, Vice-President Julio Cobos, rendering the recovery from such a blow even more difficult (see Argentina: 17 July 2008: Argentine Senate Votes Against Government's Tax Bill). Government cohesion has been severely damaged in the four months of wrangling with agricultural producers, and restoring some sheen of authority to her presidency is vital for the government at this stage. However, the element of confrontation remains embedded. Indeed, some officials close to the vice-president were removed from their posts recently in what is considered a retaliatory move. Cobos himself cannot be removed unless two-thirds of the Congress vote him out—a highly unlikely scenario—or he resigns. It is not clear yet whether he will remain in the position. In any case the whole episode has crucially undermined the alliance between Peronists and the pro-Kirchner Radicals (Radical Civic Union, the historical rival of the PJ). Cracks within Peronism and the web of allied governors are also evident. Lawmakers attached to the ruling party and coalition preferred to cast their vote on the agricultural tax in favour of their constituents, rejecting the deal, and some governors also distanced themselves from the agricultural policy championed by the government. With approval ratings already low, the government has lost a key instrument in the retention of support from non-Peronist (and even Peronist) legislators and governors.