A hotel room too far?, ctd.

Yesterday, after I had already finished writing my last post about the corruption threats surrounding Cristina Fernández de Kirchner members of her cabinet, an op-ed column appeared La Nación by Carlos Pagni discussing the affect the Caso Báez is having on the Kirchner government’s policy stance. In effect, he argues that, whatever thoughts Kirchner may have had about finishing her term early, the threat to her son, in particular, in the investigation has necessitated that she redouble her efforts to remain in power.

His cause and effect are somewhat reversed from how I perceive the situation; that the threat from the case is a major driving factor in the embryonic economic reforms of the past several weeks. I would still argue that the overwhelming factor is the memory of de la Rúa and Alfonsín leaving office early that’s driving the reforms, but I do agree that the threat from the case certainly is upping the stakes for the Kirchners. That said, the threat cuts both ways. Not being in power anymore makes Kirchner and her family more vulnerable to the potential legal fallout from the case. But the economic reforms the government has begun to undertake—and especially the fiscal consolidation through below inflation adjustments in public salaries and phasing out subsidies that are still to come—will be highly unpopular and will make the illicit enrichment that the Kirchners stand accused of all the more salient, and the odds of destabilizing protests higher.

Cristina Kirchner may well be caught in a sort of catch-22 as the result of her poor economic management and apparent corruption. She has to try to mitigate the economic problems her policies created to avoid a crisis that could threaten her presidency and make her vulnerable to legal actions related to her alleged corruption, but the specter of her corruption could make difficult reforms intolerable to the Argentine public, threatening her presidency.

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