At The Financial Times: Mauricio Macri’s Neo-Liberal Reform stalls, a comment by Old Socialist

What might a reader take from this review of The Panama Papers by Edward N. Luttwak, published by The TLS of August 17,2016 titled ‘Hidden assets, hidden costs’? A long quotation from the essay is not just revelatory about the corruption of Cristina Fernández de Kirchner, but that of Neo-Liberal White Knight Mauricio Macri, who was also customer of  Mossack Fonseca. Note that Vulture Capitalist Paul Singer rates a mention as rabid pursuer of assets, that even eluded his greed:

The Panama Papers opens with an engaging first-person account by Bastian Obermayer, a well-known investigative journalist for the Süddeutsche Zeitung, of how the whole story started: an unsolicited email from a John Doe offering “data”. As soon as Obermayer accepted the twin conditions of total anonymity and encrypted communications, he received “a big bunch of documents”.

These mostly concerned the alleged smuggling of $65 million out of Argentina on behalf of its President, Cristina Fernández de Kirchner – hardly startling news if true, given the country and the person but the documents also included what really mattered: full corporate information on the 123 name-plate-only (“shell”) companies that were used to zig-zag the money surreptitiously around the world, all of them formed by a Panamanian law firm called Mossack Fonseca.

If anyone tried to work back from company number 123 to the original money-sending company by way of the 122 companies in between, a lifetime of investigations might not do it, especially because those 122 companies could be registered anywhere in the world, not restricted to the places where Mossack Fonseca had and still have offices, to wit: Anguilla, the Bahamas, Belize, the British Virgin Islands, Costa Rica, Cyprus, Hong Kong, Malta, the Netherlands, Panama, Samoa, the Seychelles, the United Kingdom and two US states: Nevada and Wyoming. Those companies, moreover, could be legally incorporated yet have no identifiable owners at all, because their equity might all be vested in nameless “bearer” shares. Not even the ultra-formidable billionaire Paul Singer, who had bought up heavily discounted Argentine debt, had refused “haircut” payouts and was employing lawyers and investigators everywhere to track down anything of value that he could impound (he did succeed with an Argentine naval vessel), could do anything about the $65 million sitting tantalizingly close to him in Nevada – but now all the data was revealed (too late for Singer because Argentina’s new President, Mauricio Macri, also a Mossack Fonseca client as it happens, had already decided to settle and pay him off, along with all the other hold-out claimants).

While you savor that bit of what? ‘news’ that should shock, but simply confirms a wide spread cynicism about the opportunities political power offers.A look at this from the Financial Times of November 25, 2015Alfonso Prat-Gay appointed Argentina’s new finance minister, by Benedict Mander in Buenos Aires

Mauricio Macri, the centre-right mayor of Buenos Aires who won Argentina’s presidential elections on Sunday, named economist Alfonso Prat-Gay as his finance minister on Wednesday.

The 50-year-old former JPMorgan executive and former central bank governor will be responsible for reinvigorating an economy wracked with double-digit inflation as well as untangling a web of economic controls after 12 years of protectionism and state intervention.

The most urgent task facing Mr Prat-Gay will be to address a severe shortage of foreign exchange reserves at the same time as unifying a complex exchange rate regime and removing strict capital controls, which Mr Macri has promised to do on his first day in office on December 11.

Mr Prat-Gay’s appointment was confirmed during a press conference on Wednesday in which a cabinet dominated by technocrats was announced.

The southern hemisphere winter has seemingly brought only bad news for Mauricio Macri, Argentina’s new president. The economy has slowed, unemployment has grown and consumer confidence has cratered — and that is only from the most recent numbers.

For now, polls show Argentines giving the benefit of the doubt to the millionaire former businessman’s ambitious reform programme, which seeks to reverse the populist policies of his predecessor, Cristina Fernández.

But with poverty starting to bite thanks to high inflation and investors concerned about Mr Macri’s ability to execute reforms, the enthusiasm that first greeted his government seven months ago risks being worn down.

An August 25 poll by Management & Fit, a consultancy, showed Mr Macri’s approval rating at 43 per cent — solid enough, but down from a March peak of 51 per cent.

“I thought change would be for the better, but the truth is I am worse off now,” said Olga Faletti, 68. “Every week I’m scared to go to the supermarket . . . Prices keep increasing and my pension is not enough to make ends meet.”

It is a challenge faced by reformist governments everywhere — how to convince domestic voters and international investors to be patient until new, reformist policies bear fruit.

“Change is not easy,” admitted Marcos Peña, the president’s chief of staff, at an investor conference in Buenos Aires.

Please note the quotation of ‘consultancies’ as some how  constitutive of ‘objective sources’, of not facts, but of friendly speculation because they are stakeholders in the Mercri ‘Reforms’! Management & Fit, Ecolatina, Stratfor and the nebulous New York based Americas Society and Council of the Americas, what ever this is?

The Pope seems to be hostile to the Mercri ‘Reforms’ as it threatens his constituency the undeserving poor and a Supreme Court’s rejection:

One recent example of the kinds of institutional challenges facing Mr Macri was a decision by the Supreme Court, ordering the government to reverse energy tariff increases that are a cornerstone of its attempts to reduce a fiscal deficit forecast at 5 per cent of GDP.

And a long anonymous quotation:

“Under Fernández, the longer her presidency went on the more apparent it became that the story she was telling was based on lies,” said a government adviser. “Under Macri, it is the opposite: the longer it goes on, the more people will see that what he says is true. It is a whole new way of governing.”

Referring back to the TLS review: why  are Cristina Fernández de Kirchner and  Mauricio Macri both clients of Mossack Fonseca?

Is there hope for the austerity of Mercri? Or does the answer lie in a borrowing, and an extemporizing on the theme of  ‘intelligent austerity’ advocated by Mauricio Cárdenas, Minister of Finance and Public Credit of Colombia, in this interview conducted by tby.

One wonders about the ‘when’ of a realization that the Neo-Liberal Dispensation has exhausted itself, and that it is time, at the least, for a New Deal, that rescues the political/civic whole, rather than attempting to save Capital from it’s own self-destructive  greed?

Old Socialist



About stephenkmacksd

Rootless cosmopolitan,down at heels intellectual;would be writer. 'Polemic is a discourse of conflict, whose effect depends on a delicate balance between the requirements of truth and the enticements of anger, the duty to argue and the zest to inflame. Its rhetoric allows, even enforces, a certain figurative licence. Like epitaphs in Johnson’s adage, it is not under oath.'
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