Cristina Gets Her Handshake

But it won't do her any good. Why the Clinton visit isn’t enough to bolster Argentina's sagging president.


Shortly after last April’s G-20 meeting, a YouTube video circulated among Argentina’s politically minded youth, showing Argentina’s president, Cristina Fernández de Kirchner, extending her hand to U.S. President Barack Obama during a photo call of G-20 leaders. Not noticing Kirchner, Obama passes her by and greets Canada’s Stephen Harper instead.

The incident was particularly amusing in Argentina because Kirchner is seen as a president who approaches foreign relations with little seriousness. After she came to power in 2007, she was slow to name ambassadors; Britain, for example, went months without an Argentine representative. When the post was filled, it went to José Nun, an intellectual with experience on the Falklands issue, a conflict that has carried disproportionately huge weight in Argentine-British relations dating back to Argentina’s ill-fated 1982 invasion of that minuscule island territory.

So for U.S. Secretary of State Hillary Clinton to encourage Argentina and Britain to sit down and discuss the islands’ future was a political boon for Kirchner. Clinton’s visit on March 1, of course, was short and perfunctory. But had she left Argentina out of a trip that included José Mujica’s inauguration in Uruguay and visits to Brazil and Chile, she would have cost Kirchner politically by reminding Argentines of what is shocking to many of them: that Argentina’s steady decline is so advanced that the country no longer ranks among South America’s elite club. Clinton’s visit just barely rescues Kirchner from the ignominy of exclusion — but it won’t be enough to rescue her from the consequences of her own poor governing.

The latest reason for Kirchner’s waning popularity is her battle over the Central Bank’s dollar reserves. In January she issued a decree ostensibly creating a fund of $6.6 billion to service public debt and hasten Argentina’s return to the international capital markets. But ever since Kirchner nationalized private pension funds in November 2008, she has spent that cash wantonly to maintain her party’s patronage networks. Few Argentines expect the Central Bank money to go to any other purpose. Martín Redrado, the Central Bank’s governor at the time, refused to allow the transfer. He was soon replaced by the less challenging figure of Mercedes Marcó del Pont. This week, $6.5 billion in reserves was rapidly transferred to the treasury.

Such a move smacks of desperation. As a political force, Kirchner and her husband, former President Néstor Kirchner, are facing death by a thousand cuts. Their struggles began in the middle of 2008, when protests over farming taxes that lasted several months ground parts of the country to a halt. These ended when Julio Cobos, the vice president, cast the tie-breaking vote against a bill backed by the president to raise soybean taxes to almost 50 percent. Kirchner considered stepping down; she did not speak to her own vice president for nearly a year.

By the time of the farming protests, the economy was showing signs of overheating, and the global financial crisis was also beginning to be felt locally. Expecting worsening unemployment toward the end of 2009, Kirchner moved the midterm elections up from October to June. Néstor Kirchner tried to reinvigorate the first couple’s political brand by standing as a candidate in the province of Buenos Aires, where 40 percent of Argentines live. He was beaten by a wealthy businessman called Francisco de Narváez. The Kirchners’ party lost healthy majorities in both houses of Congress for the first time since Néstor Kirchner took office in 2003.

That left an awkwardly long and tense period from June to December before the new Congress took its seats. During those months, the Kirchners held no popular mandate, but they used their congressional power to pass bills that would aid their political survival until the next presidential election in 2011. The first was a law that reduced the influence of a media conglomerate called Clarín, which has been heavily critical of the Kirchners since the farming protests. The second was a political reform bill that diminishes the chance of small political fractions gaining momentum. De Narváez is a member of one such group.

Now, Kirchner is returning to an easy topic — the rallying-round issue of the Falklands — in an attempt to gain a rapid burst of popularity. Recently, the British have been searching for oil in the Falklands, something that infuriates Argentines, who still believe they have a moral right to all resources on the island archipelago off their southeast coast. A British firm called Desire Petroleum plans to install an oil exploration rig this month that will drill more than 10 wells. Some are in areas of the south Falklands basin that were not explored when drilling last occurred in 1998.

Argentina’s constitutional reforms of 1994 require the president to fight for full sovereignty over the islands. But Kirchner has already conceded to Clinton, at least, agreeing to help hunt for nuclear material at ports by installing radiation detectors.

Kirchner’s pugnacity and pragmatism on these issues suggest that she intends to rule with the blunt instruments of veto and decree for her remaining period in office. Which is not likely to be long, no matter how many times Hillary Clinton shakes her hand.

is a PhD student at Oxford University and former Argentina correspondent for  The Economist. Twitter: @annajessiep