MercoPress. South Atlantic News Agency

Cristina K rejects “monetarist” and “neo-liberal” economics

Opinion polls show Cristina a head but inflation is trailling

Argentine Senator Cristina Fernandez de Kirchner said if elected president her administration would discard “monetarist” and “neo-liberal” solutions to combat any outbreak of inflation, which has become the main campaign issue of those opposing her husband President Nestor Kirchner.

The First Lady and incumbent candidate for the October 28 election made her statements during a conference to a gathering of business leaders. The risk of an outbreak of inflation has been the ringing campaign speech of Argentine opposition presidential candidates who nevertheless seem unable to cut into Mrs K comfortable advantage in the opinion polls that could even save her from a runoff. "Inflation has to be combated with expanded investment and not by cooling the economy. We need three/four more points of investment, which currently is at a historic level equivalent to 23% of GDP", said candidate Mrs. K. Addressing one of the leading Argentine businessmen, Luis Pagani, who is considered an orthodox in economic terms, Senator Fernandez said "I celebrate we have here with us Mr Pagani who hasn't proposed any monetarist solution such as decelerating or "ironing" the economy if it was possible. I challenge you to look into history the results of these policies which always end up with a recession". Mrs Kirchner also defended, as her husband has been doing for the last few weeks, the controversial government statistics on inflation. Opposition candidates and a sector of the media claim the Kirchner administration has intervened the Statistics and Census Office, Indec, with the purpose of modifying figures which have had an impact on the credibility of the office and Argentina's official data. The Kirchner administration insists that 2007 will end with inflation in the range of 9.5%, far below other sources, private and from other provincial statistics offices, which insist in 15 to 20%. "In an economy with a 50% GDP expansion in four years and a half, the current price dynamics sounds reasonable", argues cabinet chief Alberto Fernandez who is also responsible for Mrs. Kirchner's election campaign. Real inflation in Argentina "is not the index mentioned by the opposition, no way, it's the index from the Statistics and Census office", he insisted. Indec staff claim that since early 2007 the Kirchner administration has been manipulating data so as to report a lower inflation. The Ministry of Economy admits come price sampling modifications have taken place, but "following rules and procedures of Indec". Cristina Fernandez also denied the possibility of an energy crisis, another crucial issue of the campaign and the press. "We haven't had a crisis in the terms described. Energy crisis was what we had in 1989 with blackouts every six hours", she insisted.