MercoPress. South Atlantic News Agency

Argentines accept inflation is in the range of 25%, but divided on the causes

For President Cristina Kirchner it’s a “distortion and dispersion of prices”

A majority of Argentines, 74%, believes that inflation is harming their finances and a similar percentage, 74%, considers the administration of President Cristina Fernandez de Kirchner is hardly interested in the issue, according to a public opinion poll published Sunday in Buenos Aires La Nacion.

However the Poliarquia poll also shows that in spite of the government’s lack of interest in the issue, 52% of Argentines blame “entrepreneurs and retailers who are always wanting more profit”, while 38% blame government policies and 10% don’t know or won’t answer when asked about the causes of inflation in Argentina.

“The numbers could come as a surprise but it’s always simpler to blame high prices on the last link of the supply chain than try to understand economic policies that triggered inflation” explains Alejandro Catterberg, head of Poliarquia.

Nevertheless when trying to pinpoint culprits for inflation, answers are conditioned to the degree of support for government and to a lesser extent to education level.

Among supporters of the administration of Cristina Fernandez de Kirchner, those who blame business and retailers for inflation climb to 70% and only 22% government policies. But for those who do not support the current government, 64% blame Mrs. Kirchner and only 25% targets business and retailers.

As to the degree of education, 47% of university graduates and professionals blame the government for the hike in prices and 43% retailers. Among those with only primary schooling, 58% blame retailers and 31% government policies.

Inflation has become a controversial issue in Argentina with President Cristina Kirchner and cabinet arguing there’s no such thing as inflation but rather “a distortion and dispersion of prices”, while business organizations and the unions complain bitterly or demand significant salary rises.

‘Official’ inflation which is allegedly manipulated is just below or above the two digits, (10.8% in 2010) but private consultants argue that retail prices in Argentina during 2010 increased a floor of 25%, and expectations are for further advances.

However in spite of the headlines, Poliarquía said that inflation is not number one concern for individual Argentines. Insecurity (law and order) tops the short list with 34%, followed by unemployment, 15% and inflation, 8%.

For Argentina as a country, 40% insecurity; unemployment 11%; poverty 8%; education, 7%, the ruling political class, 4% and then inflation, 3%.

“With one digit unemployment it’s not hard to understand why people do not consider inflation a serious problem even when it is above 25%”, said Cattenberg.

Nevertheless 35% of those interviewed said that inflation in the last twelve months was above 30%; another 26% said between 21% and 30% and for 15%, inflation ranged from 11% to 20%.

This means that 78% of interviews do not believe in the official numbers from the Statistics Office (Indec), which soars to 87% among people with tertiary education and to 82% for those over 50 years of age.

The poll also showed that a majority, 57% believes inflation in 2011 will be above 25%, that new salary contracts should be in the range of 25% to 30% and that the main problem for the next Argentine government (December 2011) will be inflation.