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NY Times: the influential Minister behind Argentina’s economic shift

Tuesday, January 28th 2014 - 05:34 UTC
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Cristina Fernandez and her number one minister, Kicillof Cristina Fernandez and her number one minister, Kicillof
Using Marxist concepts to interpret the work of British economist John Maynard Keynes Using Marxist concepts to interpret the work of British economist John Maynard Keynes

The following piece from The New York Times, written by Simon Romero and Jonathan Gilbertjan gives an insight into the life and thinking of the most powerful Economics minister Argentina has had in a decade: Axel Kicillof and the brains behind the current rather eclectic policies.

 As Argentina absorbs the shock from a sharp plunge in its currency, President Cristina Fernández mercurial young economy minister, Axel Kicillof, a scholar with rockabilly-style sideburns and an aversion to business suits, is emerging as the face of policy shifts that are sending tremors through financial markets around the developing world.

Mr. Kicillof, 42, is wielding greater influence over an array of areas, from Argentina’s oil industry to the government’s attempts to slow capital flight and improve relations with international creditors, as Cristina Fernandez remains largely absent from the public eye after undergoing surgery in October to drain a blood clot near her brain.

The rise of Mr. Kicillof, whose writings use Marxist concepts to interpret the work of the British economist John Maynard Keynes, points to efforts by the authorities to assert greater state control over Argentina’s economy at a time when growth is slowing significantly and inflation is soaring.

“He’s the strongest economy minister Argentina has had in a decade,” said Ezequiel Burgo, the author of “The Believer,” a book about Mr. Kicillof. “He’s confrontational, outwardly self-confident and sometimes perceived as being arrogant, which of course makes him stand out at a time like this.”

Before advising Cristina Fernandez on economic matters, Mr. Kicillof taught economics at the University of Buenos Aires. He rose to prominence as a deputy minister in 2012 when he directed the nationalization of YPF, the Argentine oil company then controlled by Repsol, the Spanish energy giant.

He has repeatedly justified the seizure of YPF, which Repsol had acquired in 1999, in pointed critiques of Argentina’s economic policies in the 1990s of fixing the currency to the dollar and selling state assets. In November, while reviewing Argentina’s offer to compensate Repsol for its stake in YPF, he contended that authorities had previously laid the foundations “for the pillaging of our companies.”

Since Cristina Fernandez named him economy minister in November, Mr. Kicillof has been thrust into the spotlight.

Paparazzi trail him around his middle-class neighborhood, Parque Chas, and a celebrity magazine has described his relatively modest lifestyle — reflected in the car he drives, a compact 2008 Renault, and his decision to forgo bodyguards on a vacation with his wife, a literature professor, and their two small children.

One columnist for the magazine Noticias went so far as to examine the psychology of Mr. Kicillof’s sideburns, questioning whether they fit within a rock ’n’ roll tradition of chafing at authority, or within the fashions of 19th century Argentine political leaders who sought to display virility and power.

Mr. Kicillof has shown a flair for clashing with critics. In an interview published on Sunday by the pro-government newspaper Página 12, he warned against what he called “disinformation” campaigns on social media networks that could destabilize Argentina’s financial system.

“Economic phenomena can have this magic,” he said, referring to the circumstances around some bank runs. “They are self-fulfilling prophecies, results of a herd mentality which have no real cause.”

In a country where Freudian therapy and brooding are rooted in the popular culture, Mr. Kicillof, the son of a psychiatrist and a psychologist, accused his opponents of generating “psychosis.”

Born to middle-class parents who prized intellectual achievement, Mr. Kicillof grew up in Recoleta, an elegant neighborhood in Buenos Aires. His father committed suicide when Mr. Kicillof was 22, according to Mr. Burgo’s book. Mr. Kicillof’s mother is a prominent psychologist. Before he became a fixture of Argentina’s political establishment, Mr. Kicillof gained notoriety as a leader of an anti-establishment student organization at the University of Buenos Aires, where he went on to earn his doctorate and lecture against orthodox economic theories as a professor.

Mr. Kicillof also gained a reputation for being obsessed with numbers in some industries. After he began requesting spreadsheets from oil companies with details of wells, investments and production, the news media here reported that industry executives began calling him Excel, after the Microsoft spreadsheet application.

While he is sometimes criticized for his leftist views by Mrs. Kirchner’s opponents, he has also led a shift in the government’s policies as Argentina seeks to regain access to global financial markets, following the country’s default on its foreign debt in 2002 during a severe economic crisis.

For instance, with Mr. Kicillof at the helm of the economy ministry, Argentina has begun discussions with Repsol over compensation for the seizure of its shares in YPF. Argentina is also trying to appease the International Monetary Fund, which censured the country in 2013 over the accuracy of its economic statistics, by releasing a revised inflation index next month.

In an attempt to obtain a $3 billion loan from the World Bank, Argentina has also settled disputes through the bank’s arbitration body with five companies claiming a total of more than $650 million. This month, Mr. Kicillof traveled to France to discuss with creditors the repayment of Argentina’s estimated $10 billion debt.

But as Argentina tries to halt a plunge in the central bank’s international reserves, Mr. Kicillof’s critics have also grown more outspoken, arguing that he helped create some of the problems he is now trying to solve.

Alfonso Prat-Gay, a former president of the central bank, called Mr. Kicillof’s recent maneuvering “a scandal,” especially in relation to Argentina’s renewed efforts to reach an agreement with foreign creditors and the sharp fall of the peso. “You don’t solve things with a devaluation, but with a credible economic program,” Mr. Prat-Gay told a local radio station.

Some people here believe Mr. Kicillof is out of his depth in government. Héctor Zumárraga, 68, a labor rights lawyer, said: “He’s not up to the job. He doesn’t understand that it’s not enough to know just economic theory, and we’re seeing proof of that now.”

Top Comments

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  • Bongo

    There are brains behind the current policies?

    Jan 28th, 2014 - 09:05 am 0
  • golfcronie

    Is everyone a professor in Argentina, obviously a very clever bunch or they give titles like confetti. I have heard that they have a title “ professor of English ” how does that work?

    Jan 28th, 2014 - 09:11 am 0
  • Boovis

    Maybe an Argie can explain, the wikipedia article on Education in Argentina states “Since its foundation, it was focused on the teaching of Professions offering Professional degrees.
    It is divided in three levels .
    Tertiary Education level: 1- to 3-years degrees related to education or technical professions like Teachers, Professorship, Technicians.
    University level: 4- to 6-years Professional education taught at Universities offering many different degrees Licentiate, Engineering degree, Medic Title, Attorney Title, Professorships, Translation degrees, etc.
    Post-graduate level: This is a specialized and research-oriented education level. It is roughly divided in a first sub-level where a Specialist degree can be obtained in a 12–18 months period or Master degree, requiring 24–30 months and an original research work and a higher sub-level where a Doctorate degree could be achieved.”

    So, what, just having a basic degree makes you a professor? I know wikipedia is a dubious source, I'd just like some clarification.

    Jan 28th, 2014 - 09:23 am 0
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