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Montevideo, August 19th 2022 - 13:46 UTC



Argentina's Supreme Court rules gas rate increases must be rolled back

Friday, August 19th 2016 - 12:59 UTC
Full article 30 comments

Argentina's Supreme Court on Thursday blocked President Mauricio Macri's move to slash natural gas subsidies, a much-hated policy that has sent customers' bills soaring. The ruling is the hardest blow yet to the business-friendly president's move to eliminate electricity, gas and water subsidies which he says are bloating the deficit and sapping the struggling economy. Read full article


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  • chronic

    Macaroni has no more understanding or respect for the rule of law than did Cretina or any other rg.

    Aug 19th, 2016 - 01:41 pm - Link - Report abuse 0
  • golfcronie

    What has it got to do with the Supreme Court? Perhaps they ought to look at the price of everything from condoms, sanitary pads, toilet paper etc. What a cockeyed society letting the Supreme Court get involved in pricing.

    Aug 19th, 2016 - 03:09 pm - Link - Report abuse 0
  • gordo01

    What an odd country where the Judicial can contradict the decisions of the democratically elected Head of Government¡

    Aug 19th, 2016 - 03:38 pm - Link - Report abuse 0
  • chronic

    It may be foreign to some lacking an actual constitution in their own countries but the rule of law dictates that DUE PROCESS be adhered to.

    There seemed to be no lack of criticism when Cretins attempted - wrongfully so - by executive order to circumvent the legislative process.

    Rg is rg - right or left.

    Aug 19th, 2016 - 04:26 pm - Link - Report abuse 0
  • Skip

    Pity no one ever took the US$80 billion subsidies to count.

    Have the public hearings. Then implement it.

    Aug 19th, 2016 - 07:37 pm - Link - Report abuse 0
  • DemonTree

    The US Supreme Court is always ruling laws unconstitutional. It's just a different system of government.

    Of course the US constitution isn't cluttered with laws on utility subsidies and irredentist claims.

    Aug 19th, 2016 - 09:25 pm - Link - Report abuse 0
  • Marti Llazo

    Here is what the law calls for here, in the area of utilities regulation and the setting of tariffs:

    There is a national regulatory agency called “Ente Regulador de la Electricidad” commonly known as ENRE.

    Under national law here, article 46 of law 24065 says that electric companies that wish to change rates have to submit their request to ENRE. ENRE then has a 30 day period to make a decision, and a 20-day notice period before convening an “audiencia pública” or public hearing. ENRE makes the decision before the hearing, which beyond being a legal requirement is pretty much just a soapbox for the purpose of entertaining insults and profanity from the red-faced Mediterraneans and other bickering riffraff.

    Natural gas regulation comes under another agency, called Ente Nacional Regulador del Gas, or ENARGAS. They have a 60 day period to make a decision before a public hearing is held, and a 20 day advance notice period prior to the hearing. For both gas and electricity, the public notice is given in the Boletin Oficial, similar in concept to the Canada Gazette (or the Federal Register in the US).

    But here is the thing: it's up to those regulatory agencies to make the decision. The public hearings are pro-forma. The populacho can throw rocks or vote against tariff changes until they are celestial blue in the face, but their comments and complaints are non-binding ( “no vinculante”) under the law.

    So it remains a mystery why the current government didn't use the prescribed process. Because now they are screwed: you can't have a retroactive public hearing. In other words, you have to have the regulatory review and public hearings, with all their decision and notice and announcement periods, before putting a rate hike into force.

    Aug 20th, 2016 - 12:25 am - Link - Report abuse 0
  • chronic

    One part incompetence.

    One part arrogance.

    One part indifference.

    One part sloth.

    100% rg.

    Aug 20th, 2016 - 12:46 am - Link - Report abuse 0
  • Enrique Massot

    #7 Marti

    ” remains a mystery why the current government didn't use the prescribed process (before hiking the utility bills).“

    It's not a mistery if you understand the psychology of the current Argentine government team--which is the same you have expressed here time and again:

    ”The hell with the populacho.”

    As I said: Good things happen sometimes.

    Aug 20th, 2016 - 05:17 am - Link - Report abuse 0
  • chronic

    Reeeeeeeeeeeeeekie, you are correct in this circumstance.

    Macaroni doesn't pander to rg to the degree that Cretina did.

    Aug 20th, 2016 - 01:39 pm - Link - Report abuse 0
  • Enrique Massot

    #7 Marti
    Marti still takes comfort on the fact that public audiences are non-binding, and that as a result, after holding said hearings the government will be able to do whatever it wants.

    “The populacho can throw rocks...but their comments and complaints are non-binding,” noted our political genius.

    This goes on to further show the inability of this individual to understand the most basic tenets of democracy, that is government works--or should--work for the majorities.

    For the Macri government, or any government interested in fostering the common good, the Supreme Court ruling would be a wake up call to change its ways and consider the needs of the non-wealthy as well as those of the minorities. If the Macri administration loses the opportunity and instead mulls ways to get around the SC ruling, it will be demonstrating the same totalitarian spirit so eloquently expressed by our fine commentator above.

    Aug 20th, 2016 - 06:15 pm - Link - Report abuse 0
  • golfcronie

    I wish you were running Argentina. I am sure you would be able to reverse the mess that Cristina left the country in. So Enrique lets hear it. The scenario is that gas costs more to produce than the income generated. You cannot keep giving away gas as your imports are costing so much more ( Thanks Cristina ) for not getting the right climate for investors.

    Aug 20th, 2016 - 09:55 pm - Link - Report abuse 0
  • Marti Llazo

    @12 “ The scenario is that gas costs more to produce than the income generated. ”

    Currently, most residential consumers only pay about 10-11 percent of the cost to import, regasify, transport, and deliver natural gas. That means that nearly 90 percent of those costs have to be subsidised with public monies that are diverted from other needs, such as health care, education, infrastructure, public security, and prosecution of corruption. The rate structure is essentially regressive since those with the ability to pay are typically charged the same as those of lower economic means, but the resulting high inflation rate and VAT that do disproportionately affect the poorer residents are among the impacts of the present “ free energy” practice. Reekie's Peronism prefers this situation, which discourages both foreign and domestic investment, limits innovation, worsens the deficit spending condition, increases inflation, damages its lower-income supporters, leads to infrastructure decay, promotes waste and misuse of enormous amounts of energy, and prevents modernisation of this country.

    Aug 20th, 2016 - 10:22 pm - Link - Report abuse 0
  • Enrique Massot

    #12 golfcronie #13 Marti Llazo

    Look. You argued ad nausea that I do not live in Argentina therefore there is no way I can know anything about it.

    However, from the moment the tarifazo happened, I understood the increases were excessive. You guys dismissed my assessment as irrelevant.

    Now judges, appeal courts and the Supreme Court have all told the Macri administration that the energy tariffs' increases need to: 1) Be reasonable and 2) Go through due process including public hearings. Capisce? Not one is saying there cannot be increases. The government, to its credit, has accepted the ruling although there will probably be some sort of analysis of the steps taken and the energy minister's head may be at risk.

    However, our know-it-all golfcronie and Marti keep crying out loud, ignoring the legal process that has just taken place, and giving us detailed analysis as to why the increases were fine and should have been applied.

    Come on, guys, give up. This ship has sailed.

    Aug 21st, 2016 - 03:52 am - Link - Report abuse 0
  • Marti Llazo

    Reekie seems to forget that Marti explained the Argentine utility regulatory process for tariff adjustment, including citing the agencies and applicable law and nonbinding nature of the public hearings, something that Reekie is clearly unfamiliar with. Also explained that the Kirchner government failed to hold public hearings, which should have invalidated the existing foolhardy rate structure. ¿capisci vos?

    Aug 21st, 2016 - 05:16 am - Link - Report abuse 0
  • chronic


    Due process isn't applicable to the K's - particularly retroactively.

    Due process does universally apply to all others at all times.

    If you doubt this refer to Reeeeeekies voluminous, historical statements confirming this.

    Aug 21st, 2016 - 06:36 am - Link - Report abuse 0
  • golfcronie

    I, personally have NEVER commented as to whether or not you live in Argentina. Get your facts right. You profess to know a lot about Argentina, again how in your considered opinion would you lift Argentina out of the financial mess that Cristina left the country in? Ask anyone if they want a hike in gas and electricity prices and the answer definataley be NO.So why bother going through a lengthy process. Surely the Gas companies are independent of the government or are they nationalised?

    Aug 21st, 2016 - 09:49 am - Link - Report abuse 0
  • Enrique Massot

    #17 golfcronie
    My apologies for having my facts wrong suggesting comments you did not make. I probably attributed to you comments from a similar nickname. Again, I am truly sorry about that.

    In regards to your questions:

    1. I do attempt to reasonably inform myself and intend to comment on my home country's current affairs.

    2. Cristina did not leave the country in a financial mess. Argentina did suffer an economic slowdown, but the situation at the time of president Macri's assumption did not require slash and burn measures. Macri needed to do as he promised during his campaign: Keep what had been done well and improve what needed improvement. However, he is really attempting to operate a crude re-distribution of national income that had shifted towards the poor and middle class, in favour of the ultra wealthy in Argentina and of multinational corporations.

    3. Yes. No consumer would agree to pay more. That is why, as our diligent commentator Marti Llazo has told us that public audiences are non-binding. However, for a government preparing significant increases, the audiences are an invaluable tool to explain the increases in advance--and the private energy companies can also explain their financial needs. If the arguments make sense, larger parts of the population are likely to at least reluctantly accept them.

    However, as the judges have said, the increases should be “reasonable” (and gradual) to let the economic actors adapt.

    All that process is not that long, and surely would have been long concluded by now had the government had started by calling the public hearings in the first place.

    And remember: the Supreme Court ruling only concerns gas supply and only residential users. Small and medium-size entreprises as well as non-profit associations are readying to ask for lower courts for injunctions against the increases.

    So the saga continues.

    Aug 21st, 2016 - 01:59 pm - Link - Report abuse 0
  • axel arg

    It's not necesary to be too smart to see that there is a very big difference, between protesting for the inflation level, for insecurtity, or for corruption, as it happened in 2012, 2013 and 2014 in the so called cacerolazos, than protesting because there are many citizens in the country who are losing their jobs, or because a lot of people can't pay something so basic like a gas bill, as a result of the regressive measures taken by the new government.
    A society who protest for those issues, is a society where the most important problems could be solved. Although there was a 0% of inflation, no insecurity, and no ccorruption, if citizens don't have a job, they have nothing.
    Anyway, in some way Macri and his ceos ministers are right when they say that they had no alternative than making a hard cut on the subsides, because the first measure that our ceo president took, was to reduce the agrarian taxes in a relevant percentage, which provoked a great reduction of the incomes that the nation receives, in this context, the only one thing he could do, was to make a hard cut on the national budget, because it was obvious that with less recources, the state wasn't going to be able to keep on giving our people the same services it used to give, which shows perfectly what social sectors are being very benefitted for the policies of his administrations.
    Even the new indec recognizes that last year Argentina had a growth of 2,1%, and it also said that there were economic growths in most of the years under the kirchnerist administration, except in 2009, which contradicts Macri's lie, about the lack of growth in the last 5 years.
    Although he inisists on his battle with adict judges and prosecutors, with the purpose of putting Cristina in prisson, if the situation of the country doesn't improve soon, there won't be any mediatic operation by his adic press, which saves him from collapsing.

    Aug 21st, 2016 - 02:48 pm - Link - Report abuse 0
  • chronic

    All rgs lie.

    Reekie confirms this.

    Cretina left a bill of staggering consequence.

    Reeeeeeeeeekie this is your biggest lie yet.

    Aug 21st, 2016 - 03:59 pm - Link - Report abuse 0
  • Marti Llazo

    Nice try, Axel, but no cigar.

    Axel reminds us that in Argentina there is a curious concept that people should have Potemkin “jobs” in which they produce nothing of value, and “jobs” in which there is no actual attendance to any sort of productive activity. These dead-wood “jobs” are actually a form of corrupt political patronage or political welfare, but often enough the “employed” are engaged in little more than the consumption of resources for political militancy (as they call it here). In the past government there were thousands of people hired into superficial make-work positions such as “cultural advisors” to swell the ranks of the apparently-employed. Paying for these non-producers means a heavy burden is placed on productive industries, a habitual practice of deficit spending, and comparatively high taxation (the VAT alone is 21 percent, and other taxes take their heavy toll as well).

    “Even the new indec recognizes that last year Argentina had a growth of 2,1%, ” ----- but everyone else knows that the country has been in recession for more than two years:

    “Argentina unveiled the results of revised growth numbers for the past decade as the government of President Mauricio Macri seeks to restore investor confidence undermined by the previous administration. The data confirmed that the new president inherited an economy in recession.Gross domestic product shrank 0.7 percent in the first quarter from the last three months of 2015, its third consecutive quarter-on-quarter contraction, the national statistics agency said. GDP expanded 0.5 percent in the first three months of the year from a year earlier. The median estimate of six economists surveyed by Bloomberg was for a 1 percent year-on-year contraction.”

    2014: “Argentina's economy slid into recession in the first quarter, piling fresh pressure on President Cristina Fernandez's leftist government to reach a deal with holdout creditors to avoid a new debt default.”

    Aug 21st, 2016 - 04:05 pm - Link - Report abuse 0
  • Enrique Massot

    #21 Marti

    “Potemkin jobs.” Ha ha ha. What's next, Marti? Are you softening the ground to beging talking about CFK's soviets?

    Unfortunately, the way the present is going is not helping Marti.

    Axel, at #19, is right. As soon as he assumed the presidency last December, Mauricio Macri was quick in eliminating most of the export tariffs, depriving the state of an income of over $60 billion in 2016. The gift to exporters included the mining industry, largely in the hands of large multinational companies.

    The move benefits the extremely large landowners and the large agro-business. A 50 per cent devaluation of the peso added to the incomes of the ultra wealthy in Argentina.

    What's next?

    The Tarifazo. Of course, reduction in income paid by the wealthy must be compensated by someone. Who is that someone? Juan and Maria, that's to say, the majority of those who do not own large estancias.

    And the loop (hole) is closed.

    Aug 22nd, 2016 - 03:06 am - Link - Report abuse 0
  • axel arg

    ENRIQUE (22).
    You are right, i forgat mentioning about the reduction of taxes to the mining industry, and about the devaluation of december.
    In some way it's a waste of time to discuss with people who justify Macri's regressive measures, they have ideological coincidences with the president, that's why although you or i mention objetive facts, those people still believe in the falacy of the so called free market. Although i tell them that even the new director of the indec, designed by Macri's government, recognizes that last year the country had a growth of 2%, and also said that only in 2009 and in 2014 there was recession, those people will always prefer living in an alternative world, where everything is because C. F. K's faults, however, that idiot fantasy has a limit, because if the situation of the country doesn't improve, there won't be neather denounce of corruption against the former administration, nor mediatic operation that saves the government from collapse, beyond the obvious protection of the hegemonical and adict press.

    Aug 22nd, 2016 - 06:06 pm - Link - Report abuse 0
  • Marti Llazo

    And now it's time to play that exciting game, What's My Inflation Rate.

    Turns out that the “effect” of increased utilities rates has almost no significant impact on anything. The calculation for inter-annual inflation as of August is done without the cancelled tariff increases, though since nothing it free, the associated costs for subsidising 90 percent of residential gas will be paid one way or the other, sooner or later, y con creces. (Foreign sourced utilities gas, made necessary due to excessive and wasteful domestic consumption, is paid for in part by borrowing at high interest rates, since there is no possibility for the mythical “vivir con lo nuestro.”)

    So....[drum roll]..... the interannual inflation rate as of August .....looks like it's going to be about ....43 percent. (Interannual inflation rate in neighbouring Chile is expected to be about 3 to 4 percent, with positive growth, contrasting with continuing recession in Argentina).

    Reekie: “ .... 50 per cent devaluation of the peso.... ”

    --- Actually it was closer to a 30 percent devaluation of a falsely over-valued currency, and the devaluation brought the ARS into line with the recognised freely traded value.


    Reekie: “ ....mining industry, largely in the hands of large multinational companies....”

    Classic peronist sentiment. Weeping inconsolably over the lack of jobs and foreign investment, and then when foreign investors do come and provide employment, the peronchos again weep inconsolably that foreign investors have provided jobs and investment. And you wonder why this country is hopeless?

    Aug 22nd, 2016 - 06:13 pm - Link - Report abuse 0
  • Enrique Massot

    #24 Marti Llazo

    MARTY: On the Freedom of Being Hungry

    A multi-million, unnecessary gift to the mining multinationals? “Classic peronist sentiment.”

    High inflation continues? Oh, but the Tarifazo has minimal incidence on it!

    A de-facto devaluation causes consummer prices skyrocket and real wages go down? Oh, but it “brought the ARS into line with the recognised freely traded value.”

    Poverty increasing during nine months straight? Why, it's the fault of the previous government!

    Mad about the elimination of a tax on wealth? Just a classic case of envy!

    Mad about the elimination of tax on exports and then the Tarifazo? Why, someone has to pay! What's wrong with the people making up for the gift to the estancieros and large agro business?

    Aug 22nd, 2016 - 06:32 pm - Link - Report abuse 0
  • Marti Llazo

    Reekie: “ Poverty increasing during nine months straight? Why, it's the fault of the previous government!”

    Actually poverty has been increasing for several years in Argentina. And those years were Kirchnerist years. Of course Kirchner lied about it: in 2014 there was about 29 percent of the Argentine population in poverty and CFK lied through her teeth that the number was 5 percent. And everybody laughed, of course.

    And then the INDEC wouldn't publish the numbers to admit the long trend to increasing poverty.

    So the United Nations studied the issue and found that at the end of the CFK reign, 3 out of 10 Argentine children were living in poverty. The way that the UN put it was this: in 2015, 30.2 percent of the people up to age 17 in Argentina were living in poverty. Década ganada, my donkey.

    The 2014 Kirchner devaluation of the peso pushed a lot more people into poverty, with an increase of about 4 percentage points between 2013 and 2014.

    Meanwhile, CFK increased her personal wealth by about 1000 percent.

    Aug 22nd, 2016 - 09:19 pm - Link - Report abuse 0
  • chronic

    Come on Reeeeeeeeeekie!

    Even you possess enough mental faculty to recognize what a bunch of commie lies that you are trying to sell to your k followers.

    Aug 23rd, 2016 - 11:56 am - Link - Report abuse 0
  • Enrique Massot

    #26 Marti Llazo

    We are going nowhere if I say “bad Macri” and Marti keeps responding “Cristina too.”

    I admit that poverty did increase under the CFK government and that was a failure of said government.

    In all likelihood, this poverty increase was one of the reasons the Argentine citizens chose Mauricio Macri in late 2015. During his campaign, Macri promised to let stand the good things that had been achieved, and improve what needed improvement. He also put forward a goal to achieve “zero poverty” in Argentina.

    Macri has now been nine months in government, and nobody would be the wiser asking that he solves Argentina's economical challenges in such a short time.

    The population, however, is in its right to ask that Macri's economic measures aim to improve, or at the very least not to worsen, the current conditions.

    And so, the citizens have begun to make the government hear their displeasure, even their dismay, at the nature of the changes operated by the Cambiemos government that are increasing poverty.

    Today, the newspaper Clarín (unsuspected of Kirchnerism so far) publishes an op-ed of Juan Manuel Casella, president of the Ricardo Rojas Foundation.

    “The Presidente makes efforts not to appear as an insensible neo-liberal,” Casella noted. “But falling consumption and recession need more consisten justifications than the inheritance and the Brazil crisis, because those who cannot afford the new tariffs and face inflation will find small consolation in being told about the past, even if such past is close and true.”

    It's up to the government to listen to the voice of the citizens. Justifying what's going on with what happened under the CFK government the way Marti is so diligently doing may only work for so long.

    Aug 23rd, 2016 - 05:48 pm - Link - Report abuse 0
  • chronic


    You are an rg and your proverbial lips are flapping so you must be lying.

    Aug 23rd, 2016 - 07:42 pm - Link - Report abuse 0
  • Enrique Massot

    #29 chronic

    “Reeeeeeeeeeekie: You are an rg and your proverbial lips are flapping so you must be lying.”

    I am humbled by the depth of the above achievement. Sure we are making progress here.

    Aug 24th, 2016 - 05:01 am - Link - Report abuse 0

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