Now it is not only the usual establishment and International Monetary Fund (IMF) analysts who claim that “if Argentina does not accept this, it is off the planet”, but it is President Alberto Fernández himself, who until very recently blamed the Fund itself for “an unspeakable loan”, who claims that “without an agreement, we had no future horizon”.

By Aram Aharonian and Jorge Marchini

In addition to these statements, some voices, supposedly progressive and even permanent critics of the IMF, claim that this agreement “opens a path where before there was a precipice”. They repeat an irrational message of fear, hinting at a hypothetical catastrophe that the country would face if it does not do what the IMF says and dares to take another path.

Notably, no one mentions the experiences and consequences of the 21 previous agreements for Argentina; even less mentioned are the contrary experiences of countries that did not accept the extortion of “accept the adjustments or the darkness” of the IMF’s prescriptions, including Argentina’s own very instructive ones at the beginning of this century.

The degree of confusion and distortion introduced has reached such a point that, remarkably, the same spokespersons began in an imperative way, presented as “realistic”, that it is essential for the National Congress to urgently approve a new agreement with the IMF because there are expirations…. with the IMF itself. It does not even go so far as to ask why such extortion with deadlines has been allowed, as if they were different negotiations.

The prevailing message does not give room for an alternative possible scenario of not signing the agreement with the Fund, of considering a different path that would prioritise national and social interests and not the demands and pressures of speculative games. A kind of media terrorism of caricaturing and disregarding different opinions and imposing collective imaginaries has been installed.

This is happening in the midst of a political and cultural battle, not only on the part of genuflecting media and analysts, but also on the part of the hard-hit ruling party and progressive sectors that until recently claimed to uphold electoral promises of “not accepting impositions”, and which have now assumed their acceptance as unavoidable, as if it were their own argument.

There is a tendency not to question the veracity of the reports and diagnoses of the multilateral organisations, while at the same time the secret negotiations that have been going on with the IMF for a year and a half are considered rational and the only possible ones.

Paradoxically, however, the veracity of allegations that during her time as executive director of the World Bank, Kristalina Georgieva, the current head of the IMF, was among the top officials who pressured staff to change data to China’s advantage in the 2018 edition of “Doing Business”, the bank’s flagship report, is not considered. The veracity is not so crystal clear.

The IMF’s media patterns

The IMF has had no problem adapting its “narratives” over the years to justify its demands, despite the fact that they have repeatedly led, as evidenced by its results in countries such as Argentina, to greater political, social and productive disarticulation.

By the confession of the parties, the proof is in the pudding. A striking “working paper” recently published by the IMF with the highly significant title “Hidden beliefs, hidden biases: the rise and fall of growth narratives”(1), based on an analysis of official documents from the Fund itself, shows how communications have adapted their language to the currents in vogue at any given time (developmentalism, neoliberalism, environmentalism, gender claims, etc.) and to provide circumstantial arguments to governments that accept their repeated prescriptions.

Obviously, the aim is to embellish their permanent impositions of “structural reforms”, despite their repeated failures. Their purpose, unashamedly acknowledged in the aforementioned document, is that they may “result from the dissemination of a popular narrative advocated by politicians, leading economists or social movements”. Today we clearly see this tone again in Argentina.

The use of argumentative sleight of hand goes as far as to justify vested interests in such a sensitive and immediately urgent issue in the context of the Covid 19 pandemic as health.

The IMF’s latest quarterly report (December 2021) (Protecting Global Health and Well-Being) should have been called The Art of Defending Big Pharma, it states that it “explores the connection between health and the economy and examines how best to protect our well-being, fight health inequality, and ensure that we never have to suffer such a crisis again”. The argument that will be followed by local broadcasters.

The fake-analyses

Some things are repeated that are inconsistent, for example: that if we stand firm with the IMF, China and Russia will turn their backs on us. This is total nonsense. It is argued that China and Russia are in the IMF, if Argentina does not accept this agreement, they will break off relations with us and make an alliance with the United States against us. Totally ridiculous.

The great global geopolitical rivalry that exists is enough to know that China and Russia are interested in having an ally in Latin America with which they can dispute power with the United States. So, it is unusual to think that they would turn their backs on us if Argentina, in the world chess game, gives them a card they can use.

What happens is that among our politicians, economists, journalists and analysts there is a colonised mind that repeats what the Financial Times or the Washington Post, Joseph Stiglitz or some other IMF or World Bank advisor professor says, without thinking about the content of what they are saying.

After Joseph Stiglitz, Nobel laureate in economics, former director of the World Bank and tutor of Argentine economy minister Martín Guzmán, received an avalanche of criticism for assuring that Argentina is experiencing an “economic miracle”, very few voices came out to support such a definition, confusing the recovery in 2021 from the sharp fall in economic activity in 2020 with a “miracle”, especially when what the IMF has now put on the table for debate is not economic growth.

The Fund’s priority is not to boost growth, but to pay off a questionable debt rather than the real need of the pending society to reverse with more jobs the growing poverty and social marginalisation that reaches more than 40 per cent of the population and could grow even more in the coming months.

The notorious lack of results in relation to previous expectations in the long negotiations, that severe austerity demands might not be included or that recognition of responsibilities, reduction of interest rates or extension of deadlines would be achieved, have been notably frustrated when it began to be known that the new agreement with the IMF would not include such “reliefs” but increased demands.

Even so, the communicators and justifiers of the agreement are once again recreating the illusion that it would include the possibility of providing resources to the Central Bank to have more freely available foreign exchange, when in reality the demand will not be to strengthen the national economy, but so that an increase in reserves will guarantee the payment of debt maturities and speculative financial games will be recreated.


The opinion-makers (journalists, analysts, experts, national and foreign advisors, government officials, right-wing leaders, and former IMF critics) are well aware that Argentina’s public debt is not sustainable, that there is no prospect of regaining access to private capital markets, and that there is no faith in the political capacity of President Alberto Fernández’s administration to implement a new programme with the support of the Fund.

But confusion is growing ahead of the vote in Congress on the agreement with the International Monetary Fund, with the argument that “this is what is possible”.

There are journalists and analysts who, assuming themselves to be progressive and perhaps in their eagerness to adapt, insist that “this is not the moment”, “let’s wait”, “we’ll see in two years”. They believe that the wrinkle can be stretched. But in two years’ time nothing can be claimed: the illegality and legitimacy of the fraud-agreement can only be denounced by the current government, now.

Because in two years’ time, the IMF will ask how it can claim that a loan is illegal, even though it violated all the IMF’s internal rules and was used for capital flight, but it was approved, and therefore legalized, by the National Congress.

All this – and analysts tend to forget it – could have been done two years ago, with this same government. Two years lost because of the illusion in the Catholic lobby of Pope Francis, Joe Biden and Joseph Stiglitz, to renegotiate the 44 billion dollar debt with the IMF. The providential or delusional faith (this is not an article to discuss religion) that creditors could understand and provide benevolent treatment by acknowledging their own responsibility for such questionable brutal indebtedness.

But this is nothing new for Argentina: an orthodox, neoliberal, right-wing government took on a debt and then came an orthodox, progressive government, with a transforming rhetoric, and legitimised this debt. And the idea that this supposedly popular and anti-neoliberal government should not be attacked, because it would be feeding the wolves, although in reality it is feeding them, comes into play.

And then all the ideas of going to the International Court of Justice, of going to the United Nations Assembly and of creating a great international commotion to denounce this agreement dissipate, and disappear from the analyses, but the uneasiness and confusion grow, which are very well exploited by even more reactionary proposals that accuse that “the adjustments must be even more severe”.

The IMF is adept at manipulating reports and the lexicon used in them. It is in the IMF’s interest that something is signed up to now. And no one analyses this rush. The IMF does not care about the details of the capital flight detailed in the Central Bank’s report, nor about the speculative games against the country that generated colossal profits for the very drivers of the indebtedness.

He urges, presses, for the signature, because he himself is much more harassed by the fear that Argentina, his main debtor country, would raise with a minimum of realism and dignity not to accept demands while the serious irregularities denounced by the agreement signed with the previous government of the Cambiemos coalition in 2018, under the presidency of the businessman – with so many suspicious businesses, Mauricio Macri – are investigated in a transparent manner.

This is how the ‘blanqueo’ is repeated. Then they will impose or postpone the modalities of the adjustment in the immediate future.

Goodbye sovereignty

In the domestic arena, it is highlighted when the Minister of Economy Martín Guzmán says that “here there is no pension reform, no labour reform, no privatisations, this is different”, and (almost) everyone applauds. But the reality is that it is different because the big card of that comes in two and a half years, now it will be in instalments and the issue will be “managed”.

When Guzmán says “we are going to have a positive interest rate”, this affects the growth he proposes and generates a financing market in pesos, which prevents the banking system from channelling savings deposited in the productive system and consumer credit for productive projects, but there is no reason for pessimism to win over the masses. What is feared is the street. Argentina has plenty of experience of social outbursts.

Few have spoken out against the loss of sovereignty shown by the clause stating that the Monetary Fund will send its emissaries every three months to review the national accounts, and they will be the ones to say whether it is right or wrong; if it is wrong, they will say “adjust and we will pardon you”. Those who remember still remember what happened to President Raúl Alfonsín, who had his government’s back against the wall every three months.

Argentina, from the experience of the last six decades, knows well what the IMF is, knows what happened with Alfonsín and knows that the Fund is merciless with its own agents if a plan tailored to its needs fails, as happened with Fernando De La Rua, Carlos Menem and Mauricio Macri: they themselves were also made to pay the bill.

Everyone knows that the debt is unpayable, everyone knows that Argentina, unless there are exceptional global conditions that cannot be foreseen today (continued low international interest rates, high prices of main export products, reversal of protectionist trends in major markets) will never be able to generate the fiscal surplus to eliminate and pay its debts.

With a permanent trade surplus and recessionary fiscal adjustment, they will still manage to impose it on “the hunger and thirst of the Argentines” as Argentine President Nicolás Avellaneda did in 1874. But they need to lie a collective imaginary of a better future, when the reality, more certainly, could be a doom for decades to come.

Some analysts make the comparison with what happened with the crisis that erupted at the end of 2001. During Néstor Kirchner’s government (2003-2007) a very circumstantial agreement was negotiated and the problem was private debt. The agreement with the IMF was a temporary arrangement for a debt that was relatively small and could therefore be paid off in 2006.

Since 2018, Argentina has been without access to the international financial market. No bank or investment fund in the world has assured that if this agreement is signed, they will give Argentina more credit. This is despite the fact that the country has human and productive resources and is the only one of the largest economies in Latin America that currently generates a positive balance of current payments with the outside world (Argentina: + 0.5% of GDP, Brazil: -2.4%, Chile -2.4%, Colombia -4.9%, Mexico -0.9%, Peru -2.4%) (2). Argentina’s negotiation is therefore a leading reference case for other countries in the region.

Argentina is facing decisive hours, with enormous challenges ahead. History should be a sobering lesson. This is not a time for lamentations, wishful thinking or opportunistic ideological justifications, but a time to take a stand. It is about determining what the priorities should be and for whom and how to govern, and society acting and/or reacting accordingly.

Already in the 19th century, a central thinker for Argentina, Juan Bautista Alberdi, who drafted the foundations of the current National Constitution, referred to the danger of dependence and the conditionalities of public debt as being alien to “the fruit of its labour and its soil”. And he asked “How to get out of it? How to pay capital on which no interest is paid? How to free itself from its creditors, its modern sovereigns? “(3) Today, the same questions must be answered.

1.- )
2- The Economist, 19/02/22
3- Alberdi, Economic Writings.

Marchini is Professor of Economics at the University of Buenos Aires. Coordinator for Latin America of the International Debt Observatory, researcher at the Latin American Council of Social Sciences (Clacso). Aharonian is a Uruguayan journalist and communicologist, Master in Integration, creator and founder of Telesur. Both are analysts at the Latin American Centre for Strategic Analysis (CLAE).