The Government’s communications engineering decided, in Javier Milei’s worst week since he has been in power, to generate and transmit the idea that the political crisis that materialized with unwavering force these days is, to tell the truth, the second most important and not the first. In one of the offices on the first floor of the Casa Rosada, an important official told Page I12 that “you don’t know what it was like the weekend where we had to stop the Bases Law.” The confusion trick refers to that press conference by Luis Caputo, in which the Minister of Economy had to give up part of the fiscal package to the fury of the governors.
In any case, the Government’s reading failed to penetrate the public agenda, which quickly identified that the affair of the Minister of Human Capital, Sandra Pettovello, with expired and undistributed food and supposed fraudulent contracts, detonated an internal bomb that put under the magnifying glass not only his conduct but that of several other ministers, also analyzed in their management capacity. With a particularity, that at this time she worries the Red Circle. Milei’s political crisis is a crisis without a network, for two reasons: the first, that it exposed operational shortcomings, management inexperience and also suspicions of corruption among the libertarians. The second, that not only does Milei not show the capacity to appease its effects, but the economic power diagnoses that Macrismo and Peronism do not put in sight a safe conduct of governability and/or an alternative to support in the face of such an overflow, which results in the worst case scenario. A recession that seems to be going to an “L”, collapse without getting out of the hole, and an unstable political context with a president who is the guarantor, almost like no other factor, of that instability.
What is notable about the scene is the disconnection between Caputo and Milei’s diagnosis of the situation – somewhat less emotional in the rest of their team – and what the more and less similar opposition and, above all, the markets and economists of the spectrum see. conservative. A few days ago, in a public meeting with business colleagues, The banker Facundo Gómez Minujín began to appear “concerned” about the dead end of the Government’s macroeconomic policy, which was already immersed in a micro crisis. Gómez Minujín is the head of the AMCHAM chamber, which brings together American companies, and is the president of the JP Morgan bank, which prepares the Country Risk indicator. That number, two weeks ago, has been growing non-stop and is now just under 200 basis points away from Sergio Massa’s worst moment in his campaign. After being closer to 1100 basis points at the beginning of Milei, he has already settled at 1600 points. Country Risk measures global reliability about Argentina and, above all, possibilities of access to credit in a closed market. Morgan’s diagnosis was central to the collapse of the price of local assets, shares in Merval and Wall Street. His analysis, shared by two other large investment banks, one of them Swiss, focuses on the eventful agenda that Milei will have between now and August. One of the operators of those banks told this newspaper that, 6 months after taking office, the Government does not have genuine dollars, it generated a very strong recession, it maintains a surplus without paying the bills and now, too, there is political noise in crescendo.
Likewise, they report that The days ahead will be bittersweet for a Government that only needs successes. To wit: whatever Milei gains with the approval of the Omnibus Law this week (if it is approved, because Milei is three votes away from the opposition overturning the law), he will lose it next week when the Senate approves the increase to retirees, which will be vetoed by the President. And what you gain with a CPI in May that will be lower than that of April, you will lose in June: the REM, the average inflation calculation of BCRA consultants, advised that it estimates inflation of 5.2 in May, 5. 5 in June and four months of stabilization in those ranges. In short, the process of recession lowering inflation stopped disinflation, but not the pandemic of business closures and layoffs.
This is what Alfonso Prat Gay, Carlos Rodríguez and Diego Giacomini have been pointing out, all economists with similar thinking to Milei, that is, they know how to measure the oil of an adjustment that is at its limit. An extra piece of information that circulated in the City this week: a major national banker raised the paradox that “Caputo ends up depending on the Chinese after Milei went to the United States 200 times, the minister went several times to beg from the Monetary Fund and they didn’t bring a single dollar.” The reference is to the extra time that is played with the renewal of the yuan swap, which China adds mystery but which it is certain to renew. If he doesn’t do it, Caputo will have to pay in full. The risks of geopolitical fanaticism. Anyone who does not seem to act along those lines of wanting to provide support, despite official pleas, is the IMF, which continues to delay the sending of 800 million dollars from the last review. Why do not you do it? Because, the permanent auditors of the organization in the country say, that the Government did not respond to the 5 times that the Fund asked them to carry out policies to stabilize the social crisis and gain governability, without relaxing the adjustment.
Pettovello sells that everything is fine
In this context, Pettovello decided to take refuge in similar environments. 10 days ago, in the midst of the food shed scandal, Natalio Mario Grinmann, president of the Argentine Chamber of Commerce (CAC), suggested to the partners to invite her to a lunch, to try to go in line with the idea that she is a painting I live in the Milei structure. A friendly way to validate it in the middle of a judicial investigation. That meal occurred this Thursday, at the CAC headquarters. The party included, among others, Grinnman, the “shoemaker” Alberto Grimoldi, Jorge Aufiero, from the prepaid Medicus, and Bettina Bulgheroni, a personal friend of Karina Milei and also of Pettovello.
The minister attended the event together with the Secretary of Labor and man from Techint and the UIA, Julio Cordero, and He began the talk by assuring that “the issue of food was an operation to cover up the drop in inflation.”. In parallel, she said that “Milei supports me in everything, I almost have a blank check.” And he ended by saying that “we are going to continue fighting the mafias, the job banks.” Nobody asked him too much, because everyone present supports the libertarians, but Milei’s unconditional support is not so generous in other important figures in the Cabinet, who understand that Pettovello makes the president pay a dear bill.
In the Casa Rosada and people very close to Pettovello believe that this “operation” has some names and surnames and that the baroque and excessive public performance of Leila Gianni, the Undersecretary of Human Capital Legal Affairs who fought with Juan Grabois is, in reality , a latent danger. They suspect that she is the information leaker and that this transformation from Peronism tattooed on her skin to wearing the Forces of Heaven shirt seeks to mislead her true role.. Nobody understands how Karina Milei, skilled at identifying traitors, has not yet reached that point. Or, perhaps, the answer is clear: what Gianni reveals is, at least, to put the eye on Pettovello’s signature. They also say that there were meetings – which they hope will not become public – between Pettovello and leaders of the OEI, including Luis Scasso.
In the turn of observers due to the internal political crisis, which exposed management deficiencies, the chancellor, Diana Mondino, also appeared. Milei received a video of her participation in the CARI luncheon, where she gave a very poor speech before important ambassadors and hours later she made Milei miss the event, forced for trying to avoid Palestinian diplomats. In the Presidency they have looked at her with distrust for a long time. “It is difficult for her to support her,” the Government argues about the owner of the San Martín Palace.
Macri warns and does not betray, the PJ observes
While all this is happening, the people of Milei work on caste political actions, far from the people, but of high future relevance. “The president is convinced that we must grow politically and wants to end the PRO. We already have candidates for the legislative elections in the city and we want a head of government,” he says. The candidate is curious: they refer to Manuel Adorni, presidential spokesperson. “He works like a crazy man”, they exaggerate.
In the other corner, businessmen who speak with Mauricio Macri say that the engineer “is waiting to capitalize on the lack of management.” In one of the last reserved conversations he had, one of his friends told him that “in order not to give the PRO to Milei, you can’t go play cards outside once a month”, in reference to his fanaticism for bridge.. Macri is seriously concerned about two things that he understands make up governability: one, “the limits of management” and, above all, “the emotional outpourings” of the president. In economic power, the diagnosis of an “unstable” President is also increasingly present.
Days ago, at the Húesped Foundation dinner, Massa spoke with many PRO leaders and curious businessmen who asked him what he was going to do in this scenario. Also, if he spoke with Cristina Kirchner. The Tigrense usually shows that the link with CFK is closer today than in the campaign, and that they talk often and exchange messages. Lately, the topic was energy, where Milei makes water in a historically troubled portfolio. Perhaps, the first public appearance of both of them together will be at the presentation of Sergio Massa’s book, entitled “Wanting a Country.”
The former UP presidential candidate diagnoses that the political crisis is important, but the economic crisis is more so. He sees a “challenging” second half, a long lockdown and a prolonged recession. He manages Massa’s own surveys, the same ones, he says, that showed him that he could win alone in the first round and those that gave him the indication that the runoff was impossible. These surveys, today, show a much higher rejection of Milei than what the pollsters sell. Massa risks, in parallel, that June will show double-digit unemployment.
Meanwhile, the former candidate held a meeting with the CGT a few days ago, where the leadership asked him to participate in the Peronist Armed Forces 2025. The richest thing about that talk, in which Héctor Daer, Gerardo Martínez and Pablo Moyano participated, was the fact of closing ranks behind ironing out differences and that “none of that comes out.” The Peronist construction is rushing in the face of an unprecedented crisis, but its state is embryonic.
