By Javier Boher
Milei has managed to break several common sense postulates that exist in politics, from that you cannot win without a territorial structure to that you cannot govern without legislators and governors. Often acting in an unpredictable manner, she has known how to twist the maxims that regulate the political life of the country. The movement of the dollar is going to test what happens to the economic reflexes of a population accustomed to having their income eaten up by destroying the peso.
The pulse of social humor is strongly tied to the value of the North American currency. The dollar rises and people worry, even if they are the people who have to do calculations on their cell phones because simple multiplication is difficult for them. The movement of the greenback is always a sign that something is not working.
Some economists have pointed out that the exchange rate calm that has reigned since December (more or less since the devaluation at the beginning of the mandate) is due to the fact that there are many Argentines exploding savings in dollars to survive. The car repair, the school trip for the kids or a heater that stopped working when the cold arrived put the precarious family finances to the test, with people selling those dollars bought in some good times to cover their expenses in pesos. Personally, I find it an insufficient explanation, especially at this time of year.
For some time now, there have been other economists pointing out that the gap between the official and the parallel is a problem, because the exchange rate delay once again generates incentives typical of the financial business instead of putting them in place for a necessary productive reactivation.
That is why those who know the most are asking for two central issues: to eliminate the exchange rate restriction and to devalue in order to accommodate the exchange rate, even if the value of the dollar could later return to somewhere close to $1,000. For this reason, they are surely saving the elimination of the PAIS tax, which can eat up the movement in the exchange rate without impacting the final numbers of those who manage inputs in dollars.
Some speculate that this type of instabilities in the value of the greenback are due to the needs of the export sectors (especially the countryside) and an attempt by some players in the financial sector to anticipate a possible devaluation (or, why not, push what exists).
However, the average citizen does not think of the dollar in the same way, but only as a symbolic reference to something that indicates that things are more or less going well. That is why Massa set the reserves on fire trying to win the elections in a simulation of normality that no one bought. Milei today is a downward inflation and a stable dollar, a neo-Menemist mirage that manages to deceive those who are willing to believe.
Today people’s main concern is not about the dollar, to the point that we do not see news screens adorned with threatening flames or graphics marking the change in the value of the bill. With 163% inflation accumulated from October to now, the peak of $1,200 that the dollar made before the elections would mean that today it should be more than $3,000. Maybe that’s why people don’t explode like they did then.
Milei has been able to break political common sense, but he has not yet faced a real economic problem, because although there is a strong recession, in the eyes of the layman things have remained stable. Returning to the teachings of the radical Juan Carlos Pugliese, the time has not yet come for the president to try to start a dialogue from the heart, running the risk of being answered with his pocketbook. She has a little more than a year to prevent the dollar from escaping and discover in a bad way which viscera predominates.
