A few days ago, Argentina’s Economy Minister, Luis Caputo, ventured that “the strong currency will be the peso” and the phrase runs the risk of joining the gallery of famous phrases of Argentine Economy ministers. Like Lorenzo Sigaut’s immortally unhappy prophecy during Roberto Viola’s dictatorship: “Whoever bets on the dollar loses”. Everyone knows that this prediction ended in a brutal devaluation and that Sigaut was fired in 1981. Did anyone learn any lessons…?
It is interesting to follow the direction of the current minister’s phrase which, like all of them, is related to the scarcity of dollars and not to the strength of the peso, which has not existed for many years. There is no point discussing the dollarization plan at the beginning of the government, which is more than apparently distant, in which the peso was “excrement”, according to the arsenal of scatological adjectives used by Javier Milei. With one sentence, Caputo transformed a metabolic waste product into a dubious promise: the Pesos Plan.
The fall in inflation is today the only great achievement that Milei can present in his administration. And he is willing to defend her against any threat. The president and his communications team know that popularity is political capital that cannot be trifled with, because they have no other. Factors that may not even touch this real or virtual strength will be confronted without mercy. Therefore, the battle to sustain the current exchange rate is crucial as a forced anchor of inflation.
The surpluses presented by the Milei government have a questionable side because they ignore debts that are not paid. But the government considers even this moot. What Milei and Caputo do not admit is insisting on devaluation. Anyone who insists on this is and will be a traitor, as is anyone who questions economic policy. There are no limits: Fausto Spotorno, an economist who was a member of the president’s Council of Advisors, was accused of using data he obtained from the government in his private consulting company. Milei fired her friend without even blinking.
All of this explains Caputo’s unexpected phrase about the pesos and dollars that will have to be sold to pay taxes, and which is nothing more than an explanation of the current fragility of the economy, despite progress against inflation.
The extreme care not to harm his popularity can also be found in the unusual friction with France. A minor leader, like Julio Garro, dared to say that Messi and the head of the AFA should apologize for a racist football chant against the French team. The idea that football is governed by different rules than other areas of society is very well established. In football you can say and do things that are prohibited in any other area of life. Milei fired Garro and banned criticism of the football team’s players, something that seems to have come out of the most stale authoritarianism manuals. This doesn’t matter to the popes of mileistic communication, these are the rules of the networks.
As a backdrop or as a way to cover one piece of news with another, the restructuring of intelligence services was launched, always more efficient for internal espionage than for strategic intelligence. As a plan, it looks interesting, we just need to see how it works. It is said that it was Santiago Caputo who sponsored the idea and carried it forward, with the advice of experienced spies.
There are more ideas circulating around young Caputo, and perhaps more productive ones. Rodrigo Lugones, also from Santiago Caputo’s team, and Marcelo Fígoli, a media entrepreneur, went to Madrid to make an offer to acquire Telefónica Argentina. And there’s more: they also want to expand into television. To do this, they look for potential sellers and perhaps they have already made an offer. And they offer dollars, not pesos.