Saturday, March 22, 2008

Farm Protest: Start of A Civil War?

58868_original.jpg

Everything is backwards down here. I guess because we are south of the equator. Although the jury is out on the whole water draining down the toilet thing, every thing else is reversed.

In the States, we heavily subsidize our farmers. In Argentina, they have resorted to taxing the hell out of them. To the tune of 44% export tariffs on things like soybeans and wheat. Ouch!

Like anyone who's livelihood is reduced by 44%, the farmers are pissed. And they are taking to the streets of the Campo with roadblocks on all the major roads.

By coincidence, the timing comes with maximum impact. During holy week, Buenos Aires empties out and the Argentines take to the road for a four day holiday. The roads are packed this weekend and no one is going anywhere fast. Angers are flaring on both sides of the issue.

soja_santa_fe.jpg

The farmers here rule the economy and tariffs on their exports have been filling the government's coffers to the tune of some $39 billion (US) at last count. The soaring commodity prices have been a big factor in Argentina's rapid turn around.

Things aren't all rosy for the new president though. Despite official numbers on inflation at 8.5% it is really topping 20%. People on the streets are grumbling about food prices.

Because of price controls on energy supplies(yes Mike, price controls), there will be a huge shortfall—if not this winter then by next. At current prices, it is just not feasible to refine and produce enough fuel. That has sent Argentina's President in her finest short designer skirts off flirting with Brazil and Chavez to come to the rescue.

Back to the farmers. So how do you solve the high food prices and continue to subsidize energy? Tax the hell out of the farmers. This is socialism at its worst. Lets punish the one sector of the economy that is saving this economy.

The Government gets by with this because the farmers are vilified as greedy opportunists and painted as the cause of the high prices.

One post on the Yahoo BA Newcomers group claimed the farmers were killing babies and deserved all to be taxed until they bleed... Alright, maybe the post was on how their blockades were shutting down all the roads were causing accidents...

“Greed runs deeper than wealth in these farmers. So before offering
any sympathy for these swine; remember the people bleeding to death
in accidents along these roads, and the ambulances that can't get
through cause some greedy rich farmer doesn't want to surrender a
small percentage of his outrageous profit in this poverty-seized
nation.

To hell with the corn revolution.”

It is that kind of propagandist vilifying that allows things like this to get out of control. It is starting to split the country. On yet another BA Newcomers post, a women quotes her Argentine boyfried as saying, “the country is heading to civil war.” I doubt it. However, it is yet another crack in the wall.

It is all a sad reminder of how this country continually shots itself in the foot economically. Every seven years this country implodes. Cristina's economic policies just might get us their sooner than we thought.

5 comments:

Anonymous said...

women quotes her Argentine boyfried as saying, “the country is heading to civil war.”
Hi Dave, sincerely I think this boyfriend is a big bo--do.
Farm protest is just a big farm protest. Wait a week and then tell me.
Juan

Longhorn Dave said...

I agree. Its a big mistake if we take our political opinion from a BA expats internet forum.

I chalked it up to the typical extreme comments people resort to when blowing these things out of proportion.

However, I am against the use of any form of price controls or tariffs to exact social policy.

It usually does more harm than good. History has proven price controls as a failed policy time and time again.

I also feel the average Argentine is getting the short end of the stick with the current tax and tariff policies.

Quickroute said...

Yet again the government here introduces a policy that increases the gap between rich and poor. Interestingly the people that are being punished by these tarrifs are the ones who voted for Cristina i.e. those in rural areas. It seems the portenos were a little more skeptical of her and for a good reason.

Anonymous said...

The jerk of D'elia wants to move 30,000 "piqueteros" to confrot the farmers in Gualeguaychu. That really could trigger a civil war.

Anonymous said...

I have a friend in Argentina who informed today that this conflict has toppled over into an all out full blown civil war.

There are videos on youtube of the battles. Check it out.

They're cutting the streets and shit like that.