This coming Sundays presidential election is Argentinas last chance in a generation to begin the arduous process of dismantling the left-populist system that has turned this once-prosperous nation into an economic and political basket case.
The bad news is that it is looking very tough for the only man who might undertake such a massive enterprise. Buenos Aires mayor, Mauricio Macri, is running about ten points behind Daniel Scioli, the candidate of the governing Peronista party.
In Argentina, the winning candidate can avoid a runoff by getting 45 percent of the vote or 40 percent plus a ten-point lead over the runner-up. But even if Macri manages to force a second round, it is not clear he will attract enough votes among the followers of Sergio Massa, a Peronista dissident who is running third and whose followers distrust Macri even more than they distrust the current president Cristina Kirchner, whom they consider a self-serving deviant.
During this campaign Marci has had to make concessions to populism in a desperate attempt to impede a first-round Scioli victory and steal votes from Massa (or at least to start cajoling Massas supporters with a view to winning their vote in a second round).
To make matters even more dramatic: It is by no means certain that Macri will be in a position to transform this country if he wins.
President Kirchner, who has been in office for eight years and succeeded her own husband, commands a puzzling 50 percent approval rating despite a legacy that is a political horror talezero percent economic growth this year, a poverty rate that is nearing 30 percent, a 7 percent fiscal deficit, double-digit inflation, dwindling foreign currency reserves despite asphyxiating exchange controls that make it a nightmare to import anything, and a total of almost fourteen million Argentines who are reliant on the government for their livelihood (compared to only nine million who earn their living from private businesses).
Kirchner has managed to cripple the energy industry through price controls and nationalizations despite the country´s vast shale reserves, while agriculture now relies on just one cropsoybeans. The total area under wheat cultivation, once an Argentine staple, is down to what it was one hundred years ago!
Many things account for the presidents popularity. Argentines painfully remember the $100 billion USD debt default at the turn of the 21st century and the dire social consequences that led to Kirchners rise to power. And they praise her government for turning the almost decade-long commodities boom into a feast of populist subsidies and artificial consumption. Kirchner also enjoys the support of many of her compatriots due to a deeply ingrained culture of left-populism. She controls what promises to be a powerful force against change no matter who becomes the next president.
The hope is that if Scioli wins, like so many Peronistas in the past, he will betray Kirchner and build a coalition for reform. But his temperament, his own convictions, and the many restrictions Kirchner has placed on the next presidentincluding laws that prohibit the sale of shares in state-owned companiesmake Scioli an unlikely traitor to the legacy. Besides, he has promised to keep many of the economic controls and taxes that make it impossible to re-energize foreign trade, one of the only ways that Argentina can get its economic machinery moving fairly quickly.
To make things worse, Scioli´s promise to obtain foreign credit hinges on his ability to reach a deal with creditors who have kept Argentina out of the capital markets since the government inflicted a 70 percent haircut on sovereign bonds. A Herculean task, to say the least.
If Macri wins, on the other hand, his biggest challenge will be to avoid the fate of the very few non-Peronista presidents Argentina has had in recent decades: surviving the onslaught of a movement whose factions disagree on almost everything except the will to make the country ungovernable for anybody else.
It will take an extremely able tactician as well as a visionary strategist to pull it off. And colossal amounts of good luck.