OK Bob, thanks for taking the time to reply. Before we start throwing mud about Kool Aid consumption, I'm sure we can keep this on a rational adult level.
Your first point is that inflation is higher than what I cited: and its true that this is hard to get unbiased information about because it’s such a hot-button political issue here after the 70's and 80's hyperinflation, and because the INDEC 's only purpose is to make the numbers look low so as skirt paying the IMF. The INDEC placed it at under 10%; Clarín would have us believe its 30%, but both have political ends in these figures, and neither are reliable. My point, however is that this number is a chimera anyhow because it deals with prices but not purchasing power. To repeat what I said earlier: in the 90's there was negligible book inflation, but the purchasing power of the average Argentine declined dramatically, and this is REAL inflation. It’s impossible to have real inflation and a sustained , across the board consumption boom, which is what this country has seen over the last eight years. I'm not a kirchnirista (i do like kool-aid though, especially Passion Fruit flavour!), but these numbers are extremely encouraging even for those like myself who would never vote for CFK.
Your second point, that this is based on an Asian commodity binge is important: that’s why I addressed it in my first response. To repeat, obviously Argentina needs to quit being the kitchen cabinet to the world and move on to being its garage, but in the meanwhile, up until 2002 market binges have always been wasted due to an atrocious wealth disparity. For example, under convertibility there were government policies actually favouring capital flight flowing in from the grain booms of the 70’s and 90’s. Yet what has been done with these cash influxes in recent years? They’ve used them to undo the decimation of the country’s infrastructure sold off under the neoliberal governments of the 90’s: AFJP, Aerolineas, paying off the external debt, etc. all of which has lead to the greatest wave of job creation in the country’s history.
This leads me to your third point that 40% of the population gets by on less than $8 USD/day. This is exactly my point because let’s look a closer look at those numbers (PPP). In 2002 9.9% of the population was living on less than $1 per day. That number was down to 3.4 in 2006 and dipped below 2.0 in 2009. I don’t have your $8 figures on hand to make a parallel, but looking at the country’s GINI, PPP and employment figures, it is undeniable that poverty has decreased drastically under the last two governments when it had been increasing drastically when following Washington Consensus principles.
As to your last point, you give evidence of shortages as proof of not investing in infrastructure. In my last response I discussed the relation of this to rapid growth, and would refer you to reread it, preferably with a tall glass of…TANG!
Best,
Ed
