Argentina’s election outcome necessitates a runoff vote in November, marking a historic event.
The world was holding its breath over the results of Argentina’s Oct. 22 presidential election when the announcement came that front-runner candidates Javier Milei and ruling coalition contender Sergio Massa will face off in a second round of voting on Nov. 19.
Argentina’s current economic minister, Mr. Massa, took the lead after securing 36.7 percent of the popular vote, while Mr. Milei came in at 30 percent.
Suspended in the balance is the country’s dire economic crisis. National inflation is currently hovering near 140 percent as depleted foreign currency reserves, a devalued currency, and high unemployment plague struggling residents.
Mr. Massa has presided over the worst period of economic decline in Argentina in decades, which is why some locals were stunned he wasn’t beaten by the firebrand economist Mr. Milei in the first round.
After emerging victorious from the August primary, many Argentinians expected Mr. Milei to secure a landslide victory in the first round over the weekend.
A political underdog and head of the party Freedom Advances, Mr. Milei captured global headlines due to the radical changes he aims to implement to save Argentina’s flatlined economy.
Eliminating the nation’s central bank, cutting unnecessary government spending, and dumping the peso in favor of the U.S. dollar are some of the debated actions he’s promised.
In the wake of the runoff vote announcement, Mr. Milei told supporters during a speech delivered at Hotel Libertador that Argentina’s election is a decision between “freedom” and what he called “nefarious Kirchnerism.”
Former president and current Vice President Cristina Kirchner has been the Peronism party’s greatest champion over the years, earning her as much hatred as loyalty among Argentinians.
An ardent supporter of raising taxes on the working class and expanding welfare subsidies, many residents blame the hard-left politician for laying the cornerstones for the country’s current economic crisis.
The vice president was indicted on corruption charges in 2022 and could receive up to 12 years in prison.
Mr. Milei was unshaken by the runoff, expressing hope that Argentina would finally end its long-suffering relationship with “Kirchnerism” and the Peronist regime.
“Two years ago, if we had been told that we would be competing with Kirchnerism for the presidency of the nation, we would not have believed it. We are facing a historic event!”
The right-wing libertarian added that facing off with a legacy political party candidate is a “truly historic achievement.”
Former Argentinian government official and analyst Fabian Calle told The Epoch Times that Sunday’s election was “the worst election for Peronism in many years.”
He said Argentinians have been steadily losing faith in their government and are tired of constant scandals and broken promises with their elected officials. This was evident in the historically low voter turnout on Oct. 22.
Mr. Calle said it was the “lowest electoral participation since 1983.”
“A vote for Massa is a vote for more of the same. A vote for Milei is taking a different gamble,” Alvaro Gomez told The Epoch Times.
Mr. Gomez supports his fellow Argentinian Mr. Calle’s assertion that people are fed up with the country’s politics.
On one hand, Mr. Massa represents a long string of economic failures and a chain of broken promises at the hands of Peronism.
On the other end, Mr. Milei has proposed radical ideas and reforms some feel are too risky.
Risk assessment is no small matter for a country teetering on the edge of total economic collapse. It’s the worst the region has endured since Nicolas Maduro’s 2013 rise to power in Venezuela.
“I’m tired. Argentina is tired,” Mr. Gomez said with a sigh.
Many locals didn’t wait for the election results to cash in and secure their assets.
Argentina witnessed the most significant discharge of stocks in more than two years ahead of the election.
An astonishing $6.6 million was pulled from the Global X MSCI Argentina ETF in a single day.
In the streets, local reports noted many residents emptied their bank accounts while scrambling to find U.S. dollars in the currency black markets ahead of the polls opening.
“Nobody wanted to wait [on the election results]. Everybody is just bracing for the worst,” Buenos Aires resident Lucilla Martinez told The Epoch Times.
Ripples within financial markets are an expected outcome of any presidential election, but Argentina’s situation is unique. The severity of its economic crisis and a highly polarized election prompted locals to prepare for an even worse economic spiral.
“I don’t care if they say he’s radical. I voted for Milei because I want real change. People have said he [Milei] will be worse for our economy, but the people saying that are the ones who destroyed this country,” Ms. Martinez said.
Peronism Faces Uncertainty
“For a Peronist in power, there’s nothing worse than another Peronist who has power,” Mr. Calle said.
Many opposition members have said Mrs. Kirchner has relied on like-minded members of the ruling coalition— particularly in Congress—to push her private agenda over the years. Yet Mr. Calle says that may end with Mr. Massa if he wins the runoff race.
“Massa is not Alberto Fernandez. He will try to establish political hegemony.”
Mr. Calle is not the first to imply or directly state that outgoing President Fernandez is a political puppet for Ms. Kirchner.
He believes that if Mr. Massa is elected in the second round, there will be a point where the other Peronists will be forced to fall in line or become political rivals. This includes the “Kirchneristas.”
“If the Peronists win, surely nothing will change. Over 50 years of their leadership has told us this,” Mr. Gomez said.
If he wins, Mr. Calle said the Peronist candidate has a monumental task ahead and will “inherit all the imbalances and holes that a collapsed economy has.”
And that economic hole has only gotten deeper since the election. The nation’s U.S. dollar bonds, which traded at less than 30 cents on the dollar before the election, continued losing ground on Oct. 23 and are listed among the worst performers in emerging economies.
“There is no easy road ahead,” Ms. Martinez said, pausing before adding, “But how could anyone believe the same person in charge of the economy during this crisis will somehow make it better as a president?”
Past vs. Future
During an August interview with Bloomberg News, Mr. Milei stressed that his top priority was to align Argentina with the United States and the rest of the Western world in terms of policies and values.
But when it came to relations with China, Mr. Milei was blunt. “We do not make a pact with communists.”
Now, the libertarian dark horse candidate will face off against the pro-China Peronist regime’s candidate in the November final round while the future of relations with Argentina’s top trade and investment partners—the United States and China—are in limbo.
Mr. Milei has made it clear on more than one occasion that he opposes anti-Western sentiment at every level. However, Mr. Massa is expected to move forward with similar foreign policies, prioritizing Beijing over the United States and deepening cooperation with the anti-Western trade bloc BRICS.
Yet some analysts believe even if the Peronists emerge as the victor in November, it won’t be business as usual.
Evan Ellis, a Latin America analyst and professor at the U.S. Army War College, told The Epoch Times that Argentina’s election is “full of ironies.”
He said the Peronists are capitalizing on the fear Mr. Milei’s wild card economic policies have created, but Mr. Massa will likely have to take a different approach even if he wins.
“You could see a little more pro-West, a little less Putin embracing,” he said.
At the end of the day, he says Argentinians will ultimately have to decide what they fear more: a known past with Mr. Massa or an unknown future with Mr. Milei.
“In an ironic sort of way, it’ll be a choice between fears of the future and the fears of the past.”
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