Argentina’s Peronist president on the virtues of Henry Ford capitalism

Argentina’s Peronist president on the virtues of Henry Ford capitalism

Alberto Fernández tells the FT that capitalism must focus on jobs and investment, not speculation

Alberto Fernández’s unconventional debut as the Peronist party’s candidate in Argentina’s presidential elections last year — former president Cristina Fernández de Kirchner announced on Twitter that he would head the ticket, with her as deputy — took the nation completely by surprise.

But the circumstances in which the 61-year-old leader is governing are even more unexpected. The coronavirus crisis struck Argentina scarcely three months after the former lawyer took power in December, prompting a decision by his leftist administration to impose a strict, early lockdown.

“God enlightened me,” the lapsed Catholic told the FT in a recent interview, sitting behind a desk flanked by a painting of his collie Dylan wearing the blue, red and white uniform of the grenadiers that guard Argentina’s president. “We saw what happened in Europe, and did the opposite . . . we saw what the US didn’t want to see, and the result has been very good.”

Mr Fernández’ assessment may prove over-optimistic. So far, the pandemic has claimed around 2,700 lives in Argentina, which compares well to the rest of the region. But the number of cases continue to rise despite one of the world’s longest and strictest lockdowns, which has continued since mid-March. The costs for the already flailing economy are rising.

Even so, Mr Fernández said that Covid-19 offers an opportunity to rethink capitalism. “I believe in the capitalism of [Henry] Ford, who one day asked himself: ‘Why are my cars not being used by my employees?’,” said Mr Fernández, who often cites the influence of 1960s hippy counterculture.

“That capitalism [of Ford] showed more solidarity, because it was a capitalism that provided employment, that produced and that generated investment — that was the capitalism that we needed, not speculative capitalism,” said Mr Fernández, arguing that the rot set in when companies’ finance managers became more important than production managers.

The guitar-strumming leader’s dog is named after the singer Bob Dylan, he admires the poetry of Walt Whitman, and he welcomes his son Estanislao’s decision to moonlight as a drag queen, a brave move in Catholic Argentina.

In sharp contrast to his jet-setting predecessor Mauricio Macri, Mr Fernández has a reputation for down-to-earth living. Sporting a moustache and slicked-back greying hair, he uses a modest official car which he likes to drive himself and worked as a visiting university lecturer before the election.

Argentina has been a perennial economic disappointment for half a century but Mr Fernández believes the solution is to add more value to the country’s vast agricultural exports and to substitute imports for national production — a policy favoured by previous Peronist leaders. But he does not want to close Argentina off from the world. “Globalisation is an irreversible fact.”

Argentina’s economy faces truly daunting challenges in the wake of coronavirus but many believe that Mr Fernández faces no thornier problem than his vice-president, Ms Fernández de Kirchner.

Still a formidable political force despite the economic turmoil which accompanied the end of her presidency in 2015, the bus driver’s daughter is president of the senate and controls a powerful array of grassroots Peronist organisations. Many commentators see her as the power behind the throne.

Mr Fernández’ relationship with Cristina, as she is universally known here, has been tempestuous. Known for his short temper, the current president crashed out of her government during a clash with farmers in 2008 only months after she took power. Subsequently, he was fiercely critical of her government, leading many to doubt his protestations — repeated emphatically to the FT — that they now enjoy a healthy relationship, and that he calls the shots.

“I don’t think Alberto is a puppet. He is just a man who is very conscious — perhaps excessively so — of how he got to where he is,” said Silvia Mercado, a journalist who has known him since the 1980s, explaining that Mr Fernández feels he cannot disappoint the more radical Peronist factions who voted for him. “He feels indebted to [them] despite for ten years saying everything that he did about Cristina.”

The president emphasises his pragmatism, both in politics and in economics. “I understand economics as a humanist science concerned with human development, which has a thousand ways to reach its goal,” he said.

“If you hear me talk about the need for fiscal solvency, some would say this man is very conservative . . . and if you believe that by expropriating a company in bankruptcy I look like a socialist, well you can believe it, but the truth is that all I’m trying to do is to resolve an economic problem.”

While downplaying the role said to have been played by Pope Francis in helping to patch up his relationship with Ms Fernández de Kirchner in early 2018, he did emphasise the influence of the Argentine pontiff on his thinking. He added that he was “intensely grateful” for the Pope’s attempts to garner support for Argentina as it restructures $65bn of foreign debt after the country defaulted for a ninth time in May.

Mr Fernández quipped that it appears to be his “destiny” to govern Argentina in default — he was cabinet chief from 2003-08 when the country was recovering from its historic 2001 financial meltdown. That explains why he is so convinced it must never happen again. But it also means reaching a deal with bondholders, who last Monday rejected what Mr Fernández emphatically insisted is his government’s final offer.

If a successful deal is reached with foreign creditors — and the pandemic is brought under control — Mr Fernández wants to return to the grand plans to restore prosperity and social justice that he unveiled days before Argentina’s lockdown began. “All that was stopped short by the pandemic, but we have to do it all . . . we just don’t know exactly when we are going to be able to get going again.” es un sitio web oficial del Gobierno Argentino