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Argentina: a problem and an opportunity for the Kirchner clan

By Tony Pagliaro

Buenos Aires 14.03.06 | Among “Industrial Union” wealthy and well known bosses, Messrs: Massuh; Mendiguren; Magneto; Rocca; Blaquier; etc., who -late in 2001- successfully caused Eduardo Duhalde to: (1) organize the manipulated “street revolt” that ended President’s De la Rúa’s mandate; (2) terminated overnight Argentina’s monetary “Convertibility” and -simultaneously- (3) defaulted on its foreign debt and (4) devalued strongly the peso to be able to “rescue” their respective industrial concerns from an otherwise unavoidable bankruptcy, fact is, only one of them has stayed really close to the political power: i.e. Mr. Héctor Magneto, Chairman and controlling shareholder of a monopolistic media empire: the “Clarín” group. Through him the Kirchners do control today Argentina’s public opinion. Day and night.

But Mr. Magneto appears to be, suddenly, in deep trouble. He is now in a Chicago hospital, apparently undergoing medical treatment. The growing rumor is that he may have cancer.

For the Kirchners, this is both a problem, because Magneto is an ally, but an opportunity as well, since they now aim at controlling the gigantic media empire through people they really trust. Soon we will know what they intend to do in this respect. If so, we will definitely report on this matter.

But in the meantime, the “Clarín” group, with the advantage of their digital technology, is virtually “taking over” the cable television business across the Río de la Plata, in Uruguay.

With the blessing and support of Mr. Tabaré Vázquez’s leftist government, trough “URSEC” the Uruguayan regulator, “Clarín’s” Uruguayan subsidiary “Bersabel S.A.” has recently been authorized to do business beyond the borders of Montevideo. In fact, it is already operating in six domestic Uruguayan provinces (Departments).

A number of local competitors are deeply concerned by this issue and have gone to court to try to avoid a monopolistic Argentine presence in their country.

In addition, the “Cámara Uruguaya de Televisión para Abonados” is lobbying hard to try to stop Magneto’s powerful bid. Up to now, unsuccessfully. “Clarín” already has a million clients in Argentina and Uruguay; 8.000 employees; and has a yearly gross income of 700 million dollars.

The traditional opposition party in Uruguay, “Partido Nacional” (known as the “whites”), appears to be extremely concerned with this troublesome development and has organized a special committee to look carefully into the issue and follow up “Clarín’s” moves.

Leftist governments seem to have an irresistible attraction towards dealing intimately with the press, “using” it to try to consolidate and maintain power.

This is so because they need such type of alliance to effectively prevent the transfer of power through elections from the hands of the incumbents to a different political elite.

Governments like the Kirchners one are, through these type of “marriages,” in no danger of losing their hold on power. Not because they are really popular, but because they do know how to play the “democratic game,” pretending they allow dissidence yet still remain in complete control. They maintain the appearance of democracy without exposing themselves to the political risks that free competition unavoidably entails.

This is precisely why they need to deal with the Magneto’s of this world. Again and again.

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