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Cablegate: Argentina: Ambassador Wayne's June 25 Meeting with Former

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INFO RUEHAC/AMEMBASSY ASUNCION 6275
RUEHBR/AMEMBASSY BRASILIA 6140
RUEHCV/AMEMBASSY CARACAS 1314
RUEHLP/AMEMBASSY LA PAZ JUN MONTEVIDEO 6536
RUEHSG/AMEMBASSY SANTIAGO 0507
RUEATRS/DEPT OF TREASURY WASHINGTON DC
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RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC

UNCLAS BUENOS AIRES 001244

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: PGOV PREL AR ECON
SUBJECT: ARGENTINA: AMBASSADOR WAYNE'S JUNE 25 MEETING WITH FORMER
PRESIDENT ALFONSIN

REF: BUENOS AIRES 01240

1. (SBU) SUMMARY: On June 25, Ambassador Wayne called on former

President Raul Alfonsin to discuss Alfonsin's views on the current

political panorama in Argentina. Alfonsin frankly shared his view

that current economic policies are not sustainable and that

Argentina is likely to see economic problems in 2009. He was

critical of the Kirchner administration for fostering weak

institutions, no separation of powers, and for violating the

'coparticipation' (federal-provincial revenue sharing) principles.

In the end, however, he said that he remains an optimist and chooses

to focus on the progress that Argentina has made to date. END

SUMMARY.

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Economic Stability

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2. (SBU) On June 25, Ambassador Wayne called on former President

Raul Alfonsin to discuss Alfonsin's views on the current political

panorama in Argentina. Alfonsin frankly shared his view that

current economic policies are not sustainable for more than the next

18 to 24 months and that Argentina is likely to see economic

problems in 2009 without significant policy shifts. He said that

Kirchner's lack of an energy policy would create significant

problems. He said that he would have worked harder to expand the

gas pipelines from Bolivia to ensure a more regular and sufficient

supply of gas in Argentina. He mentioned that he understands

Bolivian President Evo Morales's decision to raise the price of gas

for exports to Argentina, which then makes one wonder why gas prices

shouldn't increase in Argentina to help increase supply. Alfonsin

made a point to explain that although he does not see Morales as a

threat, he is against Venezuelan President Hugo Chavez's energy

policies and his broader approach.


3. (SBU) Alfonsin said he believes the current level of GDP growth

is unsustainable. He said that Argentina has been lucky that

international markets like in China and in India have been strong

and have added to Argentina's growth. He said he has several

economist friends who do not believe that Argentina will face an

economic crisis in 2008, but see it as more likely in 2009.

Alfonsin said that the stability of international markets are key to

maintaining growth, but if China or India were to suffer a downturn,

Argentina could see a crisis sooner.


--------------------------------------------- -----

Criticisms of the Kirchner Administration

--------------------------------------------- -----


4. (SBU) Alfonsin was critical of the Kirchner administration for

fostering weak institutions, no separation of powers, and for

violating the 'coparticipation' (federal-provincial revenue sharing)

principles. He said that President Kirchner has ""authoritarian

leanings"" and has eroded the separation of powers in the government.

While he thought that Kirchner's appointment of new Supreme Court

Justices was positive, Alfonsin said the changes to the Council of

Magistrates' composition gives the executive branch too much power

to veto dissenting judges. (NOTE: The Council of Magistrates is the

body that oversees the nomination, review, and discipline of judges.

END NOTE.)


5. (SBU) Alfonsin said that federalism in Argentina is just a

""shell."" He said that Kirchner's use of discretionary funds to

'bribe, extort, and trick' opposition politicians to support him is

destroying political parties in Argentina. He said that Kirchner

wants to be the sole representative of the center-left against

Buenos Aires Mayor-elect Mauricio Macri as the center-right leader.

Alfonsin said that he believes Kirchner is not really a center-left

politician, but rather a populist. The former president said he

feared that Kirchner was trying to take the Radical Civic Union

party's center-left role, but he doubted that Kirchner would

succeed.


6. (SBU) Alfonsin said he thought the destruction of the political

party system could lead to an anarchic situation in which strong

provincial leaders (caudillos) could create their own fiefdoms. He

lamented the lack of dialogue with the current administration and

said he thought that the only way to strengthen institutions and

lessen the power of the president would be through the ballot box.

He said, for instance, that in the Buenos Aires June 24 mayoral

election the people's desire for political change (represented by

Mauricio Macri) outweighed their satisfaction with continued



economic growth (represented by Daniel Filmus) (reftel).


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Still an Optimist

--------------------

7. (SBU) In the end, Alfonsin said that he remains an optimist

about the progress that Argentina has made so far. He emphasized

that at least the military is no longer involved in politics. He

explained his personal ties and affinity to the U.S., where his

son's family lives. He said that he is not fond of big receptions,

but invited the Ambassador to call on him any time. He also argued

frankly that he believed U.S. policy had strayed badly in the Middle

East, adding to anti-Americanism in Latin America as well as

elsewhere.


WAYNE


=======================CABLE ENDS============================

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