On the heels of the worst financial crisis to hit Argentina in decades, the late President Néstor Kirchner (1950-2010) took to New York to calm investors’ fears and discuss a road map for his country’s economic future. Populist undertones can be found in his emphasis on social justice and equality in pursuit of economic reform. The speech was not without controversy, however, as he defended Venezuela and outspoken President Hugo Chavez while advocating for closer ties with the United States. 

Nestor Kirchner (2007)

September 21, 2006 – New York

[…] As the president of this Institute very well said, this is the third time that I have come to this house. They were certainly difficult times the first time that we gathered here, during which Argentina was going through the most profound crisis in its history, and I believe that there is not a situation more difficult for a leader, a representative of one nation, than to talk, convince, discuss, debate, produce, and carry out, when the level of credibility of that country has been broken. I had to be here after a short time of an asymmetric devaluation, the also traumatic halt of the convertibility plan, and during a time when Argentina was not complying with all of its internal and external commitments. The external commitments are broadly known; internally, the country and its citizens were being condemned to practically loosing their faith and hope, and many of them to becoming indigent and poor. It was not by far an easy task for me, to represent Argentina in this historical moment, when internally and externally the faith in the country had been broken.

Furthermore, many of the faces I see here today were logically and considerably angry, due to legitimate motives. Anyhow, these were the circumstances, reality had to be confronted, and the credibility and predictability of the country had to be rebuilt. You well know that it is much easier to destroy credibility than to build it. This happens in all areas of life, and fundamentally this task that we have taken on, which you as businessmen know very well, is arduous, difficult and complicated; but Argentina is doing it, step by step, and with a great deal of effort.

The fact that the region was also experiencing different kinds of problems, with critical implications in the majority of the cases, with some exceptions, created a very difficult framework to work from and find solutions. Argentina overcame these moments and is in an i n important and permanent rebuilding process. To give you an idea, when I began to lead Argentina, the collection system collapsed, we dinot have resources, the authorities of the International Monetary Fund and its representatives were patrolling the country; not to mention the holders of the external private debt bonds. Internally, our country was facing a significant social crisis. After the government had passed the fifty laws dictating the intangibility of bank deposits, savers suffered the “corralito” effect, by which all the financial obligations towards those citizens that had saved, and that had trusted in the system, were violated.  We were also experiencing a very difficult social situation; our “Casa Rosada” (Government House), had permanent visitors in the “Plaza de Mayo” (Mayo Square), and we had friends who, with a great deal of justice, complained about the terrible situation they were forced to go through.

[…]

We began to be on the path; we started to grow and to announce as fundamental factors that we want to be a balanced and just country. We said that indigence and poverty are stains that Argentina could not afford to stand. We had substantial differences with regards to how the International Monetary Fund would view the process of economic recovery. With all due respect, I myself tell you that if I had followed the suggestions of my friends at the International Monetary Fund, the crisis would surely be considerably more severe. This is why some have recently asked me, “Are you heterodox with regards to the economy?” Yes, I believe in economic heterodoxy; I believe fundamentally that if a juncture is agreed upon within a strategic project framework, there can be different answers that can work and that in many cases, it is necessary to respond to the situation of each particular country.

We did not find the answers in the International Monetary Fund and we had to recreate our own ideas and actions, leading to the restructuring of the private external debt process, through which we were able to obtain 70,000 million dollars in national savings. For the first time, Argentina had its negotiation leverage up to the standards of the circumstances.

We also decided to cancel the obligations with the International Monetary Fund because it was impossible to lead the economy with the intervention of the Fund’s public bureaucrats, which had no real understanding of the country. We credited them with 10,800 million dollars and ended an important problem, which was necessary to carry out the actions lying ahead of us.

Likewise, we took decisions that were central and fundamental. We had to promote trust in the financial system and recreate the trust of Argentineans themselves in order to rebuild investors’ trust. To this end, I believe that it is fundamental to avoid altering and changing the economy everyday. Instead, we should promote predictability not only on the juncture, but also, with regards to the strategic framework. An investor should know that when he goes to the country, he has the certainty that the government will not be constantly passing special provisions that lead to an inverse power relationship. Because what has happened in Argentina is that the fervent supporters of the neoliberal theories, like to dictate much more than I, even though they have accused me of liking to govern in an authoritarian fashion.

You have witnessed the economic precedents during the last few years in Argentina, how the economic ministers, who claimed to be supporters of liberalism, would intervene in the economy everyday, leading to the results that we have seen. We are trying to generate a two-way deal that allows investors to have clear, certain and concrete rules that predetermine and determine security to those who come to invest in our country.

[…]

Logically, a country growing with the same strength as Argentina will need to invest sturdily in order to continue consolidating the necessary infrastructure for the country’s development. Also, we believe that this process of economic transformation, economic reconstruction, the country’s economic growth, ending indigence, putting a definite brake to stop poverty, having a strong level of employment, and eliminating the framework of global unemployment that so strongly hit Argentina, require deep educational reforms. Because in determining moments in Argentina, the situation led to the closing of those technical schools that prepared our children and youth, and in many cases – you know this – firms demand people, and we do not have a prepared and trained workforce, typical of this kind of situation. We have decided to undertake two fundamental educational projects. Six points of the Argentinean Gross Product will go towards investing and financing education.  We call it the Law of Education Finance, and this year we are discussing the education law with the entire society, so that the economic growth is definitely accompanied by high quality standards of the education system that allow us to have economic growth with human resources.  This is very important and the Argentinean people are very good, even more so when they are qualified. This is going to allow us to become an overpowering force, which will let us have access to the quality that we need and we want, in order to offer growth to the country. But the economic growth has to go hand in hand with the definite incorporation of Argentineans, and of those who live in Argentina that are part of this process of integration and inclusion, which is fundamental.

To give you an idea of what it means to have lowered poverty and indigence from semester to semester, we have taken 1,562,000 people out of poverty in one year and 562,000 have been lifted from indigence. Minimum salary in Argentina went from 200 pesos to 830, in other words, it experienced a 400 percent increase and the economy did not suffer at all. The number of people that retired from the lower end of the scale, had an increase of 270 percent and we are now recovering those retired persons that are in the higher end of the scale. Evidently, all of this goes to consumption, an area in which there is a full recovery and which has not experienced any alteration either.

It is fundamental for us to strike a balance between economic growth and equity and justice. The environment must be good for those of us who govern, for those who invest, for the businessmen, who are part of the growth and make the reality in Argentina for the  people, for society, for the different sectors of society in order to rebuild a national entrepreneurial force and a middle class, which is the engine that permanently allows for the Argentinean growth, developing the potential of their own human resource capabilities and the definitive consolidation of a qualified middle class, with employment, that can be integrated into the growth.

[…]

In the region, we are working strongly to build MERCOSUR. We believe in the task that we are able to achieve with MERCOSUR; there was an integration process in Latin America. It is very important; we believe that the construction of the countries of South America will serve as a prevailing instrument; we firmly believe that the economic recovery of our countries will enable us to build a sound MERCOSUR.  When these countries were in crisis, it was impossible to create as a bloc the necessary space within the countries of South America since there was no response, fundamentally, when the two largest countries were going through a deep crisis, like was the case with Brazil and Argentina.

The cases of Brazil’s and Argentina’s recoveries, the cases of the consolidation of other countries of the region, the case of Chile; I know that some of you get nervous regarding Venezuela’s support of the region, which is very important; this country has had gestures of solidarity with the entire region. Plus, working together with the smaller countries of the region will allow us to seriously build the region, so that this serious region is perceived as a bloc, together with the European economic community, with the rest of the world and also, expecting, of course, and I say it here, I want to say it in New York, that this great country, that this society for which we have the highest of respects, to be able to coincide politically with some issues appropriate of any democracy. It is very important that the United States of America enters and puts an eye on the region, and stops looking at us from behind [“mirar por la nuca”], because if the United States of America puts an eye on the region, it should have no doubt of the leadership that it will have, thus, greatly helping Argentinean growth.

[…]

Gentlemen, Argentina wants to thank all of those who have collaborated with us; we thank those that got upset because at the end, they were able to understand us; and to those who are still angry, we will continue to wait for you with opened arms. But always know that we are a country that has its destiny in our own hands; and like this country, the United States, which has shown how to build a capitalist system with national decisiveness, Argentineans too, want to do the same. Thank you very much.