Category Archives: Diversionary Behavior

Washington Post – Top US general: Venezuela not a national security threat

By Associated Press, Published: July 31

LIMA, Peru — The Air Force general responsible for U.S. military operations in most of Latin America said Tuesday that he does not believe Venezuela, despite ongoing arms purchases and close ties to Iran, poses a national security threat to the United States.

Gen. Douglas Fraser also said he would like to see more counterdrug cooperation from Venezuela, from which most northbound cocaine smuggling flights continue to originate, according to U.S. and Colombian officials.

Fraser was asked if he thought Venezuela’s newly announced development of unmanned aerial vehicles and continued purchase of billions of dollars’ worth of weaponry, including anti-aircraft missiles from Russia and other nations, did not present a danger to his country.

“From my standpoint, no, I don’t see it that way,” he told The Associated Press in a phone interview. “I don’t see them as a national security threat.”

Fraser, chief of the U.S. Southern Command, said from his headquarters in Miami that he views the anti-aircraft missile purchases in particular as primarily defensive in nature.

He also said he did not consider Iran’s ties with Chavez’s socialist government to amount to a military alliance.

“As I look at Iran and their connection with Venezuela, I see that still primarily as a diplomatic and economic relationship,” he said, with Iran using it to counter international sanctions over its alleged development of nuclear weapons.

Fraser’s comments echo a July 11 statement by U.S. President Barack Obama that drew criticism from his presumed Republican challenger in November elections, Mitt Romney.

Obama said his “overall sense is that what Mr. Chavez has done over the past several years has not had a serious national security impact on us.”

Romney responded by saying it was “simply naive” to think Chavez does not pose a threat to the United States.

Chavez, who is himself up for re-election on Oct. 7, denies his government Venezuela poses any threat to the United States, the chief purchaser of Venezuelan oil.

The United States is also the No. 1 cocaine-consuming nation. U.S. officials say most northbound cocaine, produced in the Andes, is smuggled by sea but the vast majority of U.S.-bound cocaine smuggled by air in recent years has originated in southwestern Venezuela and lands primarily in Honduras before continuing north.

The U.S. Treasury Department alleges several current and retired senior Venezuelan military officials including Defense Minister Gen. Henry Rangel Silva have enriched themselves through drug trafficking in collusion with leftist Colombian rebels, and Fraser said he has seen nothing to indicate that has changed.

He said, however, that interdiction efforts outside Venezuela have reduced the number of northbound drug flights by 40 percent in the first six months of this year as compared to the first half of 2011.

He credits international cooperation, including Colombian monitoring of Venezuela’s airspace, for the success.

“We have also seen a decrease in the Caribbean maritime (smuggling) traffic of 40 percent,” he said.

However, a similar decrease has not been noted in the Pacific, where cocaine is smuggled in everything from semisubmersibles to fishing trawlers, speedboats and freighters.

Fraser said he is retiring in the fall. He is to be succeeded by Marine Lt. Gen. John Kelly, currently senior military adviser to U.S. Secretary of Defense Leon Panetta.

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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COHA – Bolivia Dares Western Globalization

This  analysis was prepared by Roberta Bruno, Research Associate at the Council on Hemispheric Affairs

July 2, 2012

On May 1, Bolivian President Evo Morales ordered the military to seize the Transportadora de Electricidad S.A. (TDE), a private firm that controls 74 percent of the total electrical transmission lines in the country. A subsidiary of a Spanish firm, Red Eléctrica Internacional (REI), owned an estimated 99.4 percent of TDE’s shares before the nationalization. This move is meant to advance the Bolivian government’s economic independence, protecting critical production from foreign influence.

Exerting control over natural resources is nothing new in Latin America, particularly in Bolivia. Since his election in 2006, President Morales has nationalized a number of industries, such as those related to hydrocarbon operations and telecommunications, in order to generate public revenues. However, Morales’ nationalization policy appears to be just another component of the populist approach that has defined his presidency. Many analysts agree that the May 1 announcement was necessary for Morales to restore his declining popularity, underscored by continued protests against his latest project, the Amazon highway through the Isiboro Secure National Park and Indigenous Territory. Morales’ support of the highway, which indigenous groups claim will cause irreversible environmental and social damage, has caused many to question his convictions.

In May 2010 alone, Morales expropriated four energy utilities. TDE spent $81 million USD over a 16-year period, only to be accused by the Bolivian government of not investing enough money in the grid. Even though REE represents only 1.5 percent of the market, the symbolic move to nationalize this industry has tainted Bolivia’s reputation among financial investors.

While it seems logical to assume that Morales’ expropriation of energy utilities is meant to secure his presidential reelection in 2014, there are other motivations to consider.

Bolivian Electrical Market: Privatization and Deregulation

In 1994, the Bolivian Plurinational Legislative Assembly approved the Ley de Electricidad, privatizing the state-owned electrical utility managed by Empresa Nacional de Electricidad (ENDE), with the main purpose of stimulating competition. The legislation unbundled production, transmission, and distribution responsibilities by forbidding any single entity to operate in more than one of these areas. After deregulation, TDE was immediately purchased by REI, a subsidiary of the Spanish Red Electrica Española conglomerate.   According to research conducted by Observatorio de Multinacionales en América Latina, liberalization of the sector has been characterized by three noteworthy flaws. Firstly, the regulatory body monitoring incipient electrical companies in Bolivia has fined TDE several times, accusing them of “acting with carelessness, abandonment, [and] neglect … ignoring warnings or precautions in their management of transmission lines.[1] Secondly, Morales has publicly approved of TDE as private owner/operator of transmission lines in Bolivia only as a transitional phase, planning to exploit private investment for a determined time before carrying on with nationalization.[2] Lastly, public funds have played a key role in the extension and development of the power grid in Bolivia, while private investment promised by corporations has failed. Contrary to the desires of those who composed the Ley de Electricidad, privatization was unable to stimulate the level of competition necessary to yield universal access to electricity at affordable prices, and thus interventions by the Bolivian state were necessary to sustain power’s generation and transmission.[3]

A Global Perspective: Inversion of Economic Orthodoxy

The nationalization of TDE fits into the global trend of growing concerns about the capitalist financial system. It is no coincidence that a Spanish company was targeted for takeover. While European countries are struggling to stay afloat under the onerous burdens of austerity, and emerging economies are vying to take advantage of the precariousness of the situation, the global economic equilibrium is in flux. The financial crisis has diminished confidence in capitalist formulations as a consequence of financial crisis, opening the door for Latin America’s brand of hybrid model, known as social capitalism. Argentina’s nationalization of YPF is a concrete example of this. Like Argentina, Bolivia is well aware of its abundance of natural resources, and maintains what could amount to an enormous competitive advantage in the face of the depressed economies of the West.

With every passing year, Latin American countries become more self-confident as their leaders strike new paths and shirk old ones by proposing a kind of hybrid model, halfway between free-market and state-owned enterprise. Latin American countries are showing a willingness to exert pressure on the economic and political order, while in the past they showed more caution and hesitancy. However, while regional responses to the current global economic crisis lean towards a rejection of orthodox economic models, is protectionism expected to rise again?

The nationalization of TDE should be considered from two different perspectives: first, the domestic micro-level impact of the policies enacted by the Morales’ administration. Morales is a charismatic leader, but he has consistently resorted to populist moves to maintain his popularity. While this element was likely part of Morales’ calculation, the nationalization of TDE could also be read as a strategic move against calls for increased deregulation and austerity coming from Western financial institutions.

From the second perspective, boom-and-bust cycles plague commodity and labor markets. Developed economies try to leverage comparative advantages through economic integration and by exploiting human and natural resources of poorer countries. But developing countries, such as Brazil and Argentina, are becoming increasingly aware of their potential for growth and their evolving status as major competitors in international markets. It is unclear if TDE’s nationalization means Bolivia has chosen to follow a new road to economic recovery through an economic development based on natural resources, or whether they are merely snubbing Western investors. However, Morales’ policy provides important insights into current developments within Latin America’s economic and political institutions.

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COHA – What the West Missed: Insights into Expropriation

This analysis was prepared by Zachary Petroni, Research Associate at the Council on Hemispheric Affairs

On April 16th, 2012, Argentine President Cristina Fernández de Kirchner expropriated the Argentinian oil subsidiary Yacimientos Petrolíferos Fiscales (YPF) from the Spanish conglomerate Repsol. According to Fernández, her executive order to seize 51 percent of Repsol’s stake in YPF was prompted by what she and Argentine state officials deemed an inexcusable “underinvestment” in the development of newfound oil and natural gas deposits in the nation’s western regions. Instantly popular among Argentinians, the takeover was decried as unprovoked and nearsighted by Repsol’s board of directors and much of the international business community.

Nevertheless, for all the attention initially enjoyed by the Fernández administration, the Western world seems to have rapidly lost interest. Indeed, legislation finalizing the nationalization sailed through the Argentine National Congress essentially unopposed, and with virtually no coverage from Western media outlets. The prevailing notion conveyed by this boom and bust-style reporting: that Argentina is in its death throes, on a one-way path toward what some wrongly consider Latin American truisms of defunct democracy, squandered natural resource wealth, and indiscriminate nationalism. Such a conclusion, however, is as lazy as it is unhelpful, as the nationalization of YPF by President Fernández offers three valuable insights that such a narrow interpretation precludes.

First: not all nationalization efforts by left-of-center Latin American leaders follow the same logic or script.

Yes, Bolivian President Evo Morales did expropriate a Bolivian electricity subsidiary from Spain’s Red Eléctrica Española earlier this month, using very much the same nationalist rhetoric that Fernández had just weeks earlier. And yes, Venezuelan President Hugo Chávez continues his protracted campaign of nationalization, now threatening international banks with the same fate that befell the gold industry in Venezuela late last year. But, nonetheless, these are weak analogies; what appears to some an obvious and immature trend of reckless nationalism in Latin America is, in fact, much more nuanced.

Consider instead Morales’ dramatic takeover of Bolivian oil fields from international petro-magnates Petrobrás and Repsol-YPF in 2006. According to Sidney Weintraub of the Center for Strategic and International Studies, nationalism aside, these expropriations were carried out to remedy uncharacteristically low returns on Bolivian natural gas exports. Already the poorest nation in South America, Bolivia could scarcely afford the regional price differentials which made exporting its abundance of natural gas disappointingly unprofitable. Alongside the economically unwise nationalization of YPF by Cristina Fernández, Evo Morales’ takeover of foreign oil interests in 2006 clearly demonstrates a Keynesian logic regarding market failure that the West is reluctant to ascribe to the Bolivian leader. At its core, the categorical mistrust of current Latin American leaders like Morales and Fernández, which has driven so many in Washington to cast them as irrational caudillos, is excessive and unfounded.

Second: contrary to its portrayal in the media, the legalization of the YPF takeover is not so much an end as it is a beginning.

Ironically, Argentina lacks the estimated $40 billion USD necessary to develop the Vaca Muerta oil and natural gas deposits itself. According to Bloomberg, Argentina has just $47.3 billion USD in monetary reserves and remains isolated from global credit markets, a consequence of the nation’s infamous debt default of 2002. For President Fernández to accuse Repsol of underinvesting in Argentine energy and presume she can accomplish any different, without technical assistance and in the face of such steep development costs, is unrealistic.

Yet, this myopia presents unique opportunities. Fernández cannot rest on her laurels indefinitely; if she wishes to deliver on her promise of Argentine energy security, she will be forced back into the arms of foreign investors. When this occurs, these investors will most likely represent interests neither Fernández, nor her administration is accustomed to dealing with in Repsol (China’s Sinopec, for instance, has made overtures to the Argentine state regarding YPF). With the nationalization, Argentina’s foray into the geopolitics of hydrocarbons has just begun.

Third: the expropriation of YPF from Repsol may have been politically motivated. But, rather than a desperate attempt by an authoritarian regime to retain legitimacy, it could just as well indicate that democracy is alive and well in Argentina.

An Argentinian friend and postdoc at the University of Michigan, Marcelino Viera, responded to inquiries on the situation in Argentina with a compelling suggestion: “Keep in mind… in Argentina, after Perón, it is impossible to govern without populism.” Undoubtedly, the nationalization of YPF was, to a large extent, a populist ploy; after all, YPF was the perfect candidate. During its 70-year existence as Argentina’s state-run oil company, YPF became as Argentinian as an acute addiction to mate. Argentinian sociologist Horacio González, in an op-edwritten for the Buenos Aires daily Página/12, noted that the symbolism attached to YPF was so great that, with the company’s 1993 privatization, Argentina effectively became “a nation with oil, but without oil.” Beneath the symbolism, however, lies tangible substance. González predicts that with the “emancipation” of YPF, Argentina will soon see the creation of a “democratic public economy.”

González is spot on; President Fernández’s reversal of YPF’s long-lamented privatization is evidence of a marked shift toward, not away from, democracy. In national elections last October, Argentinians endorsed not only Fernández, sweeping her back into the presidency with the largest electoral majority in over three decades, but also many congressional candidates from her populist party, Frente para la Victoria (FPV). YPF’s takeover is as much a product of these elections as it is evidence of a shifting political discourse in Argentina: one that welcomes the democratic responsiveness of the Fernández administration and other FPV politicians who act in accordance with their electoral mandates. Such responsiveness is more than can be said of many of the more dignified Western democracies, with a soupçon of rectitude, condemning the Fernández administration for its action while closing their eyes to embarrassing events closer to home.

They should take notes.

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Bloomberg – Illegal enrichment probe looms for Argentine VP

By MICHAEL WARREN

Influence peddling and money laundering allegations haven’t been enough to topple Argentina’s vice president, Amado Boudou. On Monday, illegal enrichment accusations were added to the mix when a federal prosecutor asked an investigative judge to open yet another probe against him.

Prosecutor Jorge Di Lello also asked Judge Ariel Lijo to investigate 10 businesses, including The Old Fund, a holding company reportedly linked to Boudou that took over a bankrupt printing company and secured a government contract to print Argentina’s currency after Boudou and other top officials intervened on its behalf.

Also named in the probe request are Boudou’s girlfriend, Agustina Kampfer; a longtime friend and business partner, Jose Maria Nunez Carmona; and another businessman, Alejandro Vandenbroele, who allegedly served as Boudou’s proxy in a series of business deals.

The judge must now decide whether to formally open an illegal enrichment investigation and eventually whether to bring charges that carry a maximum penalty of six years in prison and a lifetime ban from public office, Di Lello’s secretary, Juliana Marquez, told The Associated Press.

“The prosecutor has found sufficient elements to justify investigating the vice president,” Marquez said. “The judge now needs to initiate the investigation … examining the declared wealth of the functionary and the others named, along with the sworn declarations of the companies, in search of any incongruencies.”

In Argentina, taxpayers must formally declare not only their income, but also their total wealth. The government can then compare the totals along with declarations from the money’s sources, and can bring tax evasion charges when the totals don’t match.

Boudou already faces potential charges of influence trafficking and other acts incompatible with public office, in a case Lijo inherited from Judge Daniel Rafecas.

Rafecas agreed to open that investigation, and Argentina’s attorney general, Esteban Righi, approved that judge’s request for a raid on Boudou’s apartment that turned up telephone records and other evidence linking Boudou and Vandenbroele. Both men denied knowing each other, but Vandenbroele’s ex-wife provided testimony and went public with her claims that he had acted as Boudou’s front-man for years.

Boudou spoke out in his own defense last month in a lengthy and passionate televised speech from his podium in the Senate, where he presides as president of the chamber.

He accused an opposition media “mafia” led by the newspaper Clarin of inventing a novel rivaling “The Godfather.” He accused the president of Argentina’s stock exchange of trying to bring him down in a conspiracy with political and business rivals who failed to get the currency-printing contract.

Boudou then filed a formal complaint with the courts alleging that all three judiciary officials managing the influence-trafficking probe — Rafecas, Righi and federal prosecutor Carlos Rivolo — had been conspiring against him and improperly leaking information to Argentina’s opposition media.

Rafecas was separated from the case, Righi resigned under pressure, and now Lijo must decide whether to separate Rivolo as well.

Opposition lawmakers on Monday repeated their calls for Boudou to resign, warning that his case could be a threat to President Cristina Fernandez.

“He needs to free the president from having to carry the risk of falling herself into the crime of an illegal coverup,” Margarita Stolbizer, an opposition deputy in congress, said in a statement.

It would be easier for the president to apologize for the error of choosing him than to become complicit in the scandal by trying to prop him up and block the justice system from taking action, she added. “What they’re imposing is a culture of such impunity that they can’t demand legal conduct from the rest of the citizens.”

The allegations against Boudou had slipped off Argentina’s front pages after Fernandez decided to take back control of the nation’s leading energy company, YPF, from Spanish shareholders.

“But now it’s come back with force,” raising questions about what the president knew and when, said Sergio Berensztein, director of the independent Poliarquia consulting firm in Buenos Aires.

Some of the allegations date back to when Boudou was a mid-level government official. Fernandez later promoted him to be her economy minister, and then again to be vice president in her second term.

“The question is whether Cristina knew about all this,” Berensztein said. “If not, it was an intelligence failure involving people around her. And if she knew about that, then the president herself is complicit.”

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NYT – Following Argentina, Bolivia Seizes Local Assets of Spanish Utility

By 
Published: May 1, 2012

MADRID — Bolivia on Tuesday seized control of the assets there of Red Eléctrica de España, a Spanish utility, a decision that the country’s president, Evo Morales, said was part of broader efforts to regain ownership of Bolivia’s natural resources and basic services.

The expropriation of Transportadora de Electricidad, or T.D.E., which operates a large part of Bolivia’s national electricity grid, is another abrupt setback for Spanish companies in Latin America, just weeks after President Cristina Fernández de Kirchner of Argentina announced that her government would take back majority control of YPF, an oil company, from Repsol, its Spanish parent.

Mr. Morales made his announcement from the government palace in La Paz during a May Day celebration only hours before he was to travel to southern Bolivia to inaugurate Repsol’s new natural gas plant there. He said the nationalization of T.D.E. was “a worthy homage to the workers and Bolivian people who have been fighting to get back natural resources and basic services.”

Mr. Morales said the expropriation was justified because Red Eléctrica had failed to invest sufficiently to develop its business in Bolivia, an argument the Kirchner government used against Repsol. Mr. Morales argued that Red Eléctrica had invested only $81 million in T.D.E. since it acquired the company in 2002. Mr. Morales said he had signed a decree to nationalize the company and ordered Gen. Tito Gandarillas, the commander of the armed forces, to immediately take over the management and assets of T.D.E. “on behalf of the Bolivian people.”

T.D.E. operates about 2,000 kilometers, or 1,250 miles, of electricity transmission lines across Bolivia. Neither the Spanish company nor the government in Madrid had an immediate response to Bolivia’s decision.

Since coming into office in early 2006, Mr. Morales has expropriated the local assets of other foreign investors, including those of GDF Suez, a French utility.

The turmoil in Latin America comes at a particularly difficult time for Spanish companies, which have grown increasingly reliant on earnings from the region to offset falling revenue in their home country, where unemployment has climbed to 24.4 percent.

NYT – Move on Oil Company Draws Praise in Argentina, Where Growth Continues

By 
Published: April 26, 2012

BUENOS AIRES — President Cristina Fernández de Kirchner ofArgentina has incurred the wrath of the European Union by expropriating a controlling stake in YPF S.A., the oil and gas company owned by the Spanish energy giant Repsol, prompting retaliatory salvos in a budding trans-Atlantic trade war.

But for many Argentines, the nationalization does not go far enough.

“They should expropriate 100 percent, not just a part of it,” said Fernando Solanas, a congressman and filmmaker who belongs to an opposition party. “Oil is a public interest.”

In seizing control of YPF, Mrs. Kirchner has adroitly shifted attention away from her country’s soaring inflationcapital flight and her own falling approval ratings, focusing instead on a longstanding subject of resentment here: the market-oriented policies of the 1990s, which preceded a severe economic crisis at the start of the last decade.

The nationalization has been so warmly received here that Argentina’s Senate voted 63 to 3 early Thursday to take control of YPF, the country’s leading energy company, during a lengthy special session in which most senators used their allotted time to laud Mrs. Kirchner’s initiative. Some members of the political opposition from oil and gas-producing provinces came close to tears expressing gratitude for the measure. The expropriation bill will be taken up on May 3 by Argentina’s lower house of Congress, where it is also expected to pass by a large margin.

Even Carlos Menem, the former president who oversaw the start of YPF’s privatization in 1992, now supports the takeover. “The scenario has changed,” said Mr. Menem, now a senator.

To critics here and abroad, the nationalization — and the readiness of many Argentines to invite a clash with Spain, one of their nation’s largest trading partners — is the kind of step that has made Argentina seem like a “truant of economic management,” in the words of Walter Molano, an American financial expert.

Indeed, some here contend that Argentina has gone to the dogs, literally. So many nervous citizens have taken their money out of the country that Argentina’s tax agency now uses Labrador retrievers trained to detect the ink used to print dollar bills in an effort to stanch capital flight at the airports, ferry terminal and bus terminal in Buenos Aires.

“It’s a marvel to watch them,” Ariel Viola, a tax agent at the Buquebus terminal, where ferries travel to Uruguay, said of the dogs. “They’re incredibly effective. They’ve smelled out millions of dollars travelers were attempting to smuggle.”

Capital flight accelerated to $22 billion in 2011 as fears spread over soaring inflation. Unofficial measures suggest that annual inflation is between 20 percent and 25 percent. But the authorities have fined researchers for disseminating such figures, and the official estimate stands at 9.8 percent.

Dollar-sniffing dogs and fines for publishing statistics might point to an economy in crisis. But Argentina’s is growing robustly, albeit at a slower pace than in recent years. A decade-long recovery has given Mrs. Kirchner broad support to pursue nationalist policies that sometimes perplex — and enrage — foreign banks, companies and governments, not to mention some Argentines who view her moves as a return to the protectionism that long hobbled the economy.

Riding an export boom for commodities like soybeans, Argentina’s economy grew at an average rate of 7.7 percent from 2004 to 2010, almost twice the average annual growth of 4.3 percent in Chile, a country often cited as a model for economic policies, over the same period.

Some controversy also swirls over the way Argentina officially measures economic growth, which the government said reached 9.2 percent in 2011. But even the I.M.F. sees Argentina growing 4.2 percent this year, a rate outstripping the 3 percent growth foreseen for Brazil, the region’s economic powerhouse.

Argentina’s postcollapse boom underscores the shifting fortunes on both sides of the Atlantic. Thousands of young Spanish emigrants have recently made their way to Buenos Aires; in the hipster restaurants of the city’s Palermo district, Spanish accents are heard among the wait staff and bartenders.

After Mrs. Kirchner was elected in 2007, succeeding her husband, Néstor Kirchner, as president, she increased social spending on programs like the “universal allocation per child,” which provides poor families with monthly cash stipends.

These programs, along with other antipoverty initiatives, reduced inequality, helping Mrs. Kirchner cruise to re-election in 2011. At the same time, the buying power of Argentines soared as incomes climbed and the government maintained controls on energy prices.

Meanwhile, YPF and other oil companies, wary of investing in a country where low energy prices curb profitability, limited spending that could have lifted energy production. The result: Argentina went from being an energy exporter to importing fuel from countries as far away as Qatar.

This reliance on foreign energy sources grew acute in the past year. The authorities now struggle with a $3 billion energy deficit to meet domestic demand for oil and natural gas, according to Esteban Fernández Medrano, an independent economist.

In addition to giving the government more control over Argentina’s energy industry, seizing YPF from Repsol also allows Mrs. Kirchner to tap into lingering bitterness over the policies that allowed many state companies to be sold more than a decade ago to private investors.

This sentiment, described as “anti-noventista” (roughly “anti-1990s”), is symbolized by the rise of La Cámpora, a nationalist youth organization led by Mrs. Kirchner’s 34-year-old son, Máximo. Members of La Cámpora now hold supervisory or senior management positions in nationalized companies like YPF and the state airline.

But the nation is also sharply divided politically, as symbolized by Mrs. Kirchner’s clashes with two leading newspapers, Clarín and La Nación, and her strengthening of an array of pro-government media organizations. Some here question whether the nationalizations, which have already encompassed seven companies in the two Kirchner administrations, will stop at YPF.

One company in Mrs. Kirchner’s cross hairs is Papel Prensa, Argentina’s only newsprint manufacturer. A new law calling newsprint a “commodity of public interest” allows the government to increase its stake in Papel Prensa, potentially taking control of the company away from Clarín and La Nación.

“We’re extremely concerned by the government’s maneuvering on this issue,” said Eduardo Lomanto, La Nación’s director. “It fits within a systematic plan for the domination of the media.”

Broadly popular social policies, like keeping energy prices low, have pleased Mrs. Kirchner’s constituents. But they come with costs, as reflected in Argentina’s yawning energy imports and the nationalization of YPF.

Galloping inflation is yet another cost, and price increases are absorbed largely by people without the means to try slipping packages of dollars past the dogs at the ferry terminal.

Ramona González, 43, a maid who lives in Florencio Varela, a city on the southern outskirts of Buenos Aires, said she was well aware of the state takeover of YPF. “What is Argentine should be Argentine.”

But she has other concerns. “Inflation is what is worrying me the most, not YPF,” she said.

Argentina’s Nationalistic Propaganda

For the occasion of this year’s Olimpic games, to be held in London, Argentina’s Olimpic Games add invokes imagery about the 30th anniversary of the Falklands War. The add affirms Argentine sovereignty over the islands and the country’s determination to have its territory back. Very intertaining!