Everybody’s favorite casual misogynist Mayor Mauricio Macri surprised no one yesterday when he publicly announced that the City of Buenos Aires will begin publishing its own measure of inflation. As the National Government’s pocket statistical data agency INDEC officially reports annual inflation at under 10% and private estimates land between 25% and 30%, we can safely assume that Macri’s (late) assessment that official inflation estimates are about as accurate as a drunk giraffe playing darts surprised no one.
It is the when and the how of this announcement that bears consideration.
Official inflation rates have seriously diverged from reality since the mid 2000s. In 2007, INDEC fired Graciela Bevacqua from her job as director of the inflation index for reporting monthly inflation as close to 2% rather than 1%. While at INDEC, she reported being harassed by then Domestic Trade Secretary Secretary Guillermo Moreno, and pressured to aim for zero inflation as a show of patriotism. Bevacqua went on to be ostracized in the dog-eat-dog world of statistician employment, and has instead produced and distributed for free her own consumer price index.
Though slightly less dramatic as harassing struggling independent statisticians, the Kirchner government has also fined independent inflation reporters and refuses to publicize its methodology (used loosely) for arriving at the annual 10% figure.
So why didn’t mathematician Mauricio Macri jump into the fray earlier?
Midterm elections are just around the corner in October, when half of the Lower House and a third of the Senate will be up for election. And while other problems such as the parallel currency market, inability to import parts to repair elevators or surgical implants for broken bones, and unsustainable subsidies are certainly important, the majority of voters don’t really feel bad that the upper class is having a slightly harder time vacationing in Miami due to the inability to buy dollars.
In his speech announcing the new inflation measure, Macri repeatedly emphasized that inflation is the worst kind of punishment on the poor, a scam that affects the poor, and is a tax on the population. And that is true. While the vast majority of the population isn’t vacationing in Punta del Este and likely couldn’t care less about imported elevator parts, those extra pesos that keep creeping into the prices of choripan, mate, and asado bite. Hard. And while spoiled yanquis like me can survive the monthly 2% increase in the cost of living, they really really can’t.
And lets not forget, in February the IMF censured Argentina and gave it until September 29 2013 to adopt measures that repair the inaccurate reporting of both inflation and GDP and implement transparent methodology that is up to international standards. And lo and behold, Macri’s measure will use “an international methodology” and all data gathered will be made available to the public! Hmm. Coincidence? I think not.
So basically in one fell swoop Macri has launched himself further onto the international stage and pandered to the populism of the poor.
Well played, sir. Well played indeed.