Argentina | The Illusionary Poor

Politicians debate the level of poverty while prices keep rising

Slums such as Villa Soldati receive desperately little by way of public services. Natacha Pisarenko / AP Photo
01 July, 2014

YOU COULD SMELL THE VEGETABLES being stewed from a few blocks away. The aroma pricked the noses of a group of the gendarmería—a security force with part-military and part-police functions. A few of them, wearing army green, were on alert under an overpass in south-west Buenos Aires that separates Flores, an area of middle- and working-class housing, from a neighbouring slum, or villa. The smell was coming from the Los Piletones Foundation in Villa Soldati, as the slum is known, where, every mealtime for five days a week, about five hundred people come for free meals. Since it was founded in a shed 18 years ago, the foundation has been transformed to hold two kitchens, a kindergarten, library and Saturday school, as well as medical and veterinary centres. Poor people from across the south of the Argentine capital come here to receive help they cannot get elsewhere—special foods for elderly diabetics, for example.

From one side of the overpass to the next the streets changed from tar to mud, and the May-morning rain had made a mess of them. About 15,000 people live in the ten blocks of Villa Soldati, in three and four-storey houses, from which the rain now dripped down. A dozen or so bedraggled stray dogs clamoured among people carrying pots wrapped in plastic bags, entering and exiting the Los Piletones dining hall. The foundation runs mostly on donations from private businesses and individuals. The city government supplies some bread, but it’s all gone before the end of breakfast. Isa, a volunteer cook, said food has had to be rationed in the last few years. Before, from about 2005 to 2010, when times were good, they had more donations and less people coming to eat, she explained. Now, it’s the other way around.

Not that President Cristina Fernández de Kirchner’s government would let on. The latest figures from the national statistics agency, INDEC, for the first half of 2013, put 4.7 percent of Argentina’s 41 million people below the poverty line. INDEC was supposed to release new data in April, but said it could not. Jorge Capitanich, Kirchner’s chief of staff, blamed the lack of new figures on a change in the basket of goods used to calculate the consumer price index, and said INDEC didn’t yet have the right methodology to work out a revised poverty level. Meanwhile, the Catholic University of Argentina, like other independent groups, says the poverty level is currently running at about 27 percent—which would account for more than 11 million people. In May, Capitanich faced fierce questioning in the Congress over the lack of government data on poverty. He has argued that the government does not hide information, and that official data on inflation, and consequently on poverty, are objective. He has also said that independent statistics are politically motivated—no doubt referring to the nebulous “enemies” of the ruling Front for Victory party, whom Kirchner and her supporters often accuse of trying to destabilise the government. As in the magic realism of Jorge Luis Borges, the country’s most celebrated writer, what is objective fact and what is illusion is unclear, and has been for several years now in Argentina.

Gabriella Apaza’s broad smile attracted attention as she walked through the Los Piletones dining hall. A 27-year-old resident of Villa Soldati, she has worked outside the villa but prefers to volunteer at the foundation and receive free food. As for most of Argentina’s poor, buying food is one of the biggest pressures she faces, intensified by the tightening noose of inflation. “Food prices have gone up almost double in the last two years,” Apaza said. “If I didn’t get it for free, life would be much harder.” Independent groups put the annual inflation rate at 30 percent or higher. For 2012 and 2013, INDEC calculated a rate of about a third of that. The International Monetary Fund, in February last year, censured the government for unreliable economic data—a rare step for the body to take against a sovereign nation. Eventually spurred into action, this February INDEC reformed its basket of goods and said inflation was just under 4 percent—about double its previous monthly rate, and correlating closely with independent groups’ year-on-year estimates. But, by April, INDEC’s monthly rate was back down to 1.8 percent.

Argentina has 1,834 villas, holding 532,800 families, according to the non-governmental organisation Techo, which works in informal settlements across the country. The national census shows that the number of slum residents in Buenos Aires grew by just over 50 percent from 2001 to 2010. Many of those living in the villas are immigrants, particularly from neighbouring countries such as Bolivia and Paraguay, who come to Argentina to find work. People in Villa Soldati estimated that about 70 percent of the slum’s population is foreign. Most other residents, they said, are from Argentina’s poorer northern provinces, such as Chaco and Salta. Techo’s research shows how few services the villas receive: 95 percent of settlements lack a sewage system, and 74 percent do not have formal access to power; 90 percent of villa families do not have access to running water, and 15 percent dispose of excrement in cesspits, without septic tanks. In Villa Soldati, residents have lost patience with the city government’s promises of electricity and hooked up illegal connections.

Poverty has long been politicised in Argentina. Kirchner is a Peronist—an adherent of the political movement started in the 1940s by the former president Juan Perón. Perón fought for Argentina’s “shirtless” working poor against corporate interests, and left a legacy of promoting social security. Today, Peronism is claimed by broad and diverse interests, and still holds strong electoral appeal. Kirchner and her predecessor, her late husband Néstor Kirchner, gained political support by advocating social inclusion. The Kirchners’ rule prospered alongside Latin America’s commodities boom; their social spending was funded partly by profits from soya grown in the bountiful, sparsely populated countryside. Commodity prices have now declined. Yet Kirchner still wants to seem a purveyor of inclusion—whether real or fake—until she finishes her final term, towards the end of next year.

Since 2007, Kirchner has increased welfare spending, as her husband did in the four years before her. The Argentine economist Luis Secco computed that public spending as a portion of GDP grew from 22 percent in 2002 to 44 percent last year. Under Kirchner, the extra funding has paid for more public-sector jobs, large energy subsidies, and the widely praised Universal Child Allowance—a programme started in 2009 that gives money to parents if their children attend school. Liliana Rolon, who lives in Villa Soldati with her husband and three children, gets 1,100 pesos a

month under the scheme. It’s the only government subsidy she receives. Life is tough with children, she said. With the money she saves by taking food from the foundation, she can pay for her children’s study materials and transportation to school, and so qualify for the allowance. Virgilio Gregorini, the executive director of Techo, said the Universal Child Allowance “is one of the government’s positive impacts on poverty,” alongside its efforts to help people find formal jobs and revive debates on access to employment. But, he argued, “What is being done at all levels of government is insufficient, not only in remediation policies, but also in prevention policies.”

Critics of the government view its regime of subsidies, price controls, social benefits and public sector jobs as at best ineffective, and at worst counter-productive, in fighting poverty. Agustin Etchebarne, director of the Argentine research centre Liberty and Progress, said the government is “lying about poverty,” and called its use of handouts “simply populist.” “The effect on people is probably bad in many different ways,” he added. “The government misses the point:  the best social plan is a real job.” Most work done by villa residents is in the informal sector, where hours are long and conditions bad. IERAL, an Argentine economic research organisation, estimates that among the country’s lowest earning households on average $3.5 of every $10 earned comes from informal work, and $3 from formal employment. Only about $1 comes from social support, suggesting that despite the government’s extensive spending, its help doesn’t necessarily reach the very poor. Eduardo Amadeo is a former congressman and ex-minister for social development, and the chair of the Social Observatory Foundation, a non-governmental organisation. He said the government has neither a good theoretical understanding of impoverishment, nor the technical capacity to deal with the problem. Neither INDEC nor the government appear proactive in dispelling such criticisms, and did not fulfill requests for interviews for this article.

The Buenos Aires sun warmed thousands of protesters one Wednesday afternoon in May. Green, blue and white flags and banners of unions and movements—for rubbish pickers, factory workers, pensioners—filled Plaza de Mayo, the square outside the presidential mansion in the centre of the capital. Portable parrillas—Argentine barbeques—sent the smell of cheap grilled meat down the avenues off the square. The villas and their illusionary poverty had come to the president’s door. The demonstrators were protesting poverty, inflation and rising violent crime. In the two months before the event, there had been nationwide strikes, and public school teachers had refused to start the term because of a pay dispute. When police halted work in December as they demanded higher wages to account for inflation, looting and unrest spread to 19 of the country’s 23 provinces.

Popular resistance in Argentina dates back almost a century, and it’s ongoing with reason. Many locals have lived through military rule in the 1970s and 1980s, hyperinflation and food riots in the 1980s, and austerity in the 1990s. An economic crash in 2001 decimated the savings of the working class and much of the middle class, and provoked widespread social unrest. Questions persist about whether chaos will come to the country again. Amadeo, who has worked in government since the 1980s, said he doesn’t think the situation is as bad as during that time. But, he warned, “if the economy enters a period of high unemployment and inflation continues, it will only increase the social protest.”