Argentina Wants To Keep Its Inflation in the Bag


Inflation Cat in Bag

Argentina's novel solution to inflation? Silence anyone with evidence that it exists. The Argentinian government issued $125,000 fines and criminal charges to at least two private economists who published data contradicting official inflation figures, The Washington Post reports.

Plenty of people aren't buying the official numbers, however:

"No one believes the government's statistics — not the [International Monetary Fund], not the World Bank, not the U.N.," said Robert Shapiro, who helps oversee a Washington group lobbying for Argentina to pay its debt to American investors. "You can't change underlying economic reality by decreeing it isn't so."…

Labor unions, for instance, routinely seek and win 30 percent annual raises for workers, not the single-digit increases that would be expected were the inflation rate as low as the government contends. Public spending also rises at that rate. Even a government-organized commission of economists from five universities concluded that the official inflation figure was vastly lower than the real rate.

The official inflation rate began to fall in 2007, the same year political appointees replaced statisticians at Argentina's National Institute of Statistics and Censuses. Unofficial sources contend actual inflation levels began to skyrocket around the same time says The Post.

President Cristina Fernandez de Kirchner, whose approval rating dropped as low as 20 percent in 2009, didn't have to actually improve Argentina's economy to win reelection by a landslide last month. She just had to convince voters that she had. 

Argentina has thus far managed to partially shirk responsibility for its reckless policies by refusing to pay back international debts. They defaulted on $100 billion back in 2001, the largest sovereign debt default in history. The country "has since defied numerous judgments from U.S. courts to pay up," and still owes another $22 billion.

Thankfully, there are some sensible voices in South America's second-largest economy:

Some pressure has been taken off by congressman Ricardo Gil Lavedra and other opposition lawmakers. They have begun a monthly compilation of the average rate of inflation from data provided by the consultants and are publicly releasing the numbers.

"This is about more than just having a good set of data," Gil Lavedra said. "This is about respecting the right of free expression."

Reason on inflation here, here, and here, and international economics here.

Matt Welch talking inflation among other things on Freedom Watch below.

H/T to the acrimonious John

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  1. Beloved, acromonyous, neglected, it is all true.

    1. I like the alt-text and photo...WATCH OUT LUCY! We are a fickle bunch.

      1. Ouch.

        I approved the alt text. If that helps.

        1. just sayin' Free Minds, Free Markets includes random anonymous internet tuff gai accolades.

          1. A million points for spelling it "tuff gai."

    2. "link via dysgraphic commenter John"

      1. "link via dysgraphic commenter Jonh"


      2. And he complains about OO.

        1. Posts may contain more than their share of typos. But they are in the English language. OO is in molespeak.

          1. blackberry grampz )

            1. Blackberry prevents you from using English?

          2. moar like [WINGNUTZ]

          3. Trucknutz rusharrhea bibbledy boo.

      3. "Link via Argintineous commenter John"

    3. John is getting too many adjectives. He only needs one adjective to survive, why should he be able to loot so many from Reason while there are people in the comments section go adjectiveless. I demand new regulations for the comments section and that the Reason be given more power over commenting so that they can more equitably distribute adjectives.

      I am the 99%

      #Occupy John's Computer

      1. Well done.

      2. Excuse me while I fix my tophat and monocle and twirl my mustache and enjoy my incredible wealth of advectives. While just yesterday my Duesenberg ran over a small child who died without a single adjective.

        1. It doesn't count if you didn't have freshly cut flowers in all of the car vases, I mean vaaaases. We may hate children but we don't do things by halves.

      3. Me at home enjoying my adjectives.

        1. You obviously care not for the increasing adjective inequality, you monster.

        2. Looks like you live Dracula's castle.

        3. That's a pretty sweet lookin' pipe organ you've got there, guy.

      4. I have been called Noble and Inexplicable.

      5. I still contend that sans adjective, that's Reason's way of calling you "forgettable".

  2. well, at least 125K isn't as much as it used to be. They've got that going for em.

    1. Correct - Technically the fine was 500,000 pesos which is dropping fast.

  3. Wow, 2 H/Ts in one day. What's in those pictures you have of the Reason staff, John?

    1. If I told you, they wouldn't be any good anymore.

      1. I heard it had something to do with midget hookers, a Carter mask, Ruffies and smuggling a live donkey onto the Reason cruise.

        1. Please, the donkey wasn't alive.

            1. If you're lucky enough to die, pray that you stay dead.


  4. Argentinians: Squandering the world's best real estate since 1946.

    1. I believe they go by Argentines. And yes. That country should be paradise. They have everything from beaches to great skiing and like every other Latin American country an enormous supply of hot women.

      1. They're squandering Messi too.

        1. How does a traditional power have the best player in the world and still suck?

      2. And who can forgive them for the crime that is Malbec?

        1. Crime my ass. It was neglected grape the idiot frogs didn't know how to properly utilize. Thank God for them rescueing it.

          1. I agree, I'm a big fan of Malbec.

          2. That one was just for you.

            Malbec turns me off. But I love Carmenere from Chile.

            1. No accounting for taste. I like Rioja from Spain a lot.

              1. Absolutely love Rioja and Del Rubio. I've got 20+ bottles of the good ones down in the cellar.

              2. Red tasteless water.

                1. which post are you replying to?

                  1. Rioja. I have a wide acceptablity profile for my pallate. I can't abide Spanish Reds however. They are to old world wines what Guiness is to Stout beer...watery and tasteless.

                    (for the record, if you don't need a knife and fork to drink a stout then you are not drinking a stout.)

                    1. I disagree, but then I don't buy cheap Rioja either.

                    2. I really like Garnacha (Grenache) from Spain as well. They're usually under ten bucks.

                    3. I can't abide Spanish Reds however. They are to old world wines what Guinness is to Stout beer...watery and tasteless.

                      Depends on the Rioja, I suppose. I've had CVNEs (or CUNE, I can never remember which) that could fall under that description. Whole lot of newer-styled Riojas from e.g. Caceres, are a lot richer, and don't show nearly the wood influence of older Reserva and Gran Reservas. And then there's Ribera del Duero...

                      Nifty grape, Tempranillo.

                    4. "Ribera del Duero..."

                      That's the one my feeble brain was reaching for earlier!

        2. The South American wine cost to taste ratio is far superior to European stuff. I enjoy a $10 malbec or carmenere quite regularly.

          1. I disagree, you can't beat Spanish wines. You can get a great Tempranillo for $10 or less.

            With any luck, the impending collapse of the Eurozone will drive all Euro wine prices to the floor.

            1. There is a Spanish wine called Protocolo. You can get it in red or white for less than 10 bucks a bottle. It is very good table wine. Great for parties. People will think you splurged and are serving them 20 dollar wine.

              1. Spain produced crap for ages (like Chianti in Tuscany). It's only in the last decade that the vineyards started managing for quality instead of volume (they're blessed with 100+ year old vineyards) and wineries started putting out quality wines.

                Sssshhhh! It's still a secret so prices haven't risen accordingly.

                1. The Spanish wines are currently good, but you still can't beat Chilean reds for the combo of quality and price. You can get really, really good shit for under $10/bottle.

                  1. Since I also make wine and mead at home, I almost never buy a bottle of wine for under 10 bucks. I buy higher-end wines that I can't make myself because I just don't have access to good grapes in Iowa.

                    So $20 buys a bitching Rioja and $40 buys Rioja as good or better than high-end Napa Cabs that cost $80 bucks (and I have both tucked away downstairs).

                  2. I will admint that a 10 dollar Rioja and a 10 dollar Cab from Chile gives you about the best contrast you can get between old-world and new-world styles with out spending big bucks.

                  3. To Epi's 4:09-
                    New Zealand, Chilean, Central Coast, Hell even missouri all have excellent wines that are 10 or less.

            2. Try Callabriga from Portugal.

              1. To be fair I usually use the phrase " I have not found a Spanish wine I like" to imply the possibility exists there is one i like...a slim possibility but there none the less.

                1. Ohh, and if any of you are one of those people that think Chianti is so beneath you that it is only for housewarming gifts then please, next time I buy a new house feel free to get a bottle of Villa Antnori Classico Reserva. I promise not to be offended.

                  1. I go straight to the Brunello di Montalcino section in the wine shop.

                    1. Brunello certainly counts as a higher-end wine. I still remember the one time I tried Lisini's version. Bottled roses.

                      I'm weak on Italian wines, but I have liked Ruffino's Chianti Classico "Oro". Falesco's stuff, though not Sangiovese, is pretty tasty too. Argiolas makes inexpensive wine from, IIRC, Sardinia, and I've always liked Allegrini's Palazzo della Torre.

                    2. Some of the worst wines in the world are made with Sangiovese.

                      And some of the best.

                      Table stakes for Brunello is $45 to $55 a bottle.

                      Can't forget the Nebbiolo-based Barolo or Barbaresco either.

                    3. "Allegrini's Palazzo della Torre."

                      Have half a case of this in the cellar.

  5. OMG Matt grew a beard and looks just like Sullum!

  6. MAybe they should re-invade the Falklands, it's not like the Brits could do anything about it now.

  7. "You can't change underlying economic reality by decreeing it isn't so."

    The People's Republic of Argentina will not tolerate such counterrevolutionary outbursts!

    There's a Rand quote somewhere in here...

  8. Threadjack:
    Florida trooper arrests Miami cop.

    1. bdoubled (Nov 02, 2011 3:24pm)
      What does it mean when a fart goes through your cooter lips?

      I swear this isn't me.

      1. We believe you. The idea that you wouldn't know what a 'queef' is, is risible.

      2. Maybe it's one of your illegitimate offspring. The apple doesn't fall far from the tree, you know. Trust me, I know.

    2. How does it end?

      1. When the officer finally came to a stop, the trooper drew her gun in fear the car had been stolen.

        When that wasn't the case, she handcuffed the officer just like she would anyone else.
        In the footage, Officer Fausto Lopez, who was being arrested, can be heard saying, "Honestly, the handcuffs are not necessary, ma'am," adding that he intended to be fully cooperative.

        "'You know, what you are to me? You are a criminal," responded FHP trooper D.J. Watts.

        Lopez said he was trying to get to his off-duty job at a school. He was cited with a misdemeanor moving violation.

        1. I wouldn't want to be a trooper rolling a stop sign in Miami.

    3. Wow. Cop Mentality Sgt. Javier Ortiz, vice president of the Fraternal Order of Police, said he sees the trooper involved in the incident as "someone who abused her power."

  9. I guess free speech isn't so free.

  10. "You can't change underlying economic reality by decreeing it isn't so."

    Somebody should tell Krugabe. And Biden.

    1. Like all bad news that occurs during the reign of the Black Jesus, it is unexpected. Growth unexpectedly lower will be the phrase in the state run media on page 30 just below the pork belly prices.

      1. Speaking of pork belly prices, when the hell did bacon get so goddamn expensive?

        I bought a pack for the first time in a while the other day and it was like $7. And that's for Bar-S bacon, not even the fancy schmancy organic stuff. No wonder so many people are on foodstamps... shit I might have to get on that gravy train so I can get some nicer cuts of meat and higher quality booze.

        1. Yeah, it's been that way for a while. I was thinking it was just because it was Seattle, where food prices are stupid high, but now I'm noticing that everything is up.

          Trader Joe's has an ok price on bacon and a fantastic price on jumbo eggs, by the way.

    2. They are now predicting that unemployment will be 7.8-8.2% in two years and long term will be 5.2-6.0%. Good think the recession ended awhile ago. Could you imagine what those numbers would look like if we weren't in the midst of a recovery?

      1. Given their track record, the 7.8% predictions are pure fantasy. In 2009 what were they saying the unemployment rate was going to be in 2011? I bet 7.8-8.2%. The recovery is just around the corner. They promise.

        1. Remember when the media used to whine about Bush 2's 'jobless recovery'?

          1. Worst economic record since Hoover. Remember them saying that. Do a google search for "Obama Hoover" and I bet you don't get a single main stream publication come up.

            1. Yeah and FDR was the worst economic record since Hoover in the first place.

              1. No FDR saved the world and put a chicken in every pot. What are you some kind of nut?

        2. We're going to have Euro-levels of unemployment for the foreseeable future unless some major economic opportunity happens. Basically, something on the scale of the Internet.

          Luckily, cold fusion is only 10 years away 😛

          1. A global war would probably do the job.

  11. On the plus side, if Obama levied a fine against anyone who suggested that the stimulus didn't work, or that the bailouts were a massive mistake, or that his various jobs bills aren't worth their weight in Weimar Marks, he'd close the budget gap in a matter of months.

    1. We'd be safe.

  12. I go to these guys for a laugh:
    Personal income increased $17.3 billion, or 0.1 percent, and disposable personal income (DPI)
    increased $12.9 billion, or 0.1 percent, in September, according to the Bureau of Economic Analysis.

    See, that's government grade numbers crunching.

    1. I used to do the government numbers reporting for my company. Made up the numbers all the time - who had time to look up all the inane crap they wanted to know?

  13. "'You know, what you are to me? You are a criminal," responded FHP trooper D.J. Watts.

    Don't worry, Bub; she says that to everybody.

  14. somebody help me out here, I thought defaulting on your debt means you dont have to pay it back. You suffer the consequences of higher interest rates, borrowing costs, loss of reputation etc.

    So what is meant by the statement -- "Argentina has thus far managed to partially shirk responsibility for its reckless policies by refusing to pay back international debts. They defaulted on $100 billion back in 2001, the largest sovereign debt default in history. The country "has since defied numerous judgments from U.S. courts to pay up," and still owes another $22 billion.

    I thought they defaulted.

    1. When you default on your home loan, the bank reposses the collateral. The loan doesn't go away until it's discharged by a judge in bankruptcy court.

      1. And so what is the international equivalency of bankruptcy court? Seems like Im reading about how Iceland has turned their economic situation around in a couple years by telling the EU and IMF to go to hell. Isnt Argentina doing something similar?

  15. "You can't change underlying economic reality by decreeing it isn't so."...

    Pppt. Works for me!

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