From Volume 38, Issue 31 of EIR Online, Published August 12, 2011

Ibero-American News Digest

Argentina Says: Rating Agencies Be Damned!

Aug. 5 (EIRNS)—Standard & Poor's, Moody's, and Fitch rating agencies don't make honest appraisals of a country's risk, Argentine President Cristina Fernández de Kirchner declared recently. Rather, she said, as occurred during Argentina's late-1990s debt crisis, which culminated in the 2001 default, these agencies deliver only "political punishments."

In terms of the current Eurozone meltdown, Fernández remarked on July 13 that European governments didn't mind when the "Big Three" rated Argentina unfavorably ten years ago. But now that they are getting poor ratings, "they don't just want to change the rules; they want to eliminate these agencies, [a proposal] we share, but we proposed this quite some time ago."

In this and other speeches, the Argentine President has noted the "paradox" that still today, the rating agencies say Argentina's default risk is higher than that of Spain or Greece, despite Argentina's high economic growth rates and successful restructuring of its defaulted debt. This "punishment" is lawful, she explained on July 19. It would look bad for the agencies if a country that had rejected the neoliberal prescriptions of the Washington consensus turned out to be successful.

Speaking on July 25, Social Development Minister Alicia Kirchner, sister of the late President Néstor Kirchner, and a political leader in her own right, echoed Fernández's attack, pointing to "the often determining role rating agencies have had in many countries, be it in the origin or in the unfolding of their economic and financial catastrophes. We can say without fear of error, that [the agencies] have caused grave consequences for populations as a whole."

As the rating agencies aren't a State, Kirchner said, "our first conclusion is that they only represent the market. Thus we can identify the interests to which they answer and their ulterior motives.... They operate globally, evaluating, rating and issuing opinions in order to create consensus and false assurances that guarantee the expansion of concentrated financial capital."

Soros's Drug Legalizers Under the Gun

Aug. 7 (EIRNS)—It's no surprise that another of drug kingpin George Soros's Argentine assets, drug legalizer and former terrorist bomb-thrower Horacio Verbitsky, rushed to the defense of Supreme Court Judge Eugenio Raúl Zaffaroni. Verbitsky cohort Zaffaroni, also a loud proponent of drug legalization, is embroiled in a scandal over the recent revelation that 6 of 15 apartments he owns in Buenos Aires are currently being used as whorehouses.

On Aug. 4, the Legal and Social Studies Center (CELS), the human rights outfit founded by Verbitsky, issued a statement charging that Zaffaroni was being attacked on the basis of "scandalous" accusations and "imprecise" information, "with a high content of hypocrisy." CELS decried efforts to "demonize" the poor judge, when "we don't even know if a crime was committed!"

Verbitsky jumped into the fray as rumors of Zaffaroni's resignation were sweeping through social and political networks, and when opposition legislators and politicians were charging that Zaffaroni had improperly advised the current government on drug policy.

In fact, the government is vulnerable on this point. On advice from Verbitsky and her own chief of staff Aníbal Fernández, President Cristina Fernández and her late husband and former President Néstor Kirchner had stupidly supported the proposal to decriminalize drugs for "personal" consumption. Aníbal Fernández has often appeared with Zaffaroni at public Soros-sponsored drug legalization conferences,

In Peru, where there is no shortage of Soros agents, events have taken an interesting turn. For the moment at least, new President Ollanta Humala, a tool of the British Empire's pro-narcoterrorist project, has apparently decided not to replicate the Kirchners' dangerous foolishness by endorsing drug legalization. Among other things, circulation of EIR's exposé of the Humala project, written by correspondent Luis Vásquez Medina, likely influenced his decision.

During his July 28 inauguration speech, Humala stated that "we will carry out a policy against drugs which consolidates the Peruvian model of integral and sustainable alternative development to convert producers, who are today illegal, into agents of a legal economy." He vowed that he would not ignore the "alarming increase of drugs among adolescents and youth," and "will not legalize any drugs or illicit crops," although he would "respect" the drug legalization debate occurring inside and outside the country. He underscored that he would be "inflexible" in regulating chemical precursors and "in combating the narcoterrorist bands."

No Letup in Chilean Upheaval

Aug. 7 (EIRNS)—Chile continues to be shaken by growing protests, led by high-school and college students who are demanding a return to the free, state-run quality education system that existed prior to the Sept. 11, 1973 coup that brought fascist dictator Augusto Pinochet to power.

On Aug. 4, when high-school students tried to march to Plaza Italia in downtown Santiago, special anti-riot squads responded brutally with tear gas and water cannons, arresting 874 students in the process. College student leaders canceled a march scheduled for 6:30 p.m. that same day, and Camila Vallejo of the Chilean Student Federation (Confech) told media that Santiago today "looks like the Santiago of 30 years ago," under the Pinochet dictatorship, "barricaded and under siege." At 9:00 that evening, citizens across the capital, and in several other cities, carried out a loud pots-and-pans demonstration from their windows and doors to protest the government's brutal repression of students.

President Sebastián Piñera, who has seen his approval rating skid from 31% on July 20 to 26% on Aug. 2, appears incapable of dealing with a protest that now extends well beyond student organizations into broader layers of society. Some analysts are referring to the current upheaval as the "Chilean Winter"—the local version of the "Arab Spring." The education issue has become emblematic of the population's widespread discontent with the economic legacy of the Pinochet dictatorship's free-market model.

The government's cause wasn't helped by remarks from Carlos Larraín, head of Piñera's National Renovation party, who charged that the protesters were merely "useless subversives." Student leaders are calling for Interior Minister Rodrigo Hinzpeter to resign, holding him responsible for brutal repression of student protesters. Confech leader Camila Vallejo has received death threats, including one from an official of the Culture Ministry who sent out a Twitter message saying that Vallejo would be better off dead.

Undeterred, college students called for a national strike to be held on Tuesday, Aug. 9.

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