Alberto Fernández busied himself on Christmas Eve and Christmas to find a technical solution that would allow him to abide by the ruling in favor of the City of Buenos Aires issued by the Supreme Court, despite supporting three days before the political position of fourteen pro-government governors who decided to repel that institutional decision taken unanimously on the Fourth Floor of the Palace of Courts .
The technical solution implied abiding by the Court’s ruling without affecting items that compromised the shared funds of the Peronist governors and without violating the goals of the agreement with the International Monetary Fund (IMF). A financial intricacies colored by the palace inmates and the future electoral campaign.
The provincial leaders of the Frente de Todos believed that Alberto Fernández had already said his last word as Christmas Eve approached, and they chewed glass and sand when they learned that the President was turning on his steps and was looking for a technical alternative to preserve the constitutional order and comply with the Court’s ruling.
Alberto Fernández did not want to move alone and opened a round of consultations with the main leaders of the Frente de Todos to find a financial solution to the final order of the high court.
Cristina Fernández de Kirchner empowered the Treasury attorney, Carlos Zannini; Sergio Massa made his Legal and Technical Secretary, Ricardo Casal, available, and the president appointed the Deputy Chief of Staff, Juan Manuel Olmos, and the Legal and Technical Secretary, Vilma Ibarra.
This heterogeneous pack with different political interests They exchanged information among themselves and then reported to their respective supporters. The head of state was in Chapadmalal and refined the technical solution in constant conversations with Ibarra and Olmos, who later pivoted with the bishops of the vice president and the Minister of Economy.
Already at Christmas, the proposal was fine-tuned: Alberto Fernández would offer to comply with the Court’s ruling through public securities that expire in 2031 and that would be deposited every day in a Banco Nación account that would be opened for those purposes. The President would pay the total ordered by the high court (2.95 of the GDP) and in this way -he believed- that he would avoid violating the Constitution and being at the mercy of a probable complaint in Comodoro Py.
Attorney Zannini delivered all the information on the presidential proposal to Cristina Fernández de Kirchner. The vice president took note of the matter, avoided speaking with Alberto Fernández and remained silent when the head of state tweeted the proposal addressed to the Court and the City of Buenos Aires.
CFK does not want to appear next to the President. And today in Avellaneda it will be known if he supports his position or will demand another institutional decision to face the Court and ignore its ruling in favor of the Buenos Aires government.
Sergio Massa had a different political attitude. The Minister of Economy spoke with Alberto Fernández when Christmas was ending, and in that conversation he learned all the details of the presidential move that would take place hours later. Massa shares the decision of the head of statebut his political communication strategy is to appear only on matters related to the Palacio de Hacienda.
It is unlikely that the Supreme Court will accept the financial initiative presented by Alberto Fernández on his official Twitter account. The President knows that the Court always demands weights in its rulings and a bond that is undervalued in the market and due in 2031 cannot replace hard cash.
Pesos and bonds are not similar instruments. They are not expendable things. In this case, silver is worth more than a public title that matures in eight years, if identical values are taken. The TX2031 bond is a depreciated paper in the secondary market.
When the time comes, the high court could order the Government to liquidate the bonds that expire in 2031 every day and with the cash cancel the debt that it maintains with the City for its federal co-participation.
Alberto Fernández should have no problems, if the Court fails in this regard: during 2023 he must pay close to 110,000 million pesos, and Massa has close to 400,000 million pesos in those titles that few trade in the market.
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