ARGENTINA: 2007 PRESIDENTIAL CAMPAIGN STARTS EARLY

UNCLAS SECTION 01 OF 02 BUENOS AIRES 001309 SIPDIS SENSITIVE SIPDIS STATE FOR WHA TOM SHANNON, JOHN MAISTO, AND CHARLES SHAPIRO NSC FOR DAN FISK TREASURY FOR DAS NANCY LEE USCINCSO FOR POLAD E.O. 12958: N/A TAGS: PGOV PHUM PREL AR SUBJECT: ARGENTINA: 2007 PRESIDENTIAL CAMPAIGN STARTS EARLY REF: A. BUENOS AIRES 01243 ¶B. BUENOS AIRES 00902 ¶1. (SBU) SUMMARY: Former Minister of the Economy Roberto Lavagna's recent steps towards a likely presidential run has opened the 2007 presidential campaign early, with President Nestor Kirchner finally admitting that either he or his wife will be the "official" candidate and center-right Republican Proposal (PRO) leader Mauricio Macri essentially declaring his candidacy. Opposition leaders have chosen to define their candidacies early in large part due to their perception that President Kirchner may move up the date of the presidential elections from October 2007 to March 2007. Kirchner's strident criticism of Lavagna in the past few days shows that he is concerned about Lavagna's candidacy, although his public attacks against Lavagna and those of his ministers have only served to increase the public attention around the former Economy Minister. Lavagna's criticism of Kirchner's policies has forced the GOA into a rare debate with the opposition over policy issues. Although polls still show that Kirchner would win reelection if elections were held today, with the recent additions to the list of 2007 presidential aspirants, the 2007 election campaign stands to be more competitive and interesting than previously thought. END SUMMARY. ¶2. (SBU) Former Minister of the Economy Roberto Lavagna's recent steps towards a likely presidential run has opened the 2007 presidential campaign early (SEE REFTEL A). Following Lavagna's public criticism of GOA policy and apparent initial moves towards a presidential run, President Kirchner on June 2 said for the first time that either he would run for reelection or his wife would be the "official" presidential candidate for 2007. In a June 8 interview with circulation-leading daily Clarin, center-right PRO leader Mauricio Macri said that "he was ready to be a candidate for president," although his formal announcement will likely not come until later this year. Affirmation for an Egalitarian Republic (ARI) leader Elisa Carrio formally announced her candidacy on May 26. PRO partner, Neuquen Governor Jorge Sobisch, remains a presidential contender after having announced his presidential candidacy last year. (Comment: Sobisch has tried to maintain a public positive attitude about Macri and Lavagna stepping into the presidential ring, saying that he does not view their candidacies negatively. Sobisch has suggested holding an internal election to decide whether he or Macri should be PRO's presidential candidate, but his recent positive statements about both Macri and Lavagna may be an indication he is vying to be the vice presidential candidate of one of them, recognizing that polls show Sobisch's chances of winning a presidential contest are slim. End Comment.) ¶3. (SBU) Opposition leaders have chosen to define their candidacies early in large part due to their perception that President Kirchner may move up the date of the presidential elections from October 2007 to March 2007. Radical Civic Union (UCR) national congressman Hugo Storero, echoing what other opposition contacts, recently told Poloff that he is convinced that Kirchner will move up the presidential elections to March in order to take advantage of the current favorable economic situation to win reelection. As one political analyst told Poloff, "I can't see there ever being a more favorable situation for Kirchner to win reelection. He (Kirchner) has to realize this. The more he waits, the more chances there are for something to go wrong." (Note: President Kirchner's current term technically goes until December 2007, although there is some leeway in the Argentine Constitution on when the presidential elections should be held in 2007, which states that the presidential term is four years long. Kirchner served out the last seven months of Eduardo Duhalde's term in 2003 when Duhalde called early elections. Kirchner's officials have declared October 28, 2007 as the official presidential election date and leading Casa Rosada political strategist Juan Carlos Mazzon told the DCM and Poloff in April that the election would be held in October 2007 - SEE REFTEL B. End Note.) BUENOS AIR 00001309 002 OF 002 ¶4. (SBU) Kirchner's strident criticism of Lavagna in the past few days shows that he is concerned about Lavagna's candidacy, although his public attacks against Lavagna and those of his ministers have only served to increase the public attention around the former Economy Minister. As one political analyst told Poloff, "Kirchner should have remained silent about Lavagna's presidential rumblings, or at least said that he enjoyed working with Lavagna and that he found it odd he would be criticizing policies that he was a part of. By attacking him publicly, Kirchner just raises the importance of Lavagna in the public eye and makes people think he is scared." ¶5. (SBU) Lavagna's criticism of Kirchner's policies has forced the GOA into rare debate with the opposition over policy issues. Lavagna has attacked the GOA's price control policy, state subsidies, energy policy, and relationship with Venezuelan President Hugo Chavez. Kirchner's ministers have gone on the defensive, arguing the merits of the GOA's policies. In particular, Minister of the Economy Felisa Miceli -- a former protege of Lavagna -- has publicly defended the GOA's economic policies. When asked about Miceli's comments, Lavagna told the Ambassador that she read from a script that had been handed to her. ¶6. (SBU) Comment: Although polls still show that Kirchner would win reelection if elections were held today, with the recent additions to the list of 2007 presidential aspirants, the 2007 election campaign stands to be more competitive and interesting than previously thought. Kirchner suddenly faces the development of a viable opposition candidate in the form of one of his own ex-ministers. There are many Peronists who are currently only reluctantly cooperating with Kirchner because his power seems unchallenged. The danger to Kirchner is that if Lavagna begins to rise in the polls, many of these Peronist leaders and voters may find Lavagna an attractive alternative option. ¶7. (SBU) Lavagna's candidacy also changes things for the opposition, particularly for the center-right PRO. As one PRO political advisor told Poloff, "With Lavagna in the race, now we are competing for third place." Many PRO advisors are already arguing for making some kind of accommodation with Lavagna to better their electoral odds in 2007. End Comment. GUTIERREZ