ARGENTINA'S JUNE 28 CONGRESSIONAL ELECTIONS: THE

C O N F I D E N T I A L BUENOS AIRES 000742

SIPDIS

E.O. 12958: DECL: 06/25/2029
TAGS: PREL PGOV KDEM PINR PHUM AR
SUBJECT: ARGENTINA'S JUNE 28 CONGRESSIONAL ELECTIONS: THE
PERMUTATIONS ARE ENDLESS

REF: BUENOS AIRES 0729 AND PREVIOUS

Classified By: CDA Tom Kelly for reasons 1.4 (b) & (d).


1. (C) Summary and introduction: Argentina's ruling Victory
Front alliance (FpV) appears headed for a nationwide defeat
in the June 28 mid-term congressional elections and will
likely lose its majority in the Chamber of Deputies and
possibly in the Senate. The election is unlikely to clarify
fully the future course of Argentine politics, however. The
new Congress will not be seated until December 10, which may
give the Kirchners time to win the support of stray
parliamentarians and re-assemble a new majority. In any
case, Congress is institutionally weak, and the Kirchners can
probably govern around it. For many Argentines, the import
of the June 28 elections lies in how they set the stage for
the 2011 presidential elections, and whether they will mark
the end of the Kirchners' dominance of Argentine politics.
There is some speculation about how the Kirchners might
respond to defeat. Finally, we offer some comments on how
this truncated electoral campaign points to some disturbing
indicators of the poor health of Argentine democracy. End
Summary.

Nationwide defeat for the Kirchners?
--------------


2. (C) With only two days remaining before Argentina's June
28 national congressional mid-term elections, it appears
President Cristina Fernandez de Kirchner's (CFK) Victory
Front (FpV) will likely lose its majority in the Chamber of
Deputies and possibly in the Senate. CFK's husband, former
president Nestor Kirchner (NK),is heading the FpV slate in
Buenos Aires province. In the face of a nationwide defeat,
NK has largely succeeded in convincing many observers that
the only race that counts is in Buenos Aires province, long a
Peronist stronghold. Even there, however, NK is in a very
tight race with the "Union-PRO" ticket headed by Peronist
dissident Francisco De Narvaez. If he comes in first place
there, NK is likely to do so with no more than 35% of the
vote, far short of the over 45% that the FpV won in 2005 and

2007. This means that, even in "victory," the FpV could lose
five or six of the 20 seats from that district that it has at
stake in this race.


3. (C) In the next four largest districts (Federal Capital,
Santa Fe, Cordoba, and Mendoza) the FpV will lose, coming in
third or fourth place with ten percent of the vote or less.
Nationwide, the FpV is expected to lose as many as 20 of the
116 seats it currently holds in the 257-member Chamber of
Deputies, where it also currently counts on the support of
another 20 deputies. In the Senate, the FpV is expected to
retain 36 of the 72 seats and count on the support of at
least one other senator. NK has been reported to tell his
confidants that the results of the June 28 elections will not
be known until the new Congress is seated -- i.e., December
10 -- implying that NK expects in the five months following
the election to snatch up enough stray parliamentarians to
form a working coalition.


4. (C) In these mid-term congressional elections, the
Kirchners are facing what, by our standards, would appear to
be a stunning setback. However, the absence of a single
clear winner on a national scale will diffuse the sting of
their loss and muddy the political waters. The alliance
between Peronist dissidents and Buenos Aires mayor Mauricio
Macri is poised to win in the Federal Capital and possibly in
Buenos Aires province but nowhere else. In Santa Fe, either
the Socialists or independent dissident Peronist senator
Carlos Reutemann will win, and in Cordoba other dissident
Peronists, a Civic Coalition supporter, and Radicals are
poised to do well. Elsewhere, the results will be equally
mixed and difficult to decipher. Since Argentina's parties
and alliances in this race are largely new, temporary,
non-ideological mechanisms, we do not see how the June 28
election results could lend themselves to any interpretation
of a "leftward" or "rightward" trend.


5. (C) Argentines are intrigued by the thought of how the
Kirchners might react to defeat in these elections. Whatever
the outcome, we expect the Kirchners will try their hardest
to spin it in their favor. There is some speculation that
CFK might resign or move up presidential elections as a

result of an NK defeat, but we doubt that. NK has not
suffered many setbacks in his political career, but we are
inclined to think that, even if he fails to convince everyone
that he "won," he will set to conserving and restoring his
power. There are also some optimists voicing the hope that
the loss of their congressional majority will induce the
Kirchners to change their governing style to one that is open
to dialogue and negotiating with the opposition. We doubt
that, too.

It's not about Congress
--------------


6. (C) What is really at stake in Sunday's elections? It is
not really a battle for control of the Congress, which is
institutionally weak. It does not control the government's
purse-strings, it is thinly staffed, and it exercises scant
oversight of the executive branch. In NK's
four-and-a-half-year administration, the GOA issued 270 laws
by executive decree, far more than the 205 approved by
Congress (and most of the substantive legislation approved by
Congress was initiated by the executive branch). In the
absence of strong checks and balances, the executive branch
here enjoys much greater leeway in obviating the legislative
branch. An opposition-controlled Congress could
theoretically start asserting itself vis-a-vis the executive
branch, but that would require the fractious opposition to
work together -- a tall order, indeed.

Setting the stage for 2011 presidential elections?
-------------- --------------


7. (C) These mid-term elections appear to be of interest to
Argentines not so much for control of the Congress or the
legislative agenda but rather as a stage-setter for the 2011
presidential elections. The conventional wisdom is that NK's
slate needs to win first place in B.A. province so that he
can retain enough space within the Peronist Party (PJ) to
launch himself or someone else (CFK, BA province governor
Scioli, etc.) as the PJ presidential candidate in 2011. A
decisive defeat for Kirchner could marginalize him and open
the bidding for the 2011 presidential race. Kirchner's major
rival is widely considered to be Santa Fe senator Carlos
Reutemann, who a few weeks ago had a 20-point lead in his bid
for re-election June 28. That lead has dissipated, however,
due to opposition success in persuading Santa Fe voters that
Reutemann's dissident status is a temporary ruse, and that
Reutemann will rejoin forces with the Kirchners after the
elections. Kirchner is anathema to many voters in
agriculturally rich Santa Fe, Argentina's second province,
who are still reeling from the Kirchners' protracted conflict
with the farming sector in 2008.


8. (C) Santa Fe is also home to another presidential
contender, Socialist Governor Hermes Binner. Like Reutemann,
Binner is highly regarded for his moderate discourse and
discretion. Binner is not a candidate in the June 28
election, but he has campaigned intensely for Senator Ruben
Giustiniani, head of the Socialist ticket in Santa Fe. The
latest polls in Santa Fe indicate that Giustiniani has been
closing in on Reutemann's once-impressive lead, and they are
now in a technical tie. If Giustiniani succeeds in defeating
Reutemann, that would effectively eliminate Reutemann as a
rival to NK or Buenos Aires governor Daniel Scioli for the
Peronist nomination in 2011.


9. (C) Even if Giustiniani does not come in first place in
Santa Fe on Sunday, Binner may emerge unscathed and still be
in a position to become a compromise presidential candidate
for the alliance of Elisa Carrio's Civic Coalition (CC),the
traditional Radical Party (UCR),and the Socialists.
Carrio's presidential prospects, in turn, may depend on how
well her slates run in Buenos Aires city and province. Her
prospects look poor -- both slates now seem to be running in
third place, and she may fail to land a seat in the Chamber
of Deputies. Her rival for the top slot on the non-Peronist
opposition's presidential ticket in 2011, Vice President
Julio Cobos, needs a victory by his slate of candidates in
his home province of Mendoza in order to keep his own
political aspirations alive.


10. (C) Back on the Peronist side of the opposition equation,
if NK and Reutemann both lose on Sunday, that could clear the

path for Buenos Aires Mayor Mauricio Macri, who stands to
benefit greatly if his ally De Narvaez should win Buenos
Aires province. For 2011, De Narvaez ostensibly has his eyes
set no higher than the governorship of Buenos Aires province
because his birth outside of Argentina (in Colombia)
currently precludes presidential office. Some believe,
however, that De Narvaez may seek to get the Constitution
changed or have a court find that provision contrary to the
spirit of the Constitution or in violation of international
conventions. De Narvaez, a multi-millionaire center-right
politician, spent prodigiously from his own fortune to run a
slick, professional campaign. He also benefited greatly from
being singled out for opprobrium by the increasingly
unpopular Kirchner.

The U.S. not a target
--------------


11. (C) In a race that has been driven by images, not issues,
foreign policy has not been debated, and the United States
has not been a target in the campaign. To the extent that
President Obama has been mentioned, it has only been on
favorable terms, with various candidates -- including former
U.S.-basher Nestor Kirchner -- seeking to identify themselves
with the new administration in Washington. (Cozying up to
the United States is a new development for the current crop
of politicians here, and reflects President Obama's
popularity among Argentine voters.)

Potential for fraud?
--------------


12. (C) As in any close race, the potential for fraud -- and
the certainty that fraud will be alleged -- will increase
according to the narrowness of the margin of victory. Even
in 2007, there were allegations of electoral hanky-panky
(mostly the disappearance of opposition party ballots from
some voting booths),but CFK's 2-to-1 margin over her
runner-up, Elisa Carrio, made it easy to dismiss the impact
of marginal fraud on the outcome. Due to NK's high personal
investment in the outcome of this year's election and the
suspicion with which the opposition regards the Kirchners,
there will almost certainly be allegations of fraud again.
If the Kirchners' FpV wins by only a slim margin in Buenos
Aires province, the relevance of fraud will be harder to
dismiss, and the allegations may easily turn into bitter
claims that the elections were stolen. In that scenario,
although the Argentine public has been largely apathetic
about these elections, we do not rule out the possibility of
violence.


13. (C) Unfortunately, the potential for fraud --
particularly what's known locally as "small-time fraud"
("fraude chico"),in which partisans remove from voting
booths the ballots of other parties, as well as the rumored
issuance of false identification documents for
ballot-stuffing purposes -- continues to loom. The
international community will not be in a position to comment
on the validity of the electoral process. Opposition parties
asked the OAS to deploy an electoral observation mission, but
the OAS reply was that it would only consider requests from
the governments of member states. The GOA did not request an
OAS observer mission or invite any other international
observers, although a handful of foreign electoral "experts"
whose identities have not been divulged will tour voting
stations on June 28. Argentine officials have made it clear
that international scrutiny of their voting is not welcome,
but electoral authorities have arranged a June 28 tour for
foreign diplomats.

Cabinet changes coming?
--------------


14. (C) CFK is widely expected to make some changes in her
Cabinet following the election. That said, CFK kept
three-fourths of her husband/predecessor's Cabinet in place,
and her Cabinet has been remarkably stable since she took
office 18 months ago, with only a couple of ministerial
changes. In the event of an electoral defeat, the Kirchners
may well dig in their heels and insist on keeping their team
in place rather than undertake any moves which might be
interpreted as a sign of weakness. Still, there are strong
rumors that the Health Minister Graciela Ocana, exhausted

from contending with outbreaks of dengue and A (H1N1)
influenza and demoralized from doing battle with CGT labor
leader Hugo Moyano, is soon heading out the door. There are
also rumors that Cabinet Chief Sergio Massa is looking to go
back to his position as mayor of Tigre in Buenos Aires
province or that he will be cajoled into taking the
congressional seat that he is expected to win June 28. (That
said, rumors of Massa's departure from the administration
have been swirling almost since he joined the Cabinet at the
end of July 2008.) The media have been touting Massa protege
Amado Boudou, currently head of Social Security (ANSES),as a
replacement for the near-invisible Finance Minister Carlos
Fernandez. There is also some speculation that MOD Nilda
Garre might be replaced, although there have been no signs of
Kirchner unhappiness with her.

Sad Comment on the State of Democracy?
--------------


15. (C) There are many aspects to the June 28 elections that
unfortunately point to disturbing trends and the weaknesses
of Argentina's democratic institutions. The way in which the
government in March moved up the elections from October to
June signaled the government's disrespect for rules across
the board. Political parties still show no internal
democracy in how they are organized; without exception,
candidates were picked in a non-transparent, non-inclusive
fashion, without benefit of primaries. As one pundit pointed
out, virtually every soccer club in Argentina is run more
democratically than Argentina's political parties. Nestor
Kirchner picked some well-known "testimonial candidates,"
such as Buenos Aires governor Daniel Scioli and Cabinet Chief
Sergio Massa, to run with him at the top of their party
slates. Their selection points to a problem inherent with a
party list system that allows unknown political operatives to
ride into Congress on the coattails of the few headliners at
the top of their slates. The need for Kirchner and others to
enlist "testimonial" candidates who are not committed to
actually serving in Congress, if elected, also stems from the
failure of political parties to generate new leaders. As
noted above, there was very little debate of issues or
proposals in this campaign, which traded mostly on images.
Pollster proliferation has largely discredited surveys of
voter intentions for their widely diverging results, and the
media seem to be doing little to keep the pollsters honest.
And, as detailed above, the potential for electoral fraud
seems to exist.

KELLY