The end of Peronismo in Argentina?

The end of Peronismo in Argentina?
Activists demonstrate with a cardboard depicting late President Juan Domingo Peron and Maria Eva Duarte Peron, as Argentines demonstrate in support of Fernandez's administration as they celebrate the Loyalty Day, which commemorates the massive mobilization by supporters of Peron to demand his release after he was imprisoned, in 1945, in Buenos Aires, Argentina October 17, 2021.
REUTERS/Agustin Marcarian

Argentina is famous for tango, literary greats like Jorge Luis Borges, and for producing (arguably) the world's two best soccer players of all time in Diego Maradona and Leo Messi. It's the third-largest economy in Latin America, and a global agricultural powerhouse.

Unfortunately, the country is also known for chronic political instability and has long been tagged an economic basket case — the direct result of successive populist governments spending beyond their means, and getting others to foot the bill for their mismanagement.

Messy politics and economic emergencies are all too common in Argentina. But after Sunday's midterm elections, Argentines can expect an especially rocky next two years.

The power brokers now have their backs to the wall. Argentina's ruling coalition, led by the Peronista party — named for nationalist, populist former president Juan Perón — has lost control of both houses of parliament for the first time since the restoration of democracy almost 40 years ago.

Even when the pro-business Mauricio Macri served as president (2015-2019), the Peronistas dominated the legislature, preventing his government from passing most laws they didn't want. Without his parliamentary cushion, Peronist President Alberto Fernández will now face a steep uphill battle in the second half of his four-year term.

This defeat comes at the worst possible time for the already-embattled Fernández. After COVID hit Argentina and its economy hard in 2020, annual inflation rose. It's now hovering above 50 percent despite the government's decision to cap the cost of 1,432 different products. The value of the peso has plummeted against the US dollar in 2021. Four out of 10 Argentines now live in poverty, up five percentage points from the day Fernández took power in December 2019.

Argentines have flooded the streets many times in recent months to protest one of the world's longest pandemic lockdowns. Fernández can expect more such public anger as economic conditions worsen.

The president also has problems within his political family. After the Peronistas were defeated two months ago in the midterm primaries, a dry run for Sunday's election, his powerful VP Cristina Fernández de Kirchner (no relation) forced him to reshuffle the cabinet. Expect the two to fight even more from now on.

But the former president, Argentina's best-known Peronista, is in an awkward position of her own. Many believe she pulls the president's strings and can mobilize large-scale street protests in Buenos Aires. But Fernández de Kirchner also knows that forcing Fernández to step down to advance her own political comeback is risky because Argentines haven't forgotten the corruption scandals that plagued her presidential reign.

The broader question is what will happen in Argentina when the Peronistas can no longer dictate laws. The opposition has long claimed that Peronist big-spending policies have led to crisis-provoking levels of debt, inviting intervention by the deeply resented International Monetary Fund. It's an open secret that Fernández might stiff the IMF on $19 billion due in March 2022, but the opposition could now make him negotiate a compromise against his will.

The consequences of an IMF default, which would be Argentina's third in 20 years, could be catastrophic for the economy. International credit would dry up, possibly provoking a run on local banks similar to the Corralito crisis in the early 2000s, one of the country's worst financial meltdowns ever.

Bottom line: the Peronist stranglehold on Argentine lawmaking has been broken. Argentine voters have made clear what they don't want. They now have two years to decide what they do before heading to the polls to elect a president in 2023.

More from GZERO Media

- YouTube

At the start of Russia’s full-scale invasion, Ukraine was already punching above its weight in technology—having one of the most powerful IT hubs and digitized governments in the world. Now, three years into the war, tech innovation in Ukraine has become a battlefield advantage, one that Anna Gvozdiar, Deputy Minister for Strategic Industries, says could benefit all of Europe.

- YouTube

“If the G-Zero world is winning, one of the things that's also winning is impunity,” says Ian Bremmer, president and founder of Eurasia Group and GZERO Media. Speaking at the 2025 Munich Security Conference, Bremmer highlights the rise of global impunity and the challenges of deterrence in today’s volatile geopolitical climate.

Israelis sit together as they light candles and hold posters with the images Oded Lifschitz, Shiri Bibas, and her two children, Kfir and Ariel Bibas, seized during the deadly Oct. 7, 2023 attack by Hamas, on the day the bodies of the deceased hostages were handed over under by Hamas on Feb. 20, 2025.

REUTERS/Itay Cohen
South Korea's impeached President Yoon Suk Yeol attends a hearing of his impeachment trial at the Constitutional Court in Seoul, South Korea, February 20, 2025.
Matrix Images/Korea Pool

Impeached South Korean President Yoon Suk-yeol appeared before two courts on Thursday. His first stop at the Seoul Central District Court made him the first sitting president — he’s not yet been formally removed from office — to face criminal prosecution.

Ukrainian President Volodymyr Zelenskiy and U.S. President Donald Trump's special envoy, General Keith Kellogg, meet in Kyiv, Ukraine, on February 20, 2025.
Photo by Maxym Marusenko/NurPhoto

Ahead of the third anniversary on Monday of Russia’s full-scale invasion of Ukraine, Ukraine’s President Volodymyr Zelensky and Donald Trump’sUkraine envoy, Keith Kellogg,met in Kyiv on Thursday to discuss bringing the fighting to an end as Washington’s allegiances appear to be shifting toward Moscow.

South African president Cyril Ramaphosa takes the national salute below a statue of former president Nelson Mandela at the Cape Town City Hall, ahead of his State Of The Nation (SONA) address in Cape Town, South Africa February 6, 2025.
REUTERS/Nic Bothma

South Africa’s ruling coalition, made up primarily of the African National Congress and the Democratic Alliance, is showing signs of a possible crack in its government of national unity.

U.S. Senator Lindsey Graham (R-SC) speaks to the media, on the day of a Senate Republicans' weekly policy lunch on Capitol Hill in Washington, D.C., U.S., February 19, 2025.

REUTERS/Kent Nishimura

Those of us who grew up in a Cold War world have long thought of Republicans as the US political party that is most consistently tough on Moscow.

Luisa Vieira

The shocking US pivot to Russia has sent the world through the political looking glass and into the upside-down era of Trumpland. Is the US abandoning its historic allies in NATO, Europe, and Canada in favor of … Russia? The short answer is yes, writes GZERO Publisher Evan Solomon. For now.

The Energy Security Hub @BMW Foundation Herbert Quandt Pavilion at the Munich Security Conference held crucial talks last weekend on pressing global issues to the energy transition. Over 2.5 days of controversial and constructive talks in the heart of Munich, it became clear that energy security is not only an economic and geopolitical issue but one that’s also inextricably linked to social progress and democratic values. “There is not just one way forward,” said Dr. Heba Aguib, board member of the BMW Foundation Herbert Quandt. However, speed, scale, and collaboration across sectors are needed to drive the transition. “The open and collaborative approach that big tech companies are taking can serve as a model for other organizations and countries to use external expertise and resources to drive their energy initiatives, tailored to local needs,” she said. Learn more about the program here.