Major Civil Unrest Going on in Argentina

Note to the editor: I am going to report a situation that has been going on in Argentina for 19 days already and because it is not main street has not picked up by the news agency. The following reporting is based on contacts I have in different parts of that country.

Argentina is on the doors of a major civil unrest. In fact, 19 days ago, farmers all over the country have cut major routes and roads and do not allow the passing of trucks transporting agricultural commodities to the cities or to the port (for exports). No food is allowed to go the cities and supermarkets are already out of stock on meat, flour, milk and basic food needs.

Why is his happening?

Argentina is major agricultural producer. All its economy is based on the production of agricultural commodities, mainly, cows, wheat, corn, and soy. Worldwide demand of this economy has pushed process of these commodities to levels that have made the exportation of agricultural commodities a huge business for companies, individual, and for the Argentine country.

In 2001-2002, one of the elected presidents was ousted from power. The country was going through a complicated situation. Inflation and unemployment were rampant and riots were happening everyday. After the country went through a series of provisional presidents (5 in a week), a definite election was set up in which Nestor Kirchner won with about 22% of acceptance. After four years of what were seen as good policies his wife has won (on December 10^th, 2007) another presidential election.

During the Kirchner´s administration a new Tax was implemented on agricultural production. That tax collected a great amount of money that was used to stabilize the country mainly by the establishment of subsidies to the people who was unemployed and through populist measures.

That tax, called "retenciones" is basically a sale tax on commodities and it started at about 20% of sale and was raised progressively to around 28% as of the beginning of last year.