The big question surrounding the new Minister of Economy is: why did he agree to return to public service? A first reading could be due to the trust that unites him with his nephew, Santiago Caputo. Milei’s strategist who gained a lot of ground so far this year and who today is part of the most trusted circle. The political scientist swears that it was he who had the original idea of bringing his uncle Luis closer to him, more than a year ago, and that Macri had nothing to do with it.
Some in the PRO add another reading: that Milei hired the economic consulting firm of Luis “Toto” Caputo to advise him on specific issues, and that the trust between the two grew from there, also with the presence of the future chief of staff, Nicolas Posse.
In the environment of “Toto” Caputo They explain that he accepted the challenge because he feels that he has to contribute wherever he can to help the country. But there is no one who knows him who is not totally surprised by the new position he will occupy starting December 10. The thing is that the man suffered like few others – like no one else? – from the exercise of power in the Macrista years. He came from a long career in the world of finance, and his jump to government in 2015 was a new experience.
Stress
“Caputo left with panic attacks,” he said. Miguel Ángel Pichetto, a phrase that only he dared to say with the recorder on but that is similar to what other members of that cabinet, even some who love him, usually say about him. “He hated public exposure, he suffered it greatly, he was not used to it. That meant that, instead of bringing solutions, when things got difficult he lost control and made Mauricio lose it, it scared us all,” says someone who was a minister and who has esteem for “Toto.”
In fact, the scandals that led to his departure from that government still abound. On the one hand, the planet’s large investment funds, like Templeton, lost millions and millions of dollars when they bet on Caputo’s bonds in 2018. In the United States they assure that this wound has not finished bleeding yet, and that it is more than unlikely that the priests of Wall Street trust Caputo again.
The other scandal, which was one of the great watersheds in his relationship with the IMF – to which were added the constant sparks between “Toto” and his then director for the Western Hemisphere, Alejandro Werner – is when he convinced, they say in the PRO , to Mauricio Macri to publicly assure that he was negotiating with the Fund to extend the loan. That was something that simply was not true, and as soon as the markets discovered it, it caused a strong bank run.
Caputo left a very heavy inheritance after leaving office. In fact, the one who thought that was Milei himself. “He irresponsibly smoked 15 billion dollars from the reserves and left us with this Lelicqs disaster,” said the then media economist, leveraged by the close relationship he had with Federico Sturzenneggerwhich was one of the great rivals of “Toto” in that administration.
Caputo also took 14 criminal cases from the administration, which were followed by the lawyer Matías Cúneo Libarona, a relative of the future Minister of Security. This issue, that of problems in Justice, obsesses “Toto” and worries him a lot, in addition to the relationship between his brothers and the Federal Revolution group that is being investigated. This matter greatly worries his family. His wife – who was, like him, charged in the case over the future dollar – and his six children say they are “dismayed” with the father’s decision. During these weeks they insisted a lot so that he did not take over.
Challenge
The unknowns about the future are enormous. On the one hand, Caputo is a financier, who will now manage Economy, which involves not only the market but the real economy. Does he know about that? That question is spinning in the heads of many specialists, including the PRO and LLA: without going any further, the appointment of “Toto” caused the immediate resignation of Emilio Ocampo and Carlos Rodríguez. “Caputo and Milei think that the whole problem with the economy is the Leliqs. And it’s not quite like that. They are going to go into debt to solve something that is not as serious as they think. The solution is going to be worse than the disease,” says an economist who was part of the Macrista government.
Added to this are some more practical doubts. The thing is that the majority of sensitive Economy portfolios will move to Infrastructure, the mega-ministry that Guillermo Ferraro will command. Those who know the story are surprised by this decision, which would seem to originate from how little Caputo is interested in anything other than Lelicqs, debts and finances. “Energy, for example, cannot be in another area, it needs permanent coordination with Economy, it is nonsense,” they point out. And the other question: Milei promises to get very involved in this area. How will the minister and the President coexist?
There is, however, one more explanation for Caputo’s decision. “He was always an adventurer, like a good timberman. “This is another adventure for him,” says someone who knows him well. Will it be like this? Or simply a revenge?
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