The State and Capital in Times of Crisis: Taxes, Financial Assistance and Credit during the Argentine Pandemic

HEREDIA, MARIANA

Buenos Aires

Congreso; International Political Sciences Association; 2023

International Political Sciences Association

In the face of the Covid 19 pandemic, numerous organizations counselled governments to distribute the costs of the crisis equitably, pointing in many cases to the social responsibility of capital. While the International Labor Organization (ILO) urged companies and governments to protect workers, others such as Oxfam and even the International Monetary Fund stressed that the richest recipients should contribute to financing exceptional health and social costs. In line with these recommendations and in a particularly complex economic and fiscal context, Argentina adopted since March 2020 an extensive battery of public policies: from double severance pay and the suspension of layoffs, the payment by the State of part of the salary of formal workers and the collection of an extraordinary contribution from large fortunes. These initiatives have been analyzed separately and underlined the country's vocation to protect the most vulnerable. Through the analysis of the legislation adopted -which includes taxes, financial assistance, and credits, its implementation and interviews with businessmen and executives of companies of different sizes and sectors, this work seeks to propose a comprehensive assessment of the relationship between the State and Capital in Argentina during the crisis. In doing so, it also confirms the government's diligence but questions the binary conclusions postulated by previous analyses. On the one hand, the Argentine State not only distributed resources from capital to the rest of society, but it also mobilized funds that served to sustain and leverage many activities. On the other hand, public policy acted by segmenting capital: while controls were reinforced, and contributions were demanded from certain sectors, preferential conditions and financing were offered to others. This hierarchization not only responded to the onslaught of the pandemic, but also reflected the preferences of the government coalition. Three years into the pandemic, economic instability poses limits not only to the sustainability of these strategic options, but also to their redistributive capacity.