Let's put this in context first. Kirchner's policies in Argentina share the common theme of brutal interventionism: he imposes tariffs and taxes, maximum prices, laws against trade and society and fines; he creates energy crises and increases uncertainty in the financial markets. He even openly consents to street violence. This situation has led many large companies to leave the country. The latest victim was Aguas de Argentina.

 

Following long, fruitless negotiations and the slow grinding pressure of the government, Kirchner has managed to force the shareholders in Aguas de Argentina to retreat: the French company Suez and the Spanish Aguas de Barcelona (Agbar). Suez (which is the main provider of energy and industrial services in the European Union, the tenth largest producer of electricity in the world, sixth largest European gas operator and second largest in water and water treatment services) threw in the towel saying the political interventionism in Argentina was unbearable; it is packing up and moving out. Agbar will do the same (given Suez is the number one shareholder, indirectly, in Agbar). Faced with Kirchner's disasterous policies and failure to live up to the contract, Suez will probably file a complaint against the government for 100 million dollars. Ah yes, interventionism certainly does have fine results.

 

And where do Spaniards' taxes fit into all this? Kirchner and Zapatero met in New York during the most recent United Nations assembly. The Argentine Prime Minister seized the moment to ask Zapatero to intervene in the dispute so that Agbar would not abandon Aguas de Argentina. Kirchner also wanted to speak with French PM Dominque Villepin, but he, quite rightly, refused any meeting. According to Villepin, the business conflict between Suez and the Argentine government does not concern the French state.

 

Zapatero, who puts his snobbish attitudes and personal friendships before his fellow citizens' money, might acquire part of Aguas de Argentina through the public entity the Spanish Society of Industrial Participation (SEPI). What does that mean? It means the Spanish state will dedicate itself to giving money away to the Argentine government to sustain a politicized, rigid and inefficient market. Water is, without doubt, necessary in Argentina, but the worst way to manage it is keeping interventionist policies in place that have only caused misery for everyone, Argentines and, possibly in short measure, Spaniards too.

 

What these good politicians, nicknamed "Factor K" and "ZP", must ask themselves is why Suez and Agbar want to run away from Argentina; and also, why Agbar is going to leave almost all of Latin America (Uruguay, Colombia, Brazil, Mexico and Cuba) due to problems with the local governments -that is, due to interventionism.

 

You don't have to be a genius: interventionism causes poverty. Remember, Agbar only wants to stay in one country in Latin America, Chile, curiously the most laissez faire one in the whole region. Perhaps the free market is the only thing capable of assuring people decent living standards and wealth? The evidence speaks for itself.