Argentine President Resigns, Yielding to Public Demands

One day after declaring a “state of seige” in an attempt to calm thousands of protestors, President Fernando de la Rua was whisked away from the presidential mansion by helicopter after tendering his resignation.

“I am writing to you to present my resignation as President of the Nation,” De la Rua said in a handwritten resignation letter presented to the nation’s Congress. “My message today, which intended to guarantee governability and which proposed the creation of a unity government, has been rejected by parliamentary leaders.”

Thousands of protesters had gathered earlier in the day in front of the “Casa Rosada,” the presidential palace in Buenos Aires, chanting “Get out! Get out!” De la Rua and his finance minister Domingo Cavallo are largely blamed by the public for the country’s rising unemployment and worsening social unrest.

De la Rua’s presidential successor will be the Senate leader, because the vice-presidency remains open since De la Rua’s running mate quit last year.

Senate leader Ramon Puerta, from the opposition Peronist party, will become the country’s new president after he is sworn in by Congress.

According to law, Puerta could call for new elections immediately. He has not commented on the president’s resignation as of late Thursday.

A day after deadly riots began, De la Rua had pleaded with opposition parties to form a coalition government. At least 22 people have died amidst the protests and hundreds are injured.

The Peronist party, which holds a majority in the senate and the largest minority in the house, rejected his bid to preserve his administration.

“Peronism will continue to exercise its role as opposition and will not participate in any co-government,” the party said in a statement.

De la Rua’s two-year term has been marked by fighting within his left-center Alianza party, and bitter feuding with the left-leaning Peronists over economic policy.

The Peronist party, opposed to the administration’s free market, neoliberal policies, have pushed for protection of domestic industries and increased trade barriers.

President De la Rua tried nine different economic plans, dealt with eight general strikes during the two years of his administration, but failed to end the four-year recession.

Months of public discontent and frustration over the government’s spending cuts exploded into massive riots throughout the country this week, prompting the president to order an emergency “state of seige” late last night.

Thousands have looted stores and set fire to federal buildings as riot police using riot gear and riding horseback have attempted to contain the violence.

At least 22 people were killed in recent days and hundreds more injured, many in confrontations with shop owners, who defended themselves with guns and knives. Police, armed with tear gas and rubber bullets, have arrested more than 2,000 people.

Earlier today, President de la Rua accepted the resignation of the Finance Minister Domingo Cavallo, who De la Rua recruited in March to restructure Argentina’s struggling economy, but the president refused to accept the resignations of several other cabinet ministers.

Cavallo, a Harvard-educated free market economist, had implemented austere financial measures, such as freezing bank accounts, reducing pensions, and cutting state budgets and public spending.

The public largely blames Cavallo for worsening Argentina’s four-year economic recession by imposing strict financial actions and causing the 18 percent unemployment rate.

Cavallo, once lauded for pegging the Argentine peso to the U.S. dollar, used belt-tightening policies in an effort to stabilize the country’s spiraling liquidity crisis amid Argentina’s recession.

Cavallo’s deputy finance minister resigned last week after Cavallo failed to procure an emergency $1.3 billion loan from the IMF that Argentina needs in order to meet its next debt payment.

If Argentina fails to garner more hard currency and make its loan payment, Latin America’s third largest economy could default on a $132 billion international debt, and either devalue its currency, the peso, or replace the peso with the dollar.