Comment by TZubiri
7 hours ago
https://en.wikipedia.org/wiki/Goodhart%27s_law
"Any observed statistical regularity will tend to collapse once pressure is placed upon it for control purposes."
Or the more pop layman version
"When a measure becomes a metric/KPI, it ceases to be a good measure."
Story time, I live in Argentina, and we don't have Big Macs, the main Mc Donald's brand, here, because during the CFK presidency, one of her tactics was to Goodhart economic metrics. Even the informal obscure ones like the [Big Mac Index](https://en.wikipedia.org/wiki/Big_Mac_Index), I don't know the precise details, but the Big Mac ended up being a very cheap item, like 2 or 3 times cheaper than actual menu items, but it was never on the advertised menu, and it also ended up being very small compared to the other burgers, so it wasn't even like a hack, a shrinkflation type of deal.
But hey, anyone who read the Big Mac Index table would never find Argentina at the bottom of that list along with a couple of other countries with bad brands, so the ploy worked. And now we live with the aftershock, the brand never really turned around, other brands with ridiculous names took over it like the McTasty, which makes me sound like that skit from Tarantino's Pulp Fiction.
How did the president manage to influence McDonalds' local business decisions? And how did that lead to McDonald's pulling out of the country?
McDonald's complies with local laws and operates with local juristic entities. While McDonald's US owns McDonalds Argentina (Arcos Dorados Argentina SA), and there's some level of control that occurs in the US "Global" headquarters, some that occurs at the National HQ level, and some that occurs in the individual location. Obviously a president would be able to influence 2 of those levels, it's not necessary for her to influence the Global executives.
To be clear McDonald's didn't pull out of the country, like in many other countries, it adapted to the local market. Same way as in india it serves non meat variants owing to the high vegetarian population, consider that mcdonald's operates in Venezuela and China, and operated in Russia up until the Russia-Ukraine war. It takes a lot for MCD to pull out of a country.
As for the exact mechanisms of presidential price control on MCD Argentina, I don't have the specifics here, but I can get pretty close. There have been 2 broad mechanisms to exhert price control during CFK's 8 years of presidency and during his Husband's 4, let's call them official and unofficial.
The official mechanisms would be passing laws or presidential decrees (DNU) that don't go through congress, as well as influencing regulation of executive ministries/departments like central bank norms, exchange rates. Some measures like 'precios cuidados' were placed for this very specific purpose, it's very possible Big Macs were under this specific scheme, I do not recall, I was a bit young.
The unofficial methods would be less public, but well known, in the food industry it was especially common, it's well established that food are one of the first and most common targets of price controls. I have heard direct accounts from family members about high ranking government officials setting up meetings with producers in food markets to give orders of lowering prices, one going as far as brandishing a firearm by placing it on a table while discussing the subject.
Writing this out loud I realize that this explains the later over-correction of argentina that allowed freemarket capitalist libertarianism to rise. The optimal strategy in democracy seems to be polarization, so both extremisms seem to symbiotically feed off each other. Not a country of moderateness this one.