The Minister Who Would Be Czar.(Domingo Cavallo)(Brief Article)

The Spanish industrialists who met Domingo Cavallo during a whirlwind 18-hour visit to Madrid last week could be forgiven for wondering whether he had just been named president of Argentina. Barely a week after he joined the cabinet of Fernando de la Rua as economy minister, Cavallo talked like the real power behind the throne as he unveiled his plan for tackling Argentina's worst recession in more than a decade. The Harvard-trained technocrat who stabilized the chaotic Argentine economy under de la Rua's predecessor Carlos Menem in the early 1990s betrayed few doubts about his ability to rescue the nation from its current crisis. "We don't need any more financial help," Cavallo blithely told his audiences in Madrid. "Soon we will have an excess of resources."

Cavallo's take-charge way has some political cartoonists in Buenos Aires calling him Domingo I. The 54-year-old minister is riding a wave of popularity as he settles back into his old job and he has wasted no time seizing the initiative. In his first week he visited Spain and Brazil, announced sweeping tax reforms and managed to get Congress to convene over the weekend for the first time in a decade to push through an economic emergency package. Congress balked at giving the man who would be king a blank check and attempted to water down the powers. But Federico Thomsen, equity-markets director for investment bank ING Barings, says Cavallo saw that coming. "He asked for the moon, because he knows how the game is played. That's why you see him smiling a lot. I doubt he's lost much that he cares about."

Argentines flock to the sight of a man--or woman--on a balcony promising them deliverance from their latest round of woes, and Cavallo has some impressive credentials for the role of national savior. He first won acclaim in 1991 when he ended months of hyperinflation by pegging the Argentine peso to the dollar under Menem. Nearly three fourths of Argentines have approved his reincarnation as economic ...