Argentina's Fernández rages at NY ruling The lady is not for turning. Only this week, facing a general strike in Argentina, Cristina Fernández thundered: "Nobody pushes me around, least of all bullies with hooligan tactics." Judging by her government's furious reaction to a New York court ruling ordering Argentina to pay $1.33bn to the holders of defaulted bonds by December 15, she counts Judge Thomas Griesa among them. The Argentine president has made confrontation a hallmark of her administration: with farmers in a battle over export tariffs in 2008; with the middle-class in two major protests since September; with Repsol of Spain over the nationalisation of YPF this year; with Britain over the Falklands; and now with unions who staged the general strike this week. Unless there is an unexpected change of heart, Ms Fernández looks set for another dramatic game of double-or-quits, this time in the name of national economic sovereignty. The stakes are high: despite being willing and able to pay the holders of 93 per cent of the debt on which Argentina defaulted in 2001, which her government and that of her late husband and predecessor, Néstor Kirchner, restructured in 2005 and 2010, Argentina risks a new default. That was never in Ms Fernández's plans. She has made a virtue of reducing its debt pile and paying religiously, and anyway she had other fish to fry this December: she was focusing on December 7, the date by which the government says Clarín, the country's top media group, must present a proposal to comply with a new media law or face being broken up by force. Indeed, there had even been talk of a government-organised rally to celebrate victory over an outspoken group which the government regularly accuses of lying. But with the Argentine navy's flagship training ship still detained in Ghana at the behest of the same hedge fund, Elliott Capital Management, which was favoured in Judge Griesa's ruling, the pre-party mood has abruptly been punctured. The government, and many observers in Argentina, consider the judge's ruling emotional and excessively vituperative. He told Argentina it had been warned over "flagrant and intentional contract violations" and "inflammatory declarations that the court rulings will not be obeyed" but that its "threats of defiance cannot go by unheeded." Explaining why he was ordering the payment to US funds, dubbed "vultures" by Argentina, at the same time as the restructured bondholders are due to be paid, despite the fact that his ruling is still subject to appeal, he added: "The less time Argentina is given to devise means for evasion, the more assurance there is against such evasion." But Argentina only got what was coming to it, according to Hans Humes, president of Greylock Capital, the hedge fund, and the former co-chairman of Argentina's bondholder committee following the 2001 default. When you have been so disrespectful of the courts, what did they expect [Judge] Griesa to do? . . . If problems arise in the sovereign debt world, then tough . . . Argentina should be called to task for being a rogue debtor and country," he said. Cristina will either throw in the towel or go scorched earth. One way or another she is done. "Scorched earth" would mean tumbling into another default and international financial pariah status. It would be an unattractive prospect for a president who would like to go down in history for taking on the establishment - rich countries and big institutions like the International Monetary Fund which Ms Fernández considers like to boss her country around - and winning. Quitting is even less likely. Argentines are still ashamed of the sight of Fernando de la Rúa fleeing the presidential Pink House by helicopter after fatal riots in December 2001. In any case, and despite popularity which has halved in the year since her landslide re-election victory and is now around 35 per cent, Ms Fernández remains the country's strongest political force. She has no anointed successor. Opposition parties are badly divided. Even dissidents from her own Peronist movement lack her pulling power and are lagging. In practical terms, a new default would only intensify the isolation from international capital markets that Argentina has been forced to embrace since 2001, and force Argentina to rely even more on its own means. The problem is that those are increasingly under strain. Daniel Artana, an economist at FIEL think-tank, says public spending rocketed to 43.5 per cent of gross domestic product in 2011 from 27.5 per cent in 2003, the year Mr Kirchner took office, and is now around $200bn. Ms Fernández has imposed certain restrictions to keep her statist economic model running - on imports, on foreign currency purchases to stem capital flight, and on dividend payments to spur investment at home - and says her policies are reducing poverty and creating jobs. She nationalised pension funds and has delved into those, and into central bank reserves, to fund her heterodox "national and popular" policies. But growth has slowed and inflation remains stubbornly high at around 25 per cent a year. Can Ms Fernández keep things going, even in the event of a default? "There's a very simple answer," says Martín Redrado, a former central bank chief. It depends on the [soya] crop. Given that international prices are strong and will continue to be . . . you can muddle along. But with low growth and high inflation.