The Tragedy of Argentina

[Michael]

The Tragedy of Argentina

Here's a good article that reviews (in brief) the troubled history of Argentina, which one hundred years ago was considered one of the richest countries in the world with great potential.

A short century ago the US and Argentina were rivals. Both were riding the first wave of globalisation at the turn of the 20th century. Both were young, dynamic nations with fertile farmlands and confident exporters. Both brought the beef of the New World to the tables of their European colonial forebears. Before the Great Depression of the 1930s, Argentina was among the 10 richest economies in the world. The millions of emigrant ¬Italians and Irish fleeing poverty at the end of the 19th century were torn between the two: Buenos Aires or New York? The pampas or the prairie?

A hundred years later there was no choice at all. One had gone on to be among the most successful economies ever. The other was a broken husk.

Article (http://www.ft.com/cms/s/2/778193e4-44d8-11de-82d6-00144feabdc0.html)

There are some good lessons for the USA here for the present crisis. The future of US prosperity is not assured, is not destiny and isn't fate. It takes good policy to make it happen. Argentina is a good example of what happens when a government follows the wrong policies.

[Leprechaun]

Argentina is an example of the pitfalls of neoliberalism. Here is an interesting article to that effect: http://www.scielo.br/pdf/rec/v11n1/a01v11n1.pdf
There is some hope in Argentina due to the emergence of worker-enterprises and their successes unfortunately there is a lot of political, legal and state opposition and even violence against them, the economic crisis at the moment will also have an adverse effect. Only time will tell.

[Michael]

Argentina is an example of the pitfalls of neoliberalism. Here is an interesting article to that effect: http://www.scielo.br/pdf/rec/v11n1/a01v11n1.pdf
I think your linked article seeks to blame neoliberalism of the 1980s as the cause for the decline of Argentina that was already complete by 1975.

That is to say, the massive decline in Argentina's relative standing occured between 1950 and 1975 under Peron and was directly caused by 'Peronism' as policy.

Your linked article just assumes that Argentina was still a leading and prosperous nation in late 1970's when the Junta took control and the IMF started getting involved (and Argentina engaged in some selective applications of 'quasi-neoliberalism' policies). I suspect that the argument is ideological and contemporary politics - seeking to blame the damage caused by (popular) Peronism onto the ever unpopular 'neoliberalism'.

I don't dispute that the neoliberalist policies followed by Argentina during the 1980s have had horrific results. But I'd argue that they were doomed to fail because of the structural, institutional and cultural elements of Peronism made success of any policy of 'prosperity' pretty much impossible regardless of policy.

It reminds me of Gorbachev's reforms of the 1980s in the USSR - too little and too late to do any good, but still blamed for 'causing' the collapse that Gorbachev's reforms were trying to stave off in the first place.

Same game with the neoliberal IMF-driven policies of the late 1970s and early 1980s - these reforms are blamed for causing the problem they were trying to prevent.

Now I'm not defending the IMF-driven policies of that period - just pointing out that they are a 'failed cure' not a 'cause' of Argentina's problems.

Argentina's problems can almost all be directly attributed to the policies associated with Peronism.

There is some hope in Argentina due to the emergence of worker-enterprises and their successes unfortunately there is a lot of political, legal and state opposition and even violence against them, the economic crisis at the moment will also have an adverse effect. Only time will tell.
I don't think there is much hope for Argentina. They are married to their historical policies and still revere Peronism as policy. I see way too many structural barriers to any kind of improvement in Argentina's moribund economy. One cannot run a modern economy dependent upon exporting low value agricultural products and importing high value consumer goods. This just doesn't work and leads to uncompetitive protectionism, currency controls and capital flight (which is exactly the problem Argentina continues to suffer from).