Argentina in Collapse? The Americas Debate

ON 20 DECEMBER 2001, the four-year recession in Argentina culminated in the resignation of President de la Rúa, following political demonstrations, police violence and the deaths of 29 people. De la Rúa’s resignation highlighted Argentina’s dire economic situation and presaged the country’s political collapse – four people held the presidency in the following two-week period. The second president, Adolfo Rodríguez Saá, declared the country in default on its US$ 150 billion external debt, making Argentina the largest defaulter in history. By Christmas 2001, 15 million people, or 40 per cent of the population, had fallen below the poverty line. Mass social and political mobilization erupted, with Argentines voicing their anger through street demonstrations (cacerolazos).

During the 1990s, many referred to Argentina as the “favourite pupil” of the international financial institutions. The country had followed a set of macroeconomic policies, including trade liberalization, deregulation, privatization of public services, and strict monetary policy. Sustained economic growth in the early 1990s appeared to some to confirm the wisdom of those policies. However, others warned of increasing indebtedness, rising unemployment, and growing inequality and poverty. Academic analysts were more sceptical of the materialization of the so-called benefits of the adopted policies. The question, of great significance to Argentines but also relevant to the rest of Latin America and the developing world is, if Argentina had followed the “best advice” of the global institutions, what had gone wrong? The Argentine experience has provided new insights about the real options available to countries in economic and political crises in the age of globalization.

Meanwhile, popular rejection in Argentina of politicians from all parties reflects the perception that the collapsing economy is not just the result of misguided external policies but, rather, the responsibility of Argentine politicians and national institutions as well. The events in Argentina mark a watershed in the current global debate about the role of both national and international institutions in development policies and economic management of developing countries.

In order to understand this difficult period and its implications beyond Argentina and the present, this volume brings together a selection of the papers from an international conference entitled Economic Management and Political Collapse in Argentina: Interpreting the Past to Build for the Future, organized by The New School’s Graduate Programme in International Affairs with the support of the Ford Foundation, and held in New York on April 8–9, 2002. The papers included in this volume, and the presentations made at the conference, triggered intense debate among the New York audience, which included many Argentines and Latin Americans. The findings that emerged over the course of the conference pointed to the responsibility of both national and international actors for the events culminating in the December 2001 collapse.

This book examines Argentina’s recent economic and political collapse from perspectives that are both interdisciplinary and transcontinental. Its contributors bring the diversity of their views as historians, economists, sociologists, journalists and architects from Argentina, the United States, Chile, Mexico and Brazil. The analyses are aimed at identifying lessons for the future and contributing to the search for sustainable development, and it is believed that the Argentine case is relevant to Latin American countries and the whole world.

In Part I, Argentine historian Tulio Halperín Donghi considers why Argentina adopted its particular form of the neoliberal model. In Part II, Argentine economists Roberto Frenkel and Nicolás Dujovne, and noted economists from MERCOSUR, José Marcio Camargo from Brazil and Andrés Solimano from Chile, evaluate Argentina’s decade of convertibility in the 1990s. Pa