Agony of Argentine Capitalism: From Menem to the Kirchners

by Paul H. Lewis

Overview

This diagnostic history of Argentina's economic prostration is full of timely lessons for readers in the United States about how an irresponsible capitalist elite and cynical politicians can lead a wealthy nation to throw it all away.

They say those who do not learn from history are bound to repeat it. Thus the importance of this book. The Agony of Argentine Capitalism: From Menem to the Kirchners is the capstone of a magisterial trilogy exploring the reasons for Argentina's shocking "reversal of development." In the early 20th century, Argentina was a rising star. It was one of the world's ten richest countries, on course to a place among the most advanced and prosperous liberal democracies in the world. Then, in 1929, Argentina fell into an economic coma from which no political or military shock treatment has been able to rouse it.

The collapse of Argentina's capitalist class has been so devastating that little support remains for free enterprise or free trade. Her fate poses an intellectual challenge for First World capitalist countries. As famed economist Paul Samuelson warned: "Argentina is the pattern no modern capitalist may face without crossing himself and saying, 'There but for the grace of God….'"

Product Details

ISBN-13:	9780313378799
Publisher:	Bloomsbury Academic
Publication date:	06/22/2009
Pages:	221
Product dimensions:	6.10(w) x 9.10(h) x 0.80(d)

About the Author

Paul H. Lewis is professor emeritus of political science at Tulane University, New Orleans, LA. He is the author of nine books, including the Praeger's Guerrillas and Generals: The "Dirty War" in Argentina and Latin Fascist Elites: The Mussolini, Franco, and Salazar Regimes.

Table of Contents

Preface xi

Abbreviations xv

Chapter 1 The Rise to Power 1

The Young Político 3

Governor Menem 9

Governor Again: The Menem Model 12

The Renovationist 14

Chapter 2 The Crisis of Argentine Capitalism 19

The Roots of Stagflation 20

The Business Elites 28

Chapter 3 Trials and Errors 35

Plan B&B 37

The Crony Cabinet 40

Family Scandals and Military Threats 43

Corruption Scandals 45

Government Shakeup 48

Chapter 4 Free Markets and Convertibility 51

The Convertibility Plan 52

Foreign Influence 55

Labor's Travails 58

Chapter 5 The Underside of the System 63

The Syrian Connection: "Yomagate" 64

The Syrian Connection: Gun-Running 67

The Syrian Connection: Terrorism 70

"Junior's Accident" 73

Intimidation of the Press 74

Chapter 6 Triumphs and Troubles 79

Convertibility's Potential Problems 80

Menem's Re-Election 84

The "Tequila Effect" 86

Economic Damage Control 87

The Dysfunctional Provinces 89

The Demands of Clientelism 92

Chapter 7 The Downward Slide 95

Cavallo versus Yabrán 97

The Rout of Domestic Capitalism 100

The Raiders 105

Summary 109

Chapter 8 Challenges 111

Murder's Red Trail 112

The October 1997 Elections 114

The Peronists Split 115

The Alliance Rolls Forward 118

Chapter 9 The Crash 123

The Alliance Breaks Up 125

Troubles and Turmoil 128

Return of the "Wizard" 130

Free Fall 133

Chapter 10 The Retreat to Populism 139

The Conflict with the Courts 143

Economic Agony 145

Three-Sided Stalemate 147

Menem Redux 148

Chapter 11 The Illusions of Progress 153

The Kirchner Coalition 154

The Debt "Haircut" 157

Toward a Closed Economy 159

The Contradictions of aClosed Economy 162

From Néstor to Cristina, With Love 167

Chapter 12 Defiance 171

Tactical Maneuvers 174

The Struggle for Public Opinion 175

The Congressional Struggle 184

The Aftermath 188

Facing the Future: The Three Argentinas 191

Notes 193

Selected Bibliography 213

Index 217

What People are Saying About This

Mark FalcoffResident Scholar Emeritus

"Between 1990 and 2001 Argentina went through the most dramatic boom-and-bust in its history. This is the story of how the—in many ways—richest country in Latin America squandered its best opportunity in decades. With a mastery born of decades of study, Paul Lewis, author of the classic GENERALS AND GUERRILLAS, now addresses with cogency, authority, and great human sympathy a crisis which has suddenly become all too relevant.' "

Mark Falcoff Resident Scholar Emeritus

"Between 1990 and 2001 Argentina went through the most dramatic boom-and-bust in its history. This is the story of how the--in many ways--richest country in Latin America squandered its best opportunity in decades. With a mastery born of decades of study, Paul Lewis, author of the classic GENERALS AND GUERRILLAS, now addresses with cogency, authority, and great human sympathy a crisis which has suddenly become all too relevant.' "

Colin M. MacLachlanJohn Christie Barr Distinguished Professor of HistoryTulane University

"Professor Lewis, a talented political scientist cum pathologist, has written an account of a country in dire peril. Argentina’s disastrously mismanaged economy has plunged its people into poverty and insecurity in a land of plenty. Its self- inflicted agony is portrayed unflinchingly. Whether the damage can be reversed remains in doubt. Argentina’s dark shadow on the wall should be a warning to all of us."

Mark Falcoff Resident Scholar Emeritus

"Between 1990 and 2001 Argentina went through the most dramatic boom-and-bust in its history. This is the story of how the--in many ways--richest country in Latin America squandered its best opportunity in decades. With a mastery born of decades of study, Paul Lewis, author of the classic GENERALS AND GUERRILLAS, now addresses with cogency, authority, and great human sympathy a crisis which has suddenly become all too relevant.' "

—

Mark Falcoff Resident Scholar Emeritus, American Enterprise Institute

William Ratliff is a fellow and curator of the world's largest collection on Juan Peron at Stanford

"We might paraphrase Shakespeare's Macbeth to summarize modern Argentine history as 'a tale dominated by demagogues, full of sound and fury, assuring spiraling tragedy.' In his three volumes on Argentine capitalism, here completed with that system's current 'agony,' Paul Lewis deftly documents this tale of a country with everything going for it except most of its modern leaders and a culture that cultivates demagogues who crush any effort to create a viable, modern nation. But Argentine history is not only repeating itself in Argentina, it has become universally relevant for as economic historian Niall Ferguson says, today 'America is Argentina,' and so is much of the world."

Colin M. MacLachlan John Christie Barr Distinguished Professor of History Tulane University

"Professor Lewis, a talented political scientist cum pathologist, has written an account of a country in dire peril. Argentina's disastrously mismanaged economy has plunged its people into poverty and insecurity in a land of plenty. Its self- inflicted agony is portrayed unflinchingly. Whether the damage can be reversed remains in doubt. Argentina's dark shadow on the wall should be a warning to all of us."

—

Colin M. MacLachlan John Christie Barr Distinguished Professor of History Tulane University, New Orleans
Author of, Argentina: What Went Wrong. Praeger, 2006

Colin M. MacLachlan John Christie Barr Distinguished Professor of History Tulane University

"Professor Lewis, a talented political scientist cum pathologist, has written an account of a country in dire peril. Argentina's disastrously mismanaged economy has plunged its people into poverty and insecurity in a land of plenty. Its self- inflicted agony is portrayed unflinchingly. Whether the damage can be reversed remains in doubt. Argentina's dark shadow on the wall should be a warning to all of us."

William Ratliff is a fellow and curator of the Archives

"We might paraphrase Shakespeare's Macbeth to summarize modern Argentine history as 'a tale dominated by demagogues, full of sound and fury, assuring spiraling tragedy.' In his three volumes on Argentine capitalism, here completed with that system's current 'agony,' Paul Lewis deftly documents this tale of a country with everything going for it except most of its modern leaders and a culture that cultivates demagogues who crush any effort to create a viable, modern nation. But Argentine history is not only repeating itself in Argentina, it has become universally relevant for as economic historian Niall Ferguson says, today 'America is Argentina,' and so is much of the world."

Editorial Reviews

Lewis presents the third in a trilogy that includes The Crisis of Argentine Capitalism, which explored the political economy of Argentina from the late 19th century through the rule of Juan Peron, and Guerillas and Generals: The 'Dirty War' in Argentina, which concentrated on the causes and effects of political violence in the 1970s. In this volume, he returbans to the political economy focus of the first volume, discussing the efforts of President Menem and President De la Rua to push through free trade policies and criticizing the populist policies of the later governments of Cristina and Néstor Kirchner, who he argues seek to 'extend state control to all aspects of the economy and to redistribute income derived from the most efficient sector, agriculture,' and threaten to repeat the mistakes of Peron, who Lewis blames for the chronic 'stagflation' (stagnant production and persistent inflation) that plagued the Argentine economy through the 1980s.” —Reference & Research Book News

“Lewis provides a first-rate analysis of the political processes leading to the implosion of the Argentine economy in December 2001. . . . Highly recommended. Upper-division undergraduates and above.” —Choice

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