Argentina At The Brink - The World Must Do More

Argentina At The Brink - The World Must Do More Than Just Stand By

December 31, 2001

As Argentina falls even further into economic and political melt-down, one featuring its president du jour, the international community must intercede on an emergency basis. This is not only because the country's woes could cause a pandemic among its neighbors as well as emergent economies around the world, but because its own population is grievously suffering. Through looting and riots, the Argentine public clamors for order and reason for hope, but Buenos Aires seems unable to find the road back to economic stability or public confidence.

The De la Rúa administration, followed by the short-lived interim Rodriguez Saá presidency, pleaded without avail with the United States and the IMF, among others, to intercede, but the outside world spurned Buenos Aires due to Argentina's unrelieved reputation for being unable to sustain fiscal discipline. But that country has another, far more mortal flaw, which is not being, but should be challenged from abroad before any outside aid is forthcoming - and that is its notorious reputation for profligacy and corruption. It is these last traits that should make the world reluctant to be pulled into another Argentine 'bailout cycle,' without recourse.

Those in Washington opposed to further financial aid on fiscal grounds would be wise to carefully rethink the nature of their objections as well as the consequences of doing nothing. History demonstrates that desperate populations facing political and economic dead-ends often turn to military rule to restore order, and later pay a fearful price for this. Without financial assistance, Argentines could very well be tempted to seek a solution to the current disorder which would have disastrous consequences - turning to the country's military as they repeatedly had done before, to save the nation by its ultimately deceptive restoration of order and stability. The last time that Argentines did this, seven years of brutal rule by an armed forces junta followed, costing the lives of upwards of 25,000 innocent civilians, who were usually heinously tortured before being murdered.

Led by Washington, the international community has the responsibility to help restructure Argentina's dysfunctional economy, but in doing so, it also has the right to sanction that any funds earmarked from abroad will be released only when Argentine authorities meet specific standards concerning their political and social systems and not only their fiscal and monetary performance. The myth that Argentina is a fully developed nation and a triumph of the market economy must be discounted as insufficient. As Argentina's modern commercial establishment developed, its civic institutions misfired and went off in distorted directions. The traditionally narrow-minded international focus on financial reform is incapable of solving Argentina's persistent problems, and must be accompanied by the restructuring of Argentina's basic political institutions and its manner of daily civic existence.

The kind of transformative changes deemed necessary to stabilize Afghanistan should be mirrored in Argentina. The international community must make an investment in Argentina as it has in Afghanistan, keeping in mind that financial assistance is only one aspect of the much broader reforms necessary to restructure Argentina's civic, political and social institutions.

The Council on Hemispheric Affairs, founded in 1975, is an independent, non-profit, non-partisan, tax-exempt research and information organization. It has been described on the Senate floor as being "one of our nation's most respected bodies of scholars and policy makers."

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