The story Of Argentina

Extracts

"So the government said, you know, we care more about growth, employment, poverty, than we do about having a little bit more than having the lowest possible inflation rate. And that’s extremely important. I mean, they pulled eleven million people out of poverty in the last five-and-a-half years. They cut unemployment from 21.5% to 8.5%. And, of course, real wages increased by more than 40% during this period.
But also they had to confront the IMF in order to do this. The IMF was opposed to all of the major policies, including the debt default. I mean, obviously they couldn’t pay their debt. But the IMF was pressuring them enormously to pay more to the foreign creditors, and they didn’t do it, because they knew that that would hurt the recovery. And they were under a lot of pressure. They stood up to the IMF. They even defaulted to the IMF temporarily in September 2003, which was a very gutsy thing to do, and the IMF backed down."

Editorial Comment

Latin America is paving the way for a new Economic order, one in which the IMF in particular is obsolete. The Capitalist structures proposed by the IMF have been disastrous for emerging economies. The Argentine Example, in which they eventually wrote a check to the IMF and said we are done with you is historic.

The subsequent growth and prosperity of Argentina is worthy of study for all Emerging Countries. Any country which does not tackle Poverty and Unemployment as their most sacred task is doomed to be themselves poor and unemployed.

The IMF model of Privatisations, opening up the country for Foreign Investment and imposing a tax structure, which had no hope of being collected was a model for colonisation. The end result was always a country who became a permanent debtor of the IMF who could for ever be blackmailed into pursuing more policies of the wrong sort. To top it all these countries had foisted on them their own nationals, who has been trained at the IMF to become Governors of their Central Bank, Finance Ministers or better still Prime Ministers.

Khusro

AMY GOODMAN: We turn to Argentina, where First Lady Cristina Fernandez de Kirchner has become Argentina's first elected female president. Kirchner won with 45% of the vote, doubling the support of her nearest challenger. She takes office in December, replacing her husband, Nestor Kirchner.
Cristina Fernandez de Kirchner is the second female to be elected head of a Latin American country in the last two years. The first, Chilean President Michelle Bachelet, said, "It’s not a coincidence these two neighboring countries with similar characteristics have elected women to direct their destinies."
For more on Argentina’s election, I’m joined by two guests. Mark Weisbrot is on the phone from the Center for Economic Policy Research. Joining me in New York is Jocelyn Olcott. She is a professor of Latin American history at Duke University.
Let's start with you, Professor Olcott. Your response? The significance of the first woman elected president of Argentina?
JOCELYN OLCOTT: I mean, I think there’s -- you know, there are several ways to read this, but certainly two of the biggest ones is it’s clearly a rejection of -- the soundest rejection of the neoliberal project, right, and so it’s an endorsement of continuing with Kirchner’s program, which was an emphasis on social programs over, you know, the IMF project. I mean, Argentina has really aggressively rejected the IMF and structural adjustment project. And the only reason it hasn't gotten more attention is because people are so distracted by Venezuela. They haven’t really focused as much on Argentina. But Argentina has been very clear on that. And so, this is really a vote to continue with that project.
AMY GOODMAN: And explain exactly what Kirchner did and then what his wife, now the elected president of Argentina, Cristina Kirchner, will do.
JOCELYN OLCOTT: I mean, it’s interesting because it’s part of what, you know -- she forms part of what some people are calling this “pink tide,” really a turn in Latin America toward -- as part of this new left. What distinguishes this left turn from former left turns really is an emphasis on gender issues, more recognition of LGBT rights, which is something that Kirchner has been involved with.
But then, also, Kirchner, like Chavez, has put a lot of emphasis on social issues, right, and so rather than leaving everything to market forces, really, an understanding that you have to have the government involved in creating social infrastructure in order to promote development. So, I mean, I’m not sure if this is where it’s going to go, but certainly the election of Cristina Fernandez de Kirchner is an endorsement of projects like what Chavez has done, in terms of promoting social programs. Chavez actually has a part of his constitution and legislation, is that women who are homemakers, if they demonstrate need, get paid minimum wage, right? So it’s a sort of wages for housework thing.
AMY GOODMAN: Why did Nestor Kirchner not run for re-election? He was enjoying something like 60% popularity.
JOCELYN OLCOTT: Yeah. I mean, you know, there’s a lot of speculation about whether or not they’re trying to kind of build a dynasty, right? He could run again, if she holds office four years, he could run again and hold office four years, and then she could conceivably run again and hold office for four years. So I think particularly a lot of the opposition is saying this is part of trying to build a dynasty, you know, in the way the people have accused the Clintons or the Bushes of trying to build a dynasty. So it’s -- you know, I think that’s part of it.
And she’s tremendously popular. She also -- I mean, I think it’s worth noting, she was a senator before he was a presidential candidate. I mean, she has a career in her own right. I think that people get distracted in cases like Michelle Bachelet or Cristina Fernandez de Kirchner, by the fact that they’re women. And the fact is, they’re very accomplished professional women before they become politicians. I mean, you know, Bachelet was an epidemiologist and has a whole career behind her, in addition to being president of Chile.
AMY GOODMAN: Mark Weisbrot, your response to the victory of the first elected woman president of Argentina?
MARK WEISBROT: Well, I think it’s true she was actually -- she had a more prominent political career than her husband did, actually, before he was elected president, so the comparisons to Hillary Clinton and Evita Peron are not really appropriate.
But I think the economy was a big thing. And, you know, the government did a bunch of things that they haven’t gotten, I think, enough credit for. You know, one was getting their basic macroeconomic policy right. And I think, you know, we don’t often pay much attention to these things, and I think we should, because it’s tremendously important. You know, the economy grew about 8.2% annually for the last five-and-a-half years, and a lot of that was just because they did the right thing in a lot of areas.
They had an exchange rate policy that was unorthodox, where the central bank targeted the exchange rate, which is something that, you know, you’re not supposed to do, and the neoliberal or even, you know, any orthodox central banks in this hemisphere wouldn’t do that. They’re only supposed to care about inflation. So the government said, you know, we care more about growth, employment, poverty, than we do about having a little bit more than having the lowest possible inflation rate. And that’s extremely important. I mean, they pulled eleven million people out of poverty in the last five-and-a-half years. They cut unemployment from 21.5% to 8.5%. And, of course, real wages increased by more than 40% during this period. So that’s why you had such an easy victory for Cristina.
But also they had to confront the IMF in order to do this. The IMF was opposed to all of the major policies, including the debt default. I mean, obviously they couldn’t pay their debt. But the IMF was pressuring them enormously to pay more to the foreign creditors, and they didn’t do it, because they knew that that would hurt the recovery. And they were under a lot of pressure. They stood up to the IMF. They even defaulted to the IMF temporarily in September 2003, which was a very gutsy thing to do, and the IMF backed down. And nobody knew really what was going to happen at that time, because they could have been, you know, punished very severely for that. So that was a historic move, as well, because it helped break the grip of the IMF and of Washington. Not only Argentina, but Latin America, was a major stage in that process of breaking up this creditors cartel, which had determined economic policy for so long in Latin America.
AMY GOODMAN: Professor Olcott, what would you like to add to that?
JOCELYN OLCOTT: I mean, I think that’s exactly right, and I think that what we're seeing is really a dramatic turn, in terms of what Latin American countries are willing do to stand up to the IMF and to the Washington Consensus. I mean, this is really -- I think it’s hard to overestimate how important this is.
AMY GOODMAN: Hugo Chavez agreed to refinance $5 billion of Argentina's debt?
JOCELYN OLCOTT: Yeah.
AMY GOODMAN: And Cristina Fernandez de Kirchner's relationship with Hugo Chavez?
JOCELYN OLCOTT: I mean, that remains to be seen. I think that she’s been very savvy about being -- you know, kind of playing all sides. And so, she’s, you know, been pictured with Laura Bush and all this stuff. I think she’s trying not to take sides too strongly. But it’s clear that there’s a sort of counterweight developing in the Southern Cone that is supposed to outweigh the Washington Consensus, which is impressive.
AMY GOODMAN: We’re going to leave it there. I want to thank you very much for being with us. Professor Jocelyn Olcott of Duke University teaches Latin American history there. And Mark Weisbrot, co-director of the Center for Economic and Policy Research in Washington, D.C.