|
It used to be called the ''Paris of the South'' - and
there is no doubt that Buenos Aires is a beautiful city
with a very European feel. To the outside observer,
it does not even appear to be in a developing country,
not least because the resident population is almost
completely dominated by relatively recent European migrants
of the past century and a half. Indeed, Argentina is
still much richer and more developed than most countries
in the world, and in Buenos Aires the evidence of past
splendour still dominates in the wide boulevards and
imposing classical architecture that fill the centre
of the city.
Yet
the grandeur is a little faded - and perhaps is all
the more charming for that reason, like a newly impoverished
dowager holding on graciously (if a little anxiously)
to the signs of previous elegance and prosperity. For
all of its tumultuous recent history, especially in
the past half century, the city seems to be drawn towards
a more distant, stylish past. It is evoked in the spacious
central squares, including the famous Plaza de Mayo;
in the wonderful 19th century opera house; in the modish
cafes dotting the landscape around the imposing Recoleta
Cemetery where all the famous people are buried; in
the gloriously decadent old tango halls where young
and old people still come to watch, learn and perform
this most disciplined of erotic dances.
Of course there is much more to it, because at another
level the city is another of the huge urban conurbations
that are becoming more and more prevalent in the developing
world in the 21st century. While the central city has
around 3 million residents, another 9 million or so
are in greater Buenos Aires, making it a large city
even by Latin American standards. (Of course Sao Paulo
in Brazil and Mexico City, with well above 20 million
inhabitants each, are still far ahead.)
In much of this larger city, nostalgia is actually a
thing of the past, as typically 20th century high-rise
housing and 21st century malls compete for attention
and Portenos (as the local residents are called) face
the usual preoccupations of contemporary life such as
finding and keeping jobs. Every so often, just to prevent
the apparent signs of prosperity from misleading, it
is possible to see groups of adults and children on
the streets engaged in the what is currently the most
dynamic urban informal sector occupation: picking through
the garbage bags to find and take away whatever of the
contents can be recycled.
All this is the culmination of a very complex set of
volatile and extreme political and economic changes
over the past half century. In Argentina today, the
legacy of Peronism is not much talked about, despite
the fact that it is the Peronist Party which currently
rules the government. Literature and media have ensured
that the world remembers the glamour of Evita and the
populist and often perverted machismo of General Juan
Peron as the most significant features of that time.
But there is also a significant economic legacy, which
enabled development in the 1940s and onwards by setting
up the industrial base in what was a dominantly agricultural
economy. It also recognised workers' rights in a systematic
way, creating one of the first welfare states of the
developing world.
The millitary coup of the 1976 brought in one of the
most vicious dictatorships of the 20th century, brutal
and destructive even by Latin American standards. The
ruling junta did not simply destroy all the existing
democratic opposition: it used the most sadistic forms
of physical and psychological torture to drive people
out of the country and prevent any new opposition from
emerging. The generals and their cohorts also looted
the country, driving the economy into deep debt which
financed their own luxury expenditures and capital flight.
The dramatic debt crisis of Argentina in the 1980s reflected
borrowing which had been mostly misused by the military
regime, very little of which actually translated into
productive expenditure.
As in Chile, the transition to democracy in the 1980s
was perforce made on the basis of what has been described
by Chilean social theorist Manuel Riesco as ''a hideous
pact''. Effectively, the generals and other perpetrators
of the ghastly crimes of the military period were exonerated
from any possible punishment, and neoliberal economic
strategies were maintained in both countries. The democracies
that emerged were therefore necessarily constrained
from putting into place policies that would directly
benefit the people. It did not help that they came into
being at a time of economic crisis, when unsustainable
external debt payments combined with domestic hyper
inflation to force all these countries into the standard
IMF stabilisation-cum-adjustment package.
In Argentina, the neoliberal economic policies pursued
in the 1990s made things worse because of the obsession
with restricting inflation and impetus to privatise
almost all public assets and service delivery. A supposedly
permanent link of the Argentine peso to the US dollar
caused deflation at the same time that financial liberalisation
led to financial fragility despite the stringent monetary
policy.
The resulting financial crisis in 2001 was extreme even
by Latin American standards, with a collapse of the
peso and of the domestic credit system and very deep
economic slump, with a 20 per cent fall in GDP in the
subsequent year. Income distribution worsened sharply
and poverty rates doubled within a few months. All this
also led to severe political instability - as the locals
put it, history was being doled out by the day. There
were six governments within the space of a few months,
complete turmoil in civil society and the breakdown
of banking institutions and other forces that normally
keep capitalism running.
Yet from the wreckage something could and did emerge,
and it has created the basis for one of the more successful
economies in Latin America at the moment. The Peronist
government led by Nestor Kirchner has proved to be both
more stable and more quietly progressive than could
have been imagined when he first took over the reins
of government.
Kirchner's own background should not be ignored - he
and his wife, the recently elected Senator, were both
Monteneros, part of the Resistance movement against
the generals, and many of their friends were among those
who ''disappeared'' to be tortured and killed by the military
regime. His government has emphasised social spending,
including unemployment benefits, and avoided further
cuts in basic government expenditure.
The imposition of export taxes (up to 25 per cent of
value of export of primary goods) in early 2002 proved
to be a great boon as international commodity prices
have been increasing, agricultural export values have
gone up and contributed more to the government exchequer.
There has also been a revival of the import substituting
industries that had collapsed in the 1990s, and new
forms of export, such as software, have emerged. As
a result, the economy has grown by 9 per cent per annum
for the last three years, and the unemployment rate
has fallen from 23 per cent in 2002 to less than 14
per cent currently.
A major achievement of the government was the renegotiation
- or effective default - of the Argentine external debt
in 2004, whereby international creditors had to accept
a deal that wiped out around 65 per cent of the face
value of the debt. This was managed in the teeth of
IMF opposition, and provides a powerful example to other
highly indebted developing countries. Argentina has
also repaid its loan to the IMF ahead of time, so as
to avoid continuous interference in domestic economic
policies.
The recent changes in Argentine economy and polity are
complex and not easily categorised, but they are indicative
of wider changes taking place across the subcontinent,
pointing to a wider range of progressive possibilities
for people across the developing world.
|
