Deuda externa, crisis y política

The economic impact of the Proceso de Reorganización Nacional dictatorship (1976–83) remains a topic of perennial interest among scholars and wider publics in Argentina. In addition to the legacies of its infamous human rights abuses, the regime left behind a ballooning foreign debt and other burdens. In this slim volume, Raúl García Heras revisits the contentious history of dictatorship and debt. His study makes an empirical contribution to ongoing debates by drawing on a range of sources, including state records, the financial press, and the archives of multilateral organizations. In this regard, the author furthers the path blazed by historians, like Claudia Kedar, who have analyzed the power dynamics of Argentina's relations with the International Monetary Fund (IMF). In his exploration of the world of international borrowing, García Heras keeps the focus tightly on the top civilian officials and their policy tools.That said, there is a broader interpretation implicitly at work here. Rather than beginning with the Proceso, this study examines the deterioration of relations between Argentinean authorities and the “international financial community” (the IMF and the World Bank, US agencies like the Export-Import Bank of the United States, and major investment banks) during the early 1970s. As the initial boom of Juan Perón's third presidency faded, public officials faced fiscal deficits and surging inflation. Despite asserting a staunchly nationalist position, Peronist ministers worked behind the scenes to secure foreign credit to relieve these pressures. Their efforts bore little fruit—not surprisingly, given the mutual mistrust among these actors and the increasing political disarray. As García Heras shows, the advisers of the military-led regime that seized command in March 1976 made mending relations with the international financial community a priority.The man picked for this mission, José Alfredo Martínez de Hoz, became one of the country's most famous (and infamous) economics ministers. García Heras distinguishes sharply between two phases of his tenure. From 1976 to 1978, Martínez de Hoz adopted policies that, in the author's estimation, pulled Argentina back from the brink of hyperinflation and default. He managed to secure generous loans from the IMF and the World Bank—over the objections of the Jimmy Carter administration, which was concerned about the regime's brutal crimes. The design of the adjustment measures mattered, but so, too, did the persona of Martínez de Hoz. As the scion of a wealthy landed family, he had friends in high places within international organizations and espoused an economic liberalism embraced by foreign pundits. For García Heras, Martínez de Hoz was far less effective in his second phase (1979–81). As the economy began to slump under military rule, the minister sought to energize business activity by deregulating the banking system while implementing a series of preannounced devaluations in the exchange rate (the so-called tablita cambiaria). These steps created the conditions for a feeding frenzy of speculation and reckless borrowing abroad. They also led to a severe overvaluation of the peso, which contributed to a flood of imports, deindustrialization, and rising unemployment. The author considers how the officials who replaced Martínez de Hoz confronted the fallout, often in ways that aggravated these problems.One of the book's most intriguing sections examines the responses of domestic institutions like the Banco de la Nación Argentina and the Banco de la Provincia de Buenos Aires to the liberalization measures. García Heras documents how Argentinean bankers borrowed huge sums abroad in dollars and then made enormously risky loans to ventures locally and in Brazil, Poland, and Mexico, among other countries. They also lent money to different branches of the military that enabled significant foreign arms purchases, even as the domestic situation fell apart.This study's contributions are useful in building a more complete picture of the era's economic history. Yet, at times, the book sticks too closely to the viewpoint of its protagonists. Appreciating why Martínez de Hoz was lauded by financial journalists gets us only so far. One should also assess the wider social impact of the policy decisions made under military rule. What did Argentina ultimately get in exchange for more indebtedness? Whose interests did policymakers like Martínez de Hoz favor, and who suffered as a result? The fact that military-appointed authorities in the early 1980s nationalized the foreign debts run up by private banks and companies and added them to the public foreign debt—thus putting all citizens on the hook for their actions—merits more discussion. Such matters have been addressed in the scholarship on the dictatorship, and specialist readers will surely be able to fill in some of the gaps. But posing these questions would have placed the specific policy decisions analyzed in this book in a fuller context

Economic history · Economics · Humanities · Political science · Argentine historical studies · Latin American socio-political dynamics · Philosophy · Politics and Society in Latin America