Argentina's Downward Spiral

By Jaime Daremblum

Since the early 2000s, tens of millions of people have emerged from poverty in Brazil and Peru; Colombia has transformed itself from a potential failed state into a fast-growing economic star; and Chile's per capita income has increased dramatically, moving above the $20,000 benchmark. Surely these are the very best of times for South America?

Not quite. The gains in Brazil, Peru, Colombia and Chile have occurred during a period of severe democratic erosion in Venezuela, Bolivia, Ecuador and Argentina. Each of the latter four countries have become elected autocracies led by caudillo-style populists who retain the superficial trappings of democracy while persecuting political opponents, attacking independent journalists and seeking near-dictatorial control over public institutions. As a result, the rule of law in these nations has been either crippled or demolished.

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Take Argentina. Its current president, Cristina Kirchner, succeeded her late husband, Néstor Kirchner, in December 2007, and over the past six years she has governed as an increasingly radical leftist. At a January 15 Hudson Institute conference, former U.S. ambassador Lino Gutiérrez explained that, while the Néstor Kirchner government often used "heavy-handed" political tactics, "I don't think anybody was that worried about democracy in 2005 [and] 2006. But gradually things got worse." When you look at Argentina today, said Gutiérrez, "you see police strikes, you see energy cuts, you see looting, you see a depletion of reserves, you see runaway inflation ... you see corruption scandals among government ministers." The Argentine economy, he added, has become "a slow train wreck."

Under Cristina Kirchner, press freedom has been trampled; newspapers, journalists, researchers and opposition governors have been targeted for political reasons; and judicial independence has effectively been eradicated. The Kirchner government has weakened unfriendly media outlets with its controversial 2009 "anti-monopoly" law, and also with other, more authoritarian maneuvers. In early 2013, for example, Argentine supermarkets and electronic retailers told the Wall Street Journal that the government had "ordered them to stop advertising in the country's top newspapers." More recently, Argentina's Supreme Court upheld the 2009 law, thereby forcing the nation's biggest media company (Grupo Clarín) to be dismantled.

Meanwhile, the Kirchner government has repeatedly seized private businesses and other private property -- including private pension accounts, the country's largest airline (Aerolíneas Argentinas) and 51 percent of the interest of the Spanish oil company Repsol in YPF -- and it has been censured by the International Monetary Fund for deliberately publishing false economic data. Moreover, the government has harassed economists and journalists for reporting the correct data. Back in September 2011, an Argentine judge went so far as to subpoena several newspapers for the contact information of writers and editors who had worked on stories related to the economy. (The same judge also subpoenaed the IMF's Argentina office for consultant and client records.) This prompted foreign affairs commentator Walter Russell Mead to declare: "Stockholders should be able to sue the management of any company which puts money into Argentina. It is hard to think of measures that send a more unmistakable warning of dishonesty and impending crisis. Nothing and no one can be safe in a country where such things are done."

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Ambassador Jaime Daremblum is director of the Center for Latin American Studies at the Hudson Institute.

(AP Photo)

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