Groundhog Day Looms in Argentina as the IMF Returns
Groundhog Day Looms in Argentina as the IMF Returns
By: Dan Ozarow
Published 17 September 2016
. . .
It was a sticky late-December evening in 2001 and the masses were responding to the astonishing site of President Fernando De La Rua fleeing the presidential palace in a helicopter. Once hailed by the International Monetary Fund as a poster-child for obedience to its formula of structural adjustment, austerity and neoliberal reforms in return for new loans during the 1990s, by 2001 the Argentine economy had collapsed and was on the verge of largest public debt default in history (until Greece), totalling US $132 billion.
Half the population descended into poverty, including swathes of the middle class, a quarter were left unemployed and depositors had their life-savings confiscated as the banks went under. Amid the chaos that engulfed the country, millions of citizens were in revolt in city centers nationwide, seeking to rebuild grassroots democracy through neighbourhood assemblies, worker-run factories and participatory budgets.
But aside from the banks, politicians, judicial system, political parties and the rest of the established order whom the population wanted a shot of, a Latinobarometer poll at the time indicated that the IMF featured second only to “the government” in terms of whom the Argentines deemed most culpable for having caused the economic and political crisis. Once the insurrectionary spirit of those extraordinary times had been placated by the election of a new left-leaning government led by President Nestor Kirchner in 2003, the remaining US $10 billion debt to the IMF was promptly paid off and the institution soon expelled from the country. Following the default, two-thirds of the outstanding debt was written off. Combined with favorable global commodity prices, prudent internal investment and Chinese demand for Argentina’s soya exports, the economy went on to become the fastest-growing in the Western Hemisphere, lifting 11 million out of poverty while prosperity returned for many. Despite the initial pain and becoming a pariah on the global markets due to its refusal to cede to the repeatedly-failed IMF policy recipe, debt default proved the right thing to do.
Yet on Sunday the IMF will be back in Argentina to inspect the accounts. Invited by conservative, neoliberal President Mauricio Macri, who came to power in December 2015, the official brief of the IMF’s economists is “to assess the sustainability of the country’s fiscal and monetary policies.” In practice its imminent return is already stoking misery for Argentina’s embattled people.
More:
http://www.telesurtv.net/english/opinion/Groundhog-Day-Looms-in-Argentina-as-the-IMF-Returns-20160917-0019.html
