Argentina

The Argentine Republic dates from 1816, and its earlier phases — the Viceroyalty, the United Provinces, the confederation of the provinces under Rosas — are treated in their own entries. This one begins in 1930 because that is where the map's border data begins, and because the modern Argentine state is recognisably a creature of that year's break: the collapse of the first Radical experiment, the arrival of the army as a permanent arbiter, and the search for a new coalition of labour, industry and state that has dominated politics ever since. The name on the map, "Argentina", is the short form of República Argentina; the constitution of 1853, revised in 1860, 1949, 1957 and 1994, is nominally still the one under which the country is governed.

What makes Argentina a world subject rather than a regional one is that it ran the twentieth century's experiments early and hard. It industrialised behind a tariff wall before Latin America did; it built a welfare state and a mass labour party a decade before Britain; it produced one of the first truth commissions and the first major domestic war-crimes trial after 1945; in 2001 it defaulted on the largest sovereign debt in history to that date without a war or a revolution; and it has spent four decades living with inflation rates that elsewhere accompany state collapse. The results are not a morality tale. They are a record of what a rich, literate, resource-exporting society can do to itself when its political system cannot settle who is entitled to what.

At a glance

Why did the constitutional order collapse in 1930?

The Radical Civic Union had governed since 1916, when the Sáenz Peña law of 1912 — secret ballot, universal male suffrage — turned a fraud-ridden oligarchic republic into something like a democracy. Hipólito Yrigoyen, its founder, was a strange democrat: a man of the provincial middle class who governed through personal intervention, kept his party as a movement rather than an organisation, and intervened in the provinces at will. His second term, which began in 1928 when he was seventy-six, coincided with the collapse of agricultural prices after October 1929. Argentina's exports fell by about a third, the peso came under pressure, and the government, which had no central bank and no income tax worth the name, responded with exchange controls and hesitation.

The coup of 6 September 1930 was hardly a battle. General José Félix Uriburu marched a few thousand troops into Buenos Aires, the garrisons declared for him, and Yrigoyen was arrested in La Plata. Crowds came out in the streets in support, which is the part usually forgotten: the coup was popular with a middle class tired of Yrigoyen's patronage and with students who thought his government corrupt. Uriburu's own programme was corporatist — a chamber of corporations rather than parties, a state organised by function instead of by vote — and it failed. He was replaced in 1932 by General Agustín P. Justo, who won an election in which the Radicals were proscribed and which nobody described as clean.

The regime that followed, the Concordancia, governed from 1931 to 1943 through a mixture of fraud, patronage and the army's veto. The name it acquired, the "Infamous Decade", was coined afterwards by its opponents, and it captures the political record better than the economic one. Justo's minister of finance, Federico Pinedo, and the foreign minister, Julio Argentino Roca (hijo), negotiated the Roca–Runciman treaty of 1933 with Britain: Argentina got a guaranteed share of the British meat market, which the Ottawa agreements of 1932 had put at risk, and in return conceded that British companies would be treated no worse than domestic firms and that the exchange control would favour British creditors. Roca defended it in the Senate as the price of the trade that kept the country solvent, which it largely was. The treaty is remembered as a surrender; it was a hard bargain struck from weakness by a country whose main customer had just built a wall.

The decade's economic record is better than its politics. Tariffs and exchange controls pushed manufacturing up, and industry's share of output rose steadily; the Central Bank, created in 1935 with Raúl Prebisch as its first manager, gave the state instruments it had never had. What the growth did not do was absorb the rural population. Migrants from Santiago del Estero, Corrientes and the Chaco moved into the rings of shanty towns around Buenos Aires, took jobs in the new factories, and found that the state that taxed their employers had nothing to offer them in law. That population, and not the pampas, would decide the next twenty years.

How did a staff officer become the leader of the working class?

The regime ended as it had begun, with a coup. On 4 June 1943 a group of officers — the United Officers' Group, or GOU, a secret lodge of colonels and majors — overthrew Ramón Castillo, the conservative president who had succeeded the dying Roberto Ortiz in 1942. The plotters were nationalist, Catholic and anti-communist, divided between those who wanted a corporatist state and those who wanted a modernising military government, and united mainly in wanting to keep Argentina neutral in a war many of them expected Germany to win, and in ending the fraud of the Concordancia. General Arturo Rawson lasted three days; General Pedro Ramírez a year; General Edelmiro Farrell, from February 1944, presided over a regime that had already begun to look for a popular base.

It found one through a colonel who had been posted to the Department of Labour in October 1943 and turned it into a machine. Juan Domingo Perón was forty-seven in 1943, a career officer who had taught military history, served as a military attaché in Rome, and understood both the army's fear of revolution and the unions' hunger for recognition. From the labour secretariat he pushed through collective bargaining, wage awards, paid holidays, accident compensation and a Christmas bonus, recognised unions that his predecessors had jailed, and built a personal following among the railwaymen, meatworkers and textile hands of Greater Buenos Aires. When an earthquake destroyed San Juan in January 1944, he ran the relief fund and put Eva Duarte, a radio actress, on the committee — the beginning of the partnership that would define the movement.

His colleagues moved against him in October 1945: he was arrested and taken to Martín García island, and the labour movement, which had never had a leader inside the state before, called a general strike. On 17 October 1945 the workers of Greater Buenos Aires marched into the Plaza de Mayo and stayed there until he appeared on the balcony of the Casa Rosada. Whether the demonstration was spontaneous or organised by the CGT and Eva Duarte is still argued; what is not argued is that it invented a political actor — the descamisados, the shirtless ones — and a date that Peronism treats as its foundation. He married Eva on 22 October, was nominated by a coalition of labour, dissident Radicals and Catholic nationalists, and on 24 February 1946 won the presidency with 53.7 per cent of the vote and 304 of the 376 electoral votes.

The campaign turned on the United States. The ambassador, Spruille Braden, published a "Blue Book" accusing the Argentine government of harbouring Nazis and produced the slogan "Braden or Perón", which was exactly the gift Perón needed. The opposition, the Democratic Union, was a coalition of the old parties and the oligarchy, and it campaigned as the defender of the Allies and of decency. Perón campaigned as the country against the world.

What did Peronism build in its first three years?

Between 1946 and 1949 the Argentine state was rebuilt around three ideas: that the country's wealth should be redistributed through wages, that the state should own the commanding heights, and that industrialisation should be paid for by agricultural exports. The Central Bank was nationalised in 1946, the railways — mostly British-owned, and bought with sterling balances accumulated during the war — in 1947 and 1948, the telephone system in 1948, and the universities were put under direct government control in 1946. The Instituto Argentino de Promoción del Intercambio, the IAPI, took a monopoly of foreign trade, buying the harvest at domestic prices and selling it abroad, and used the difference to subsidise industry and urban consumers.

The results in the first years were real. With the terms of trade at their best in a generation and Europe short of food, the IAPI ran large surpluses. Real wages rose by more than a third between 1946 and 1949 by the usual estimates, and the share of national income going to wage-earners rose with them. A five-year plan announced in 1946 and formalised in 1947 put money into energy, transport and heavy industry: the state steel company Somisa, the national electricity utility, a merchant fleet, an airline. Half a million houses were built, hospitals and schools opened, and university tuition was abolished. In 1947 the congress granted women the vote, and in 1951 they used it for the first time.

Eva Perón was the second centre of power. As first lady she ran the Fundación Eva Perón from 1948, which distributed shoes, sewing machines, medicines and housing with a speed and publicity that the ministries could not match, and she organised the women's branch of the party, which gave her a political base independent of the unions. Her intervention in the 1951 campaign, when the CGT proposed her as vice-president and she declined in front of a crowd on the Ninth of July Avenue, is one of the republic's set pieces; she was already dying of cancer, and she died on 26 July 1952, at thirty-three. Her body was embalmed and kept until the coup of 1955, then smuggled to Italy and buried in Milan under a false name; it was brought back to Argentina in 1971.

The constitutional rewriting of 1949 was the movement's attempt to make itself permanent. A convention was elected, the Radicals withdrew before the vote, and the new text was approved by Peronist votes alone. It added a chapter on the "social function of property" and the rights of workers, the family and the old, made the president immediately re-electable, abolished the electoral college, and gave the state the right to nationalise public services and mineral resources — Article 40, which the opposition regarded as a licence for expropriation and which the Peronists regarded as the point of the exercise. The same year's law of political parties required three years' standing before a new party could contest elections, which was plainly aimed at the opposition.

Peronism in power was also intolerant in ways its admirers underplay. The Supreme Court was impeached in 1947; the press was harassed, and La Prensa, the country's leading newspaper, was expropriated in 1951 and handed to the unions; opposition politicians were jailed, and the universities lost most of their autonomy. Perón governed as a plebiscitary leader with a party that was really a movement, a congress that did what it was told and a union structure that delivered votes in exchange for wages.

Why did the Peronist economy stall?

The model had a flaw that nobody in Buenos Aires wanted to name: it taxed the countryside to pay the cities, and the countryside was where the foreign currency came from. As long as agricultural prices were high, the arithmetic worked. From 1948 they fell, the Marshall Plan restored European production, and the buyers of Argentine beef and wheat became choosier. The drought of 1949 cut the harvest, the IAPI's surplus turned into a deficit, and the government found that it had spent the reserves it needed to import the machinery its factories required.

The adjustment came in stages. In 1949 the government devalued, cut some subsidies and slowed the nationalisations; in 1952, after a second drought and a trade deficit of some US$500 million, it froze wages and prices in a biennial bargain, cut public investment, and began courting foreign capital — the first steps towards the oil contracts with Standard Oil of California that were signed in 1955 and annulled after the coup. A second five-year plan shifted emphasis from light consumer goods to cars, petrochemicals and machinery, which required more imports, not fewer. Inflation, which had been 50 per cent in 1951, was driven down by the controls of 1952 and then began to climb again as soon as they were loosened.

Perón's second term, which began in June 1952, was therefore a defensive government. Real wages fell from their 1949 peak; strikes became common; the regime answered with arrests and with the cult of Evita, whose death had removed the one figure who could talk to the movement's left. The conflict with the Catholic Church, which had blessed the regime in 1946, broke out in 1954 over divorce, religious education and the church's charities, and the government's answer — prosecuting priests, legalising prostitution, restricting processions — was vindictive and self-defeating. By 1955 the coalition of 1946 was gone: the church was hostile, the army was divided, the middle class was tired, and the unions were the only organised support left.

The end came in two blows. On 16 June 1955 navy and air force planes bombed the Plaza de Mayo in an attempt to kill Perón, killing more than 300 people in the square and the surrounding streets; it remains the largest air attack ever mounted on the Argentine mainland. On 16 September, General Eduardo Lonardi raised the flag of revolution in Córdoba, the navy seized the port of Río Santiago and the fleet at Puerto Belgrano, and after four days of fighting Perón resigned and took refuge on a Paraguayan gunboat. He would spend eighteen years in exile, mostly in Madrid, and would return only when the soldiers who had exiled him could no longer govern without him.

What did the 1955 coup settle?

The Revolución Libertadora answered the question of who should rule and created a worse one: whether the half of the country that had voted for Perón could be allowed to vote at all. Lonardi wanted reconciliation — his slogan was that there were neither victors nor vanquished — and he was removed within two months by hardliners who wanted the movement destroyed. General Pedro Aramburu, who replaced him in November 1955, proscribed Peronism, purged the unions and the universities, and in 1956 declared the constitution of 1949 void, restoring the text of 1853. A constituent assembly in 1957, elected with the Peronists abstaining, added Article 14 bis, which constitutionalised workers' rights — the one part of the Peronist legacy the anti-Peronists were willing to keep — and broke up over the attempt to restore Article 40.

The result was a political system with a permanent hole in it. The Justicialist Party could not stand; its voters could still vote, and they could be counted on to abstain, to vote blank, or to vote for whoever seemed closest to Perón. Arturo Frondizi, the Radical who won the presidency in 1958, had made a pact with Perón to get those votes, and governed as a developmentalist: oil contracts with foreign companies, a steel industry, motor manufacturing, a vast public works programme. He also used the army against strikes under a state-of-siege regime, and in 1962, when Peronists won several governorships, the generals removed him. The presidency passed to a Radical senator, José María Guido, who governed for eighteen months with the army looking over his shoulder.

Arturo Illia, elected in 1963 with a quarter of the vote and a Peronist abstention, was honest, slow and disliked. He cancelled the oil contracts, regulated pharmaceutical prices, and did nothing about the one question that mattered, which was how to bring the Peronists back into the system without handing them the government. The army answered that in June 1966.

Why did the generals decide to stay this time?

The coup of 28 June 1966 was different from its predecessors. Previous interventions had described themselves as provisional, promising elections and going home. General Juan Carlos Onganía and the officers around him announced a "Revolución Argentina" with no timetable, abolished the parties, and set out to build a corporatist, Catholic, authoritarian state that would last a generation. Onganía admired Francoist Spain and wanted a similar arrangement of functional representation, a disciplined society and a state above class. The unions were to be incorporated, the universities purged and the young taught order.

The economic side was run by Adalbert Krieger Vasena, who devalued the peso in 1967, imposed a wage freeze, raised tariffs on some imports while liberalising others, and wooed foreign investment. Growth resumed, inflation fell, and for two years the model looked as if it might work. What it could not do was accommodate the political consequences of its own modernisation. The universities had expanded hugely in the 1960s, and their students were the first Argentine generation to combine a mass higher education with a radicalised Catholicism and a reading of dependency theory. The industrial belt around Córdoba, built on foreign car plants, was the most modern in the country and the best organised.

On 29 May 1969 the police of Córdoba shot a worker, Máximo Mena, during a protest, and the city rose. Students, car workers and the CGT's Córdoba branch under Agustín Tosco held the centre for two days, built barricades, burned the offices of foreign companies, and were dislodged only when the army sent in troops with tanks. The Cordobazo killed dozens — the counts vary from a handful to more than thirty — and wounded hundreds, and it destroyed the regime's claim to competence. Within a year Onganía had been replaced by his own junta; General Roberto Levingston lasted nine months; General Alejandro Lanusse, from 1971, promised a return to democracy and tried to manage it through a Grand National Accord that would include Perón.

The armed groups had their own timetable. The Montoneros, Peronist and Catholic in origin, kidnapped and killed Aramburu in 1970; the Marxist ERP opened a rural front in Tucumán; the urban cells robbed banks and kidnapped executives. In August 1972 sixteen guerrillas were shot at the Almirante Zar airbase near Trelew after a prison break, an episode that ended any chance of a negotiated transition without rancour. When the elections came on 11 March 1973, Peronism's candidate, Héctor Cámpora, took 49.5 per cent and the presidency, and the military government withdrew.

How did Perón's return turn into a war inside Peronism?

Cámpora's inauguration on 25 May 1973 was attended by the Cuban and Chilean presidents and by crowds chanting for a socialist homeland, and the first acts of his government — an amnesty for political prisoners, the release of the guerrillas, the reopening of the universities — were the work of a movement that had spent eighteen years in opposition. Perón, still in Madrid, watched with the distaste of a man who had built his career on the unions and the army and who now found his name claimed by the young.

The break came at Ezeiza on 20 June 1973, when Perón flew home for good. The organising committee, run by the right, put the platform behind a screen of armed men; as the crowd pressed forward, snipers opened fire. At least thirteen bodies were identified and 365 people were wounded, and the true death toll was almost certainly higher. The massacre settled the question of who owned Peronism: not the Montoneros, who had brought the crowds, but the old man and the union bosses. Cámpora resigned within a month, and in September 1973 Perón was elected president for the third time with 61.9 per cent of the vote, with his wife Isabel as vice-president.

He died on 1 July 1974, nine months into the term, and the movement he left behind had no mechanism for succession. Isabel Perón was a former nightclub dancer with no political base of her own; real power sat with her private secretary, José López Rega, an astrologer and policeman who had built a death squad, the Argentine Anticommunist Alliance, which had begun killing leftists in 1973 and continued under the new government. The Montoneros went back underground and the ERP intensified its campaign; the army was ordered to "annihilate" the guerrillas in Tucumán in 1975. The economy collapsed on 4 June 1975, when the economy minister, Celestino Rodrigo, imposed a 150 per cent devaluation, let fuel prices rise 180 per cent and utility tariffs 100 per cent, and conceded wage increases of 45 per cent. The "Rodrigazo" destroyed real wages, set off a wave of strikes and riots, and finished whatever legitimacy the government had. In November a state of siege was declared; on 24 March 1976 the army took the Casa Rosada and the president was arrested.

What was the Process, and how did it end in the Malvinas?

The junta that took power — General Jorge Videla, Admiral Emilio Massera and Brigadier Orlando Agosti — called its regime the National Reorganization Process and described it as a war. It dissolved the congress, banned the parties and the unions, imposed censorship, replaced the Supreme Court, and gave the police and the armed forces powers of arrest that had no judicial check. The method it chose was disappearance: people were seized, taken to clandestine detention centres, tortured, and killed; their bodies were buried in unmarked graves or, in the case of the "death flights", thrown into the sea from aircraft. Pregnant prisoners were kept alive until they gave birth, and the babies were given to families connected with the regime. The services cooperated with the dictatorships of Chile, Uruguay, Brazil and Paraguay in Operation Condor, exchanging prisoners and hunting exiles abroad: Argentine agents helped kill the former Chilean foreign minister Orlando Letelier in Washington in 1976, and the former Chilean commander-in-chief Carlos Prats in Buenos Aires two years earlier.

The numbers are disputed in a way that is worth setting out plainly. The National Commission on the Disappearance of Persons, appointed by Alfonsín in 1983, documented 8,961 cases in its report Nunca Más, and said the total was certainly higher. Human rights organisations and the official figure used by Argentine governments since 2003 put the number at 30,000. Other estimates, including a Chilean intelligence report of 1978, sit in between. What is not in doubt is the system: the commission listed 340 clandestine detention centres, the largest of them the Navy Mechanics' School in Buenos Aires, and the testimonies it collected established the practice of torture as policy rather than excess.

The dictatorship governed the economy through José Alfredo Martínez de Hoz, who cut tariffs, liberalised the financial sector, froze wages and borrowed abroad. His programme was presented as a break with forty years of Peronist statism; its results were a fourfold increase in the foreign debt, a speculative boom and, in 1981, one of the worst banking collapses in Argentine history. The regime's political capital came from two things: the 1978 World Cup, which Argentina hosted and won while the detention centres were full, and the dispute with Chile over the Beagle Channel, which brought the two countries to the edge of war in 1978 and was settled only by papal mediation.

The map year, 1977, falls in the worst of it. That was the year the disappearances peaked, the year the Mothers of the Plaza de Mayo began walking in front of the Casa Rosada on Thursday afternoons, and the year the United States, under Carter, made human rights a condition of its military relationship — a pressure that mattered less than the junta's own collapse. By 1981 the economy was broken and the junta was divided; Videla handed over to Roberto Viola, who was replaced within nine months by Leopoldo Galtieri, a man who needed a triumph.

The islands, known in Argentina as the Malvinas and in Britain as the Falklands, had been claimed by Buenos Aires since the 1830s, when a British squadron expelled the Argentine garrison. The claim was a fixture of Argentine diplomacy and of school textbooks; it was not a policy anyone expected to be settled by force. Galtieri's junta decided otherwise. On 2 April 1982 Argentine forces landed at Port Stanley, overwhelming a garrison of some 70 Royal Marines, and the following day took South Georgia. The junta calculated that Britain would protest and negotiate, that the United States would stay neutral, and that a short, popular war would restore the army's standing.

All three calculations failed. The United Nations Security Council demanded withdrawal; the United States, after an attempt at mediation by Alexander Haig, backed Britain and supplied it with missiles and intelligence; and the British dispatched a task force of some 100 ships, including two carriers and the requisitioned liners Canberra and Queen Elizabeth 2. The sinking of the cruiser General Belgrano on 2 May, in which 323 Argentine sailors died, ended any hope of a negotiated settlement, and the sinking of HMS Sheffield two days later showed that the Argentine navy's Exocets were dangerous. British troops landed at San Carlos on 21 May and fought their way across East Falkland in three weeks. The Argentine garrison in Stanley surrendered on 14 June. In seventy-four days, 649 Argentine servicemen, 255 British servicemen and three islanders had been killed.

The war destroyed the regime it was meant to save. The junta had lied to the public about the course of the fighting, and the returning conscripts told a different story; within days Galtieri was gone, and the army was looking for a way out. General Reynaldo Bignone, the last president, legalised parties, lifted the ban on the unions and called elections for October 1983. The war also fixed the Malvinas as a national cause that no subsequent government could abandon, and gave the armed forces a grievance — that they had been sent to fight a war their government had mismanaged — which they carried into the trials that followed.

What did Alfonsín's democracy achieve?

Raúl Alfonsín won the election of 30 October 1983 with 51.75 per cent of the vote and 317 of the 600 electoral votes, beating the Peronist Ítalo Luder, who had hinted at an amnesty for the military. Alfonsín campaigned on the opposite: that there would be no amnesty, and that the crimes of the dictatorship would be tried in the ordinary courts. He took office on 10 December 1983 and within a week had created the commission that became CONADEP.

The commission's report, delivered in September 1984 and published as Nunca Más, sold out in days. On 22 April 1985 the trial of the nine members of the three juntas opened before the Federal Criminal Court in Buenos Aires, with Julio Strassera and Luis Moreno Ocampo prosecuting; on 9 December Videla and Massera were sentenced to life imprisonment, Viola to seventeen years, Lambruschini to eight and Agosti to four and a half. It was the first time a democratic government had tried its own former dictators in a domestic court, and it set a template that courts in Chile, Guatemala and elsewhere would follow decades later. Strassera ended his summing-up with the words "nunca más", never again, which became the slogan of a generation.

Then the trials ran into the army. Discontent among the officers produced the carapintadas mutinies, the first of them at Easter 1987, when Alfonsín faced down the rebels from a balcony at Campo de Mayo. To hold the line he conceded two laws: the Full Stop law of 1986, which set a deadline for new prosecutions, and the Due Obedience law of 1987, which excused officers below the rank of colonel on the grounds that they had been following orders. Both were later annulled, in 2003 and 2005, and the prosecutions resumed in the 2000s; but in the 1980s they bought the government time at the cost of its moral capital.

The economy was the harder front. Alfonsín inherited a foreign debt of some US$45 billion, most of it contracted by the dictatorship, and an inflation rate already above 300 per cent. His Plan Austral of June 1985 — a new currency, a price freeze, a wage freeze and a fiscal tightening — worked for a year and a half, and then the price of the freeze became a shortage of foreign exchange and a budget that could not be cut. By 1988 the government was improvising a second plan and the austral had collapsed; in 1989 prices rose by more than 3,000 per cent over the year. With food riots in Rosario and Buenos Aires and the Peronist Carlos Menem elected in May, Alfonsín handed over power five months early, on 8 July 1989.

How did Menem end hyperinflation, and why did the peso collapse anyway?

Menem had campaigned on a populist platform — a "productive revolution", wage increases, no privatisations — and governed as the opposite. His economy minister, Domingo Cavallo, pushed through the Convertibility Law in March 1991: from 1 April the austral was fixed at 10,000 to the dollar, the Central Bank was required to hold reserves equal to the whole monetary base, and contracts could be written in dollars. In January 1992 the austral was replaced by a new peso at one to the dollar. Inflation fell from more than 3,000 per cent in 1989 to 3.4 per cent in 1994, the state sold the telephone company, the airlines, the oil fields, the roads, the water and the electricity, and the proceeds paid for the deficits that had been financed by the printing press.

The social cost was heavy and uneven. Unemployment, which had been under 7 per cent in 1990, reached double digits by the middle of the decade and never came down; manufacturing employment fell by a quarter or more as tariffs dropped and the fixed peso made exports expensive. The provinces, which had been bailed out by the Central Bank, were squeezed. Corruption became the currency of politics: the privatisations were sold through procedures that enriched friends of the government, and the 1994 bombing of the AMIA Jewish community centre in Buenos Aires, which killed 85 people, has never been properly investigated. With Brazil, Paraguay and Uruguay he built Mercosur, the customs union signed in 1991, which gave Argentine industry a protected regional market and tied the country's trade to its largest neighbour.

Menem also rewrote the rules to keep himself in office. In 1990 he pardoned the convicted commanders, including Videla. In 1994, after the Pact of Olivos with Alfonsín, a constituent convention in Santa Fe approved a reform that shortened the presidential term to four years, allowed one immediate re-election, gave constitutional rank to human rights treaties, and inserted Article 36, which declares the coups of the past void and makes anyone who interrupts the constitutional order guilty of treason. Menem won again in 1995. By 1998 the economy was in recession, the Asian and Russian crises had raised the cost of Argentina's debt, and the fixed exchange rate — which had worked while dollars were plentiful — turned every external shock into a domestic slump.

Fernando de la Rúa, the Radical who won in 1999 at the head of an alliance with the left, inherited the recession and the debt. His government raised taxes, cut salaries and, in 2001, brought Cavallo back to save the currency. Cavallo's answer was the corralito: from the beginning of December, withdrawals from bank accounts were limited to a few hundred pesos a week. The measure hit the middle class, which had kept its savings in dollars, and it produced the cacerolazos — the pot-banging protests — that spread from Buenos Aires to every city. On 19 December the government declared a state of siege; that night and the next day 39 people were killed in the streets, most of them in the poorer provinces, and de la Rúa resigned on 20 December.

What followed is usually described as five presidents in ten days. Adolfo Rodríguez Saá, elected by the congress, defaulted on some US$82 billion of sovereign bonds on 23 December — the largest sovereign default in history to that date — and resigned a week later. Eduardo Duhalde took office on 2 January 2002, ended convertibility, and converted dollar deposits to pesos at 1.4 to the dollar while debts stayed at one to one, a decision that transferred a large part of the banking system's losses to savers and to the state. The economy shrank by 10.9 per cent that year, having fallen for four years in a row, and unemployment passed a fifth of the workforce. More than half the population was below the poverty line.

What did Kirchnerism do with the recovery?

The recovery began in 2002 with the end of the fixed exchange rate: a cheap peso made exports competitive, soy and commodity prices were rising, and the factories that had survived had spare capacity. Néstor Kirchner, elected in 2003 with 22.3 per cent of the vote after Menem withdrew from the run-off, inherited a country whose economy was already growing at 9 per cent a year. His contribution was political: he purged the army of the officers who had protected the torturers, reopened the human rights cases, and made the memory of the dictatorship a central theme of government, with the conversion of the ESMA into a memorial site and the annulment of the amnesty laws.

His governments, and those of his wife Cristina Fernández de Kirchner, who succeeded him in 2007, ran a model built on high commodity prices, export taxes on soy, price controls and subsidies. The 2005 debt restructuring, in which 76 per cent of defaulted bonds were exchanged for new ones at about 30 cents on the dollar, and a second swap in 2010 that brought the total to 93 per cent, cleared the way back to the capital markets. Growth averaged 7 per cent between 2003 and 2011; poverty fell sharply; real wages rose; and Argentina paid off its IMF debt in 2006.

The model's limits appeared as soon as the commodity boom faded. The government's answer to inflation — price controls, export bans, and an official statistics office that was intervened in 2007 and began publishing figures nobody believed — destroyed the credibility of the numbers on which policy depended. The conflict with the farmers over export taxes in 2008 produced four months of roadblocks and a senate defeat for the government; the 2011 re-election of Cristina Fernández with 54 per cent was followed by the exhaustion of the reserves, the expropriation of the oil company YPF in 2012, and a return to the defaulters' bench in 2014, when a New York court ruled that Argentina could not pay the holders of restructured bonds unless it also paid the holdouts. The country defaulted again, technically, in July 2014, and settled with the holdouts in 2016 for about US$9 billion.

Where does Argentina stand now?

Mauricio Macri, elected in 2015 with 51.3 per cent in the first run-off in Argentine history, promised to unwind the controls gradually and to attract investment. He cut export taxes, unified the exchange rate and restored the statistics, but the fiscal deficit barely moved, and in 2018 a currency run forced him to accept an IMF standby arrangement of US$50 billion — later increased — the largest in the Fund's history. The money did not stop the fall; the peso lost half its value, inflation passed 50 per cent, and in 2019 Macri lost to Alberto Fernández, whose running mate was Cristina Fernández de Kirchner, by 48.2 to 40.3 per cent.

The Fernández government inherited a debt it could not pay and a pandemic it handled with a long lockdown and a large fiscal response. It restructured the private debt in 2020 and the IMF debt in 2022, but the printing press paid for the deficit, and inflation rose from 54 per cent in 2019 to 95 per cent in 2022 and 211 per cent in 2023. In the election of that year, with inflation out of control and the reserves empty, the voters turned to Javier Milei, a libertarian economist and television panellist who promised to abolish the Central Bank and dollarise the economy. He took 55.7 per cent in the November run-off against the economy minister, Sergio Massa — the highest share since the return of democracy — and took office on 10 December.

Milei's first year was a shock programme: a 54 per cent devaluation, the elimination of price controls, the deregulation of rents and prices, a vetoed pension increase, and the layoff or non-renewal of tens of thousands of public employees. Inflation fell from 25 per cent a month in December 2023 to under 3 per cent by the end of 2024, the fiscal deficit was eliminated, and the economy contracted by about 1.3 per cent for the year. Poverty, which private estimates put above 50 per cent in early 2024, fell below 40 per cent by the end of the year. Whether the stabilisation can survive an election, a union offensive or a run on the peso is the open question of Argentine politics; the country has had stabilisations before.

Common myths about Argentina

Timeline of Argentina

What the map shows next

At 1947 on the map Argentina is at the height of the first Peronist government: the railways are nationalised, the IAPI is running a surplus, and the country that the map draws is the one that seemed, to contemporaries, to have found a way to combine industrialisation with social peace. Look at the shape of the territory too — the same borders that the 1930s inherited, with the Chaco, Formosa and Patagonia still national territories administered from Buenos Aires.

By 1969 on the map the map shows a country whose politics have broken: Onganía's corporate state is in its last year, and the Cordobazo has just shown what the industrial belt can do. At 1982 on the map the junta is fighting a war it will lose within ten weeks, over islands that lie off the edge of the drawn territory. At 2001 on the map the borders are unchanged and the state is in the middle of the collapse that produced the default; what the map cannot show is that the country's economic geography had shifted, with soy and the port complexes of the Paraná replacing the old industrial belt as the source of foreign exchange.