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From promise to poverty: A country on the ropes

It's difficult to read or watch the TV accounts of the travail in Argentina these days — economic and personal — and square it with the vibrant, cosmopolitan, progressive country that was one of the world's shining spots a decade ago.

The stories of bank accounts frozen, money turned worthless, rioting in the streets of Buenos Aires, millions of middle class citizens finding themselves in poverty, are discomfiting in light of the turmoil that grips much of the world these days.

I had the good fortune to spend time in Argentina back when times were good. Buenos Aires was the Paris, the London of the southern hemisphere — wealth, culture, sophistication, and some of the friendliest, most hospitable people anywhere. The vastness of the country, from lush tropical forests of the north through the seemingly endless landscape of the pampas to the penguins and ice of Tierra del Fuego, was mind-boggling. Farming/ranching operations of 50,000 to 75,000 to 100,000 acres or more were not uncommon.

Life was good, investment money was flowing, and the future, like the horizon, seemed limitless. Now Argentina's on the ropes, its government and banking system in chaos.

In an e-mail, one of my hosts on that trip, while rejoicing in his country being favored to win the World Cup in football, says ruefully: “I know human beings can adapt to anything; come what may, life goes on. But it is difficult. Now, we go to the supermarket and buy whatever is available with whatever money we can get our hands on. Many common articles that include imported ingredients are very expensive or absent from the shelves. Everyone has to repair things now rather than buying new ones. The Titanic is getting closer to the iceberg and the crew members are drunk or out of their minds. Somehow, we have to make a 180-degree turn.”

Here are some of the things once prosperous, once boundlessly optimistic Argentineans are having to contend with:

  • Billions of dollars in personal savings trapped in a national banking freeze. The government recently announced a plan to give account holders a choice of bonds that would mature in 3 to 10 years.

  • Since January, a more than 70 percent devaluation of the peso (which was pegged to the U.S. dollar). A house worth 50,000 pesos just a year ago is now worth only about 15,000, if anyone could get money from the bank to buy.

  • An unemployment rate in excess of 20 percent.

  • Industrial production at its lowest level in 10 years.

  • Almost half the 36 million population now classified below the poverty line and another 6 million unable to buy the most basic bread, milk, oil, and fresh vegetables. The per capita gross domestic product, about $9,000 in recent years, is now only $3,000.

  • A healthcare system in ruin, with prescription drug costs up 40 percent since January.

Could Argentina happen here? No, we say. Of course not. But those who gripe and rail about the cost of U.S. agricultural self-sufficiency might sing a different tune if our supermarkets become simply storehouses dependent on imported goods.

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