The European media have distorted the lessons of Argentina’s relatively successful response to its own economic crisis a decade ago, as newly published research documents in detail. This is not surprising, because the policies adopted by Buenos Aires were directly opposed to those currently favoured by European authorities, in particular the ECB and Germany.
Argentina defaulted on its debts, devalued its currency and extricated itself from a severe economic downturn. Over the decade following default, GDP grew by some 90 per cent in real terms. The lessons of the Argentinian experience for peripheral European countries in the current crisis have been noted by some analysts who have recommended that they seriously consider adopting some of the policies implemented by Buenos Aires, such as defaulting on their debts and ditching the euro. The latter surely involve significant risks, but may well be preferable to the current austerity packages that continue to devastate economies.
In any case, whatever one thinks of those policy options, it is clear that they should at least be mentioned, discussed, and debated. The problem is that since 2008, the European press has distorted the lessons of Argentina’s experience, painting an almost exclusively negative picture of it.
The media have described the Argentinian default as catastrophic, while mentioning its positive consequences only in passing, if at all. For example, an article in the London Times, entitled ‘Rioting, looting, bartering, killing: what happened when Argentina defaulted’, states that ‘Default means upheaval’ while describing how in December 2001 ‘Shops were looted, buildings set on fire, streets were paved with broken and abandoned goods, shopfronts were smashed and in the clashes with police, more than 30 people were killed within sight of the presidential balcony’ (19 May 2012). But the article does not tell the story of the subsequent recovery.
Similarly, a Financial Times editorial asserts that the country has ‘been mired in relative stagnation’ and that Argentina is ‘a land of squandered opportunities’ (15 October 2009). Le Monde opines that ‘the Argentine miracle was a sham’ and that ‘Greece would be well advised not to follow this precedent’ (24 June 2012). An article in the Süddeutsche Zeitung entitled ‘Nightmare Argentina’ sums it up by asserting that ‘until today, the country has not recovered from the 2001 economic crisis’ (29 April 2010).
When the European media concede that Argentina’s recovery has been impressive, the alleged cause is invariably that the country was lucky because it benefitted from a global commodity boom, which boosted exports. Of course, that helped, but the story is much more complex. Domestic policies were also important in stimulating the economy, and as such the World Bank characterised Argentina’s recovery as ‘demand led’. The expansion started in the second quarter of 2002, only three months after the default. It was initially triggered by the devaluation of the peso and the government’s stabilisation of the foreign exchange market and domestic prices. This made exports more competitive and, more importantly, imports more expensive. The latter decreased significantly, which stimulated domestic production of formerly imported goods.
Whatever one makes of the Kirchner administrations, the press consistently emphasised their failings, real or imagined. An article in Die Zeit entitled ‘Lie, deceive and hamper’ states that ‘Néstor and Cristina Kirchner have impoverished Argentina with their disastrous economic policies’ (4 February 2010) while the Financial Times claims that the country is led by ‘a profligate president’ and that Argentina ‘has become a laggard’ (19 February 2010).
The nationalisation of strategic economic sectors like oil and gas has been strongly condemned in the press. An article in the Frankfurter Allgemeine Zeitung, entitled ‘The return of the Caudillos’, states that ‘Argentina’s government has become the Kirchners’ family business’ and that Cristina Kirchner ‘has what it takes to become Argentina’s first “Caudilla”’ (2 November 2007). Die Welt claims that ‘Cristina Kirchner is driving Argentina into the abyss’ because she ‘has an iron and damaging grip on the economy’ (16 October 2012).
Personal attacks also abound. Le Figaro has referred to Néstor Kirchner as ‘Argentina’s strongman’ (28 October 2010), while Le Monde has opined that the ‘Kirchners have pushed to an extreme the hyperpresidentialist logic, in the pure hegemonic tradition of Latin America’s caudillos’ (24 October 2011). Cristina Kirchner is described in Le Monde as a ‘woman obsessed with her physical appearance’ (24 October 2011). Elsewhere, she is referred to as ‘Queen Cristina’ and said to be ‘a glamorous, auburn-haired leftwinger, known for her pugilistic political style’ with a ‘penchant for elegant fashion’ who ‘remains defiant’ and ‘likes to play the victim’ (Financial Times, 21 October 2011; The Times, 18 April 2012; Financial Times, 1 November 2012). On the other hand, ‘Néstor Kirchner may have given up his beloved cigarettes but the former president remains hooked on power’ (Financial Times, 19 February 2010).
One wonders how much public opposition to European policies would grow if examples like Argentina’s were publicised more widely and fairly in the media.