“Unfortunately, our starting point is shallow. Many years of mistakes and mismanagement have led us to a critical situation. It is tough for the salaries of public administration to be paid on time this month. We will continue on the downward slope we have been on for more than ten years. We will let each inhabitant of the country live as they can and as they want. The current measures allow us to launch a new formula today: ‘We have to get through the winter.'” The disastrous experiment of Alvaro Alsogaray, Minister of Finance under Arturo Frondizi between 1959 and 1961, who came to power under military pressure, will begin to repeat itself tomorrow with Javier Milei as president.
The country awaits what it has experienced so many times over decades of liberal governments: social catastrophe, concentration of wealth, extreme indebtedness, squandering of public assets, destruction of industry, financial speculation, and economic backwardness. Each of these experiences sank Argentina into a swamp from which it became increasingly difficult to emerge. The surrender of sovereignty was also a constant with those governments.
Like Alsogaray in the mid-20th century, the serial debtor Luis “Toto” Caputo now claims that his tenure as Minister of Economy will be complicated due to the “heavy legacy” he inherits from the outgoing government. He overlooks that in his previous stint in public office, as Minister of Finance, Economy, and President of the Central Bank under Mauricio Macri, he committed ten generations to pay off the debt he contracted for a hundred years.
That money was not used for constructing roads, power plants, or new industries but for financial speculation. The dollars evaporated in that party enjoyed by a few and paid for by all Argentinians. As usual, the Peronist government had to restructure those liabilities with the international financial capital and the monumental debt that Macri, Caputo, and the company left with the IMF. Caputo’s audacity in talking about a heavy legacy is a trademark of liberal governments.
The List
The dictatorship of Pedro Eugenio Aramburu, after the coup against Juan Domingo Perón in September 1955, had one of its emblematic Ministers of Economy as the liberal Adalbert Krieger Vasena. That government was responsible for obtaining a loan from several European banks that supposedly would be repaid with the economic growth generated by liberal policies. The result was that the loan could not be refunded, Argentina defaulted, and European governments created the Paris Club to pressure for payments. This administration must also be held accountable for Argentina’s accession to the International Monetary Fund and unconditional alignment with the United States.
The subsequent government of Arturo Frondizi had as Ministers of Economy the Alsogaray above and then the liberal Roberto Alemann, who in 1981 would return to the Ministry of Economy under the dictator Leopoldo Fortunato Galtieri. In 1961, he led a ruinous renegotiation of the debt with the Paris Club and implemented an austerity plan that plunged the majority of the population into crisis: there were layoffs and salary freezes for public employees, excessive increases in public utility tariffs, reduction of import tariffs, reduction of severance pay, and shortened maternity leaves.
In 1962, days before Frondizi’s overthrow and the assumption of José María Guido, Jorge Wehbe became Minister of Economy for the first time. He remained in office for only a month and maintained the line of permanent austerity. Wehbe reappeared as Minister of Economy with Alejandro Agustín Lanusse in 1972, with the exact imprint, and had a third participation towards the end of the last dictatorship, during Reynaldo Bignone’s administration in 1982 and 1983.
In 1962 and 1963, Guido, Alsogaray and José Alfredo Martínez de Hoz succeeded each other as Ministers of Economy. Joe, as he was called, was a prominent exponent of the land-owning oligarchy and financial patriarchy, a fierce hater of the national industry, a fanatic of import liberalization, economic deregulation, and free market. Every time he intervened in public management, the country fell into severe crises, ended up heavily indebted, and his social circle enriched in proportion.
After three years of Arturo Illia’s government, another coup led by Juan Carlos Onganía appointed Krieger Vasena (1967-1969) and another shining figure of the economic right, José María Dagnino Pastore (1969-1970), as Ministers of Economy. During those years, the suspension of labor agreements, the approval of the hydrocarbons law that allowed the participation of private companies in the oil business, the enactment of the rent law that facilitated evictions, the suspension of salary increases for two years, and the promotion of the contractor nation for public works that the State used to undertake all occurred. Some of these policies will be repeated now with Milei.
Dictatorship
After almost two decades of forced exile, Perón returned to the presidency between October 1973 and July 1, 1974, when he died. It was only eight months, but the results of the economic management were successful. The plan of Minister José Ber Gelbard, who had been a founder of the General Economic Confederation (CGE), consisted of a notable revitalization of the domestic market, wages, SMEs, and productive activities. There was decisive state intervention in the economy and strict rules on national and foreign capital. In 1974, inflation dropped to 30.2 percent from 79.6 percent in 1972; unemployment was reduced to only 2.5 percent from 6.1 percent during Lanusse’s government, and GDP rose 6.4 percent from 3.5 percent two years earlier.
Gelbard’s plan was complemented by signing a social pact between the CGT and the CGE to coordinate prices and wages, anchor expectations, and enable economic expansion. However, this strategy fell apart with Perón’s death and the following political unrest.
Gelbard resigned in October 1974, and after an eight-month interregnum of Alfredo Gómez Morales, Celestino Rodrigo rose to the Ministry of Economy. His number two and the actual creator of the most extensive destabilization plan in Argentine history, Ricardo Zinn, convinced the government of María Estela Martínez de Perón to produce a massive devaluation, with astronomical increases in tariffs and prices, and wages lagging. There, a historical turning point in the country began, as the monetary economy that persists, with permanent coverage in the dollar, emerged from that chaos.
Zinn had strong ties to business groups, particularly the Argentine Business Council, which Martínez de Hoz belonged to and actively participated in destabilizing activities in the weeks leading up to the March 24 coup.
After Isabelita’s overthrow, the genocidal civic-military dictatorship implemented a plan with Martínez de Hoz based on the following structural axes: liberalization of prices, the exchange market, imports, rents, and removal of export duties.
