Adios Peronism? Argentina Tries To Finally Bury The 20th Century

The Macri government's sober discourse and steady reformist hand suggest the political and economic dramas of the last century in Argentina may be ending.

A new dawn for Buenos Aires?
A new dawn for Buenos Aires?
Jorge Ossona

BUENOS AIRES — The results of last month's parliamentary elections in Argentina may be the final proof that a new historical cycle in Argentine politics has begun. That would mark an end to the radical social and political options that dominated the country through the 20th century.

Back in 1930, several political storms coincided to halt the dual promises of growth and greatness that Argentina had entertained — and which had seemed unstoppable, in the first decades of the 20th century. There was an abrupt end to the pattern of prosperous farming exports that had made this outlying "periphery" of the continent into one of the world's granaries, and of institutional improvements initiated in 1912 and 1916 that promised the consolidation of a liberal republic.

Already in the early 20th century, various essentialist perspectives — touting the country's "intrinsic" nature — had begun to change our collective culture into competing secular ideologies marked by authoritarian or corporatist discourses. Ruling elites began speaking on behalf of all Argentines, promising to re-found the fatherland and regenerate the decaying cultural order.

The country then witnessed a succession of regimes: There was the New Argentina of General Juan Domingo Perón and his followers, then the Liberating Revolution of their opponents, the Argentine Revolution of the 1960s, an authoritarian outfit led by generals, the Peronists' return with Argentine Power (Argentina Potencia), and the 1970s' Process of National Reorganization imposed by the last military junta.

The democracy installed in 1983 was in principle more sober in the scope of its leaders' ambitions. But even here, these could not entirely resist the temptation to "refound" things, as suggested by terms like "the third historical movement" coined by supporters of the first president, Raúl Alfonsín, and "the First World County" that the Peronist-inspired President Carlos Menem promised with the whiff of an earlier Argentine Power slogan.

There are no more prodigious options left — we've used them all.

The result was intellectual inertia and a fondness for facile answers that meant tackling problems with broad measures, and scant attention to details.

This approach soon became the source of new problems piling onto existing ones, further hampering their resolution. Protecting domestic industry to reduce imports became a social response to the effects of the Great Depression, and continued as elites remained oblivious to its long-term sustainability. The peasants and farm hands of the Humid Pampas outside the capital moved in to become a dense urban working class. By the 1950s, they would begin emulating the consumption patterns of people in an advanced welfare state, which Argentina was not. Wage increases unleashed productivity but also endemic inflation that was checked only from time to time.

The manufacturing branches that grew in the 1960s and 70s did so with little concern for the small scale of the local market. In the 1980s, inflation became exponential and Argentina's massive foreign debt was coupled with a deepening rich-poor divide. In 1989, the country emerged from hyperinflation by artfully using convertibility, though that could not be sustained beyond the late 1990s and led to the socioeconomic crash of 2001.

Pampa outside of Buenos Aires — Photo: lrargerich

Two years later, the "soy monsoon" gave the impression that prosperity had come to stay, though it only lasted a decade. Then began the period of penury that continues to this day. The state, meanwhile, was systematically drained and dismantled, as it kept responding to shortcomings by outsourcing even the most elementary functions to corporate partners detached from the public interest.

The administration that began in 2015 appears not to want to refound Argentina, but free the inherent capabilities of a country that has impoverished and isolated itself from the world. It is a Herculean task the government has begun without the usual bombast about regeneration. There are no more prodigious options left — we've used them all.

Nor will there be automatic majorities at every election. The governing party will have to negotiate with opponents finely woven agreements between different interests. The easy promises and magic formulae must give way to identifying and dealing intelligently with specific problems. In short, the time has come to speak seriously about the issues affecting a modern republic with a mature, capitalistic economy.

If the country can grow at a moderate but steady rate over the next 15 years, better integrate itself in a world whose technological advances leave no place for ideological games, and make progress on reducing the social and cultural poverty of our cities and provinces, then we may assert that the government first elected in 2015 represented a bona fide rupture, launching a whole new cycle to replace the dramatic politics of 20th-century Argentina.

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Debt Trap: Why South Korean Economics Explains Squid Game

Crunching the numbers of South Korea's personal and household debt offers a glimpse into what drives the win-or-die plot of the Netflix hit produced in the Asian country.

In the Netflix series, losers of the game face death

Yip Wing Sum


SEOUL — The South Korean series Squid Game has become the most viewed series on Netflix, watched by over 111 million viewers and counting. It has also generated a wave of debate online and off about its provocative message about contemporary life.

The plot follows the story of a desperate man in debt, who receives a mysterious invitation to play a game in which the contestants gamble their lives on six childhood games, with the winner awarded a prize of 45.6 billion won ($38 million)... while the losers face death.

It's a plot that many have noted is not quite as surreal as it sounds, a reflection of the reality of Korean society today mired in personal debt.

Seoul housing prices top London and New York

In the polished streets of downtown Seoul, one sees endless cards and coupons advertising loans scattered on the ground. Since the outbreak of the pandemic, as the demand for loans in South Korea has exploded, lax lending policies have led to a rapid increase in personal debt.

According to the South Korean Central Bank's "Monetary Credit Policy Report," household debt reached 105% of GDP in the first quarter of this year, equivalent to approximately $1.5 trillion at the end of March, with a major share tied up in home mortgages.

Average home loans are equivalent to 270% of annual income.

One reason behind the debts is the soaring housing prices. In Seoul, home to nearly half of the country's population, housing prices are now among the highest in the world. The price to income ratio (PIR), which weighs the average price of a home to the average annual household income, is 12.04 in Seoul, compared to 8.4 in San Francisco, 8.2 in London and 5.4 in New York.

According to the Korea Real Estate Commission, 42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s. For those in their 30s, the average amount borrowed is equivalent to 270% of their annual income.

Playing the stock market

At the same time, the South Korean stock market is booming. The increased demand to buy stocks has led to an increase in other loans such as credit. The ratio for Korean shareholders conducting credit financing, i.e. borrowing from securities companies to secure stock holdings, had reached 21.4 trillion won ($17.7 billion), further increasing the indebtedness of households.

A 30-year-old Seoul office worker who bought stocks through various forms of borrowing was interviewed by Reuters this year, and said he was "very foolish not to take advantage of the rebound."

In addition to his 100 million won ($84,000) overdraft account, he also took out a 100 million won loan against his house in Seoul, and a 50 million won stock pledge. All of these demands on the stock market have further exacerbated the problem of household debt.

42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s

Simon Shin/SOPA Images/ZUMA

Game of survival

In response to the accumulating financial risks, the Bank of Korea has restricted the release of loans and has announced its first interest rate hike in three years at the end of August.

But experts believe that even if banks cut loans or raise interest rates, those who need money will look for other ways to borrow, often turning to more costly institutions and mechanisms.

This all risks leading to what one can call a "debt trap," one loan piling on top of another. That brings us back to the plot of Squid Game, "Either you live or I do." South Korean society has turned into a game of survival.

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