Brandon Sack is right that the U.S. could learn much from Argentina. But rather than use only his two-week trip as perspective, I suggest we look at significant events over the last 100 years and the administrations of both Mrs. Kirchner and her husband.
Simply put, Argentina has gone from South American breadbasket to world-class basket case. In the 1920s, Argentina was the seventh largest economy in the world and had a constitution that held limited government and private property as the highest ideals of the land. As Argentina and the world began to slip into a depression, the country started down the path of entitlements, class warfare, hostility toward producers, protectionism and subsidized central planning.
These government policies came to a head in 2001-2002, and Argentina went into catastrophic economic collapse. Nationwide riots, looting, strikes and demonstrations erupted in late December 2001, leading President Fernando de la Rúa to resign. There was a strong public rejection of the entire political class, characterized by the pithy slogan "Que se vayan todos" ("Away with them all").
Following his election in 2003, Mrs. Kirchner's husband used "emergency powers," delegated to him by the Peronist-controlled Congress, to rule by decree for five years. There was no intervention that Mr. Kirchner considered out of bounds. Argentina was, after all, in "a crisis." He imposed price controls, raised export taxes, increased populist subsidies, abrogated contracts, stiffed creditors, ended central bank independence and even manipulated inflation statistics. The private sector and profits were demonized, and members of the press were imprisoned.
Not surprisingly, five years later, the wheels are coming off again. More than a few analysts are worried that should the economy continue to slow, Argentina will go through complete economic collapse for the second time in less than a decade.
Americans reading the laundry list of Argentinian central-planning policies that include things like increased entitlements, raised taxes and protectionism will note that it sounds a lot like the political issues we will decide on when voting in November. From nationalized health care and government-owned refineries to punitive taxes on the rich, Argentina has been there, done that. There are good reasons to find the resemblance disturbing.
