Argentina Weathers the Storm

The events of December 2001 seemed to transform Argentina’s international status from poster child to basket case. Throughout the 1990s, Argentina had been widely hailed as a case of successful market reform under democratic government. The radical economic transformation undertaken by the government of Carlos Saúl Menem had ended hyperinflation and restored economic growth, while the country enjoyed an unprecedented degree of democratic stability. Elections were free; civil liberties were broadly protected; and the armed forces, which had toppled six civilian governments since 1930, largely disappeared from the political scene. Yet in late 2001, Argentina suffered an extraordinary economic and political meltdown. A prolonged recession and a severe financial crisis culminated in a debt default, a chaotic devaluation, and a descent into the deepest depression in Argentine history. A massive wave of riots and protests triggered a string of presidential resignations, plunging the country into a profound crisis. For several months, Argentina teetered on the brink of anarchy. Widespread hostility toward the political elite raised the specter of a Peruor Venezuela-style partysystem collapse. As the 2003 presidential election approached, many observers feared that the vote would be marred by violence or fraud. The April 27 election produced no such outcome. Not only did democracy survive and the vote proceed smoothly, but the top two finishers, ex-president Menem and Santa Cruz provincial Governor Steven Levitsky is assistant professor of government at Harvard University. He is author of Transforming Labor-Based Parties in Latin America: Argentine Peronism in Comparative Perspective (2003) and is currently writing a book on the emergence and dynamics of competitive authoritarian regimes in the post–Cold War era. María Victoria Murillo is associate professor of political science and international affairs at Columbia University. She is the author of Labor Unions, Partisan Coalitions, and Market Reforms in Latin America (2001).