Balance-sheet of Repression

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behind by its former equals. wide range of industrial jobs. Despite surges of industrial- Argentina has sizeable heavy isation in the 20th century industries like steel, petrothe economy has been chemicals and armaments ravaged by paralysing bouts (especially the army-owned political crisis which mean Militares). only be regarded as a semi- cial nuclear power plant in WHAT country in the last few years experienced erratic and generally falling production, balance of payments problems despite near self-sufficiency in oil, out-ofcontrol government deficits and money supply and unacceptably high inflation.

What country has experienced a government whose doctrinaire monetarist creed has led it totry to cut the money supply and government services, keep interest rates high, sell off the public sector, create mass unemployment and lower real wages, policies which have squeezed industrial and commercial companies into bankruptcy but created bonanza for the banks?

Ironically the two contries which arguably best fit that description are on the point of trying to sink each öther's navies in the South Atlantic.

But for all the uncanny similarities between Thatcher's Britain and Argentina under the military dictators Videla, Viola and now Galtieri, the economies they are trying to control are far from identical.

Mature

Argentina is not a mature industrial country like Britain. Yet on the other hand it is a long way from the more backward underdeveloped countries of Latin America, let alone Africa and Asia.

In the nineteenth century it became an enormously prosperous supplier of agricultural staples (wheat and then beef) to the rich markets of Europe and North America. At the end of the century its economic development stood on a par with Australia and New Zealand and and was greater than much of Europe.

Cinna than Aroentina's Duice LILL ALL D economy has been left far ot economic, financial and that today the country can Well they may look worried... industrialised one even though qualitatively more developed than most underdeveloped countries.

Unlike most countries, Argentina has never had a very sizeable subsistence, peasant agriculture. Its farming almost from the start grew up on modern capitalist lines. That is why today only 13% of its labour force work in agriculture (less than Poland or the USSR or Spain, and about level with Japan), and 82% of the population live in cities (nearly as many as in Western Europe and the USA).

28% of workers work in a corporation Fabricaciones It has the only commerLatin America and, helped by its moderate reserves of uranium (enough discovered to supply present total electrical energy needs for 30 years), it has a major programme of nuclear development - including, by the government's own admission, the development of a nuclear bomb.

Argentina has produced oil and petroleum products for many years and the government now has a plan of exploration to develop new supplies and export 300,000 barrels a day by the mid-1980s.

This plan is behind schedule partly because the major US oil companies have not been keen on the government's terms and partly because new discoveries have not been made as rapidly as was hoped (though expert world oil opinion is divided about the prospects around the Falklands/Malvinas over which the UK and Argentina already clashed in 1981 about prospecting rights).

Despite past development and ambitious future plans, the standard of living of Argentinians remains well below that of Britons.

Average income in 1980 was $2230, compared with Britain's $6320. That makes the average income of Argentina slightly ahead of Portugal, Mexico and Turkey and slightly below Yugoslavia. Greece and Venezuela.

And the distribution of mcome been more unequal the figure is 7.4%). And the top 10% get 35% (compared with 23% in Britain).

Argentina has more doctors per head of population than Britain (one for every 530 inhabitants).

But since nearly all medicine is private the services of doctors are extremely unequally spread.

Argentinians are in general better educated than Britons. Nearly one in three school leavers get some kind of college education compared with less than one in five in Britain. Much education, like medicine, private, so workers and the poor certainly don't get their share.

And, since the military seized power in April 1976 (after the 3-year interlude of Peronist rule), their share of everything has been declining.

Over the last six years of bloody dictatorship it is not the structure and long term development of the economy which has mostly concerned the makers of economic policy but its short term crisis.

When Videla took power he installed Jose Martinez de Hoz as his economics minister, which he remained for five catastrophic years.

Martinez de Hoz is a kind of Geoffrey Howe of the South Atlantic (he even went to the same school -Eton!). A doctrinaire monetarist, he has tried 1o. deil with Argentina's severe exonimi problems with a wris Thatcher and Howe.

Argentina's inflation rate when Martinez de Hoz was installed by his military friends was •a staggering 600%, the result of the intense class struggle and collapse of financial discipline of the Peron era.

Martinez de Hoz proposed to deal with the inflation by • the now familiar monetarist remedies of an intense squeeze on the money supply, savage cuts in government welfare spending to reduce the budget deficit (which had been nearly 15% of the GNP in the last year of the Peron government) increasing taxes and maintaining an artificially overvalued exchange rate to hold down the price of imports.

The result of the overvalued exchange rate has been a growing balance of trade deficit which was offset by inflows of short-term funds attracted by enormously high interest rates.

And these interest rates in turn have increased government spending on financing the national debt and have produced a catastrophic worsening of the financial position of industry and commerce (nationalised and private).

Last year this resulted in several major bankruptcies -of Celulosa Argentina, the largest pulp and paper firm: of Saestru, the biggest agroindustrial comples with interests in grain. flour milling. wire. 'isheries and bankirE: redibono. a large * - . - empany along with +-- companies.

-i are now runnSocialist Organiser no.81 April 22 1982 Page 5

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