Cato Policy Analysis No. 445 July 16, 2002

Policy Analysis

Fixing Argentina

by Kurt Schuler

Kurt Schuler (kurt_schuler@jec.senate.gov) is a senior economist at the Joint Economic Committee of the U.S. Congress. The views expressed here are those of the author, not necessarily those of the Joint Economic Committee or the U.S. government.


Executive Summary

Argentina's currency crisis and economic depression have been caused by the bad policies of its government—not by banks, speculators, the International Monetary Fund (despite the bad advice it has given), or other scapegoats. The De la Rúa and Duhalde governments have made several gigantic blunders, namely,

At present, all property is potentially subject to government control or confiscation. There is little reason for anybody to produce, save, or invest in Argentina. The country is returning to the failed economic model that caused so much trouble in the 1980s and had to be jettisoned from 1989 to 1991.

Fixing Argentina's currency and economy requires reversing those blunders and returning to policies that respect private property and encourage the private saving, investment, and initiative that create economic growth. The main steps necessary in the short term are

Full Text of Policy Analysis No. 445 (PDF, 37 pgs, 304 Kb)

© 2002 The Cato Institute
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