Re: Re: Canada, Australia, Argentina

[Nestor Miguel Gorojovsky]

After I read what follows, and which deserves no answer at all, I am 
beginning to believe that I am not debating with Brad DeLong, but 
with Spruille Braden DeLong. From now onwards, I will put things in 
clear by addressing Mr. Braden DeLong...


En relación a [PEN-L:1685] Re: Canada, Australia, Argentina, 
el 10 Sep 00, a las 22:25, Brad DeLong dijo:

> >En relación a [PEN-L:1549] Re: Re: Re: Canada, Australia, Argen, el
> >10 Sep 00, a las 3:37, Rob Schaap dijo:
> >
> >>  Australia, too, consciously nourished its (relative) independence,
> >>  largely through mutually constitutive ties between Australia's
> >>  government and bourgeoisie - ensuring that the latter would not
> >>  serve as a compradorial local elite for foreign interests. 
> >
> >This is EXACTLY what Peronism attempted to do here, and failed.
> >
> >Funny to see again how different are things in an imperialist country
> >and in a colony. In more senses than one, Peronism, which is widely
> >known outside Argentina (and particularly in the United States) as a
> >Fascist South American overgrowth that remained alive for a decade
> >after Nazism was swept away from Europe was in fact a domestic
> >version of a Labour government in Australia...
> 
> Any Labor government--hell, *any* democratic government or *any*
> left-of-center non-democratic government--would have been eager to
> join the war against Hitler. Peron was not--hence the classification
> of his regime as "fascist South American overgrowth" seems not
> unfair...

My dear Mr. Braden DeLong: Argentina wasn't, by any means, the only 
country that remained neutral during World War II. Most peoples 
weren't even allowed the possibility to have a saying, because they 
were under occupation: there were imperialist troops deployed all 
over Africa, over a good deal of Asia, even over Latin America -you 
the democratic Americans had put in prison our cherished and beloved 
Albizu Campos, who died in prison in Atlanta, because of the sin of 
fighting for the independence of Puerto Rico against your democratic 
will; India's leader Ghandi, out of calculation, decided to side with 
Britain, but not before a long debate took place and not before he 
intentionally had visited Mr. Mussolini against the advice of every 
"democratic" imperialist in Europe.

Hadn't the colonial empires existed, be sure that most people in the 
world would have been indifferent to Mr. Hitler's actions. "What's 
new with that, would many have said, he's just doing to white people 
what all of them have been doing to us for decades and centuries?"

Not that I agree with that position. I, personally and as an isolated 
individual, are for war against all imperialists. That is the 
position I would have raised in Argentina, 1939. But our neutrality 
was an absolutely justifiable one. And, as I explained, it even was 
of help for the war effort of Great Britain. Let me show now that 
countries who profited from the war, and who in many ways gave help 
to the Nazi regime, are considered "democratic" by Brad, whereas this 
treatment is denied to Argentina.

Among others which I could mention, I prefer to center on two: 
Switzerland. Sweden. Switzerland proved a "neutral" hideaway for Nazi 
money and riches stolen from many, particularly from the Jews, as it 
has recently been shown. Sweden was still worse: the Socialist 
government there allowed the Nazi troops to traverse its Northern 
territories in order to occupy Norway (by the way, in order to 
protect their own citizens, the Swedish government put the militant 
union leaders of the North in prison while the Wehrmacht merrily 
toured the Kiruna steel mines on way to the Atlantic).

Why do you slander the Argentinians, who were victims of Anglo-
American expoliation and thus had at least a reasonable motivation to 
remain neutral, while you do not slander the Swiss or the Swedes? I 
will tell you again, Mr. Braden: that is because you are an 
imperialist under "Leftist" robes.


> 
> As for Peron's social and economic policies, I have always been 
> fascinated with the extraordinary economic success of post-WWII 
> western Europe relative to Argentina.

Ah, that's reasonable. Your country made a strong investment effort 
in an Europe that was ruined but still had strong assets to rebuild 
itself. Argentina had to clumsily manage by herself, against the 
pressure of the American Department of State and the cold hostility 
of other imperialist regimes. The Europeans had a full bearded 
bourgeoisie, while the first minister of Economy of Peronism was the 
chubby owner of a small manufacturer of tins for a minor peach 
packer. Miguel Miranda, a man with no Universities, proved however 
that it was possible to boost popular consumption, rise wages, and 
have an economic boom all at the same time. He could not prove (and 
this was his doom) that all this was sustainable without socialist 
measures, but at least he gave millions of people four or five years 
of happiness and a sense of personal dignity that they had never had 
before.

> 
> At the end of the Second World War, both regions were predisposed
> toward some strict regime of economic planning. Everyone remembered
> the disastrous outcome of the laissez-faire policies that had been in
> effect at the start of the 1930s. Politicians were predisposed toward
> intervention and regulation: no matter how damaging "government
> failure" might be to the economy, it had to be better than the "market
> failure" of the Depression.

An ignorant can only commit blunders. Economic planning in Argentina 
was not an issue, because it was bestowed on Peronism by the 
oligarchic, pro-imperialist, governments of the Infamous Decade. Our 
economy was strictly planned towards self destruction. Peronism took 
the whole apparatus, and put it upside down. Magically, the riches 
that flowed outwards began to remain here. Uruguay didn't do the 
same. The only thing they obtained of the lush export years after 
1945 is a host of imported American cars that would make the envy of 
any driver in Havanna.

> 
> Had European political economy taken a different turn, post-World War
> II European recovery might have been stagnant, as in Argentina.

Stagnant? Have you ever looked at the figures?

The sentence above proves that I did not read the whole of Braden 
DeLong's posting before I answered. Since some paragraphs below there 
is an essential piece of information, I will skip lots of chatter and 
go to the basic fact that DeLong's interpretation of Argentinian 
economy is based on the work of an economist who shares the basic 
ideas of the neoliberal clique. I do not know which is Braden 
DeLong's game in the USA, but now I know which is his game in my own 
country. And I understand his decission not to accept my getting 
armed. He positively knows that his boys would be my target.

So that, skipping a lot, let us jump to

[...]
> 
> Carlos Díaz Alejandro's (1970) _Essays on the Economic History of the
> Argentine Republic_ provides what has become the standard analysis of
> Argentina's post-World War II relative economic stagnation. According
> to his interpretation the collapse of world trade in the Great
> Depression was a disaster of the first magnitude for an Argentina
> tightly integrated into the world division of labor. While Argentina
> continued to service its foreign debt, its trade partners took
> unilateral steps to shut it out of markets. The experience of the
> Depression justifiably undermined the nation's commitment to
> international economic integration...

Ah, those are your sources! Yes, everything fits now. "International 
economic integration" is the key concept. In fact, this is 
ideological smuggling. Argentina has never attempted to "de-
integrate" itself from the world market; it only struggled for an 
integration that would not mean dependency. There are other authors, 
more modern than Díaz Alejandro, who even say to be Marxists, who 
also work for Mr. Braden DeLong. I would quote them if I were not 
making Braden DeLong's life easier in so doing.  But Díaz Alejandro 
is a good choice for Braden DeLong: is the ultimate sepoy, and it is 
not a matter of chance that, in the economic circles of the United 
States of America, the Braden DeLongs consider his 600 page long 
bunch of half-muttered hardly digerible stupidities a "standard book" 
on Argentina.  The _very_ diffusion of that book (as well as those of 
the historian Halperin Donghi) is proof against it.

Yes, Mr. Braden DeLong, I made up my mind and you are welcome with 
Videla and others.  Probably the Social Democrat ambassador of Videla 
to Portugal, Américo Ghioldi, would have given you a good time in 
Lisbon. In the meantime, and just for the illustration of list 
members, I want to inform that the guidelines of the economic 
policies of the gorilla regimes in Argentina were in perfect 
agreement with the ideas of Díaz Alejandro. Yessir. We are on two 
sides of the fence. While you remain in PEN-L, I do not know what can 
I do here. You are simply an imperialist.

So that you simply lie galore:

> 
> In this environment Juan Perón gained enthusiastic mass political
> support. Taxes were increased, 

False. Lowered. Only income taxes were increased. But the overall 
balance, taking into account indirect taxes on consumption, was of 
reduction.

> agricultural marketing boards created,

False. They were created in the 30s. But they were snatched off the 
hands of the Seven Sisters and put to work for Argentina.

> unions supported, urban real wages boosted, international trade
> regulated. 

Not only that. It was practically nationalized. A pity they did not 
do it in full.

> Perón sought to generate rapid growth and to twist terms of
> trade against rural agriculture and redistribute wealth to urban
> workers who did not receive their fair share. 

False. Perón sought to fuel industrial growth with the remains of the 
differential rent on the world market that had bestowed such a gift 
on Argentinian landed oligarchy for decaedes. He redistributed wealth 
the country over. "Urban workers" were already the large mass of 
Argentinians, but also "rural workers" were benefitted. Of course, 
for an economist such as Díaz Alejandro, who shares in the general 
views of Argentinian insertion in the world market that our oligarchs 
have, it is better to close the eyes to such "fascistic"  measures as 
the "Rural worker regulations" which, among others, prohibited 
children work in the countryside and enforced this prohibition for 
the first time.

> The redistribution to
> urban workers and to firms that had to pay their newly increased wages
> required a redistribution away from exporters, agricultural oligarchs,
> foreigners, and entrepreneurs.

Yes, quite fair, but not "entrepreneurs" nor "foreigners": the first 
is an obviously senseless category, the second is a lie, because what 
was done was to redistribute from wealthy foreigners  (British, 
French, American, German imperialists) to poor foreigners (the new 
bourgeoisie, mostly of Italian and Spanish origin).

> 
> Moreover, conservative dictatorships in Argentina during the Great
> Depression had sharpened lines of political cleavage. 

This is either banal or absurd. "Lines of political cleavage" were 
very sharp indeed in a country that had endured seventy years of 
civil war half a century ago. What the Conservative mock democratic 
governments (appropiately changed to "dictatorships" by Braden DeLong 
following Díaz Alejandro) did was simply to manage as they best could 
the Depression, by restricting vote through fraudulent practice. 

> Landowner and
> exporter elites had always appropriated the lion's share of the
> benefits of free trade. They had in the 1930's shown a willingness to
> sacrifice political democracy in order to stunt the growth of the
> domestic welfare state. 

Another idiocy. "Landowner and exporter elites" were in no way 
interested in stunting the growth of a domestic welfare state because 
this state did simply NOT exist. In fact, what existed of welfare had 
been built on the scraps that fell from the table of the non-
productive consumption of rent from agrarian exports. This is what 
Perón attacked: he attempted to put that money to good use. Many 
critics, from within the national revolution, claimed not without 
reason that this attempt at accumulation was hindered somehow by the 
rythm of growth of the workers' share in national income. But since 
the creation of a domestic market was also one of the tasks ahead, 
the debate did not arrive at a conclusion. On the other hand, workers 
militancy and the idiotic blindness of our bourgeoisie made the 
regime very prone to concede to workers more than the capitalist 
project would have been able to support. But this is a completely 
different issue.

Then Díaz Alejandro (quoted by Braden DeLong) goes ahead (by the way, 
from now onwards I will call Díaz Alejandro by the name that should 
actually be added to his, Díaz Alejandro Agustín Lanusse. Since I 
have given Brad his actual Argentinian name it is only fair to link 
Díaz Alejandro with Alejandro A. Lanusse, the oligarch antiPeronist 
military dictator who, between 1966 and 1973, that is at the same 
time that Díaz Alejandro charged against our economic liberation, 
helped transform Argentina in a colony for the USA). So that Díaz 
Alejandro Lanusse is thus exposed by Braden DeLong:

> The Peronist program seemed prima facie
> reasonable given the memory of the Great Depression, and it produced
> almost half a decade of very rapid growth toward the end of the 1940s.

Quite true. Only that "rapid growth" is not precisely what one would 
say of a programme that at the same time reconstructed the country 
and gave more than half its population a new sense of personal 
dignity. But we are among economists here, who cares for these stupid 
issues?

Díaz Alejandro Lanusse / Braden DeLong then triumphantly state that 
once Western imperialism recovered itself from the post-war stress, 
it could begin to settle accounts with unruly colonies. This they 
adscribe, of course, not to imperialism or anything the such, but to 
"international business cycle", an explanation which, I guess, might 
be very useful to American workers laid off some years ago by 
interimperialist competition with, say, Japan (ah, niceties of 
language):

> 
> Then exports fell sharply as a result of the international business
> cycle. And exports fell further as the consequences of the enforced
> reduction in real prices of rural exportables made themselves felt.

What do you mean, "enforced reduction"? On the contrary, the state 
monopoly on foreign trade (the IAPI, a bourgeois forerunner of a 
socialist self-defence mechanism, in fact) obtained better prices for 
farmers than the prices they had ever obtained from the trade 
monopolies of foreign capital. What is true is that a share of those 
better prices was redistributed, via the State, to industries and not 
to luxurious consumption. Quite reasonable, I think, particularly if 
we take into account that farmers were released by Peronism of many 
of the constraints imposed on them by the oligarchs (typically, a 
farmer was a tenant with very short term contracts which, for 
example, forbade him to raise cattle)/

> Agricultural production fell because of low prices offered by
> government marketing agencies--the equivalent of the "scissors crisis"
> found in Russia at the end of the NEP. 

Ah, Trotsky, how many blunders are committed in Thy Name! But in a 
second thought, yes, this was some kind of a "scissors crisis".  Not 
however in the Russian sense. In an Argentinian sense, this crisis 
showed that it was not possible to keep going along the capitalist 
path. Oligarchic improductivity (the basic problem here) had to be 
uprooted by the sword of socialist revolution. This was one of the 
limits of Peronism, true. The great limit. But nobody dared reach 
that limit before.

> Domestic consumption rose. The
> rural sector found itself short of fertilizer and tractors. Squeezed
> between declining production and rising domestic consumption,
> Argentinian exports fell. 

Argentinian main export commodity was by those times meat. Meat needs 
no tractors in the pastorile conditions of those times. On the other 
side, Perón arrived at agreements for local design and construction 
of agrarian machinery and tractors (the combine is, by the way, an 
Argentine invention, of Engineer Druetta, so that there was local 
know how that the oligarchic regime had not paid attention to while 
Peronism did). The problem is that the oligarchy was already in an 
economic civil war against the Argentinians, and their usual 
improductivity was enhanced by this attitude. No measure beneath 
outright nationalization of the large estates would be able to bridge 
the gap. And this was unthinkable for Perón in the 50s. He made a 
timid attempt at the 70s through Engineer Giberti's Agrarian Law, but 
it was precisely because of this law that reaction rallied against 
the government. One of these days I will explain you what this 
Giberti law was.

> By the first half of the 1950's the real
> value of Argentine exports was only 60 percent of the depressed levels
> of the late 1930's, and only 40 percent of 1920's levels. Because the
> Peronist government twisted the terms of trade against agriculture and
> exportables, when the network of world trade was put back together
> Argentina was largely excluded.

So that the victim is made the culprit! "Because the Peronist 
government" is a convenient phrase to shun the fact that even the 
mild ECLA economists led by Prebisch (a beloved child of the 
conservative 30s, by the way!) have understood as a basic trait of 
international trade under imperialism, that of the relative loss of 
value of agricultural versus industrial exports! It is precisely 
against this dependency on agricultural goods _and_ on foreign 
currency through trade that the whole strategy of Perón was 
constructed. He simply counted with too short a time. The enemy was 
already in combat outfit by 1950. Korea was to be the first 
demonstration. And Algeria, and Viet Nam.

Then, Braden DeLong summarily exposes the general lines of the crisis 
of 1950/52, a crisis that was enhanced by the most violent couple of 
dry years witnessed by Argentinian commercial agriculture, by firstly 
presenting the alternatives at sight (rather fairly) as thus: 

> 
> The consequent foreign exchange shortage presented Perón with only
> unattractive options. First, he could attempt to balance foreign
> payments by devaluing to bring imports and exports back into balance
> in the long run and in the short run by borrowing from abroad. But
> effective devaluation would have entailed raising the real price of
> imported goods and therefore cutting living standards of the urban
> workers who made up his political base. [This is not completely true, 
> since lots of water had passed beneath the bridges and Argentina in 
> the 50s produced most of the basic goods required by popular > 
consumption] Foreign borrowing would have
> meant a betrayal of his strong nationalist position. 

Not so. What would have meant a betrayal was to introduce Argentina 
into the IMF, something duly accomplished by the Díaz Alejandro 
Lanusses of the 50s, to the great myrth of the Braden DeLongs of that 
time... But let us go ahead.

> (And foreign
> borrowing appeared even less attractive to Argentines who recalled the
> extraordinarily high real effective interest rates that their foreign
> debt had carried during the deflation of the 1930's.)

This line, repeated today, is honestly outrageous. 55 children a day 
die in Argentina to pay what is aseptically called "high real 
effective interest rates". Doublespeak, doublespeak...

> 
> Second, he could contract the economy, raising unemployment and 
> reducing consumption, and expand incentives to produce for export by
> decontrolling agricultural prices. 

This is a red herring advanced by Díaz Alejandro Lanusse and promptly 
grasped by Braden DeLong. One of the interesting and modern features 
of the Argentinian economy under Perón was that domestic prices were 
not of necessity linked to foreign prices. In fact, while prices of 
export commodities were strongly defended outside, they were kept at 
reasonable levels inside. There was no need to "decontrol", which was 
the measure that the oligarchs and the trade monopolies were pressing 
for. It was a question of technical adjustments within a generally 
sound schema.

> But this too would have required a
> reversal of the distributional shifts that had been the central aim of
> his administration.

Ignorance, economists is thy name?  The central aim of Perón's 
administration was to achieve economic independence (not isolation, 
not autarchy, Braden DeLong, just "independence"). The distributional 
shifts were just one of the tools by which this was to be obtained. 
It is very meaningful that every antiPeronist that goes around is 
always ready to stress that Perón was interested in "distributional 
shifts and social justice" but they step back in sacred horror when 
they are replied that he was for none of both, unless they served the 
goal of arriving at an independent Argentinian capitalism. 
Imperialists can be "good hearted". What they cannot is accept 
colonial subjects to fight for independence. In fact, the whole 
political operation that with Menem ended with Peronism as a 
revolutionary force in Argentinian politics was built on this very 
mischievously devised _quid pro quo_.

> 
> The remaining third option was one of controlling and rationing
> imports.

Ignorant, again, Braden DeLong (poor chap, he is just parroting the 
arch-sepoy Díaz Alejandro Lanusse, the "standard" author of 
imperialist Universities), ignores that imports were controlled and 
rationed from 1945 and even from before.

> 
> Not surprisingly, Perón and his advisors chose this third 
> alternative, believing that a dash for growth and a reduction in
> dependence on the world economy was good for Argentina. 

Not surprisingly, Braden DeLong believes to the contrary. Yes, he is 
a good candidate to run for a high management post at a multinational 
corporation in a colonial country. I know that kind of people very 
well. There is even a whole "Trotskyst" party in Argentina whose 
leadership is basically composed by their children (children who 
later grow up and take the trade of their daddies). Now, let us have 
him expose the great wisdom of Díaz Alejandro Lanusse:

> As Díaz Alejandro writes:
> 
> "First priority was given to raw materials and intermediate goods
> imports needed to maintain existing capacity in operation. Machinery
> and equipment for new capacity could neither be imported nor produced
> domestically. A sharp decrease in the rate of real capital formation
> in new machinery and equipment followed. Hostility toward foreign
> capital, which could have provided a way out of this difficulty,
> aggravated the crisis..."

"Did you say half a truth?  /  They will say that you lie twice /  if 
you tell the other half" runs a stanza by the Spanish poet Antonio 
Machado. What in fact happened was that the industrial sector 
received by Peronism from the past was too clumsy and the new sector 
of machinery manufacturing, strongly favored by the military fraction 
of the Peronist early years, was not given enough attention. Thus, 
when the crisis came, Argentina was not in the best position. Though, 
deformedly, Díaz Alejandro Lanusse is not lying here. He lies, 
however, as could be expected, when he refers to imperialist 
"investors". The crisis was aggravated by no hostility on the side of 
Perón but by an objective boycott from greedy multinationals. Perón 
arrived at good agreements with many imperialist concerns, such as 
Mercedes Benz, or as the Rocca family of Italian origin which rebuilt 
their economic empire from a new basis in Argentina, and he was 
carrying along talks with the Californian Oil Co. for development of 
oilfields (which of course implied that the Díaz Alejandro Lanusse of 
his times accused him of being an American spy and agent!). On the 
other hand, Perón expected that a new World War could break, and in 
that perspective he was careful in his dealings.

> 
> After the coup that deposed Peron, subsequent governments did not
> fully reverse his policies, for the political forces that Perón had
> mobilized still had to be appeased. 

Otherwise stated: "since Argentinian workers displayed a heroic 
militancy against the pro-imperialist regimes that followed Perón, 
then they took long decades after they finally imposed, after 1976, 
the regime they had been consistently seeking to impose".  This 
"Perón was no better than his followers" rant is a very comfortable 
and mean way to attack him. Argentinian common people, however, are 
stubborn enough not to pay attention to this mind-boggling shit. So 
that the influence is exerted on the minds of Argentinian students of 
economics, thus generating types such as Cavallo. There is such an 
amount of half-truths, perversions of actual facts, and nonsensical 
babble in all that follows that, short of time as I am, I will ask my 
readers to dispense me with the duty of answering point by point to 
the following paragraphs.

Let us instead go to the core of the issue, the actual movement Díaz 
Alejandro Lanusse was fighting against in his essay, namely the 
process of revolutionary nationalism that was putting the middle 
classes and the workers side by side against imperialism and 
oligarchy in Argentina. Let us skip a lot of minor bush, and go to 
the core of the matter, to the political message of Braden DeLong:

> In Díaz Alejandro's estimation, it was four factors that set the stage
> for Argentina's relative decline: a politically-active and militant
> urban industrial working class, strong economic nationalism, sharp
> divisions between traditional elites used to having their own way and
> poorer strata without even shirts to lose, and a government used to
> exercising control over goods allocation that viewed the price system
> as a tool for redistributing wealth rather than for determining the
> pattern of economic activity.


So that Braden DeLong, not surprisingly, shares the opposition of 
Díaz Alejandro Lanusse to Argentine workers, to the impulse towards 
economic independence of Argentina vis a vis the foreign powers, and 
cannot see that any redistribution of wealth implies not only a 
redetermination of the pattern of economic activity and more than 
that the construction of a new kind of worker and even of 
"entrepreneurs". As to the "sharp division" that Díaz Alejandro 
Lanusse laments, and Braden DeLong also cries over, is of course a 
minor deceptive device in the whole set of the argument. In fact, it 
hides the anger at the good memory of the Argentinian poor, who still 
remember -my mother for example- the times during the 30s when a 
crust of bread ointed with oil was a luxury that only the rich 
daughters of the neighborhood grocery store's owner (my grandpa) 
could afford. Minor, stupid things for these guys who must have 
probably spent their childhood wading into ice cream.

Then, the "comparative method" begins by stating an absurdity:

> 
> >From the perspective of 1947, the political economy of Western Europe
> would lead one to think that it was at least as vulnerable as 
> Argentina to the Peronist form of economic stagnation. 

This is an absurdity because no matter the devastation produced by 
the war, Europe was already developed as a set of self-centered 
economies in 1945, and provided the USA funded them, which they did, 
these bourgeoisies had all the mechanisms handy to regenerate 
themselves out of scratch. Argentina was trying to generate its own 
bourgeois, self-centered economy. A minor difference that simply 
allows us to throw most of the formal comparisons by Braden DeLong / 
Díaz Alejandro Lanusse to the dustbin. And thus close our issue.

Please, Braden, if you want to debate with me, resort to serious 
sources.


Bye.

Néstor Miguel Gorojovsky
[EMAIL PROTECTED]