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PASTOR GENERAL'S REPORT, August 8, 1980
Page 13
employees from the feather-bedded state railway system. (Former
President Juan Peron had used the country's handsome profits from World
War II sales of wheat to its allies to buy out the railways in 1946, then
proceeded to staff the system with Peronista supporters and cronies.)
Next, Martinez de Hoz knocked an opening--apertura--in the entire economy,
freeing it up finally to outside imports and investments. As in Chile,
this forced sluggish, high-priced home producers to work harder to get
into another line of work. The former leadership was, frankly, selfish.
They wanted to sell the country's abundant harvests of meat and grains
to the world, but at the same time produce their own manufactured goods
behind an almost impenetrable tariff wall. The walls have since been
coming down, although not as much yet as those in Chile.
Results of this program? I talked for almost two hours with Senor Tomas
Donovan, chief assistant to "Doctor Joe," in Mr. Donovan's office in the
Economic Ministry. Inflation, he said, is now down to about 80% a year.
"Down?" you might ask? Well, it's better than 920% for all of 1976, when
the new team took over. And it continues to drop. How do Argentines
survive even 80% inflation? Simple--wages are adjusted quarterly, income
tax is indexed, and with interest rate ceilings on savings removed,
people are putting money in their own banks, not sending pesos to Miami
and Zurich. Tax recovery is way up and so are the country's reserves,
up to about seven billion dollars--much of it moving into gold.
So Argentina is recovering from what even Time magazine termed "politi
cally-induced poverty," adding that "by almost any measure, Argentina
ought to be an economic Eden."
One hears a phrase in government circles in Buenos Aires frequently,
reflective of the determination which motivates many of its leaders to
day. It goes like this: "This time we are going to do it right."
One can't help contrasting the economic fortunes in Chile and Argentina
with those of the United States. The United States is only tinkering
with its problems. Its leaders don't have the political courage to cut
the fat where needed, to accept short-term disadvantages for long-term
benefits. In a democracy, perhaps, that is impossible to do. One
absolutely shudders to think what the country would be like with Senator
Kennedy in the White House--with all of his bloated big-government schemes
and controls on economic activities. Would the United States soon see
1,000% inflation too?
One other thing should be mentioned here. Argentina, like Chile, has a
bad name for its alleged "human rights" violations. However, most
Americans cannot conceive of what went on here in Argentine society
before and after the 1976 change. Two vicious--that is the only way to
phrase it--guerrilla armies were aiming their guns at government officials
and leading businessmen (the Economic Ministry personnel are still a tar
get). These guerrillas were outright anarchists whose aim was to bring
down the entire society. They had no real plan for the post-ashes period.
They were of the same mold as the Red Briga�2 who still terrorize Italy.
These people had absolutely no regard for "hunan rights."
(I was given
a thick book, "Terrorism in Argentina," which detailed shocking episodes
of the tactics of these inhumane people.)