Words by Erez Reuveni
April 2004

Chicken Little likely traveled through Argentina before intoning that the sky was falling. In 2001, following a decade's worth of privatization and increased foreign investment that led to rapid economic development, Argentina's economy collapsed.

The country's economic boom during the 1990s, led by then president Carlos Saul Menem, fueled by huge government expenditures and the pegging of the country's currency, the Peso, to the American dollar, collapsed under the weight of a huge national debt and widespread tax evasion. Following an infusion of $40 billion from the International Monetary Fund, Argentina initiated extensive austerity measures, which further exacerbated the country's economic plight. After years of economic successes, Argentina's citizens were faced with unprecedented inflation, recession, and record unemployment. However dire Argentina's current economic woes, the country hasn't always been dogged by sour economic fortunes.

Argentina experienced rapid industrialization and urbanization during the 20th century, yielding a nation of Argentines who considered themselves a first world European antidote to the perennial political intrigue and economic crises inherent to Latin America. Even today, Argentina's verdant Pampas region, a vast expanse of rich grassland often referred to as the breadbasket of South America, continues to produce wheat, alfalfa, and corn, while also serving as a base for Argentina's substantial cattle-ranching operations. But despite the productivity of the country's industrial and agricultural base, today many Argentines are questioning the wisdom of the Menem government's heavy-handed effort to transform Argentina into an American-style economy during the 1990s.

First discovered by Amerigo Vespucci, a European, in 1502, Argentina quickly became the lynchpin in the Spanish empire's mercantilist system. Following the disintegration of the Spanish empire in the western hemisphere during the 1800s, Argentina declared independence, promulgating a constitution that espoused federalist ideals akin the system of government then in vogue in the United States. However, as with many of Argentina's South American neighbors, the country's politics quickly became fractious and unpredictable. Throughout the 19th and 20th centuries, democratic rule alternated with pseudo-dictatorship. Numerous coups, led by the military, continually checked the advance of democratic ideals. By 1945, under the leadership of Juan Peron, the country had become a one-party state.

Peron, and his political party, Justicialismo, a union of upper-class industry, the military, and Argentine nationalists, remained the primary engine of Argentine growth throughout the latter half of the 20th century. Occasionally interrupted by military coups, the Peronists expanded Argentine industry and agriculture, creating a ruling class of wealthy landowners and industrialists. The strength of the Peronists was challenged, first by a military junta that ruled during the late 1970s, initiating Argentina's "dirty war," during which many advocates of liberal reform simply disappeared, and again during the economic growth and upheaval during the 1990s. Four separate presidents have presided over the country's attempts at economic recovery during the past four years, with Nestor Kirchner the most recently elected president.

Despite the tumultuous nature of the country's politics, Argentines remain a sophisticated people. Unlike the rest of Latin America, the majority of Argentines are descendant of European immigrants, mostly of Spanish and Italian stock; and many Argentines are bilingual, speaking both Spanish and Italian. Over 80 percent of the population lives in urban areas and the country's literacy rateÑ96 percentÑis the highest in South America. While most of the country is nominally Catholic, many people are secular, with only a minority of Argentines attending religious services on a regular basis. Buenos Aires, the nation's capital, oozes elegant urbanity and serves as home to most of the country's creative industries, including numerous film, advertising, and graphic design houses.