Neoliberalism is once again disillusioned in Argentina

The results of the Argentine election were announced on the 28th. The left-wing opposition candidate Fernandez defeated the current President Markley and was elected the new president of Argentina. The defeat of Macquarie not only indicates the general psychology of the Argentine people, but also reflects the failure of neoliberal ideology in Argentina. On the surface, the key to Fernandez’s victory is that Argentina’s economic recession has been in recession for four years in Macquarie’s administration. Its pro-free market-oriented economic policy has not only failed to lead the country out of the crisis in the new century, but has led to the living conditions of the middle class and the lower classes.

Deteriorating. Fernandez’s ruling philosophy has given the Argentines an expectation. He proposed to control foreign exchange, especially the US dollar, emphasizing the state’s intervention in the economy and protecting the rights of workers, thus attracting many middle and lower votes. Through the appearance, the deep reason In terms of the neoliberalism that has prevailed in Argentina for decades, it has once again shattered.

Under the influence of the debt crisis that swept through Latin America in the 20th century, Argentina was not spared and had to implement reforms. During the period of Carlos Menem’s administration (1989-1999), excessive openness and extreme neoliberal reforms were implemented. The first is to promote the complete market mechanism, strongly oppose the state’s intervention in the economy, deviate from the actual situation in Argentina, adopt “shock therapy” and implement a series of open policies, the most intriguing is the implementation of a comprehensive state-owned enterprise privatization policy.

In the process of privatization, state-owned enterprises and natural resources fell into the hands of foreign capital in large numbers. Secondly, the Menem government implements a financial liberalization policy, which allows foreign capital to enjoy national treatment through the “Emergency Economic Law”; through the liberalization of capital transactions, large amounts of overseas capital flow into Argentina. Then there is the pervasiveness of foreign capital, which almost controls the economic lifeline of Argentina.

Market fundamentalist economic policies seem to have alleviated Argentina’s temporary economic difficulties, but they have given Argentina the seeds of a bigger crisis. The large amount of short-term capital that comes with privatization and financial liberalization is highly speculative and unstable. When the bells of the 21st century sounded, Argentina under the neoliberal reforms began to experience a disaster, the economic situation deteriorated, the situation of foreign reserves became increasingly serious, and eventually it fell into a protracted financial crisis, which triggered economic crisis, political crisis and Chain reaction such as social crisis.

This marks the failure of Menem’s neo-liberal reforms. The Argentine economy has been hit hard. The society has not only failed to achieve the expected goals, but has also experienced a major setback. After the Kirchners took power, Argentina began to turn left, but after taking office, Marki completely denied Kirchner’s left-wing policy and began to implement a liberal economic policy of “turning right”, especially for the dollar.

The liberalized policy of regulation is exactly the same as the economic policy of the Menem period 30 years ago. This is precisely the key to the political contest between Mark and Fernandez. Fernandez believes that an open and unregulated market will only exacerbate Argentina’s economic risks, and he advocates the establishment of a set of regulations that restrict investment capital. The disillusionment of neoliberalism in Argentina has brought important enlightenment to developing countries. First, developing countries should keep a clear understanding of the purpose of opening up.

The opening and privatization of capital can bring potential economic benefits to developing countries, but there is no inevitability between capital market opening and economic success. Argentina has used the US dollar as a weapon to solve all economic problems, but it has paid a huge price, causing the country’s economic growth to stagnate or even seriously regress. Second, we must choose an open strategy based on our national interests and the real environment.

The practical experience of Argentina provides people with negative teaching materials. Third, the role of the state in reform and opening up should be strengthened. Regardless of the neo-liberal Menem and the market-based Markri, their open policies have caused the government to lose its ability to control the economy and to be weak and helpless in the face of economic crises or recessions.

Of course, the reality in Argentina also reflects that a perfect government and a perfect market do not exist. In reality, there must be a market mechanism, but also strengthen the state’s intervention in the economy, especially in an open environment, to strengthen the government’s ability to control. Avoid potential risks and ensure the stable development of the national economy.