At the beginning of the 20th century, Argentina was one of the world’s 10 richest countries, propelled by fertile lowlands or pampas, good prices for crops and cattle farming. It greatly expanded beef exports to the world. Before WWI, Argentina experienced peace, prosperity and a “land of opportunity.” Europeans eagerly immigrated to a country with better climate, and once settled, built grand buildings like the Teatro Colón opera house, which opened in 1908, and the Retiro railway station, completed in 1915. They spent money, lots of it.
WWI and WWII significantly reduced trade. Over-reliance on the British Empire, which was in decline, took a toll. The Great Depression crushed open trade and caused Argentina to implement high tariffs. The country’s education system declined from lack of investment. The political system neglected land and political reform, allowing wealth to concentrate into the hands of a few families, currently about 300 families out of a population of 43 million, who control not only the land, but the entire economy and the government. As Matt O’Brian wrote in The Washington Post:
Everyone else was just a cog in their beef-and-grain-exporting machine. Or, as the Financial Times’s Alan Beattie has put it, Argentina is “what North America might have looked” like “if the South had won the Civil War and gone on to dominate the North.” Which is to say that it was a semi-feudal aristocracy dependent on a steady supply of cheap labor.
If this sounds like a good way to start a class war, that’s because it was. Up until recently, Argentina had spent most of the last 100 years alternating between left-wing populists who promised to share the country’s wealth, and right-wing military dictatorships that tried to stop that from happening. And, of course, with the stakes so high, neither side was willing to play by the rules…
Right-wing governments had no interest in educating the workers or investing in anything other than the landowners’ exports. And left-wing governments just nationalized industries, protected others with tariffs, and made promises they could only afford by printing money. The result was a century of inflation and stagnation.