DEMOCRACY, FISCAL RESTRUCTURING, AND NEOLIBERAL RESTRUCTURING IN ARGENTINA AND BRAZIL
Since the time of the first Arab crude oil embargo in the early 1970s, the economies of Latin American countries have been reeling. Economic problems have been particularly acute in Latin America's two largest countries Brazil and Argentina.
In both Argentina and Brazil, economic chaos has been punctuated by conflicting experimentation in the development and implementation of economic policy by domestic leaders, and by meddling from the international community primarily the United States and its surrogate the International Monetary Fund (IMF). Depending upon one's perception of these events, both Argentina and Brazil have been plunged into an economic and social morass from which they may never recover, or each country is on the verge of dramatic economic growth and political stability.
This research explores the contemporary state of economic, social, and political affairs in Argentina and Brazil. This exploration is pursued through considerations of debt and structural constraints, social pacts and collective action dilemmas, hyperinflation, and the implications of the "lost decade."
In both Argentina and Brazil, numerous economic stabilization plans have been implemented by the respective governments. Most of these plans were subsequently approved by the IMF.
Argentina has managed to renegotiate repayment, to some extent, of its external debt, without completely alienating the IMF (Canitrot, 1993, pp. 4, 8. The country requires, however, significant additional debt repayment renegotiation.
For Brazil's part, that country began a brinksmanship game with the IMF and the international lenders, by refusing in 1987 to continue to pay on the principal of its external debt, although keeping up interest payments. Brazil, at that time, indicated that the country really did not have much to fear from IMF displeasure because, as the...