Argentina Consolidates its Oligarchy, 1879-1916

Roca Conquers the Desert

[This is the second in a series of posts synthesizing the last century or so of Argentine history, with some help from Luis Alberto Romero and Wikimedia.]

If I had to pick a symbolic birth year for modern Argentina, it wouldn’t be 1810, when a council of Buenos Aires’ leading citizens forced the resignation of the Spanish Viceroy, an event now celebrated as the origin of independent Argentina. Nor would it be 1816, when the Congress of Tucumán formally severed its ties to Spain (without, it should be noted, the participation of any Federalists, who opposed Buenos Aires’ dominance and were actually at war with the nascent central government at the time. Funny, the detailed museum that now occupies the Congress’ old meeting quarters in Tucumán doesn’t mention this).

Instead, it’d be 1879, when General and soon-to-be-President Julio Argentino Roca launched the last massive campaign to defeat the indigenous groups of Argentina’s interior and open the fertile pampas to agricultural production. The successful campaign capped a period of rapid territorial expansion and state consolidation. The Paraguayan War, concluded in 1870, had established a fixed and advantageous border with Argentina’s northern neighbor (while killing perhaps 70% of Paraguay’s population in the process). Increasing portions of the continent’s southern stretches had come under Argentine control. And with the growth of a competent professional army, the civil wars that had dominated the country’s first half-century of independence had largely subsided. Within the year, Buenos Aires would be federalized and Roca’s National Autonomist Party (PAN) would dominate Argentine politics through the system of sharply limited suffrage known as voto cantado(“sung vote”), a reference both to the requirement that votes be declared aloud and to the certainty that elections would follow the PAN’s preestablished script.

  (The History of Paraguay’s Borders Really Deserves a Post of its Own)

With the pampas in hand and the political system largely stable, Argentina could finally set about exploiting the vast natural resources it had definitively secured. The result was something like the US’ contemporaneous Gilded Age, but on steroids. At the same time that the US government was distributing Western lands under the Homestead Act and massively subsidizing the creation of a national rail network, Romero explains, the Argentine state set off down a similar path, acting “systematically to facilitate Argentina’s insertion into the global economy and to adapt it to a role and a function that — it was thought — fit it perfectly.”

To the government, it was obvious which role would be a “perfect fit.” Argentina would be the breadbasket (and butcher) of the cresting British Empire. Britain had long been eyeing Argentina’s many natural gifts, but in the late 19th century its involvement reached historic highs. Between 1880 and 1913, British capital investments in the country increased by a factor of twenty, funding an extensive railway network (expanded from 2500km in 1880 to 34,000 in 1916) and an advanced system for meat processing and distribution. This infrastructure not only reinforced the presence of the state in newly acquired territories; it also meant that the rich agricultural lands of the pampas would be seamlessly connected to Argentina’s main port at Buenos Aires — and to the world.

Such integration made these newly available lands extraordinarily profitable. The single-party regime charged with distributing them — representative, as it was, not of Argentina’s population at large but of its wealthiest male citizens alone — set about “transferring huge tracts at minimal cost to powerful and well-connected individuals,” thereby ensuring the consolidation of a genuine aristocratic class — Romero terms it “an oligarchy.”

Argentina’s dramatic expansion wasn’t seamless; in 1890, reckless Argentine loans brought down Britain’s Bearing Bank, setting off an international crisis and plunging Argentina into severe recession. Nor was the country’s newfound prosperity a genuinely national affair; instead, growth concentrated in the central pampas and the large cities of the Litoral, which developed critical industries to supply the country’s grain-and-meat engine. With the exception of Mendoza (ideally suited to wine production) and Tucuman (the heart of the country’s massively subsidized sugar industry), the interior of the country remained a sleepy, impoverished backwater.

But, despite these caveats, growth in the cities and on the pampas was dramatic enough to earn the now-underpopulated country international renown. Seeking both to build a productive labor force and “Europeanize” the population, the classically liberal leaders of the late 19th century heavily promoted the country as a destination for European immigrants, launching advertising campaigns and subsidizing transatlantic voyages. Their efforts met with great success; by 1914, a country that 45 years before had 1.8 million residents was now home to 7.8 million.

Argentine demographics shifted with amazing speed; by 1895, two out of every three residents of Buenos Aires were foreign born. But the political system did not move with them. Though the state sought to insert itself ever more deeply into Argentine daily life — creating a European-style Civil Register and enacting civil marriage, establishing a Ministry of Labor, imposing obligatory military service, and offering free mandatory primary education — political enfranchisement remained the province of the landed elite. As many immigrants and, especially, their children began to climb the ladder to the country’s emerging middle class — and as many others remained trapped, without representation, in low-wage jobs as tenant farmers and factory workers — members of Argentina’s “oligarchy” came to see themselves ever-more as “owners of the country to which these immigrants had come to work.” The result was a proliferation of new political demands and a political system unable to moderate among “parties with divergent and legitimate interests, capable of disagreeing and agreeing.”

Heroes of the Revolution of ’90

As conflict among social sectors grew, many came to see Argentina as a sick society. This was certainly the view of Leandro N. Alem’s Civic Union, which launched violent political uprisings against what it characterized as a corrupt and illegitimate order in 1890 and again in 1893 and 1905. But it was also the view of an ever-increasing share of the PAN elite. The election of reformist President (and luxury shopping-mall namesake)  José Figueroa Alcorta in 1906 laid the groundwork for the 1910 ascension of emphatic Roque Sáenz Peña, whose largest achievement, the electoral reform law of 1912, made voting secret and obligatory for all naturalized and native-born Argentine males beginning with the elections of 1916. Electoral reform, Romero notes, wouldn’t have succeeded if the political elite hadn’t been “absolutely convinced” that “traditional interests” could retain power through an electorally successful “party of notables.”

But decades without real political competition had blinded the PAN elite to the reality of their increasingly diverse country. With the prospect of real success on the horizon, the country’s middle-class revolutionaries — now calling themselves the Radical Civic Union (UCR) — rapidly built themselves into a movement with a base far broader than the “notables” of the now-fractured PAN. In the elections of 1916, UCR militant Hipólito Yrigoyen captured 46.8% of the vote, more than three times the share earned by conservative Ángel Rojas, his closest competitor. Millions of newly enfranchised Argentines were buoyant; traditionalists were aghast.

A new, Radical era in Argentine history had undoubtedly arrived. But the characteristics that shaped the country in its formative years — the rivalry between surging metropolis and stagnant interior, the tensions between a territorially fortified elite and the immigrants they now held in contempt, the tendency of actors across the spectrum to view opposing politicians not as rivals but as dangerous enemies — weren’t about to fade away. It would take much more than a 33% margin of victory to turn democratic aspirations into real institutional change.

Yrigoyen Assumes the Presidency

La Vida Carlotense

I spent last weekend at my roommate’s family reunion in La Carlota, a pampas town of some 12,000 people in the south of Córdoba province, about six and a half hours by car from Buenos Aires. It was a welcome reminder that porteños alone do not a country make. Grassy fields stretching past the horizon, small-scale farms where carlotenses still raise crops and cattle, giant but close-knit families, even a gleaming new swimming pool — I couldn’t have asked for a better end to a January I won’t soon forget.

Argentina in the Twentieth Century (with Some Help from my Good Friend Luis)

I’m currently rereading Luis Alberto Romero’s excellent Breve historia contemporánea de la Argentina as I prepare to draft the “backround” chapter of my book. Both because it’ll be a useful exercise for me to critically engage Romero, and because you guys might want to bone up a bit on your Argentine history, I’m going to use this rereading as an opportunity to write short posts on the major developments of the last hundred y pico years, from the consolidation of the state in the late 1800s through the menemato of the ’90s. (And if you’re moved to read Romero’s book, all the better! You can find it in English on Amazon.)

As I do this, I’d love to be able to juxtapose Romero’s take with what is to my mind the other giant of the genre, David Rock’s Argentina, 1516-1987. Romero’s rather to the left and an obvious fan of what might loosely be termed “social democracy,” while Rock delivers a generally more conservative and economics-heavy analysis centered on the country’s relationship to the world. I think the historiographic contrast would be entertaining — at least to those among you who, like me, are entertained by such things. But sadly I’ve left my copy of the book back in Pittsburgh, so it’ll have to wait until I head back for a bit in June.

For the moment, then, it’s just going to be you, me, and Luis. First up: Argentina Consolidates its Oligarchy, 1879-1916.

The Isleño Within

The trip to the Paraná Delta starts rough — an hour on your feet, packed into a cramped, jolty, far-too-hot train; another hour gathering up the food and bug spray you can’t leave the mainland without; then the hunt, giant jugs of water in hand, for a little lancha to carry you into the Delta. But here’s just one of the many magical things about a lavishly long summer weekend spent on an island where the Paraná meets the Rio de la Plata: You get off the boat, and none of it ever happened. Because you’re on another planet. One where rivers have taken the place of roads and boats cars, where your nearest neighbor is just beyond shouting distance, where at times it’s hard to hear over the birdsong. Nothing could connect this place to the sweltering megalopolis you’ve finally managed to escape. You’ve got no steps to retrace — and you’ve never entertained a happier thought. Click play above, check out the pictures below. You’ll see what I mean.

Subterranean Time-Warp Blues

It’s been a hectic montaña rusa of a month and by far the longest stretch I’ve gone yet without posting to the blog. To ease myself back into the game, here’s something I’ve been meaning to share for a while now: an underground tunnel direct to the past, just a few blocks from my home. Galería Obelisco Norte is a subterranean shopping strip buried beneath gargantuan Avenida 9 de Julio and adjacent to one of the city’s main subway transfer stations. Long past its prime and worlds away from the nearby galeries parisiennes that share the first part of its name, this galería is a curio cabinet straight out of the ’50s. The tenants occupying its six-foot-shallow stalls sell everything from custom shoes and model trains to the sort of art that Motel 6 buys in bulk. There’s even a barber shop and a restaurant, The Paty King.

I come imitating Walter Benjamin, who’d wander Paris’ arcades in search of those traces of the past no historian would have thought to record. For it’s in this neglected corridor, among all the places I go in Buenos Aires, that I feel closest to the (imagined) city that used to sit atop it. Have a look for yourself:

A Much-Needed Kick in the SEC’s Pants

I haven’t written much about US politics lately, but a decision this morning by federal District Court Judge Jed Rakoff has me fired up, and lest it fly under your radar, I’d like to explain why. In the years leading up to 2008, many of the country’s biggest investment and insurance firms developed a chain of interrelated financial products that enabled them to sell ultimately worthless subprime mortgage debt to investors while simultaneously betting against these same investments. In other words, they encouraged their clients to buy products they knew, in the words of one Goldman Sachs executive, to be “shit” and collected large bonuses for doing so. When the bubble burst, investors like the Mississippi state pension plan took a huge hit while the banks (and their bonus-happy bankers) profited.

(It’s ethically bankrupt and, to my eye, transparently illegal practices like this that led me to detest the unmatched influence that “i-banks” and their enablers wield over the undergrads and career services offices of Harvard and other “elite” schools. When my classmates and I went searching for jobs, no career path was more clearly delineated than the one that led right to Goldman’s door. But, crankily, I digress.)

Since long before the US financial crisis of 2008, the Securities and Exchange Commission–the federal entity responsible for enforcing the laws that supposedly govern the sale of securities in the US–has developed the habit of charging investment firms with fraud or negligence and then negotiating settlements with these firms instead of taking them to court. This practice has continued to govern the agency’s pathetic response to the widespread fraud that contributed to our recent crisis–like, for instance, the $550 million fine the SEC negotiated with Goldman Sachs last year.

Settlements like this might sound like a win for the public–firms get bad publicity and have to pay big bucks, and the SEC can avoid committing its limited manpower to an all-out court battle. But in truth, it’s anything but. Hundreds of millions of dollars in fines would be pretty tough for you or me to swallow, but to a monstrously outsized, too-big-to-fail investment firm like Goldman Sachs, these settlements are chump change–the cost of doing (personally lucrative, morally decrepit) business. But much worse is that they enable the firms to pay up without admitting or denying wrongdoing, and because they forgo the public fact-finding of a trial, there’s no evidence for the victims of these terrible practices to use to recover their losses in civil suits. Perhaps this complete lack of accountability is just an unintended byproduct of the SEC’s pursuit of the public interest, but given the notorious revolving door between the commission and the firms it’s supposed to be regulating, I’m hardly convinced.

Excitingly, neither is Judge Jed Rakoff, who just this morning rejected a $285-million version of the Goldman Sachs settlement that the SEC had negotiated with Citigroup. (In this case, investors lost $700 million through Citigroup-designed securities while the bank itself made $160 million betting against them.) Assuming his decision stands, Citigroup will be going to court to face accusations of fraud, and the SEC’s shamefuly toothless enforcement practices will likely change in what I can only hope to be a substantial way.

Rakoff’s decision is rife with deliciously quotable and oh-so-appropriate moral indignation. Decrying the complete lack of accountability inherent in the SEC’s blame-free settlements, Rakoff observes, “Even in our nation, apologists for suppressing or obscuring the truth may always be found. But the S.E.C., of all agencies, has a duty, inherent in its statutory mission, to see that the truth emerges; and if it fails to do so, this Court must not, in the name of deference or convenience, grant judicial enforcement to the agency’s contrivances.” He takes particular aim at the lack of fact-finding, writing, “An application of judicial power that does not rest on facts is worse than mindless, it is inherently dangerous, serves no lawful or moral purpose and is simply an engine of oppression.”

Here here! At a time when the federal agencies and Congressional committees charged with overseeing the finance industry often seem less like genuine counerweights than launching pads for lobbying careers, and the federal courts little more than a rubber stamp, muscular judicial oversight from judges like Rakoff is exactly what we need more of. The days when our government is accountable to the public over the narrow interests of our country’s greediest sector still feel impossibly far in the future, but this decision fills me with hope. Our system of legalized corruption is under attack, and not just from Occupy Wall Street. Somebody needs to buy Jed Rakoff a beer!