Harold James From J.B. Alberdi: Argentina and The Vultures

Estimado Professor James:

Thanks to the ether networks in the vaults of La Recoleta I have internet and keep an eye out for articles which mention the fate of Argentina. As principal author of our Constitution of 1853 I feel culpable that I was not ever able fully to convince my compatriots to be good managers of our debt destiny, save and invest productively, and live within their means.

My attention was drawn to your interesting article at Project Syndicate mainly because of these words: “Two fundamental facts have turned countries like Argentina and Greece into victims of an impossible logic. First, debt continually grows; second, there is no really satisfactory way of getting rid of it.” I recognise your point that exceptionally large debt due to exceptional growth in financial services has intensified the long game of mounting new debt upon old debt so as to avoid default. There exists such a thing as “inextinguishable debt” (old bones for archeologists). A clean start without any debt is impossible. Accepted.

But I take issue with the perhaps unintended inference that Argentina has been a “victim” of external logics (debt would be only last in a long line of these). You say: “A cleanup is impossible. That leaves only one solution: pile on new claims to such an extent that old debts appear paltry”. I have memory of Argentina’s past, so if you would permit my ghostly intrusion, I will undertake a partial deflation of this claim with a brief history of our cycle.