Economic collapse in Argentina

I value Dmitry Orlov’s writings about economic collapse in Russia, because they have taught me many things about the reality of collapse that I wouldn’t have been able to imagine on my own. But there’s a lot about the Russian example that is actually in stark contrast to what might happen here in the West—in fact, Orlov uses the contrast to make many important points—so I’ve been looking around for other examples that might be instructive in ways that Russia is not.

Right now I think it might be good to study Argentina next. It is a modern, industrialized nation. A large part of its population immigrated from Europe. Much of its instability seems to be derived from its embrace of an extreme form of Chicago-school economics. The Argentine economy collapsed in 2001, then seemed to be on the road to recovery, and now seems to be headed for collapse again as part of the current crisis.

Here’s a documentary on YouTube that gives an overview of the 2001 collapse. I’ve only watched the first of the twelve episodes, and can’t say anything about the point of view of the filmmakers, but it uses a lot of on-the-street film footage to give a sense of what everyday life was like as events unfolded.

And here’s a long posting from someone who evidently lived through these events, describing what everyday life in the city was like. I can’t vouch for its authenticity (I can’t even figure out exactly who wrote it), but it doesn’t seem to have an agenda and rings true as far as practical details go. Some passages that caught my eye:

Someone once asked me how did those that live in the country fare. If they were better off than city dwellers. As always there are no simple answers. Wish I could say country good, city bad, but I can’t, because if I have to be completely honest, and I intend to be so, there are some issues that have to be analyzed, especially security. Of course that those that live in the country and have some land and animals were better prepared food-wise. No need to have several acres full of crops. A few fruit trees, some animals, such as chickens, cows and rabbits, and a small orchard was enough to be light years ahead of those in the cities. Chickens, eggs and rabbits would provide the proteins, a cow or two for milk and cheese, some vegetables and fruit plants covered the vegetable diet, and some eggs or a rabbit could be traded for flower to make bread and pasta or sugar and salt.

And this:

So, where to go? The concrete jungle is dangerous and so is living away from it all, on your own. The solution is to stay away from the cities but in groups, either by living in a small town-community or sub division, or if you have friends or family that think as you do, form your own small community. Some may think that having neighbors within “shouting” distance means loosing your privacy and freedom, but it’s a price that you have to pay if you want to have someone to help you if you ever need it. To those that believe that they will never need help from anyone because they will always have their rifle at hand, checking the horizon with their scope every five minutes and a first aid kit on their back packs at all times…. Grow up.

And this:

Summarizing, being in a city without light turn to be depressing after a while. I spent my share of nights, alone, listening to the radio, eating canned food and cleaning my guns under the light of my LED head lamp. Then I got married, had a son, and found out that when you have loved ones around you black outs are not as bad. The point is that family helps morale on these situations.

And this:

After TSHTF in 2001, only the most narrow minded, brain washed, butterfly IQ level idiots believed that the police would protect them from the crime wave that followed the collapse of our economy. A lot of people that could have been considered antigun before, ran to the gun shops, seeking advise on how to defend themselves and their families. They would buy a 38 revolver, a box of ammo, and leave it in the closet, probably believing that it would magically protect them from intruders.

Oh, maybe you don’t think that firearms are really necessary or your beliefs do not allow you to buy a tool designed to kill people. So you probably ask yourself, is a gun really necessary when TSHTF? Will it truly make a difference? Having gone through a shtf scenario myself, total economical collapse in the year 2001, and still dealing with the consequences, 5 years later, I feel I can answer that question. YES, you need a gun, pepper spray, a machete, a battle axe, club with a rusty nail sticking out of it, or whatever weapon you can get hold of.

And finally this, which I quote at length because you ought to read it even if you decide not to read the entire piece:

I forgot it! Darn, same as the gold stuff but worse, much worse. I’ve never been good at remembering some things, like numbers and names of people I meet, I forget those (instantly), they just flee my mind, uneventfully, but I do remember some other things that don’t seem to be as important. I do remember living in USA as a kid. I remember my school, Pierce School, Don’t remember exactly were it was, because we lived some in Boston, Massachusetts and some in New Hampshire. I remember my best friend, Freddy, and a girl (why is there always a girl? [Smile] ) Samantha, Sam. She was red haired and tall, I had a picture of her playing together but I lost it. Some time between the age of 3 and 26 I lost that picture that was so dear to me. I remember the smell of an orange shaped “scratch and smell” sticker my kindergarten teacher stuck in a small book we made once. But I almost forgot this forever. This, this was important, a moment where the life we once knew stopped existing, and a group of students, in a class room that looked like and abandoned building, realized it, all 60 of us at the same time.

It’s 1:06 AM over here. I just finished showering and my wife and son are asleep. I was putting shampoo on my hair, thinking about what I wrote today on this post, and remembered the exact moment when I realized along with several other people, not only that TSHTF (that we all knew) but that the world we once new no longer existed, and that this was not a hurricane, this was an ice age period, it wouldn’t just go away.

We understood it the same way a kid understands photosynthesis: Because a teacher coldly explained it to us, even used graphics. I slept 5 hours yesterday, 2 hours the day before yesterday. Saturday night I didn’t sleep at all. I’m already used to it. Deadlines at the University, staying late at night, drawing in CAD 3D, waiting until Renders are ready. It’s a competitive world out there, and no one sympathizes with what you are going through, they just want you to perform as expected, and the standard is always high. It happened 4 years ago, almost a year after the December 2001 crisis. It was a social studies class and this teacher, don’t remember if it was a he or a she, was explaining the different kinds of social pyramids. God! Now I remember more! We even had a text book with those darn, cruel pyramids! The first pyramid explained the basic society. A pyramid with two horizontal lines, dividing those on top (high social class) those in the middle (middle class) and the bottom of the pyramid (the poor, proletarian). The teacher explained that the middle of the pyramid, the middle class, acted as a cushion between the rich and the poor, taking care of the social stress. The second pyramid had a big middle section, this was the pyramid that represents 1st world countries. I which the bottom is very thin and arrows show that there is a possibility to
go from low to middle class, and from middle to the top of the social pyramid. Our teacher explained that this was the classic, democratic capitalist society, and that on countries such as Europeans one, socialists, the pyramid was very similar but a little more flat, meaning that here is a big middle section, middle class, and small high and low class. There is little difference between the three of them.

The third pyramid showed the communist society. Where arrows from the low and middle class tried to reach the top but they bounced off the line. A small high society and one big low society, cushioned by a minimal middle class section of pyramid. Then we turned the page and saw the darned fourth pyramid. This one had arrows from the middle class dropping to the low, poor class.

“What is this?” Some of us asked.

The teacher looked at us. “This is us”

“It’s the collapsed country, a country that turns into 3rd world country like in pyramid five where there is almost no middle class to speak, one huge low, poor class , and a very small, very rich, top class.”

“What are those arrows that go from the middle to the bottom of the pyramid?” Someone asked.

You could hear a pin drop. “That is middle class turning into poor”.

I won’t lie, no one cried, though people rubbed their faces, held their heads and their breath.

No one cried, but we all knew at that very moment that all we thought, all we took for granted, simply was not going to happen.

“You see, the income from the middle class is not enough to function as middle class any more. Some from the top class fall to middle class, but the vast majority of the middle class turns into poor” Said the teacher.

I don’t know how many people in that room suddenly understood that he/she was poor.

The teacher continued “You see, we have a middle class that suddenly turns to poor, creating a society of basically poor people, there is no more middle class to cushion tensions any more. Middle class suddenly discovers that they are overqualified for the jobs they can find and have to settle for anything they can obtain, there for unemployment sky rockets, too much to offer, too little demand. You see they prepare, study for a job they are not going to get. You kids, you are studying Architecture because you simply wish to do so. Only 3 or 4 percent of you will actually find a job related to architecture.”

We all sat there, letting it all sink in. After a few months, it all proved to be true. Even the amount of students that dropped out of college increased to at least 50%. They either so no point in studying something that would not make much of a difference in their future salaries, had no money to keep themselves in college, or simply had to drop college to work and support their families.

Someone once said, in this forum, that if this had happened in USA, the social unrest would have been much worse, because people from S. America are stronger. At first, I told him that I didn’t think so, I said that all humans adapt when they have no other choice. But now that I consider it more, maybe he was right. Not that S. Americans are stronger, but they are more used to adversities. Most of us are children from grandparents that escaped civil war, either in Spain or dictators in Italy, our parents survived the dirty war, even more dictators, and therefore their children are of strong character too. Can USA citizens survive what we survived? Of course they can, though I think that there are too many that are not like you, many that don’t prepare, and take everything for granted. Those are the ones that will be responsible for the increase in the social unrest once the SHTF, those that were too lazy to take care of themselves before the SHTF, or that had gone soft through out the years, believing that the government will “take care of them because they pay their taxes”. But in the end, they will pull through. People will adapt, they always do. You’d be surprised. And those that don’t want to adapt to the new reality they live in, will die young, thus cleaning the gene pool and ensuring the continuity of the specie. It’s been this way for thousands of years.

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4 thoughts on “Economic collapse in Argentina

  1. That is the kind of scenario I have been seeing just over the horizon for a few years now. I have been doing my best to prepare myself and my family for just such an eventuality (while praying God will spare us) but my friends will have none of it. They feel I am a Chicken Little with an apocalyptic fetish.

    God save us all.

  2. I first read this essay as a series of forum posts about 5 years ago.
    The author goes by the handle “ferfal” and you can find more of his stuff out there if you search that name plus Argentina.

    edit: here’s his blog…
    http://ferfal.blogspot.com/

  3. I am an American, & truely value your sobering candidness !
    In my opinion, the U.S. should adopt Non-Entropic energy systems, and totaly utilize them to create a clean (non-fossile / nuclear)enabled society. Please see http://www.chernie.org to understand what I mean by “non-entropic energy”. If we are able to take the almost free, almost unlimited energy aproach, then the sky is almost the limit. Imagie for a second almost no limits on desalinazation, and being ale to terraform all the worlds desserts at will into lush farmland, timberland / game preserves. I believe that availabilty of clean & almost limitless energy is the key, that can preserve this planet. The two greatest foes of this in the U.S. have been the Petro-Chemical Industry, and the “House of Morgan” that is the banking industry that J.P. Morgan built up in the U.S. @ 1900 on. Morgan personally dedictaed his life to destroying the availability of non-enetropic energy first in the U.S., and it’s then budding engineerig schools, he completely eliminated 50% of Maxwells theory from the curiculums, and anything else, that would stop him & his henchmen from putting the globe on a perminent diet of un-renuable, and always consumable energy. Today “the House of Morgan” is a self worshiping, self perpetuating entropic beast. Of course you have heard all the stories about Exxon-Mobile. This can be really hard to hear / even believe. Especially if you just graduated from a good engineering school ! Entropy is thoroughly embedded in your head, as THE ONLY AND COMPLEATE FOUNDATION UNDERLYING ALL THE SCIENCES ! Now take what happened to the economy of Argentina, or what is happening to the economy of the U.S. and inject unlimmeted ultra-cheep energy
    for building, farming, basically everything that takes energy to do, then add one other key component, COMPLETELY COVERED EDUCATION THROUGH THE HIGHEST COLLEGE LEVEL. I’ts a frightening concept to the rich, because their most important resource (RIGHT NOW) is an unlimited supply of relativly poor suckers, and as of now that’s us in the U.S. too

    So , simply stated, we can all get educated, and live in a golden age of super tech. where we are all super wealthy, but all clean our own damn toilets, and all have long life, excellent health bla, bla, bla…. Or we can all march down the road together into an entropically oriented future, were overpoulation, starvation, and so many other wonderfull nightmares become reality. But don’t dispare, as Exxon-Mobile will re-write history, to make it seem like it was the only possible way things could have turned out… And … that they were some how the hero of why anyone was even still alive….

    Ok… Best Regards to You All,
    Alexander

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