Ivan Briscoe, 17. april 2003

William C. Morris is devastated, but somehow its inhabitants stagger on. A few young men, powered by boredom and adrenaline, annex its dirt streets with revolvers once night falls. Mothers of large families gather for their milk rations each afternoon, bewildered fathers rue the absence of work. Once in a while, when bellies and pockets are empty, the locals march a few blocks, light a fire, and stew their leftovers in front of the local town hall; the hope is that their political bosses might be shamed into donating food.

The marchers in this destitute corner of Greater Buenos Aires call themselves the Movement of Unemployed Peronists, though one of their leaders, Francisco, finds it hard to name a single politician who meets his approval. “If they give you milk or noodles, they want you to put their name and flag on it”, he complains.

But needs must: thanks to their political bosses, each member receives food parcels and a subsidy from the Argentine government of 150 pesos ($45) a month. One of them, María Hilda Torres, has seven young children and no front teeth. When elections are held on 27 April, it may safely be assumed that she and her colleagues, jobless or not, will be voting for a Peronist.

Mr Morris, a wandering 19th century British philanthropist, would be bewildered by the resentment and dependence now festering in his name. Poverty in the sprawl of bruised concrete and rusted metal that circles Argentina’s capital (home to 13 million of Argentina’s 34 million inhabitants) has reached an unprecedented 54.3% since the nation’s economy crumbled in December 2001, weighed down under unserviceable foreign debt.

Fury, popular protest, devaluation and yet deeper recession have followed since then, but the rulers who oversaw Argentina’s ignominious slump remain in place, and are jostling for first place in the poll. In a land haunted by dispossession, the political system has perfected the art of survival.

President Eduardo Duhalde, a Peronist who has governed since the start of 2002 and is due to step down after the elections, is entitled to some credit for the holding operation. Improvised economic policies and apocalyptic warnings of social breakdown have helped secure relief from debt payments (until the summer at least), prevented hyperinflation, partially restored people’s savings, and prompted a recovery of industrial activity.

The economy is just about stable – note that stability can mean the death of children through malnutrition – and a tourist boom is underway. But these are petty gains against the broader legacy of ruinous economic management: unemployment at over 22%, a shrivelling of the economy equivalent to 20% since 1999, a rate of inequality that is twice as high as in 1990. 9% of Argentines were classified as poor in 1974; well over half are now.

The free-market, capital-intensive gospel embraced by Argentina throughout the 1990s never envisaged a stumble like this. When Brazil followed the Asian countries and Russia into financial crisis early in 1999, then President Carlos Menem boasted of his country’s fiscal health and the marvels of a dollarised future. The reasoning, atrocious as it may seem today, appeared sound: his government’s click on the currency lever in 1991 – convertibility between the Argentine peso and the dollar – had combined with an onrush of “emerging market” capital to bring four decades of relative decline for the once rich nation to an end. Argentine debt became enticing to investors, news that proved thrilling to Menem and his henchmen.

Foreign firms flocked in, yearly growth touched 8%, and as a result of such over-performance, the International Monetary Fund (IMF) invited the architect as guest of honour to its annual jamboree in Washington in October 1998. Three weeks later, Menem addressed the Confederation of British Industry: “for constitutional reasons, we did not privatise the state,” he told the chortling delegates. “But everything else that we could, we privatised.”

On this point, the president was not lying. Some $23 billion coursed into Argentina via public sector sell-offs and billions more in foreign direct investment, bringing necessary modernisation – cable, decent telephones, cineplexes, massive factories staffed by a few dozen men – in return for the creative destruction of local industry, the train service and teachers’ wage packets.

Elected on an egalitarian platform, Menem’s policies simply resurrected those applied by military dictators from 1976 to 1983, whose programme systematically bowed to the wishes of financial speculators, thrust the balance of payments into the red, and enabled certain lucky families to forget the Dirty War and take their first ever holidays in Miami.

Foreign debt in the dictatorship quadrupled to $20 billion; under ten years of Menem, and in spite of privatisations and IMF wisdom, it more than doubled (from $65.3 billion to $146.2 billion). For those Argentines left by the wayside, there was severance pay. When that was gone, there were the typical methods of Latin American subsistence – changuitas (odd-jobs) and clientilismo (political patronage).

Carlos Repetto, a psycho-analyst who used to have a flourishing practice, insists that he was never taken in by the bonanza, but sympathises with those who were. “There was a certain complicity in the illusion of convertibility with the dollar and the possibility of taking out loans – that’s the only thing the Argentine people can be blamed for”, declares Repetto. The doctor’s couch is distressingly empty these days: the crisis has devoured people’s budget for psychoanalysis, leaving this university professor with abundant free time to agonise over the state of the nation. “The Argentine people believed what the banks were offering. Three or four banks used to call me everyday, offering me accounts, loans, credit cards, mobile phones, purchases of all kinds of things, all of it virtually useless consumption. Infinite journeys to any part of the world. And then the result is that your home is being auctioned off.”

It is late afternoon in the affluent, boutique-encrusted Barrio Norte of Buenos Aires, and outside the doctor’s apartment the neighbourhood’s cartoneros (garbage-scavengers) are gathering. Around 40,000 of them flock to the capital each night in search of recyclable paper and boxes; many also rummage for food. Four years ago, this line of work was virtually unknown in Argentina. For the impoverished or outcast of the past decade, it is now one of the few options left aside from crime.

Yet as Repetto suggests, economic quicksand will not tend to be picky about who or what it engulfs. Nearby, in the plaza of proudly middle-class Caballito, 56-year-old Carlos Pedro Abaria spent several months last year offering a dog-eared selection of paperbacks and signed lithographs by well-known artists. They were among his last possessions, and having been out of work as a book salesman for all of a year, lost his home, and found refuge in a hostel, he had no choice but to hawk them in the open air.

When I ask Abaria about his sell-off, he clumps his fingers together and makes a cramming gesture at his mouth: “art is all very well, but you’ve got to eat.” Until the city government fenced off the plaza in January, he was joined every weekend on the lawns by a further 500 stalls offering a disheartening selection of corroded utensils and dusty heirlooms: chipped sunglasses from the 1970s, broken electric razors, locks, keys, taps, and even the occasional family photograph (sold for the frame).

In the absence of any welfare state, the idiosyncrasies of private desperation unfurl across city and country, regardless of people’s class or upbringing or talent: a wander through modern Buenos Aires can throw up operatic arias on a pedestrian walkway, tango quintets in the metro, or a plague of well-staffed brothels. “I used to be lucky” is the parting comment made to me by a crippled pensioner on crutches, stumbling from one café to the next with his tray of ballpoint pens.

“People’s mental health has been broken, not just through traditional pathologies like paranoia, schizophrenia, melancholy and phobias,” says Repetto. “New and as yet unclassified pathologies have appeared. There are violent switches in mood during the day. People wake up in states of anxiety. There is dejection: people have nothing to keep them going.” Leading businessman Francisco Macri remarked last year that Argentina in 2002 was in many ways worse than the Italy he left just after the second world war.

The historian Félix Luna has observed that wealth in most Argentine families does not last for more than two generations, but nothing has been seen like this before: half a once preponderant middle class collapsing; over six million people tumbling beneath the poverty line in the year to May 2002, at a rate of twelve per minute.

The nemesis is not hard to find. Pegged to a rising dollar, the country’s governments, especially that headed by Menem’s successor, Fernando de la Rúa from the supposedly centre-left Alliance, were unable to adapt to a world of shrinking credit, stalled exports, and tenacious recession. No official in Buenos Aires or Washington, nor any political force in Argentina for that matter, dared entertain a significant change in monetary policy. Instead, from 1999 to the popular uprisings of late 2001, the country witnessed the bloodletting savagery of blinkered minds.

The strategy was to balance the budget and cut wages so that investor confidence could be restored – a textbook approach undone by the astonishing finding that lower wages and fewer jobs in fact spelled more recession, greater public deficit, and eventual financial meltdown. Paul Krugman was one of the few to get it right: Argentina had been crucified on “the cross of dollars.”

De la Rúa’s flight from power on 20 December 2001 came amid massive and largely spontaneous street protests, during which twenty-five people were shot dead by police and shopkeepers. The extraordinary weeks that followed saw four different presidents in office, and a social clamour and effervescence unseen since the years prior to military rule.

Throughout the major cities, neighbourhood assemblies and pot-thumping gatherings appeared to proclaim a new national coalition – of savers stripped of their assets, the unemployed and the revolutionaries. For all of these, the free-market “model” had degenerated beyond repair, converting every institution into a mafia, every banker into a robber, and every person under the age of 30 into a potential migrant.

The targets of their wrath were obvious. Some $18 billion went on holiday from March to the crisis of late 2001, extracted from Argentine banks by those with sound contacts and sufficient financial muscle. Then there was the IMF, generous to a fault during convertibility, but eminently peeved by Argentina’s debt default and its efforts to succour the populace at the expense of debt-holders and privatised utilities (“now give me the list of promises you will not keep,” the Fund’s number two, Anne Krueger, is reported to have asked Argentine officials at the end of one fruitless meeting).

Foreign banks for their part chose to erect metal shields around their branches in central Buenos Aires to fend off stones and graffiti. Back at head office, their business ethics were unchanged: “there is no point in accumulating assets in the region if its recurrent crises interrupt the flow of revenue and the servicing of its debts,” opined Francisco Luzón, director general of the Spanish bank Santander Central Hispano.

But the principal enemy was domestic: a political and administrative elite that even the new president, Eduardo Duhalde, admitted was inept and corrupt to its core. Opinion polls in early 2002 showed that no single institution aside from the Church earned over ten percent in positive ratings, while most slumbered in the shadows of zero. Bravura displays of incompetence merely confirmed people’s hunches, as Supreme Court justices proceeded to spit venom at the other in front of microphones, the security forces fought for the most profitable rackets – stolen goods, drugs, gambling or prostitution – and the politicians mingled, their minds on the timetable for primaries and the best ways to smile before large crowds. Que se vayan todos (everybody out) was the most common and heartfelt refrain you could hear from a citizen.

Sebastián is still nursing bullet wounds to his arm and chest, but the round fired from police guns does not deter him. Most days, the 20-year-old is to be seen in the wasteground between Don Orione’s housing blocks, where with over sixty others he tends the polenta stew, tills the vegetable plot of lettuce and parsley, or instructs new recruits on the philosophy of total renewal. The estate, bordered by open drainage outlets and expansive fields of garbage, is one of the most blighted in the southern stretch of Greater Buenos Aires; for the co-ordinadora Aníbal Verón, it is a base, and it is growing at a startling rate.

Around 10,000 people are fed each day in various sites by the Aníbal Verón – a fair measurement of its following in the current idiom of Argentine politics. Named after a protester shot dead in the north-western province of Salta three years ago, the group stands at the anarchistic left of a movement that is the quintessential outcome of a severed social contract. Rather than campaign for elections or lobby politicians, these piqueteros (picketers) block roads, occupy hospitals, and storm ministries. As a result, they win food for their kitchens and measly unemployment subsidies. From the doubting Peronists of William C. Morris to the revolutionaries of Verón, an estimated 130,000 people receive welfare cheques secured by menacing the state.

“Elections solve nothing,” insists Mariano Pacheco, the 21-year-old who “co-ordinates” in Don Orione. Instead, his political references are to collective struggles, to the Movimiento Sem Terra in Brazil and Mexico’s Zapatistas: “There’s a very strong culture of delegation in Argentina – of always getting your problems solved by others. We are searching for a transformation of the reality lived under capitalism, and that can only be achieved by fighting.”

Impressed by the picketers’ spirit, middle-class neighbourhoods in Buenos Aires have aped their popular assemblies, only to find that the interests of Trotskyites, housewives, artists and people wanting their dollars back from the banks are rarely compatible beyond the first few syllables of a choleric outburst. After a spectacular beginning, these gatherings are now in decline. Luis Zenko, a watercolour painter and former organiser of one assembly in the San Cristóbal district of Buenos Aires, recalls his own disenchantment with the movement’s split into three separate confederations, and the failure to achieve more than a polyvocal moan: “it’s easier to be united in rejection than in affirmation,” he sighs.

The picketers, on the other hand, have sufficient collective will to constitute a substantial force. On numerous occasions they have cut the main roads into Buenos Aires, or filled the city’s plazas to a thunderous drumbeat. In the case of moderate groups, some of whose leaders have now entered the political race, these blockages are orderly, with armed policemen lining up peacefully against a column of ragged-trousered activists gripping wooden staffs. For the young radicals of Aníbal Verón, however, officers’ flashbacks from the 1970s have resulted in volleys of tear gas and hot pursuit under motorway bridges. On 26 June last year, two of the group’s leaders were shot dead at close range. Many others, including Sebastián, were wounded.

“In Argentina, the rupture between society and politics has been monumental,” declares Federico Schüster, dean of the University of Buenos Aires’ social science faculty. Yet with the possible exception of those early weeks of chronic instability, the political class has shown little interest in early retirement or major reform. Rule by and for the few, allied to institutional abuse, are the coinage of Argentine political history; they connect the dictatorship that inflicted secretive carnage in the name of “idealistic humanism” (navy chief Admiral Massera’s words), to the shady men of the 1990s (Syrian arms merchant Monzer Al Kassar, customs and postal tycoon Alfredo Yabrán, Menem’s private secretary Ramón Hernández), who ambled from one government minister to the next, gaining improbable favours and making vast sums of money along the way.

Today’s rulers have certainly been chastened by popular revolt, but their hold on power is locked tight. “The strange dreams that sprouted in such tropical abundance when De la Rúa was airlifted out of the Casa Rosada [government house] wilted long ago,” wrote political commentator James Neilson recently.

Several reasons account for this inertia. Divisions between the discontented factions of society have certainly sapped the movement’s initial vigour, particularly so now that the economy is functioning again and the government can claim to have outwitted the IMF (which in January 2003 signed a deal to roll over $6 billion in debt). Yet none of this would have been possible – nor would Argentina’s democracy, pallid as it may be, have even survived – without the influences exerted on public and politicians alike by one force: Peronism.

Its ideology is a matter for scholastic dispute, but the source of the Peronist mística (mystique) remains intact: Juan Domingo Peron and his doomed wife Evita took the gold bullion from wartime trading, and gave it to the grateful masses. Even today, the 35% of the labour market with formal employment still enjoy the perks of the duo’s legislation: twice-yearly bonuses, ample severance pay, ever-ascending holiday entitlements.

That, however, is where it stopped. Once Evita died in 1952, Perón soon became little more than an exiled chieftain with a liking for schoolgirls. His movement fractured into many parts, providing both guerrillas and killers for the Dirty War, seducing intellectuals, hypnotising the poor. His long-term contribution to Argentina is not so much advanced social philosophy as a behavioural pathology: a drawl in the palate, a pinch on the cheek, and a patronising insistence that loyalty to the big men will result in satisfaction for all concerned.

The Peronists of today are the result. Across the length and breath of the country, in thirteen out of twenty-four provinces, they make up a loosely-knit clan of overlords, assembled in a party that exists only so that power can be won and loyalties managed. It is their local bosses who control most of the two million unemployment subsidies, a treasure chest that has been used to great effect. “The party has a very strong mafia structure in Greater Buenos Aires”, argues the piquetero Pacheco. “I think it is the only means that allows those in power to dominate the chaos of today.”

Force and feudalism, meanwhile, are common tactics in the more distant, poverty-ridden regions. In the government vacuum of late 2001, it was these provincial despots who put Duhalde – a practised masseur of party cliques – into high office. Even if opinion polls reveal widespread distrust in politicians, the clan’s message holds sway: without Peronism, chaos ensues. “People are going to have to choose a candidate, because that is how it works in a democratic system,” philosophises party deputy Adrián Menem.

Adrián’s uncle, Carlos, is back in the race, and indeed is among the front-runners among a surreal band of candidates vying to hurdle the 20% poll barrier ahead of elections in April. Without the masses, three Peronist rivals are honing their skills of internal warfare and media noise. If critics are to be believed, it was Menem’s money that financed the takeover of Channel 9 television, now a bastion of crime-fixated reporting and evocations of military order. This might explain why he wants troops patrolling the streets (“the best defence is a good attack,” especially when “Marxists and criminals” are around). His other bright ideas include abolition of income tax and total subservience to Washington.

If this option appears a bit too severe, the voter might succumb to the brilliant white teeth of Adolfo Rodríguez Saá: “the good thing about him is that he is corrupt, but he doesn’t let his ministers get any,” a friend of mine observed. Rodríguez Saá was governor of a remote province for the last eighteen years, but his shining moment arrived with a ten-day presidency in late 2001 – marked by his declaration of default, plans to create a third currency for Argentina, and the publication of three books on his ideal nation.

Rodríguez Saá’s promise now is the “first revolution of the 21st century”; his supporters, the Adolfistas, are eyeing up the best jobs already. Both he and Menem, however, are currently chasing the moderate Néstor Kirchner, the third Peronist and the favourite of President Duhalde. Outside these factions, options vary from a spring clean of political life courtesy of Elisa Carrió (she wears a crucifix round her neck, and has teamed up with a devout neo-liberal), to ex-Radicals, to the old left (though their leaders are stuck in an ancient class war, and their doctrine suggests they shouldn’t even stand).

Faced with such an unappetising roll-call, few Argentines have shown great interest in the electoral contest. The policies on offer are diverse, and the stakes (four years to restore health to an ailing nation) are huge, but most voters suspect that each and every candidate will conform to the straightjacket of office once elected. Rather than enter this unproductive fray, the new social movements hold that change can only come once deeper social ills are addressed – namely, the anomie generated by the dictatorship, and the egocentric materialism exalted by Menem.

“Here in Buenos Aires social ties have totally disintegrated,” reads a text from one of Aníbal Verón’s sister groups. “If you are unemployed and you go to block a road, the neighbour who has to go to work knocks you down with his car. Here people are really fucked up, their minds are wasted, individualism is absolute.”

The society of Fabián Bielinsky’s film Nueve Reinas (Nine Queens), one of endemic shiftiness, is what these groups – and the 9 million people currently involved in some 80,000 voluntary associations – are seeking to remake. In the words of Juan Carr, founder of the non-governmental organisation (NGO) Red Solidaria, the sole remedy is “a revolution of compassionate culture without blood and deaths”; even the garbage recyclers have their first collective, El Ceibo. What the volunteers face, however, is a reality of house repossessions, tax evasion, even kidnappings organised by the victims’ best friends: a country where champagne and personal security are growth industries, whose people have stashed away $30 billion in banknotes.

Individualism is indeed a national trait. Argentina, like the United States, was formed by European migrants seeking freedom and prosperity – noble values, were it not for their continuous dialectic with a weak, brutal and militarised state. Back in the 19th century, liberal modernisers were the ones to massacre Patagonia’s Indians for the sake of agrarian growth. Fortunes were made playing the speculative game during the military dictatorship that lasted until 1982. Business, banks, media and the Catholic church: all have systematically turned to unscrupulous political patrons for material protection, only to discover that the country’s vertebrae are now made of vested interests, society is splintered, and the state’s credibility is nil.

Even so, there are clear signs that the coming elections could close two years of social ferment, and reaffirm these traditions. Economic recovery has already started to channel popular demands towards wage rises and union protests, while the business oligarchy has renewed contact with friendly ministers. As in previous decades, political life could soon revert to a fight for office between economic schools and their devoted backers – ranging from neo-liberals to “genuine” capitalists, moderate market regulators, and the proponents of full state control of foreign exchange and trade (the choice of the CTA union, a radical grouping of around one million state workers and picketers) – only for the victors to end up making hasty improvisations dictated by the necessities of foreign creditors and domestic unrest.

But the restless, dissenting people who pioneered the tempest of late 2001 are likely to remain wary of this decayed political sport. Their spray-cans and pots may have been shelved, but not their enduring mistrust of government and its poisonous duet with social interests. If their calls for greater justice and equality are ignored, Argentine politics could (in the words of analyst Rosendo Fraga) be “emptied of content”. Despite the rulers’ cunning, anti-establishment solidarity is strong and spreading. Between that and the hollow cries of Peronists, with blood or without, the future of Borges’ “vast concept” in the River Plate will be resolved.