Once upon a time, Argentina was a very successful nation. One hundred years ago, it looked a lot like the United States in terms of growth, wealth creation and natural resources. It’s small population, huge landmass, agricultural potential, minerals, fisheries and oil reserves should have made it a world power. Today it is on the verge of collapse.
Fitch Ratings on Tuesday downgraded Argentina’s sovereign credit rating to CC from B, a five-step cut reflecting its view of a “probable” default after a U.S. judge ordered payment to holdout investors from its historic 2002 default.
Decades of fascist socialism, however, has rendered it a basket case deep in dept and unable to pay its bills. The Argentinian political class, under the cover of slogans that sound a lot like “hope and change” have ruined a prosperous economy and impoverished its people. In the process, it has picked fights with previously supportive nations around the world.
Utter incompetence has destroyed the Argentinian economy. A country blessed with vast natural resources and a highly skilled work force has been led down the path of ruin by failed socialist ideals, class warfare and cronyism.
In the midst of the collapse, the political class is cultivating a personality cult. This is evidenced above in the huge banner image of President Cristina Fernandez. The more desperate the situation, the more the political class will call the people to unite around the head of state. It is as predictable as the sun rise.
Cowards and fools, lured by a promised utopia that never materializes will comply and support the dear leader and the downfall will accelerate. It is eminently predictable.