[Marxism] Roger Burbach reconsiders the state

Louis Proyect lnp3 at panix.com
Sat Feb 21 08:14:05 MST 2004

(Although Roger Burbach explains Nestor Kirchner's taking on the IMF in 
terms of Piquetero pressure, it is of some significance that he (and they) 
give him critical support. This probably reflects a willingness to engage 
with reality, now that a number of Latin American heads of state are 
showing some independence to one degree or another. This is a healthy turn 
in my opinion. Burbach is an interesting figure. His "Fire in the Americas" 
was a brilliant attempt to apply the lessons of the Sandinista revolution 
to US politics. I was so impressed with it when I read it that I bought ten 
copies and sent it out to people I knew from the SWP. I think that Roger 
became somewhat disoriented in the 1990s under the influence of a kind of 
Chiapas postmodernism that was sweeping the left. At the core of this trend 
was an almost anarchist distrust in the state, accountable no doubt to the 
collapse of the USSR. In a way it reflected the disillusionment that set in 
after the defeat of Daniel Ortega in the 1990 elections. Roger lost the use 
of his legs after a terrible accident while surfing in the Pacific off the 
coast of Nicaragua, but this has not stopped him from being an effective 
spokesman for the Latin American revolution in all its forms.)

Argentine President Faces Off With IMF
by Roger Burbach
Znet, February 20, 2004

Buenos Aires. President Nestor Kirchner of Argentina is emerging as the 
leading nemesis of the International Monetary Fund and the private 
financial speculators in South America. Assuming office in May 2003 with 
less than a quarter of the popular vote, he now enjoys 85% support in the 
opinion polls due in large part to his determination to take on the 
neo-liberal policies that lead to the country's economic collapse in 2001-2.

During the crisis Argentina defaulted on portions of its international debt 
that stands at over $140 billion. Kirchner has now thrown the G-7 nations, 
the leading capitalist countries, into a quandary with his declaration that 
the private investors who bought about $50 billion in government bonds in 
Argentina in the 1990s will receive only 25% of the face value of their 
bonds. Kirchner argues the bondholders gambled on Argentina during the 
heady days of the corrupt, neo-liberal government of Carlos Menem, when 
some bonds paid upwards of 30% annual returns. Caring little about what 
these exorbitant rates meant for the Argentine people, the Kirchner 
government argues the bondholders should now reap the results of their 
speculative adventures that helped fuel the boom and bust of the Argentine 

During 2002 and 2003 the IMF, the World Bank and other international 
financial institutions lent new funds to Argentina in hopes of keeping the 
country from opting out of the international financial system. There were 
even signs that some of the lending institutions were backing off from 
their history of enforcing dramatic cutbacks in basic social programs and 
balancing the budget on the backs of the poor. In early 2003, the 
Inter-American Development Bank lent $1.5 billion to help shore up the 
country's social programs, including the special government payments of 
about $50 a month to the heads of household who were unemployed. Due in 
large part to the government's decision to insist that the domestic economy 
came first and that social spending needed to be increased, the country's 
economy in 2003 grew at 7.5% percent after having contracted by over a 
quarter in 2001 and 2002.

However just last week the finance ministers of the G-7 nations who meet in 
Monterrey, Mexico, insisted the government must "be more flexible" in its 
debt renegotiations with the private bondholders. Beholden to the financial 
and political dictates of the G-7 countries, the IMF and the World Bank are 
both pressuring the government to change its approach. The IMF called the 
Economics Minister, Roberto Lavagna, to Washington to renegotiate the 
release of a loan for $8 billion later this month while the World Bank has 
already held up a loan for $5 billion that was scheduled for release on 
February 11.

The government however is giving few signs of budging and has hinted it may 
even suspend debt repayments to the IMF and the World Bank. On February 4, 
Lavagna released a report pointing out that these institutions continued to 
drain the country of financial resources even during the midst of a severe 
economic crisis. In 2002 and 2003, they lent $9.3 billion to the country 
while collecting $16.6 billion in old debt. In other words due to the 
repayment demands of institutions like the IMF and the World Bank the 
country suffered a net loss of over $7 billion.

full: http://www.zmag.org/content/showarticle.cfm?SectionID=41&ItemID=5014

Louis Proyect
Marxism list: www.marxmail.org 

More information about the Marxism mailing list