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Argentina is the poster child for economic dysfunction in the Americas and stands as a cautionary tale of the perils of populist economics. The International Monetary Fund’s recent unprecedented censure of the Argentine government for cooking inflation figures is only the latest installment in a long fall from grace for what was once one of the world’s most productive economies. Moreover, under the presidencies of Néstor and Cristina Fernández de Kirchner, Argentina has alienated traditional allies such as the United States while reorienting its foreign relations toward radical outliers like Venezuela and Iran. US policymakers must continue to hold Argentina accountable for its failures to abide by its obligations to international financial institutions and work to thwart Argentina’s troubling alliances with rogue governments.
Key points in this Outlook:
Argentina’s economic implosion amounts to one of the largest train wrecks in history. From a country whose standard of living once rivaled counterparts in Europe, today, Argentina is mostly known for having undergone the largest sovereign default in history ($100 billion in 2001) and, more than a decade later, remains in the humiliating position of trying to stay one step ahead of its international creditors.
Economic policymaking under President Cristina Fernández de Kirchner (and under her predecessor, her late husband Néstor Kirchner) has been a riot of statist, interventionist initiatives that have undercut the private sector at every turn and dashed any hopes for long-term prosperity. Rule of law has been trampled on or, worse yet, used as a cudgel against government critics. Unlike Venezuela, whose huge oil revenues protected the late Hugo Chávez’s regime from the consequences of antimarket policies, Argentina can count on no such cushion. Although in recent years, abundant soy sales to China have provided some cover for the Kirchner government, global recession—leading to decreasing Chinese demand—and lower domestic productivity will only heighten Argentina’s internal economic contradictions and spawn another fiscal crisis.
The 2013 Wall Street Journal and Heritage Foundation economic freedom index categorizes the Argentine economy as “repressed” and ranks it 60th out of 177 countries, behind such countries as Haiti and Belarus. According to the International Finance Corporation, it is easier to do business in Russia than it is in Argentina, while the Americans for Tax Reform Foundation’s International Property Rights Index ranks Argentina 87th out of 130 countries. Not surprisingly, Argentina attracts the least amount of foreign direct investment among the major Latin American economies.
In the foreign policy domain, the Kirchner government— in true populist fashion—incessantly rails against imagined foreign enemies, resurrecting the conflict over the Falkland Islands with the United Kingdom and lashing out against international financial institutions and the United States, while casting its lot with rogue governments like those in Venezuela and Iran.
The Kirchner Dynasty
President Cristina Fernández de Kirchner was first elected in 2007 and reelected for a second term in 2011. She succeeded her late husband Néstor Kirchner—a former governor from the remote province of Santa Cruz who was steeped in radical politics (both the Kirchners are from the left wing of the dominant Peronist party)—who served as president from 2003–07. Néstor Kirchner rose to power following Argentina’s calamitous debt default that saw the country run through five presidents in two years, crippled by massive capital flight, and banished from international credit markets.
Néstor’s populist rhetoric blaming others for Argentina’s misfortunes and his implementing of short-term economic fixes that would only undermine long-term stability were central to his rise. Taking advantage of a fractured and dispirited country, he moved quickly and boldly to assert his authority (critics accused him of authoritarianism), expanding the role of the state in the economy, bullying anyone who got in the way (from the judiciary to the Central Bank of Argentina to private companies) and, in true Peronist fashion, rewarding compliant politicians and unions with subsidies and patronage.
Néstor Kirchner stepped down in 2007 after only one term to allow his ambitious wife, Cristina, to run for the presidency. With Néstor widely seen in Argentina as the stabilizer of a post-default Argentina, the mantle of leadership passed easily to his wife. During her presidency, Cristina has doubled down on her husband’s policies and demonstrated that she is as adept as her husband was in staying one step ahead of the bookkeepers.
Her tenure has been marked by fiscal profligacy, currency controls, expropriations, and battles with, among others, the media and agricultural producers (who have chafed under heavy export taxes). As the Bloomberg news service put it, “Since 2010 [Argentina has] implemented a series of economic regulations that seem to mix purposeful self-delusion — akin to closing the window shade and claiming it’s nighttime — with discredited economic theories last taken seriously during the era of black-and-white television.”
“Argentina’s economic growth has dropped from 9.0 percent to 2.2 percent, inflation has increased to approximately 24 percent, and unemployment stands at 7.6 percent.”
Argentina’s difficulties certainly predated the Kirchners. For years, good governance has been hampered by weak institutions, corruption, and chronic clientelism. But this does not mask the fact that President Kirchner’s unorthodox economic policies, while continuing to spur a short-term boom, are beginning to run out of steam. Economic growth has dropped from 9.0 percent to 2.2 percent, inflation has increased to approximately 24 percent, and unemployment stands at 7.6 percent. Yet despite these negative indicators, President Kirchner remains unrepentant and unapologetic and continues to rail against market economics as impositions from the International Monetary Fund (IMF) and the United States.
As an example of her unorthodox style, last year, President Kirchner, as a protectionist measure, mandated that automobile importers would have to match their imports with exports of equal value. With no recourse, importers were forced to become exporters overnight, or else risk being shuttered by the government. Predictably, car companies struggled to meet their new obligations and new-car sales plummeted. It also resulted in such odd actions as BMW purchasing a rice factory to export the same value as its imports, Mitsubishi purchasing a peanut company, Subaru a chicken-feed factory, and Porsche a wine and olive factory. As a result, many other international corporations have simply left the Argentinean market rather than comply with the mercurial actions of the government.
Argentina’s Battles with the IMF
Argentina’s tensions with the IMF that began during the 2001 debt default have continued to simmer ever since, and the most recent incident was the organization’s censure of Argentina for consistently misreporting inflation and gross-domestic-product data. (Underreporting inflation figures has allowed the Kirchner government to save some $6.8 billion since 2007 on debt payments.)
The IMF gave Argentina until the end of September 2013 to correct the problem, which has been festering since former president Néstor Kirchner fired the senior professional staff of the national statistics agency in 2007 and replaced them with political cronies. (The Kirchners have even sought to fine private economists for releasing economic data that does not comport with official numbers.) Nor has Argentina allowed IMF officials to review its finances—which is required of all members—since it paid off its debt to the organization in 2006.
If the Kirchner government fails to comply with the IMF’s request for cooperation, the organization can levy additional sanctions such as suspending Argentina’s voting rights and barring the country from taking loans. Ultimately, the country could be asked to leave the organization. While such an extreme outcome is doubtful, Argentina is not likely to comply any time soon. And Argentina’s reputation stands to plummet further among international investors that already demand the highest return among major emerging markets to own Argentine debt (the country’s notes yield 1,058 basis points more than US Department of the Treasury bonds).
Nonetheless, President Kirchner remains unrepentant and combative. Responding to media reports that the IMF had given Argentina a “red card,” she said: “Argentina is not a soccer team. It’s a sovereign and accepts no threats or pressures.”
The politicization of Argentina’s business environment has been a hallmark of the Kirchner years and has involved the nationalization of numerous companies, often in violation of the country’s own constitution. In seeking to undo the privatizations of the past, the Kirchners renationalized the water company AySA, the airline Aerolineas Argentinas, the electric company Edenor, the gas company Metrogas, and the energy provider Pampa Energia. In 2008, Cristina Kirchner nationalized the country’s private-pension funds, which allowed her to increase spending on public works and the unemployed ahead of congressional elections.
“The politicization of Argentina’s business environment has been a hallmark of the Kirchner years and has involved the nationalization of numerous companies, often in violation of the country’s own constitution.”
The most flagrant expropriation was the April 2012 seizure of 51 percent ownership of YPF, the one-time state oil company that was sold to Repsol of Spain, setting off a still-unresolved row with one of Argentina’s oldest and most important foreign partners. Repsol is seeking $10 billion for its loss and has requested arbitration at the World Bank’s International Center for Settlement of Investment Disputes, but it is doubtful there will be a resolution anytime soon.
As Repsol’s chairman told the Wall Street Journal, “Argentina wants to pay zero,” and said he expects alleged “environmental penalties” to be levied by the Kirchner government in the exact amount of Repsol’s claim. Once again, most observers saw it as another cash-grab for domestic spending purposes, while trying to whip up nationalist sentiment over another foreign “enemy.” Yet such behavior continues to exact a huge cost, as countries whose companies and investors have been negatively impacted by the seizures have taken retaliatory measures by blocking imports from Argentina and withdrawing their investments.
Today, Argentina is in the unenviable position of having to plan every official activity abroad with one eye toward the possibility of having the country’s assets seized. Following the humiliation of Argentina’s ceremonial frigate Libertad being detained in port for 78 days by the Ghanaian government late last year, President Kirchner now flies charter planes internationally for fear that the state-owned presidential plane will be seized by creditors.
Those actions stem from a lawsuit now wending its way through US courts, which was filed by a group of bondholders who refused cut-rate repayments (27 cents on the dollar, way below the norm) by the Argentinean government during a 2005 restructuring. After further restructurings in 2010 failed to meet their demands, the bondholders sued Argentina for full repayment of the outstanding debt, arguing that Argentina’s ample reserves were enough to meet obligations to original bondholders. (In total, Argentina owes $3.5 billion to US creditors and another $16 billion to private creditors worldwide.)
Leading the charge on behalf of the “holdout” creditors (amounting to roughly 7 percent of the bondholders) is Elliott Management, a New York-based hedge fund that is seeking a full repayment of a $1.3 billion claim against Argentina. In Manhattan in October 2012, US District Judge Thomas Griesa ruled on Elliott’s behalf that Argentina must repay the holdouts at he same time it pays what it owes to the holders of its performing debt.
Argentina’s troubles were compounded a month later when Judge Griesa lifted his stay pending appeal and ordered that the Kirchner government immediately place the $1.3 billion into an escrow account to repay the holdouts when the government is due to pay the restructured bondholders. The judge specifically cited the defiant statements of President Kirchner as the reason for ordering the payment.
“Whereas in 2002, Argentina exported $339 million in goods to Iran with zero imports, by 2011, Argentina exported $1.1 billion and imported $17 billion from Iran, an increase of some 195 percent.”
In late February 2013, the US Court of Appeals for the Second Circuit gave the Kirchner government one month to present an alternative plan to satisfy the outstanding claimants. If Argentina ultimately loses the case, it is quite possible that the Kirchner government will choose to pay no one, since payments to restructured bondholders will violate equal-treatment provisions ruled on by the courts, thereby triggering yet another default and a raft of new lawsuits.
Whatever happens in US courts regarding Argentine debt, the Kirchner government remains trapped in a labyrinth of its own making. Barred from international capital markets, beset by legal challenges on a number of fronts, fresh off a stinging rebuke from the IMF, and dogged in international fora by such lobby groups as the American Task Force Argentina, the country’s economic future continues to look bleak.
Suppressing Freedom of Expression
The Kirchner government has taken a page out of the Hugo Chávez populist playbook by waging an intimidation campaign against independent media that are critical of its policies. In particular, the government has targeted the largest media conglomerate, Grupo Clarín, manipulating the law in attempt to break up the company and taking other measures to undercut its profitability. The media group’s apparent transgression involved criticizing President Kirchner’s heavy-handed tax on agricultural producers and mishandling a farmers’ strike in 2008.
Under a media law championed by the president, Clarín would be forced to divest itself of its broadcast licenses and its majority stake in a cable television network. The government has also tried to seize control of Papel Prensa, the country’s only producer of newsprint; directed lucrative government advertising revenue to sympathetic media outlets; and strong-armed the national soccer association to break its contract with Clarín’s cable channel.
Numerous media watchdog groups have criticized the Kirchner government’s intimidation tactics. In October 2012, the Inter American Press Association (IAPA) asked the government to “end the escalation of aggression against media critical [of the government] . . . cease pressuring the judiciary [on media-related cases] . . . and administrative harassment of [the only domestic newsprint company] Papel Prensa.” A December 2012 IAPA fact-finding
mission to Argentina found that “there continue to be serious setbacks to the free practice of journalism.” Reporters Without Borders’ 2013 World Press Freedom Index expressed concern over polarization in Argentina amid “growing tension between the government and certain privately-owned media.”
Dubious New Relationships
As Argentina remains a pariah among international lending organizations and capital markets, the Kirchner government has been turning its back on its historical alliances and increasingly tilting its economic relationships toward countries of dubious international standing, where rule of law is less of a concern. Not only did the government embrace the late Hugo Chávez, but also Iran and other oil-rich dictatorial regimes in Africa and the Middle East. These governments need agricultural commodities—which Argentina currently has—and they have the cash to pay for them and have no regard for what Argentina owes Western governments and bondholders.
In 2004, Argentinean trade with Venezuela amounted to some $140 million, but has soared to more than $2 billion today. Similarly, Argentinean trade with Iran has witnessed exponential growth. Whereas in 2002, Argentina exported $339 million in goods to Iran with zero imports, by 2011, Argentina exported $1.1 billion and imported $17 billion from Iran, an increase of some 195 percent. (Moreover, the two countries recently established joint chambers of commerce in Buenos Aires.)
The most recent demonstration of warming Argentina- Iran ties was the January 2013 announcement that Argentina had agreed to form a joint “truth commission” with Iran to reinvestigate the notorious 1994 terrorist attack on the Jewish community center Asociación Mutual Israelita Argentina (AMIA) in Buenos Aires that killed 85 and injured hundreds. An Argentine investigation has already ruled that Iran’s terrorist proxy Hezbollah was behind the attack, with financing and logistical support having come from Iran. That investigation resulted in arrest warrants for nine individuals—including current Iranian Defense Minister Ahmad Vahidi and former president Akbar Hashemi Rafsanjani—all of whom have been issued Red Notices by Interpol.
Evading accountability for the AMIA bombing has been a foreign policy priority of the Iranian regime for years, and the recent announcement by Argentina and Iran of a so-called “truth commission” whereby the crime will be “reinvestigated” on terms favorable to Iran appears the closest the regime has come to that goal. Argentinean Jewish leaders and Israelis have denounced the commission, calling it an Iranian attempt to undermine the Argentinean court’s own investigation, absolve Iranian officials involved in the attack, and result in the lifting of their Red Notices.
According to Sergio Widder of the Simon Wiesenthal Center in Buenos Aires, “We see Argentina’s rapprochement with Iran as dangerous for the entire region, because Iran is a sponsor of international terrorism with a regime that doesn’t respect human rights. Argentina has nothing in common with Iran and should have nothing to do with it.” Danny Ayalon, Israel’s deputy foreign minister, likened the truth commission to “inviting the murderer to participate in the murder investigation.”
Argentina’s increasing ties to Iran are particularly troubling given past links between the two countries. In the 1980s, in the wake of the rupture of US-Iranian relations, Argentina moved in to retrofit Tehran’s nuclear reactor with Argentine technology and began shipping nuclear fuel to Iran. That relationship, however, was halted under pressure from the United States following the 1990s terrorist attacks in Buenos Aires. Still, Tehran never lost hope for restoring nuclear ties with Argentina and has since made it a priority. In 2009, the Iranian representative to the International Atomic Energy Agency publicly reaffirmed: “We are interested in buying [nuclear fuel] from any supplier, including Argentina.”
Nor is Argentinean territory unknown to Iran. As we reported in a previous Latin American Outlook, Argentina was once the home base of radical Iranian cleric Mohsen Rabbani. Previously the “cultural attaché” operating out of the Iranian embassy in Buenos Aires, Rabbani was implicated in the AMIA bombing and is today the subject of a Red Notice.
A die-hard defender of the Iranian revolution, Rabbani currently oversees the propagation of Shia Islam outside of Iran. He is still active in the Western Hemisphere, traveling with falsified Venezuelan documents and cultivating the network of his former disciples. It is worth noting that in the Federal Bureau of Investigation-foiled 2007 plot to launch a terrorist attack at John F. Kennedy International Airport in New York, the ringleader, Kareem Ibrahim, was a Rabbani acolyte; he was arrested in Trinidad en route to Venezuela, where he was going to board a direct flight to Tehran to meet with Rabbani.
Like her husband, President Cristina Kirchner has never been shy about expressing her animus toward the United States. True to their populist credentials, the Kirchners have always found great political utility in blaming the United States and the US-led international economic order for all manner of Argentina’s ills—most recently in a speech at Georgetown University. And this has occurred despite the extraordinary lengths the United States went to help Argentina avert its 2001 default.
The Obama administration has, in turn, sought to maintain a professional, forward-looking relationship with the Kirchner government. However, Washington was clearly irritated in 2011 when Argentinean authorities seized the cargo of a US Air Force plane that was delivering supplies for an authorized police training program. Argentina’s foreign minister accused the United States of smuggling wea-pons and “drugs” into the country (the “drugs” were from first-aid kits). Eventually, the matter was quietly resolved.
The administration has also tried to subtly encourage Argentina to honor its international financial obligations by voting against new loans for Argentina at the World Bank and the Inter-American Development Bank. To this end, the Obama administration has furthermore suspended Argentina’s normal trade benefits for Argentina under the Generalized System of Preferences (GSP) program for Argentina’s failure to pay some $300 million in compensation awards to two other American investor groups. (This marked the first time the United States has suspended a country from the GSP program for not paying an arbitration award.)
The administration was also critical of the seizure of the oil company YPF, calling it “a negative development” that could hurt Argentina’s investment climate. And, just this past December, the administration requested that the World Trade Organization investigate Argentinean restrictions on US exports to the country, with Trade Representative Ron Kirk saying, “Argentina’s persistent use of protectionist measures broadly impacts all U.S. exporters of goods to Argentina.”
Declining Political Fortunes
An always reliable gauge of the amount of internal pressure the Argentinean government is feeling is its effort to whip up nationalist fury over the Falkland Islands. By this measure, the Kirchner government is in a panic, since so much of its foreign policy is devoted to the issue. Argentine Foreign Minister Hector Timerman recently provocatively told the BBC that the Falklands would be under Argentina’s control within “20 years.”
Yet it remains unclear what value the issue has in distracting Argentineans from increasing economic pressures at home. Inflation, declining growth, and rising unemployment are beginning to wear on President Kirchner’s image, with her once-high approval ratings now standing at some 30 percent—a far cry from the heady days following her reelection with 54 percent of the vote in 2011. Meanwhile, strikes and street demonstrations are becoming more common.
In the aftermath of the 2001 default, Argentina had every opportunity to begin the slow and arduous road of rebuilding and reassimilating into the international economic mainstream. Instead, Argentinean voters opted for populist leaders like Néstor and Cristina Kirchner whose default tactic is blaming others for Argentina’s difficulties, implementing unorthodox policy shortcuts that are disastrous in the long run, placing ever more burdens on the private sector to satisfy key constituencies, and reorienting the country’s foreign policy toward radical outliers like Venezuela and Iran.
This approach bought the Kirchners some time, but even as Cristina Kirchner has begun dropping hints about the possibility of reforming the constitution to run for a third term, the more salient question in Argentina today is not if there is going to be another economic implosion, but when. In the meantime, Argentina continues as proof positive that populism may be an excellent way to get elected, but remains a disastrous way to govern.
Though the Obama administration has taken some actions to address Argentina’s failure to meet its international financial obligations, to date those actions have been easy lifts. What is needed now is a more serious response to Iran’s encroachments in the Western Hemisphere, which in the case of Argentina is undermining a core US foreign policy priority of isolating the Iranian regime over its rogue nuclear program.
In helping Iran avoid the brunt of economic sanctions and lending it an air of credibility through its political contacts, Argentina is facilitating what could very well develop into a crisis of global proportions. While it is hardly likely that the Kirchner government will be responsive to any US diplomatic entreaties, the Obama administration can work through more responsible governments in the region to discourage Argentina from forging closer ties with Iran.
On the economic front, US leverage is not great, but there are mechanisms to increase pressure on the Kirchner government. For example, US officials need to scrutinize Argentina’s economic deals with Iran to ensure that they are not signed with entities under US and international sanction. The Obama administration should also coordinate with US bondholders to identify ways to satisfy outstanding US judgments against Argentina to demonstrate that there are consequences for countries that choose not to abide by their international obligations.
The authors would like to thank Felipe Trigos for his research that contributed to this paper.
1. Heritage Foundation, “2013 Index of Economic Freedom: Argentina,” www.heritage.org/index/country/argentina.
2. 2012 Report: International Property Rights Index (Americans for Tax Reform Foundation), www.international propertyrightsindex.org/ranking; and World Bank Group, “Ease of Doing Business in Argentina,” www.doingbusiness .org/data/exploreeconomies/argentina/.
3. “Country Profile: Argentina,” 2012 Report: International Property Rights Index (Americans for Tax Reform Foundation), www.internationalpropertyrightsindex.org/profile?location=argentina.
4. Néstor Kirchner died of a sudden heart attack in October 2010.
5. Ian Mount, “Argentine Protectionism Sees Cars Swapped for Rice, Olives, Wine,” Bloomberg, November 8, 2012.
6. Camila Russo, “Argentina Denies Inflation, Subsidizes Loans: Mortgages,” Bloomberg, January 22, 2013.
7. Mount, “Argentine Protectionism . . . ”
8. Linette Lopez, “The President Of Argentina’s Next Fight Could Be With None Other Than The IMF’s Christine Lagarde,” November 17, 2012, Business Insider, www.businessinsider.com/fernandez-de-kirchner-fight-with-laguard-2012-11#ixzz2LMO3Ua2U.
9. “Socialism for Foes, Capitalism for Friends,” Economist, February 25, 2010.
10. Mary Anastasia O’Grady, “Kirchner’s Oil Expropriation Backfires,” Wall Street Journal, June 3, 2012.
11. Jude Webber, “Seized Argentine Ship Blocks Ghana Port,” Financial Times, October 22, 2012, www.ft.com/intl/cms/s/0 /a038137a-1c7b-11e2-a63b-00144feabdc0.html.
12. The US Court of Appeals for the Second Circuit in New York has already upheld Judge Griesa’s February 2012 ruling that Argentina violated equal-treatment provisions for all creditors when it elected to pay restructured bondholders and not the holdouts.
13. Almudena Calatrava, “Argentina Declares Media Law Constitutional, Begins Process To Break Up Grupo Clarin,” Huffington Post, December 17, 2013.
14. American Task Force Argentina, “Energetic Complaint from the IAPA against the Government,” October 19, 2011, www.atfa .org/energetic-complaint-from-the-iapa-against-the-government/.
15. “IAPA Issues Its Preliminary Conclusions on State of Press in Argentina,” Inter American Press Association, January 17, 2013, www.sipiapa.org/v4/comunicados_de_prensa.php?seccion=detalles.
16. Reporters without Borders for Freedom of Information, 2013 World Press Freedom Index: Dashed Hopes after Spring, January 22, 2013, http://en.rsf.org/press-freedom-index-2013,1054.html.
17. “Trade Between Venezuela and Argentina Up Tenfold,” Latin American Herald Tribune, January 18, 2013, www.laht.com/article.asp ?CategoryId=10717&ArticleId=347778.
18. “Las Ventas a Irán Crecieron 234 % Desde Que Asumió Cristina” [Iran’s Sales Grew 234 Percent Since Cristina Became President], Clarín, August 28, 2012, www.clarin.com/politica/ventas-Iran-crecieron-asumio-Cristina_0_782321919.html.
19. A Red Notice is a wanted notice issued by Interpol at the request of an Interpol member country and it is distributed to all member countries; it requests an arrest be made with a view to extradition.
20. Emily Schmall, “Why Argentina Is Reaching out to Iran,” Christian Science Monitor, January 31, 2013, www.csmonitor.com /World/Americas/2013/0131/Why-Argentina-is-reaching-out-to-Iran.
22. Kaveh L. Afrasiabi, “Iran Looks to Argentina for Nuclear Fuel,” Asia Times, November 9, 2009, www.atimes.com/atimes/Middle_East/KK06Ak02.html.
23. Roger F. Noriega and Jose R. Cardenas, “The Mounting Hezbollah Threat in Latin America,” AEI Latin American Outlook (October 6, 2011).
24. “Cristina Fernández Critica En Washington a La Prensa De Argentina Al FMI Y a EU” [In Washington, Cristina Fernández Criticized the Argentine Press, the IMF, and the United States], La Jornada, September 26, 2013, www.jornada.unam.mx/2012 /09/27/mundo/027n2mun.
25. Alexei Barrionuevo, “Argentina Accuses U.S. Of Sneaking in Cargo,” New York Times, February 15, 2011; and “Under Pressure Argentina Returns Seized Cargo from US Military Plane,” MercoPress, June 16, 2011, http://en.mercopress.com/2011/06/16 /under-pressure-argentina-returns-seized-cargo-from-us-military-plane.
26. Doug Palmer, “Obama Says to Suspend Trade Benefits for Argentina,” Reuters, March 26, 2012.
27. “US Says Argentina’s YPF Plan a Negative Development,” Reuters, April 18, 2012.
28. Julian Pecquet, “US Asks for WTO Action against Argentina,” The Hill, December 6, 2012, http://thehill.com/blogs /global-affairs/americas/271413-us-asks-for-wto-action-as-relations-with-argentina-continue-to-deteriorate.
29. See “Argentina ‘Will Control Falklands within 20 Years,’” BBC News UK, www.bbc.co.uk/news/uk-21341578. The Falklands Islands government responded to this article by saying: “Argentina has a better chance of having their flag on the Moon in 20 years than here in Stanley.”
30. Santiago Fioriti, “Retrocede La Imagen De Cristina Y Ya Tiene Más Rechazos Que Adhesiones” [Cristina’s Approval Rating Plummets and She Now Has More Rejections Than Supporters], Clarín, August 26, 2012, www.clarin.com/politica/Retrocede-imagen-Cristina-rechazos-adhesiones_0_762523802.html.
31. Jonathan Gilbert, “Argentina: Oil Nationalization and Currency Controls Divide a Nation,” MinnPost, October 4, 2012, www.minnpost.com/christian-science-monitor/2012/10/argentina-oil-nationalization-and-currency-controls-divide-nation.
32. In the New York bondholders’ case, the Obama administration has elected not to support the holdouts, fearing the precedent that would be set would make future debt-restructuring plans incapable of resolving crises. Yet that position places the administration in a situation where it is undermining the authority of the US judicial system when confronting a foreign sovereign.
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