Post Transition Challenges in Argentina & Chile Notes

Economic Challenges and Debt

1. After the return to democracy, both Argentina and Chile faced economic instability, heavy foreign debt, and pressure from global financial institutions to liberalize their economies.
2. During the 1980s “Lost Decade,” Latin American economies suffered from high inflation, unemployment, and falling living standards.
3. Argentina
   1. The government of Raúl Alfonsín (1983–1989) inherited a bankrupt state and $45 billion in debt.
   2. Efforts to control inflation failed, leading to hyperinflation in 1989 and mass protests.
   3. Carlos Menem (1989–1999) adopted neoliberal reforms, privatizing industries and pegging the peso to the U.S. dollar under the Convertibility Plan (1991).
   4. Short-term stability was followed by deep recession and a 2001 financial collapse.
4. Chile
   1. The democratic governments after Pinochet continued market-oriented policies but added social programs to reduce poverty.
   2. By the late 1990s, Chile was considered one of Latin America’s most stable economies, though inequality remained high.

Justice and Reconciliation after Dictatorship

1. Both countries faced the challenge of balancing justice for victims of dictatorship with the need to maintain political stability.
2. Argentina
   1. President Alfonsín established the National Commission on the Disappearance of Persons (CONADEP) and initiated trials of military leaders in 1985.
   2. Due to military backlash, later governments passed amnesty laws, which were later repealed in the 2000s under Néstor Kirchner.
   3. Thousands of perpetrators were eventually tried and convicted, restoring public confidence in democracy.
3. Chile