Social Welfare and the Slump: Argentina in the 1930s

  • Peter Alhadeff

Abstract

This chapter examines Argentine social policy in the 1930s from the vantage point of macroeconomic policy. I believe that the approach is especially relevant to Argentina, where it would be reasonable to argue that changes in welfare under General Peron’s first two presidencies (1946–51, 51–55) — quite apart from whatever was achieved by additions to the existing body of social legislation — were the result of the extraordinary wage settlements of 1946–8. The government not only connived at raising the price of labour, but it helped to finance that rise by the application of expansionary expenditure and by monetary policies which subsidised credit for industry to an unprecedented degree. For the first time ever in the Republic, economic policy was tailored to the redistribution of income. It was this, perhaps more than anything else, which marked the beginning of a welfare state in Argentina.1

Keywords

Burning Maize Depression Income Petrol 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

NOTES

  1. 1.
    Real wages increased by 53 per cent between 1946 and 1948; for 1946–9 the rise was in the order of 60 per cent. These are figures of the first magnitude. As real GDP at factor prices increased only 19 per cent, the change in relative prices during 1946–9 was indeed dramatic. The most recent indepth study of the 1945–55 period concludes that, the top priority of economic policy — at times pursued regardless of any other consideration — was rapid change in the distribution of income towards workers, and then the consolidation of the new economic order under the new model. (p. 1, author’s translation): P. Gerchunoff, ‘Politica Económica Peronista, 1945–55’, in G. di Tella and R. Dornbusch (eds) The Political Economy of Argentina, 1946–1983 (Macmillan, forthcoming). J. Llach also emphasises the historical significance of the 1946–9 wage ‘hike’: the real wage he says, had hovered around the 1929 value for over seventeen years: J. Llach, ‘El Plan Pinedo de 1940, su significado histórico y los origenes de la economia del peronismo’, in Desarrollo Económico, no. 92, January—March, 1984, pp. 515–58, 551. In fact, the share of labour in income was to grow from 46 per cent in 1946 to 57–61 per cent in 1950; Republica Argentina, Producto e Ingreso en la Republica Argentina en el Periodo 1935–54 (Buenos Aires, 1955), Appendix, Table IV.Google Scholar
  2. 2.
    A. Ferrer, Crisis y Alternativas de la Politica Económica Argentina (Buenos Aires, 1977) p. 53.Google Scholar
  3. 3.
    J. A. Martinez de Hoz, La Agricultura y la Ganaderia Argentina en el Periodo 1930–1960 (Buenos Aires, 1967) pp. 11–12.Google Scholar
  4. 4.
    J. Villanueva, ‘La Depresión y la Segunda Guerra Mundial: Sus Effectos sobre el Desarrollo Económico Argentino’, unpublished paper at the Instituto Torcuato di Tella (Buenos Aires, 1973) p. 47.Google Scholar
  5. 5.
    G. di Tella and M. Zymelman, Las Etapas del Desarrollo Económico Argentino (Buenos Aires, 1967) pp. 141–2.Google Scholar
  6. 6.
    I have tried to substantiate the point in ‘Finance and the Economic Management of the Argentine Government in the 1930s’ (unpublished D. Phil. thesis, Oxford 1983) pp. 56–61. See also J. Llach, ‘El Plan Pinedo de 1940’, pp. 540–41, where he dates the socalled triumph of mercadointernismo to the Second World War.Google Scholar
  7. 7.
    D. Rock, ‘Radical Populism and the Conservative Elite, 1912–1930’, in David Rock (ed.) Argentina in the Twentieth Century (London, 1975) pp. 66–87.Google Scholar
  8. 8.
    New York Times, 2 October 1932, p. 25.Google Scholar
  9. 9.
    See, for example, A. Bunge’s speech, La Prensa, 13 June 1933, p. 11.Google Scholar
  10. 10.
    Caras y Caretas, vol. XXXVI, 8 July 1933.Google Scholar
  11. 11.
    M. Murmis and J. C. Portantiero, Estudios sobre los Origenes del Peronismo, vol. 1 (Buenos Aires, 1971) pp.42–8.Google Scholar
  12. 12.
    ‘Los Más Temibles Proteccionistas Argentinos son Mansos Librecambistas’, La Prensa, 13 June 1933, p. 11.Google Scholar
  13. 13.
    La Nación, 28 September 1933, p. 6.Google Scholar
  14. 14.
    La Prensa, 7 June 1933, p. 1.Google Scholar
  15. 15.
    Halperin has shown that a recognition existed, long anticipating ackknowledgement by the Argentine authorities or the public at large, that land expansion had come to an end: T. Halperin, ‘The Argentine Export Economy: Intimations of Mortality, 1894–1930’, in G. di Tella and D. C. M. Platt (eds) The Political Economy of Argentina, 1880–1946 (London, 1986) pp. 39–59.Google Scholar
  16. 16.
    Developments in Argentine public finance in the 1930s are compared with Australia and Canada in P. Alhadeff, ‘Public Finance and the Economy in Argentina, Australia, and Canada during the Depression of the 1930s’, in D. C. M. Platt and G. di Tella (eds) Argentina, Australia and Canada: Studies in Comparative Development, 1870–1965 (London, 1985) pp. 161–78.Google Scholar
  17. 17.
    League of Nations, Public Finance 1928–37 (Geneva, 1938) vol. XXXV, p. 17.Google Scholar
  18. 18.
    Ibid., p. 17.Google Scholar
  19. 19.
    For example, E. Tornquist & Co., Business Conditions in Argentina, no. 187, July 1930, p. 85; Bank of London and South America, Monthly Review, no. 148, March 1931, p. 135; Economist, 14 February 1931, p. 341; Economist, 4 April 1931, p. 730; Economist, 19 March 1932, p. 633; La Prensa, 4 August 1933, p. 1; and A. Bunge, ‘La Crisis Actual’, Revista de Economia Argentina, vol. XXXI, no. 181, July 1933, p. 40.Google Scholar
  20. 20.
    Comité Nacional de Geografia, Anuario Geográfico 1941 (Buenos Aires, 1942) pp. 207, 210 and 212.Google Scholar
  21. 21.
    For a comparison with Australia and Canada see Alhadeff, ‘Public Finance and the Economy’ in Platt and di Tella, Argentina, Australia and Canada, pp. 164–6.Google Scholar
  22. 22.
    Review of the River Plate, 12 April 1935, p. 13.Google Scholar
  23. 23.
    The Times, 29 September 1932, p. 12.Google Scholar
  24. 24.
    La Prensa, 20 December 1933, p. 12.Google Scholar
  25. 25.
    This view is at odds with that of G. di Tella, who maintains that the unemployment rate was much higher and that as a result ‘industry was at last seen as a possible solution to the problem of a potential surplus of population [in the countryside]’: G. di Tella, ‘Economic Controversies in Argentina from the 1920s to the 1940s’, in di Tella and Platt (eds) The Political Economy of Argentina, pp. 120–32, 125–6. It would be difficult to reconcile this with the facts and evidence above.Google Scholar
  26. 26.
    Departamento Nacional de Trabajo, Investigaciones Sociales, no. 7 (Buenos Aires, 1942) p. 82; Anuario Geográfico 1941, pp. 368–9; Fundación Banco de Boston, Argentina: Evolución Económica 1915–1976 (Buenos Aires, 1978) p. 18 and p. 60.Google Scholar

Copyright information

© D. C. M. Platt 1989

Authors and Affiliations

  • Peter Alhadeff

There are no affiliations available

Personalised recommendations