ve of neoliberal, free market reforms designed to restructure the Argentine economy along the lines of a so-called Washington Consensus (Smith, 1999). In essence, Menem rejected the structuralist, populist, and statist postulates defended by Peronism since the 1940s.
However, a neoliberal economic order in Argentina was also seen as having the capacity to bail the nation out of the debt crisis and hyperinflation which began with the Mexican debt crisis of 1982. Argentina joined with other Latin American debtor countries as early as 1984 to resist a proposed International Monetary Fund (IMF) austerity program, give priority to economic growth, limit debt payments to a reasonable percentage of export earnings, and otherwise ease the debt service burden (Spero, 1990). These efforts were succeeded by the Menem Experiment, which rejected the failed monetarist experiments of the post-1976 authoritarian regime (Smith, 1991).
Menem's plan involved a number of shock policies designed to create stability. Government-controlled prices were raised, tax breaks were eliminated, and the currency was devalued. Inflation fell and the plan was seen as successful in the short-term. Structural reforms ultimately led to privatization and the anticipated free market reform. However, Smith (1991) contends that the neoliberal approach in Argentina accentuated a decline in investment rates, reduced labor costs, and a major transfer of income from the pockets of wage earners into those of capital holders. This suggests that the results of the neoliberalist experiment in Argentina have not been as positive as might have been anticipated.
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