A Tale Of Two Decades.(Argentina struggles with recession)(Brief Article)(Column)

It was the worst of times, it was the weirdest of times. In my first year as Buenos Aires bureau chief for NEWSWEEK, Argentina entered a dizzying spiral of hyperinflation. The cost of living began to rise in the second half of 1988 and skyrocketed by nearly 5,000 percent in a single 12-month period. President Raul Alfonsin had made his name as a fearless crusader for human rights, but he was never cut out to manage the volatile Argentine economy. His presidency ended five months ahead of schedule amid a wave of labor strikes and food riots. Products flew off store shelves as wage earners scurried to spend their rapidly devaluing australs as quickly as they could cash their paychecks. In July 1988 I bought a brand-new Volkswagen sedan for 130,000 australs, then the equivalent of about $13,000. I went back to the dealer 18 months later to replace a broken mirror, and it cost me almost as many australs as I had paid for the entire car.

When I returned to Buenos Aires last month for the first time in 11 years to profile Economy Minister Domingo Cavallo, I found a city plagued by very different economic pains: deflation and a looming, full-blown depression. Men without jobs roam the city peddling cheap items and finding few buyers. With the country mired in a nearly three- year-old slump, many Argentines talk openly about abandoning the land of their birth: a taxi driver of Greek parentage says he plans to emigrate to his ancestors' native island in the Aegean later this year.

And everybody complains. That in itself is hardly news: after soccer, kvetching always struck me as Argentina's leading pastime. Far be it for an Argentine to suffer a precipitous decline of living standards in silence, as Mexicans or Peruvians typically do. To my American eyes, not everything had taken a turn for the worse since I left Buenos Aires in May 1990. Basic services like phones and electricity actually work quite well, and shortages of food products, consumer durables and other goods are practically unheard of. But the bellyaching is not just the self-indulgent quirk of a society whose heyday ended in the 1930s and has ...