Argentina's economic crisis is the result of avoidable mistakes

The IMF and others must play a part in preventing another debt default

Investors and economic observers have begun to ask the same question that I posed in an article published 18 years ago: "Who lost Argentina?" In late 2001, the country was in the grips of an intensifying blame game, and would soon default on its debt obligations, fall into a deep recession, and suffer a lasting blow to its international credibility. This time around, many of the same contenders for the roles of victim and accuser are back, but others have joined them. Intentionally or not, all are reprising an avoidable tragedy.

After a poor primary-election outcome, Argentinian president Mauricio Macri finds himself running for another term under economic and financial conditions that he promised would never return. The country has imposed capital controls and announced a re-profiling of its debt payments. Its sovereign debt has been downgraded deeper into junk territory by Moody's, and to selective default by Standard & Poor's. A deep recession is under way, inflation is very high, and an increase in poverty is sure to follow.

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