Carlos Menem was inarguably Argentina’ most consequential president since Juan Perón.
One reason being is that Menem reformed the economy, slayed inflation, and reoriented Argentina to the West.
To be certain, corruption scandals and his ambition for a third term were his undoing.
Nonetheless, Menem’s presidency was the only time in the last 70 years when Argentinians could hope for a "normal" country.
Menem’s passing at the age of 90 on Monday was marked with deeply mixed feelings and — a muted goodbye.
I am an "interested party" in that regard; by way of disclosure, my father-in-law, Domingo Cavallo, served as Menem’s foreign minister and finance minister between 1989 to 1996.
The child of Syrian Muslim immigrants, Menem was first elected Governor of small, rural La Rioja province in 1973 — the same year the charismatic Peron — "El Lider" — returned to Argentina after 18 years in exile and was elected president.
His sudden death a year later resulted in an eventual military coup that jailed Peronist politicians. Menem was one of them, and he spent a number of years in prison.
After the return of democracy, Menem was re-elected as governor.
He won the presidential election in 1989 partially because then governing Raul Alfonsin of the Radical Party could not successfully tame inflation.
Menem had the common touch and mobilized the working-class.
He won the presidency with 47% of the vote. Many in the Buenos Aires saw Menem as a hayseed outsider with his signature mutton-chop sideburns.
He did not carry a grudge against the military for his imprisonment and, instead, sought to put the military era behind Argentina.
He faced an attempted coup just as U.S. President George H.W. Bush was coming to visit.
Bush came in spite of warnings by the Secret Service that they might not be able to protect him. His trip was a huge success and bolstered Menem, garnering Bush deep affection from "The Man in the Pink House," the presidential palace in Buenos Aires.
Menem made institutional changes that ended Argentina’s neutral foreign policy as a part of the "non-aligned movement." (Argentina infamously declared war on Germany the day before Germany surrendered in World War II.)
He improved relations with Brazil, Chile, the United Kingdom, and the United States. Menem famously deployed Argentina’s navy in the first Gulf War — the only Latin American country in the "Coalition of the Willing."
His premier assignment, however, was putting Argentina’s economic house back together.
Menem went through three finance ministers in two years with hyperinflation continuing without an end in sight.
Then in 1991, he asked my father-in-law to be finance minister. Menem and Cavallo formed a unique partnership.
With Cavallo as the economic strategist and with Menem’s political cover, history was made: more than half a century of economic mismanagement was overthrown and with it, more than 50 years of Peronist autarky.
To quell hyperinflation, Cavallo also implemented the "convertibility plan" that pegged the peso to the dollar and permitted thelegal use of the dollar as a currency for domestic transactionsUnder these moves, inflation fell from over 2300% in 1990 to under 20% in 1993.
GDP growth remained over 56% per year until 1995.
Tens of billions in foreign investment flooded in.
Energy and telecom systems were also dramatically improved, and airports, roads, and ports were modernized.
While the population liked the modernity and the growth, many were accustomed to a coddling state and dreams of European social democracy.
This group was conflicted about a full-throated market economy.
Others criticized the high levels of unemployment and others were nostalgic for inefficient (and more corrupt) economic arrangements.
Scandals linked Menem with controversial figures within his inner circle. The saying at the time was "he robs but he does things."
This part of his legacy in many ways poisoned the well for future center-right governments to make further reforms, and gravely set back progress in reform in modern Argentina.
My father-in-law broke with Menem in 1996 over these corruption scandals.
Menem never governed effectively after Cavallo left.
Menem’s personal ambitions damaged his positive policies.
He was re-elected in 1995, winning 49% of the vote.
In order to run, he had to cut a deal with parliament for a new constitution that increased its powers.
In the process of bolstering his chances for a third term, Menem allowed the governors to take on significant debt to finance fiscal deficits in the provinces to win the favor of local Peronists supporters and the electorate.
These moves saddled his successor Fernando De la Rúa with a lot of debt and an economic mess. De la Rúa resigned in 2001 after only two years in office amidst chaos and violence.
My father-in-law had joined the De la Rúa government in the hopes of turning around the economy.
Cavallo did not succeed, in part, due to the Bush 43 administration being distracted by 9/11 and conflicted views within the Bush administration about the uses of "financial bailouts" by the International Monetary Fund (IMF).
Thus, the unwillingness of the IMF to aid Argentina in November of 2001 was in sharp contrast to the IMF’s and G7 countries to aid Turkey around the same time.
The collapse of the De la Rúa government led to the return of a more leftist, crony capitalist, anti-American strain of Peronism for decades.
The 4 years of the Macri government (2015-2019) served as a sort of parenthesis of normalcy.
The 2005 Summit of the Americas in Argentina was a fiasco. Argentina played a key role in ending the Free Trade of the Americas Agreement and sought to repudiate every single policy of the Menem years.
Argentina has been and is a largely reliable partner to the Marxist strongman Maduro in Venezuela. China is now Argentina’s Number One trading partner, and China has a "scientific observatory" on Argentine soil.
In 2001, soon after leaving office, Menem was placed under house arrest.
He would run for president again in 2003, winning less far below what was needed to win the first round. Knowing he would lose a second round, he famously declared, "Kirchner can have the government, I’ll stay with the people."
The former president’s petty refusal to stand in a second round gave Nestor Kirchner a weak presidential mandate.
Menem was elected to the Senate from 2005 remaining there until his death largely to remain out of jail. Menem changed the country. Argentina’s model was looked up to globally. But his willingness to tolerate corruption-largely as a result of a need to finance political campaigns and gray areas left over from 60 years of authoritarian regimes created problems for Menem.
Menem’s actions he took to attempt a third term led to the ruin of much of his historic reform initiatives. Nevertheless, Menem is a monumental figure in Argentine history.
His famous slogan from his 1989 campaign was "¡Siganme, No los voy a defraudar!" which means "Follow me, I won’t defraud you!"
If only that had only been true.
Daniel Runde is the Chair of the Advisory Committee on Voluntary Foreign Assistance.
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