More than twenty-five years ago, Felix J. Weil argued that the key to Argentine economic history was in a fundamental conflict between nascent industry and entrenched grazing interests. What made Argentina a pastoral rather than manufacturing nation, he wrote in The Argentine Riddle (1944), was less natural endowments than the disproportionate influence of a small elite of beef barons and importers. Hence, resolution of the “industrial question” involved not only issues of economic expediency but social power as well, a fact amply recognized by the Argentine ranching class, which did all it could to postpone the day when the countryside would no longer be the focal point of economic activity.

In the years since its appearance, Weil’s thesis has become the cornerstone of an entire economic literature emphasizing Argentina’s “lost opportunities” for industrial development. In the later years of the nineteenth century, so the argument runs, Argentina’s leaders sacrificed the chance for economic diversification to “get rich quick” on meat and cereals. Although the disadvantages of economic dependency should have become apparent to them during the First World War, they did nothing to protect the small amount of industry which had grown up in the shadow of that conflict, so that a second chance was lost amidst the economic euphoria of the mid-twenties. During the world depression, Conservative governments spumed a third opportunity, to take refuge instead in restrictive bilateralism, protectionism-in-reverse, and excessively generous concessions to British trade and investment. Hence, the industrial growth of the late ’thirties and early ’forties, far from being a Conservative achievement, came about in spite of and in opposition to government policies—the biggest single factor being the Second World War. In fact, the unexpected development of industry largely contributed to the fall of the ancien régime and the advent of a military populism committed to its preservation and expansion. Whatever Perón’s deficiencies, it is then concluded, they were of execution rather than intent, and it is precisely the return to the international division of labor since 1955 that explains Argentina’s social and economic regression and her continuing political instability.

Professor Díaz Alejandro’s book sets out systematically to destroy each of these arguments one by one. In fact, his Essays constitute the most drastically revisionist work of Argentine history to appear in many years, and will doubtless cause much discomfiture when made available to Argentine readers. At the very least, he raises issues of the highest importance for students of both Argentine and Latin American economic development.

What basically establishes the “revisionist” tenor of this work is the author’s predilection for export economies, and his belief that countries such as Argentina can only develop through the generation of vast, steady and predictable amounts of foreign exchange earnings. Hence it is not surprising that he views the pre-1930 Argentine economy in extremely benevolent terms. Its principal features, he reminds us, were full employment and a high per capita income which compared favorably with that of many European countries, Australia and Canada. The vigorous trade in agricultural raw materials, while not in itself lessening dependence on European industry, did establish the basis for a future economic diversification. This prospect was particularly good, in fact, since Argentina enjoyed a seller’s market until 1930. Moreover, the pre-1930 period witnessed no “lost opportunities” for industrialization; manufacturing actually experienced a respectable 3.2 per cent annual growth rate in 1913-1929, and the First World War, far from helping it along, actually caused a slowdown by reducing availability of capital, fuels and certain raw materials.

If favorable world market conditions assured Argentine prosperity before 1930, Díaz Alejandro attributes subsequent economic difficulties to deteriorating terms of trade since that year. The post-1930 Argentine economy, he explains, has been characterized by a chronic shortage of foreign exchange, inadequate capital accumulation and investment, and by bourgeoning (and unproductive) bureaucracies. In this generally grim picture, the Conservative governments of the thirties get high marks not only for their “realistic” rescue of the meat industry through the Roca-Runciman Pact, but for promoting Argentine industry without damaging the export sector. Not the Second World War, he insists, but high tariffs and benevolent manipulation of exchange control promoted industrial growth in the late thirties. The Second World War actually hindered an ongoing process, for industry increased 43 per cent in 1933-1939, and slowed down to 23 per cent from 1939-1945 (for much the same reasons as in 1914-1918).

In fact, the only “lost opportunity” for Argentine industry came under Perón! With market conditions far more favorable than its predecessor, the Justicialist regime frittered away currency reserves, neglected foreign trade, and discouraged foreign investment—all of which led to a foreign exchange crisis. Díaz Alejandro can scarcely conceal his sardonic satisfaction when he points out that “greater attention to exports during 1943-1955 would have resulted in more, rather than less, industrialization.” True, this recipe has failed to revive the Argentine economy since the fall of Perón, but that is due less to the policies themselves, he maintains, than to the political impossibility of fully implementing them.

These are bold and even, as the author admits, “reactionary” claims. What evidence is presented upon their behalf? In the first place, the strength of Díaz Alejandro’s arguments lies largely in the richness of his data rather than in his interpretations. No book on the Argentine economy has ever assembled so many facts and figures, and the author has increased the acceptability of his (sometimes necessarily) shaky calculations by explaining how he arrived at each one. On the other hand, to state a fact is one thing; to explain its significance quite another, and it seems to me that he has extracted more from his figures than they can possibly tell about economic policy-making, particularly in the inter-war period.

For example, can one really be impressed with the growth of industry from 1913-1929, when “industry” during those years consisted largely of sugar, wine, construction, yerba maté and leather goods, not to mention meat-packing—activities that were actually subsidiary branches of agriculture, and hence largely non-competitive with British imports? This at any rate might explain why Argentina could afford the luxury of having—as the author suggests she did have—one of the highest tariff rates in the world prior to 1939 without arousing undue ise on the part of her industrial suppliers/customers.

Again, the argument that exchange control purposely aided industry during the thirties may be true, but it remains a fact that this was one of the concessions which the British were most adamant in wringing from the Roca mission in 1933. And the case which is made against protectionism-in-reverse, whatever merit it may have, is lamentably weak.

Nor have all the holes been closed in the case for Conservative- guided industrialization. The last word on this subject can hardly be spoken, but to suggest (as many of us have done) that most Argentine Conservatives, whatever expedients they may have adopted in the thirties, were fundamentally pro-agrarian is not necessarily to accept the devil-theories currently in circulation; actually this position characterized almost all Argentine politicians right up to the Second World War. To argue otherwise amounts to asserting that policy makers like Federico Pinedo were doing one thing, while vehemently advocating quite another.

Finally, while few could dessent from the masterly critique of Perón’s economic policies, do the pre-Perón years really offer Argentina the guidelines of economic recovery? Díaz Alejandro himself admits that the “right” economic policies are the “wrong” ones for political and social harmony; the Argentine leader who plans economic development in the seventies with the Essays in his briefcase is hardly to be envied.

On the other hand, those who study Argentine history rather than make it will find this book one of their most valuable tools and formidable challenges. It will be possible to fully appreciate its value only when others have answered many of the fundamental questions which it brilliantly and persuasively raises.