Class divide hardens for Argentina's growing poor

A quarter of the nation now lives in poverty in a country that once prided itself on an egalitarian ethos.

By Sara Miller Llana | Staff writer of The Christian Science Monitor

from the January 7, 2008 edition

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Buenos Aires - Florencia Tedin grew up wealthy, but says she never felt any distinction between her prospects and those of her cleaning lady's children.

For years, it was a common Argentine assumption that a taxi driver's son could become a lawyer, the plumber's daughter a psychoanalyst.

But not any more. On a recent day, Ms. Tedin looks at the woman caring for her four small children in their rambling home in a gated community outside Buenos Aires and shakes her head sadly. Today, she says, maids' children will be maids.

The gap between rich and poor has slowly expanded over the decades in a society that has always thought of itself as Latin America's model for egalitarianism.

But the financial crisis that exploded in 2001 – plunging 50 percent of the population into poverty and leading to a spike in crime that pushed city dwellers into gated communities – has caused many to face Argentina's new reality: The family you are born into will largely determine where you end up in life.

"During the crisis, everyone fell," says Osvaldo Giordano, an economist at the Argentinean Institute of Social Development in Buenos Aires. Argentina is recovering, with extended economic growth and poverty rates falling to 25 percent, but the improvements have not spread to all, leaving visible inequality in its wake. "People think we are moving back to the old dream, but we aren't."

Unlike the rest of Latin America, Argentina had vast, productive land and few inhabitants in the 19th century, when Europeans poured into the country, says Maria Laura Alzua, an economist at Mediterranean Foundation, Buenos Aires. A middle class began to rise in the 1920s, and until the '70s, Argentina enjoyed relatively equal income distribution. But a development model based on imports and a history of fiscal mismanagement started to erode the general well-being.

It was really in the '90s, however, when the economy was opened and the public sector privatized, that things began to deteriorate. At the peak of the crisis, the national currency collapsed and savings accounts were wiped out. "Today we are much more like segmented societies in Latin America," says Ms Alzua, who also attributes the income disparities to a decline in the quality of public education.

While unemployment has halved, from around 20 percent at the height of the crisis, half of all jobs are in the informal sector. Few provide benefits, protection, or true prospects for mobility. "The poor are working more to gain the same amount of money," says Agustin Salvia, a sociologist at the Catholic University of Argentina. "In the '90s, there was poverty because of unemployment. It's not the same today."

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