Argentina Needs a Friend

Daniel Scioli, Argentina’s vice president, went to Wall Street last week to tell investors his country didn’t need more loans. It does, he said, need time. The United States should work with Buenos Aires and its creditors so the Argentines get the time they need to get their economic house in order. But, just as important, Washington needs to act like a friend to help them sort out their many other problems.

Secretary of State Colin Powell will take a sound step on this path, meeting President Nestor Kirchner at the presidential Casa Rosada on Tuesday. Powell will get a better sense of Argentina’s predicament and Kirchner’s plans to improve Argentine lives.

The secretary should listen carefully and well, partly because he’ll already be playing catch-up in this diplomatic arena. That’s because Cuba’s Fidel Castro, Venezuela’s Hugo Chavez and almost every other head of state in Latin America appeared late last month at Kirchner’s inauguration. The U.S. sent a lower-level delegation headed by Housing Secretary Mel Martinez, and, needless to say, Castro stole the show.

But to get out of its present mess, Argentina hardly needs Castro’s windy words and theatrics. It does need U.S. firms willing to commit for long-term investment and American-sized markets for its exports. It must have a powerful friend with the political will to help it reach fair deals with its creditors, including a longer, better accord to replace its transitional agreement -- expiring in August -- with the International Monetary Fund.

In turn, Argentina must address the dire structural problems that hamper its economy. Its banks need recapitalizing and the government must let bad institutions fail. The government can’t keep freezing utility rates at unrealistic levels. Regulators must make investment rules transparent and fair for both Argentines and foreigners.

In his first month in office, Kirchner -- who many thought would be a weak president because he won such a shaky electoral mandate -- has moved swiftly. He swept the military brass, “retiring” 52 officers suspected of human rights abuses. He got rid of 10 of 11 top federal police tainted by allegations of torture and corruption. He called on Argentina’s Congress last week to remove, via constitutional means, Supreme Court judges presumed to have corrupted justice.

Atop good steps taken by Kirchner’s predecessor, Argentina has in the last 18 months brought some stability to its baleful economy, recent data show. Argentines know their future lies in their own grip. But they also should know that the U.S. -- in its own best interest -- will help them out of this crisis. For old time’s sake, Powell should start giving them that friendly hand.