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Protectionism Pulls the Plug on Argentina’s Creativity

By: Adam Dubove - @dubdam - Jan 5, 2015, 8:56 am

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After almost 12 years of rule by the administrations of Néstor and Cristina Kirchner, state protectionism in Argentina has become an entrenched moneymaker. It has created and continues to benefit a privileged class at the expense of the rest of society. Now, through the manipulation of exchange rates, excessive duties on imports, a wide variety of taxes, and elevated transport costs, Argentineans suffer the highest prices for electronic goods in the region.

According to the Iprofesional website, buying the latest make of television, smartphone, or tablet will set Argentinean consumers back up to double what shoppers pay in neighboring Chile. Kirchnerism has isolated Argentina from the world and condemned it to severely lag behind when it comes to technology. Not only is choice limited, the technology available belongs to previous decades. Prices — despite all trends elsewhere to the contrary — only continue to rise.

Teresa Parodi, ahora a cargo del Ministerio de Cultura, ha sido una de las artistas más beneficiadas en los festivales musicales financiados por el Gobierno argentino.
Teresa Parodi, now in charge of the Argentina’s Ministry of Culture, is one of several artists to have benefited from government-financed music festivals. (Ministerio de Cultura de Argentina)

High levels of inflation (around 40 percent annually) have combined with protectionist policies to privilege those business leaders accustomed to living on handouts. The general public, meanwhile, are denied products widely owned in other countries. For example, an Apple iPad in Chilean chain Paris is worth US$468, while the same gadget in leading outlets in Argentina can go for as much as $850.

The differences don’t end with the prices. There’s also a marked disparity in the time one needs to work in each country to be able to afford these goods. According to an investigation by Argentinean daily Clarín, buying a notebook-style laptop requires 3.7 times the average monthly salary. Put another way, an individual would have to work for almost four months to be able to afford a computer — if he spent nothing on rent, food, and other basic necessities. Meanwhile, across the Andes, a Chilean would only need 1.4 times his monthly wage, while a Colombian would require two months.

It’s the same story with other technological goods. Buying a cell phone in Argentina uses up 2.9 months’ worth of labor, while the same handset can be acquired in Mexico in 1.4 months. In Brazil, you need only a little more than one month’s wages (1.1 times the national average) to be able to leave your landline behind.

Culture: The Enemy of Power

Amid all of this, the Argentinean central government is purportedly seeking to encourage and promote home-grown culture. Subsidized concerts and festivals abound, all aiming to convert self-proclaimed “artists” into a privileged caste.

Nevertheless, despite what the official discourse maintains, there’s a big difference between genuinely promoting culture and providing funds that benefit only those musicians, writers, and dramatists addicted to government cash. Culture, by its definition, is generated from below and moves upwards, and generally resists prevailing power structures.

Culture is dynamic, alive, and the result of an unquantifiable amount of independent activity. When culture is directed by the state, the results aren’t pretty: we have Leni Riefenstahl and Sergei Eisenstein, or Víctor Heredia and Teresa Parodi, to show for that.

With the availability of basic artistic tools under strict regulation, culture itself is similarly restricted. Video and photo cameras, smartphones, musical instruments, and computers, among other items, have become the fundamental means of consuming and producing culture in this century. But the idea that technology has democratized culture is still far from reaching Argentina.

In his book In Praise of Commercial Culture, Tyler Cowen — a US economist at George Mason University — explores several of the many instances where artists have benefited from the free market. The range of color on the palettes of French Impressionists, for example, was only possible thanks to innovations in the chemical industry of the era. The possibility of easier access to technological advances created independent artists.

In the case of Vincent Van Gogh, “his nonconformism was possible because technological progress had lowered the costs of paints and canvas and enabled him to persist as an artist,” writes Cowen. If Van Gogh worked in Argentina today, he’d have to fill out forms, wait in line, and spend long periods of time just waiting to obtain his materials. How many Van Goghs have we lost as a result?

Alongside 3D cinemas, art galleries, and stadium concerts, YouTube, Vimeo, Flickr, Spotify, and other online platforms are designed to facilitate public access to art and disseminate individual creativity. It may be true that the vast majority of the content generated on these platforms lacks much artistic merit. But it’s equally true that other artists have used these tools to perfect their craft and rise to prominence.

A Tool against Civil Liberties

To believe that protectionism is only a commercial policy is to commit a myopic error. The barriers thereby erected affect all society, from new enterprises and health through to science and, of course, cultural production. The free market allows us to access and take advantage of technological advances anywhere around the world at the minimum price. Protectionism, on the other hand, not only closes commercial borders, it ends up erecting mental frontiers. It discourages creativity and converts goods of mass consumption into luxury items available only to a privileged minority.

According to a study by the Information Technology & Innovation Foundation, the impact of the protectionist policies implemented by the Argentinean government have resulted in an estimated reduction in demand of between 13 and 29 percent. At the global level, Argentina is the country with the ninth-highest tax levels on information and communication technology (ITC), only outdone by Brazil at the regional level. Together with Nigeria, Ecuador, Turkey, and Brazil, Argentina’s tariffs and taxes on ITC artificially raise prices and end up preventing a significant portion of society from accessing such technologies.

Far from being an example of economic ignorance, the Argentinean government continues to consciously impose new obstacles to freedom of expression, despite official rhetoric to the contrary. The prohibitive cost of basic electronic goods in Argentina is yet another example of the negative consequences of protectionism. It’s also proof that there’s only a tiny step between economic authoritarianism and outright totalitarianism.

Translated by Laurie Blair. Edited by Fergus Hodgson.

Adam Dubove Adam Dubove

Adam Dubove is a journalist, co-host of The Titanic's Violinists radio show, and the secretary of the Amagi Institute. Follow him on Twitter: @dubdam, and read his blog: Diario de un Drapetómano.