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Political Unity and Economic Diversity in the Argentine Federation

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Political Unity and Economic Diversity in the Argentine Federation Chapter 8 Political Unity and Economic Diversity in the Argentine Federation Miguel Angel Asensio 1 Introduction The formation of federations has been frequently accompanied by differences in the economic power of the partners. Thus, some form of imbalances appear in the early stages of its integration. Not many decades ago Francois Perroux (1956), when elaborating the theory of the “growth poles,” reminded us that economic growth does not occur everywhere at once and at the same pace. Therefore, it should be not astonishing to find a lot of cases displaying such imbalances, whether organic or manufactured. New South Wales and Vic- toria in Australia or “Central Canada” and the Atlantic Provinces in Canada were examples in the new worlds opened by the European expansion, with- out ignoring the obvious case of usa. For the Low Countries, Frits Bos (2010, 2012) has reminded us, for example, that the power of the province of Holland among the others grouped in the union of seven, implied that its contribution to the financial sustaining of the “house of three floors” represented 60% of the total. The issue suggests at least an open question on the future for federalism and federations in scenarios where this phenomenon of political unity and economic diversity takes place. These circumstances are quite common given the difficulties in getting a homogeneous and parallel process of growth and progress in all the provinces or states or cantons participating in any federal arrangement. We will focus on the particular case of Argentina, going in depth on some topics already approached in a former previous presentation on territorial diversity (Asensio 2013, 93–105), extending my examination to a few qualitative indicators available for addressing the issue. Initially I will retake and outline in a broader context the process of the economic evolution of Argentina in the long run and the regional development and emerging imbalances linked to them, trying to make visible some of the challenges for the operation of the federation. © koninklijke brill nv, leiden, ���8 | doi:�0.��63/9789004367�80_009 <UN> 194 Asensio As it is known, a more balanced regional or provincial development – besides reaching a more homogeneous federation1 in terms of standards of living – offers the possibility of reducing other imbalances, like the fiscal one. So, the improvement of the non-advanced areas of a country allows them to, while reaching an increased tax capacity, get more financial autonomy and then depend less on transfers from the center or from other jurisdictions. Thus, a more accurate knowledge of the regional imbalances is useful in both the “pure” economic front and social advancement, on the one side, and in the consideration of fiscal autonomy with less dependence on transfers, on the other. The order of this chapter is the following. In this section we have identi- fied the problem of regional imbalance and relative regional development as an issue to address. In the second we re-examine in historical perspective the parallel evolution of economic growth with economic regional diversity. In the third section we will examine some recent indicators that confirm the contem- porary form taken by such regional divergences. Fourth, we introduce a note about “dissemination” of regional development. Finally we will present some provisional conclusions linked to the operation of the federal model. 2 Historical Background In historical terms, the formation of the Argentine Federation occurred in a dif- ficult way given the disintegration of the former Viceroyalty of Rio de la Plata and the tensions among its original components, opening initially a period of half a century of centrifugal dispersion as a resistance to the domination of Buenos Aires. This period of turmoil in the first half of the nineteenth Century, which was predominantly confederal, was followed by the federal period after the Con- stitution of 1853 with its modifications, when the centripetal forces prevailed, forming the Union, then comprising by 14 uneven provinces. It is possible to find the following stages in the Argentine political evolution during the period 1810–1853: (a) 1810–1820, fragile unity under independence battles; (b) 1820–1831, confederal in fact with erection of autonomous provinces; (c) 1831–1853, loose formal confederation under the “Federal Pact of 1831” (see Asensio, M.A, 2010, 93). On the economic front, paralleling the Prussian experience within the Ger- manic experiment, such an agreement meant the Union was among a giant 1 I assume here the “brother concepts” of federalism and federation considered in works like the one of P. King (1982) and Burgess and Gagnon (1993). <UN>.
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