Why Institutions Matter
Fiscal Citizenship in Argentina
and the United States
NATALIO R. BOTANA
AHISTORICAL OVERVIEW of Latin American democracies, and in particular Argentina’s, reveals the weak link between each nation’s political Constitution and the economy’s constitution (the first is capitalized to differentiate it from the other in this play on words), which should provide the necessary framework for political institutions to function properly.1 When considering the crucial issue of the rule of law in the case of Argentina today, the continued relevance of this perspective becomes clear: laws are either entirely unenforced or only partially enforced; promises are not kept; rights appear at times to be entirely illusory.
To think that the region’s economic problems can be solved without first addressing their political underpinnings is a mistake. As events in the region have demonstrated over time, the political context in which an economy functions is not defined exclusively by the short-term decisions of those in government nor by the technicalities of a specific plan, but is more broadly framed within a set of general laws endowed with political legitimacy and designed to provide an effective mechanism to channel human activity toward endeavors to create wealth and innovation.