Forty Centuries of Wage and Price Controls by Robert L. Schuettinger & Eamonn F. Butler

Author:Robert L. Schuettinger & Eamonn F. Butler [Schuettinger, Robert L.]
Language: eng
Format: epub
ISBN: 978-1610-1614-0-4
Publisher: The Heritage Foundation

CONTROLS IN ARGENTINA

On the South American continent, similar controls were tried and failed. Perhaps the most celebrated inflation rate in that part of the world belongs to Argentina, despite the price-fixing attempts of the administration of Juan Peron. But his controls, which lasted (on and off) from 1946 to 1955, did not mollify it. As Congressman Philip Crane said in the House of Representatives on the subject of the United States’ Economic Stabilization measures:

In June 1947, the [Argentine] government instituted a program of fixing retail prices and seized factory stocks of clothing and shoes for distribution at these prices. Numerous price violators were arrested. Then, in an attempt to control prices, the Government began to subsidize foodstuffs in the 1948–49 period. It bought wheat from the farmers and sold it to the miller in an attempt to control the price of bread. The same policy was followed with regard to meat, cooking oils, and the milk supply. The controls did not work and in 1949 all public services, including railroads, increased prices. The cost of other commodities increased: Gasoline rose from 35 to 60 centavos per liter, bread from 50 to 80 centavos per loaf, meat from 1.80 pesos to 2.50 pesos, and clothing prices soared.16

At the end of the 1940s, Peron supported increases in wages although he tried to keep them down as far as possible. An example of the ineffectiveness of this policy was his grant of a sixty percent wage increase to workers in the important sugar industry. The military also received substantial increases, and this sparked off a new round of pay demands.

Despite his control of the General Confederation of Labor, Peron could not continue to hold down wages; his demand in 1954 that wage increases should be tied to a very low target precipitated an epidemic of wildcat strikes in many industries. And because of his failures, Peron lost support in the country, and resigned under military pressure on September 19, 1955.

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