Argentina: an extremely happy place but with some Caveats

In my previous articles on Argentina, I argued that based on my several random interactions with locals in the country that its people were happier, more generous, and generally more satisfied with their lives than many more affluent individuals that I have encountered in richer societies like the US and the UK. However, I received criticism online from a few Argentines who perceived the two articles as overly positive and that I may have downplayed the pain caused by the country’s endless economic failures. So I will list here some of the common complaints over the economic situation that I have heard:

• “Our people are friendly and happy, we also have decent infrastructure and nice healthcare services…. But our incomes are so low that we can’t afford basic imported goods!”

This was the takeaway from a person’s email to me describing the odd economic situation in her country. She further explains in her email that some neighboring Latin American countries may lack the beautiful parks that Bueno Aires has but their citizens can at least afford basic imported household products that many Argentines no longer find or even worse, cannot afford.

Another Argentine friend, who is also an intelligent economist, summarizes the situation as follows:

This is a place where most rules of how a typical economy runs are violated. In other countries, she illustrates, people have an incentive to save and invest in their 20’s through 30’s so that one day they may own their property, which is still an attainable goal even in brutally Capitalist economies like the United States. But in Argentina, most people without old family wealth, including skilled professionals earning in pesos realize that homeownership is not possible. This statement was not as surprising to me when I learned that one bedroom apartments in BA cost a staggering $130K, whereas monthly wages in the capital range between $300 to $400!

This perplexing and unfortunate economic situation leads to a spending behavior that you rarely observe in other Capitalist economies, perhaps not even in Communist ones. Take a walk around BA on a weekday evening and you will find that most restaurants and cafes are fully packed with locals, this includes the fanciest specialized cafes but also the most casual cafes.

My friend’s logical explanation is that this a natural outcome where many people have no hope in homeownership, they decide to splurge and spend their entire monthly earnings with their friends or family in the city’s amazing restaurants. So while I may have observed happy individuals who prioritize socializing and life satisfaction over dull concepts like investment or savings, the underpinnings or drivers of such behavior might be partially due to a bleak realization amongst citizens: the government and officials have failed us consistently in the last 3–4 decades, causing us to have little or no faith in better governance, so we might as well spend our income on Alfajores and Malbec bottles.