Argentina's Bank Robbers

- Confiscation of foreign reserves: $17.8 billion

- Devaluation of the peso: $9 billion or more

- Losses to banks from "pesofication" of dollar loans: $18-54 billion

- Losses to depositors from "pesofication" of dollar deposits: $9 billion or more

- Losses to companies from exchange controls, suspension of contracts, and other measures: unknown, but billions more.

The Duhalde government is robbing banks, bank depositors, corporations, and the man on the street who holds pesos-in short, everyone it can find. Tax-paying Americans (and Canadians) should not support a government that robs foreign investors. As long as Duhalde's government follows its current policies, the Bush administration should refuse to offer any direct aid and should veto any proposal for the International Monetary Fund, the World Bank and the Inter-American Development Bank to lend money to Argentina. Fortunately, the U.S. government is required to do just that. Title 22, section 2370 of the U.S. Code, provides for suspending U.S. assistance to any country that seizes ownership of property owned by U.S. citizens or corporations or nullifies contracts with them.

Argentina needs to stop trampling on property rights and start encouraging economic growth. In contract law, it needs to reverse the steps it has taken under the law of public emergency. In monetary policy, Argentina should eliminate the peso and replace it with the dollar. Dollarization would allow the elimination of exchange controls and, after a short period, restrictions on bank withdrawals. In tax policy, Argentina should cut its top tax rates drastically. Thanks to three large tax increases in 2000 and 2001, many Argentine rates are much higher than those in the United States. Respect for property rights, a sound currency, and reasonable tax rates are a time-tested recipe for producing economic growth.