Austerity for Dinner

When austerity-minded President Arturo Frondizi predicted last January that "a lowering of the standard of living is inevitable," the warning could hardly be heard for the sounds of high living. Over street fires, outdoor laborers at noonday broiled tender chunks of marbled beef that cost 8-c- a pound; white-collar workers lunched in restaurants on 17-c- beefsteaks so large they overlapped the dinner plates. Sundays brought an outdoor churrasco (barbecue) that began with meaty ravioli, went on to beef broiled over a pit fire.

Now Argentina, intent on curing its economic ills, needs to cut beef consumption and restore it to its historic role as a foreign-exchange earner. One day Amalia Ferrer, wife of an insurance-company employee, said to her butcher: "Carlos, two kilos of beefsteak." Carlos cut the thick slices, said: "Seventysix pesos [the equivalent of 19-c- a pound]." Senora Ferrer protested: "But Don Carlos, only last Friday I paid 60." Sighed the butcher: "That was Friday. Today this is the price; soon it will be more." The housewife settled for stew beef.

Giving up Comforts. In less than six months, Frondizi's austerity has turned from vague phrase into dinner-table reality. Headlined Noticias Graficas: DISASTER HITS ARGENTINE TABLE. "Commodities that were never missing from tables of the most modest homes," the paper said, "are now fast disappearing, such as wine, butter and the classic Argentine barbecue. How far can a meager family income go?"

Since January the Buenos Aires' cost-of-living index has soared from 1,610 to 2,665 (from a base of 100 in January 1943). Sen Ferrer finds bread up from 4-c- to 8-c- a kilo, eggs from 14-c- to 47-c- a dozen, vegetables and fruits trebled in price. Husband Vittorino, 38, no longer goes noontimes to a restaurant; instead, he takes a sandwich and a bottle of bouillon to work. He has even given up his cheap, locally made cigarettes. His paycheck is fixed at 5,200 pesos a month (around $60 on last week's exchange market), but everything Vittorino Ferrer buys costs more: electricity and transportation to the office, 130% ; phone service, 180% ; his morning La Prensa, 100%. Rent, which has been frozen since 1949, remains the single stable item.

Getting Results. Frondizi's plan to force Argentina to live within its means --by removing price subsidies from food, freeing foreign trade, freeing the artificially pegged peso to find its real level--has ended what used to be one of the most comfortable ways of life in the world. With prices rising, beef consumption is down 40%, capital district retail sales 60%, attendance at movies 20%, attendance at soccer games and horse races 25%. Even the rate of marriages has fallen 13% because of higher costs of setting up a household. The need for dollars to buy U.S. capital goods to raise production has depressed the peso, which hit an alltime low of no a dollar a fortnight ago before climbing back to 86. But the encouragement to export, and the discouragement of imports, is getting results. In the first four months of 1959, Argentina earned $102 million more than it spent abroad--its first favorable trade balance in five years.

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