The question of whether Argentina or Greece depends on the criteria the analyst relies.
By contrast, Greece played ball with the EU and IMF and the reward is that it stays in the euro zone. However, the beneficiaries have been large European banks, especially German and a few Greek millionaires who have cashed in on austerity once the government began to sell precious assets for pennies on the euro. Despite its total conformity with IMF-EU, in Greece yields on the 10-year government bond reached 29% in early 2012 and remain so high that Athens cannot possibly go to the markets to borrow because rates are well above the 5% cut off point for serving the debt. Argentina can actually borrow on lower rates than Greece, despite its isolation, largely because it has gross reserves of roughly $28 billion, and its national debt as a percentage of GDP is expected to be between 35 and 40%. Meanwhile, Greece manufactures a statistical primary budgetary surplus, as it manufactures statistical reserves amounting to roughly $6 billion.
What frightens creditors, the IMF, EU, and US is that no country follows Argentina’s example of disregarding international norms of financing and defying the neoliberal model. For this reason, from 2010 to the present EU and the US were deeply worried that Greece could follow the nationalist example of Buenos Aires. Although Argentina’s debt-to-GDP ratio is one of the smallest in the world at one-fifth of Greece’s debt-to-GDP ratio, and although the Argentine economy has a solid foundation in comparison with Greece relying mostly on tourism and shipping, the geopolitics of Greece’s case – a NATO and EU member – actually make it less of a risk than the financial, balance of payments, and investment numbers would suggest in comparison to Argentina. For example, when Argentina defaulted in 2001 its deficit was a mere 3.2% of GDP, while Greece’s official deficit was at 7.8% and the unofficial anywhere between 12 and 15%. And even in 2014 when Greece has a debt-to-GDP ratio of 176%, Argentina has less than 40% with far greater growth prospects of reducing it into the low 30s according to the IMF.
Given this reality of quantitative comparisons, why is the international community punishing Argentina, while praising Greece that Standard and Poor’s continues to have on the top ten list of default risk nations? Just as the West backs Ukraine that Standard and Poor’s has on the top ten list of possible default nations, similarly, Greece enjoys comparable political cover for its financial and economic chaos. What is important for the G-7 members if that governments comply with the model of integration and not deviate, otherwise they face the kind of punishment Argentina has been suffering. Amazingly, besides using the court system to punish Argentina by ruling in favor of a massively profiteering Hedge Fund Paul Singer controls, the US has been advocating removing the South American country from the G-20, just as it removed Russia from the G-8, not for economic but purely political considerations.
The US government, media and corporations have been lobbying to make sure Argentina receives no development loans from the World Bank or any other international financial institution. Europeans, have simply gone along with everything the US has dictated on the Argentine issue, just as they catered to US demands that Greece must remain in the euro zone.
Unlike Greece that tries to create annual budgetary surpluses through the infamous “Greek statistics” that have become the laughing stock of Europe, Argentina has real reserves it tries to hold on to in case the US-led economic squeeze becomes tighter. Because its reserves and economic power is so substantial US politicians, media and corporations want Argentina to use those reserves and to mortgage its future, just as Greece has done to cater to foreign creditors so the country can remain a financial dependency for the duration.
It is true that in Argentina income and housing values losses combined amounted between one-third and one-half, but data show a doubling of GDP per capita between 2004 and 2012, while the situation in Greece has not bottomed out six straight years of negative GDP growth. Of course, Greece started out from a much higher income base (ranking 32nd in the world before austerity) than Argentina. However, the fall from such a high ranking is even harder than Argentina’s because the new EU model of integration means lowering living standards to reflect those of the northern Balkan countries and Eastern Europe.