When the riches never came, Argentines took solace in the nostalgia and melancholy of the tango © AP

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Argentina has led the world in the politics of magical realism that shapes the era of Brexit and Donald Trump. Peddling dreams and evading hard truths has been the staple of Peronism, the populist force that has dominated the country’s politics since 1946 and ruled the country under Néstor Kirchner and then his widow Cristina Fernández between 2003 and December last year.

In most other respects Argentina has lagged behind, a unique global example of progressive underdevelopment since the end of the second world war, a time when aspirant immigrants in Europe would toss a coin between sailing across to New York or down to Buenos Aires. Each seemed to offer equally inviting economic prospects.

I lived in the Argentine capital as a child in the 1960s, as a young adult between 1979 and 1982, and have returned often since, the last time two years ago. Some glossy new buildings have gone up but otherwise the pavements have become more decrepit, the walls more badly in need of paint, the beggars more abundant, the shanty slums ever closer to the city centre. It was on beef exports from the Pampas that the economy was substantially built but meat, daily fare for all during the two periods when I lived there, is almost a luxury item today. I have travelled widely all my life and know of no other country that has experienced such visible decline.

It’s what happens when an economy is built on myths, in the Argentine case on the Peronist one that the country would get rich quick on the fat of the land with negligible government discipline and minimal personal toil.

Analyses abound. I’ll offer one. Immigrants to Argentina, the bulk of whom populated the country early in the 20th century, differed from those that went to the US in one critical respect. Those who went to the US did so disposed to abandon the past and settle for good, embracing the American Dream. Those who went to Argentina, chiefly from Italy or Spain, did so with the notion that they would thrive fast and return to their places of origin, enviably rich.

For most the Argentine Dream failed to materialise, hence the nostalgia and melancholy of the tango, hence Argentines’ enduring habit of referring to their country as “the arsehole of the world”, hence the sense of dislocation many have, as if — to use a phrase coined by Gabriel García Márquez — it is by “an error of God” that Buenos Aires happens to be in the deep south of Latin America and not in Europe, where it belongs, alongside Barcelona, Paris or Milan. If you are looking for an explanation of why Buenos Aires has long been the city with the world’s highest number of psychoanalysts per capita, part of the answer might reside in the widespread perception of ill-fated isolation and muddled sense of place.

The Peronists, attuned like none of their political rivals to the national unconscious, have skilfully pandered to the electorate’s yearning for instant economic cures while preaching a message of patriotic identity based more on bombast than on collective accomplishment.

The challenge of the new anti-Peronist president, Mauricio Macri, is finally to drag Argentina into the modern age, while shunning the Trumpist politics of his predecessors. He aspires to be a pragmatist, settling his country’s international debts, ending the Kirchners’ untenably profligate electricity subsidies, thinning the ludicrously overpopulated civil service. There has been much kicking and screaming, in particular among the Peronist-controlled unions, but Macri’s chief enemy is time. If the rewards of the fiscal common sense he seeks to impose do not kick in soon, the dream-peddlers will make political hay, reaping economic chaos once again.

John Carlin lived in Argentina from the age of three to 10; his first job in journalism was at the Buenos Aires Herald in 1981

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