We know that finance capital is powerful, but that a hedge fund can impound the navy of the world’s eighth largest country is nonetheless startling.

Financiers the world over have fumed over Argentina escaping their clutches a decade ago — the example of a country refusing to acknowledge the maximization of bank profits as the central organizing principle of civilization is too scary to contemplate — but most have made their peace. Accepting that something is better than nothing, at least for now, almost all of Argentina’s creditors accepted 30 percent of the face value of the country’s sovereign debt.

Much of that debt is odious, accumulated by Argentina’s military dictatorship as it killed, tortured, “disappeared” or forced into exile Argentines by the hundreds of thousands as it imposed the Pinochet/Chicago School economic model. The rest of the debt came courtesy of the the country’s neoliberal rulers following the end of military rule, as it followed International Monetary Fund instructions into a crisis that culminated with economic crisis at the end of 2001. When Néstor Kirchner became Argentina’s fifth president in two weeks, he put an end to austerity and defaulted on the debt, ultimately agreeing to pay 30 percent to those willing to negotiate a settlement but refusing to pay anything to holdouts.

Many of Argentina’s creditors are not the financial institutions that originally made the loans; much of the debt was sold to speculators.

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