Europe needs to stop dithering, accept that Greece is insolvent
and proceed with the I.M.F.’s aid toward a solution. June 19,
2011 Defaults by large national economies have occurred many
times in history, Argentina being the most memorable recent
example. Financial crisis often precipitates these defaults. A
number of countries were forced into International Monetary Fund
programs when Argentina was under stress early last decade. Of
those countries, Argentina is arguably the worst example for
today’s I.M.F. aid recipients to follow. Argentina suffered a
significant downturn in 1998 in the turmoil after Russia’s
default. After a painful three years, Argentina was forced to
ask for an I.M.F. loan. But this was not enough, Argentina
unilaterally defaulted on its financial obligations to foreign
creditors in early 2002. That is to say, the country stopped
paying its creditors without having reached mutual agreement to
do so. The result was a large currency depreciation and high
inflation that impoverished the co