Abstract
Summary The catastrophic consequences of misgovernment and corruption experienced by Argentina and Brazil in the 1980s are contrasted with the subsequent achievements of reforming administrations. The brake of persistent corruption throughout the state and business came close to defeating Carlos Menem, President of Argentina. In Argentina, the Yabran affair of mid‐1995 marked an important extension of the fight against corruption as the Economics Minister, Domingo Cavallo, took on private monopoly power. The subsequent political battle exposed the vulnerability of a narrowly‐based technocratic administration to tactical alliances of old and new corruptions, against which the cultivation of reformed intermediate social institutions offers the best available defence.
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