Why Nations Fail

Law and Ethics
, with the note “Beware I
wrote this” inscribed. Undeterred, within three months of
taking office, Menem sent a law to the Chamber of
Deputies proposing to expand the Court from five to nine
members. One argument was the same Roosevelt used in
1937: the court was overworked. The law quickly passed
the Senate and Chamber, and this allowed Menem to
name four new judges. He had his majority.
Menem’s victory against the Supreme Court set in
motion the type of slippery-slope dynamics we mentioned
earlier. His next step was to rewrite the constitution to
remove the term limit so he could run for president again.
After being reelected, Menem moved to rewrite the
constitution again, but was stopped not by Argentina
political institutions but by factions within his own Perónist
Party, who fought back against his personal domination.
Since independence, Argentina has suffered from most
of the institutional problems that have plagued Latin
America. It has been trapped in a vicious, not a virtuous,
circle. As a consequence, positive developments, such as
first steps toward the creation of an independent Supreme
Court, never gained a foothold. With pluralism, no group

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wants or dares to overthrow the power of another, for fear
that its own power will be subsequently challenged. At the
same time, the broad distribution of power makes such an
overthrow difficult. A Supreme Court can have power if it
receives significant support from broad segments of
society willing to push back attempts to vitiate the Court’s
independence. That has been the case in the United
States, but not Argentina. Legislators there were happy to
undermine the Court even if they anticipated that this could
jeopardize their own position. One reason is that with
extractive institutions there is much to gain from
overthrowing the Supreme Court, and the potential benefits
are worth the risks.