Argentina loses New York court case, owes vulture fund $1.3bn

Elliott Capital Management must now be paid at the same time Argentina pays its normal bondholders.

Fresh off its success in seizing a 100m-long tall ship owned by the Argentine navy from a Ghanaian port, Elliott Capital Management – the biggest and boldest of Argentina's "vulture funds" – has secured what looks like a final victory over the country in the New York courts. Argentina is now caught in the unenviable position of either paying back debt which it thought it had defaulted on a decade ago (and which Argentine president Cristina Kirchner has sworn not to do), or default on entirely new debt, which it has both the will and the funds to stay current on.

The problem Elliott has had is that Argentina, as a sovereign nation, can't be bound by any court judgement. Once it decides not to pay up on bonds – as it did when it defaulted on its debt in late 2001 – there is very little its creditors can do.

As a result, after the default, the value of the bonds plummeted well below face value. Most creditors were happy to swap the defaulted bonds for new, lower-value ones, which ensured they at least got something, but some – like Elliott – decided to hold out for the full payment.

Elliott had pursued a nuisance strategy – seizing Argentine assets which had ended up under other nations' jurisdiction, like the sailing ship ARA Libertad – but at the same time, the hedge fund, which now holds bonds with a face value of well over $1bn, has been attempting to force the country to pay up on the total amount.

Faced with an inability to directly affect Argentina's actions, the fund has instead gone after an organisation it whose hand it can force: the Bank of New York. The bank is responsible for issuing Argentina's present-day debt, issued since the default. The judgement Elliott has won forces BoNY to pay them with the money Argentina hands over to pay its bondholders.

This is legally problematic at two levels. In the specific case, it means that BoNY and Argentina's current bondholders are being penalised for a case which they have nothing to do with. BoNY in particular is caught in a bind – either it breaks its legal obligations to the court, or to its bondholders. And the bondholders are doubly screwed. If Argentina doesn't pay the holdouts – and Argentina has a thing about not paying holdouts – then money which they are legally owed, and which Argentina is legally trying to get to them, will instead go to Elliott (and presumably other holdouts who will follow a similar route in court).

And in general, it's a worrying precedent for future sovereigns hoping to restructure their debt. There is no bankruptcy procedure for nations, but it is still perfectly possible for their debt to pile up to such an extent that they – and possibly their creditors, in aggregate – would be better off restructuring it. That just got slightly more difficult. If the precedent stands, then any sovereign holding bonds administered through the US can expect to have to pay them off, in full, no matter what their finances are. (Greece, are you listening?)

All of which means that we can probably expect Argentina to take the only other route open to it: default – again – and offer new bonds at face value, but issued under Argentine law. Bondholders shouldn't lose too much money, but they will lose a lot of security (if, that is, they haven't already). Argentina's reputation, slowly rebuilding after the initial default, will take another hit. And Elliott – which holds a lot of insurance against an Argentine default – will actually make quite a lot of money. Which makes the whole thing seem rather counter-productive on Argentina's part.

The ARA Libertad, the ship seized in Ghana. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Photo: Getty
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Leaving the cleaning to someone else makes you happier? Men have known that for centuries

Research says avoiding housework is good for wellbeing, but women have rarely had the option.

If you want to be happy, there is apparently a trick: offload the shitwork onto somebody else. Hire cleaner. Get your groceries delivered. Have someone else launder your sheets. These are the findings published by the Proceedings of the National Academy of Sciences, but it’s also been the foundation of our economy since before we had economics. Who does the offloading? Men. Who does the shitwork? Women.

Over the last 40 years, female employment has risen to almost match the male rate, but inside the home, labour sticks stubbornly to old patterns: men self-report doing eight hours of housework a week, while women slog away for 13. When it comes to caring for family members, the difference is even more stark: men do ten hours, and women 23.

For your average heterosexual couple with kids, that means women spend 18 extra hours every week going to the shops, doing the laundry, laying out uniform, doing the school run, loading dishwashers, organising doctors' appointments, going to baby groups, picking things up, cooking meals, applying for tax credits, checking in on elderly parents, scrubbing pots, washing floors, combing out nits, dusting, folding laundry, etcetera etcetera et-tedious-cetera.

Split down the middle, that’s nine hours of unpaid work that men just sit back and let women take on. It’s not that men don’t need to eat, or that they don’t feel the cold cringe of horror when bare foot meets dropped food on a sticky kitchen floor. As Katrine Marçal pointed out in Who Cooked Adam Smiths Dinner?, men’s participation in the labour market has always relied on a woman in the background to service his needs. As far as the majority of men are concerned, domestic work is Someone Else’s Problem.

And though one of the study authors expressed surprise at how few people spend their money on time-saving services given the substantial effect on happiness, it surely isn’t that mysterious. The male half of the population has the option to recruit a wife or girlfriend who’ll do all this for free, while the female half faces harsh judgement for bringing cover in. Got a cleaner? Shouldn’t you be doing it yourself rather than outsourcing it to another woman? The fact that men have even more definitively shrugged off the housework gets little notice. Dirt apparently belongs to girls.

From infancy up, chores are coded pink. Looking on the Toys “R” Us website, I see you can buy a Disney Princess My First Kitchen (fuchsia, of course), which is one in the eye for royal privilege. Suck it up, Snow White: you don’t get out of the housekeeping just because your prince has come. Shop the blue aisle and you’ll find the Just Like Home Workshop Deluxe Carry Case Workbench – and this, precisely, is the difference between masculine and feminine work. Masculine work is productive: it makes something, and that something is valuable. Feminine work is reproductive: a cleaned toilet doesn’t stay clean, the used plates stack up in the sink.

The worst part of this con is that women are presumed to take on the shitwork because we want to. Because our natures dictate that there is a satisfaction in wiping an arse with a woman’s hand that men could never feel and money could never match. That fiction is used to justify not only women picking up the slack at home, but also employers paying less for what is seen as traditional “women’s work” – the caring, cleaning roles.

It took a six-year legal battle to secure compensation for the women Birmingham council underpaid for care work over decades. “Don’t get me wrong, the men do work hard, but we did work hard,” said one of the women who brought the action. “And I couldn’t see a lot of them doing what we do. Would they empty a commode, wash somebody down covered in mess, go into a house full of maggots and clean it up? But I’ll tell you what, I would have gone and done a dustman’s job for the day.”

If women are paid less, they’re more financially dependent on the men they live with. If you’re financially dependent, you can’t walk out over your unfair housework burden. No wonder the settlement of shitwork has been so hard to budge. The dream, of course, is that one day men will sack up and start to look after themselves and their own children. Till then, of course women should buy happiness if they can. There’s no guilt in hiring a cleaner – housework is work, so why shouldn’t someone get paid for it? One proviso: every week, spend just a little of the time you’ve purchased plotting how you’ll overthrow patriarchy for good.

Sarah Ditum is a journalist who writes regularly for the Guardian, New Statesman and others. Her website is here.