ONE YEAR AGO, as Argentina wallowed through one of the worst economic and political storms in its history, two outcomes were commonly forecast: Either its weak government would muster the strength to formulate and implement a stabilization program approved by the International Monetary Fund, or the country would plunge into an abyss of hyperinflation, plummeting production and, possibly, political chaos. In fact, neither has happened. President Eduardo Duhalde, who took office after three previous presidents resigned in short succession, has failed to develop a coherent plan for rebuilding Argentina's financial system or restoring its prospects for growth. Yet Argentina has also avoided collapse: In the past few months the economy has stabilized, though at a level far below that of the 1990s, and there has been no renewal of mass unrest. This minimalist muddling-through can't last; at best it might serve until presidential elections are held and a new leader replaces Mr. Duhalde on May 25. In an attempt to make that outcome more likely, the Bush administration and several of its Group of Seven allies have strong-armed the IMF into signing an agreement that will roll over $6 billion of Argentina's debt. It's a risky maneuver that may backfire.

Administration officials tend to see the new accord in political terms: as a good-faith gesture that could prove valuable at a moment when the various Argentine presidential candidates are hotly debating whether to continue cooperation with the international financial institutions. But the carrot comes at the cost of a rift between the IMF administration and its government sponsors and the violation of a principle the IMF previously has been chastised for failing to uphold in Argentina's case: that an agreement, and the signal of endorsement it usually represents for international financial markets, should not be granted unless the government commits to a serious economic reform plan. Although it has limited its public spending, and thereby avoided the worst scenarios that loomed a few months ago, Mr. Duhalde's government has consistently rejected the IMF's proposals for reconstructing the collapsed banking system or laying the groundwork for a genuine economic recovery. Instead, it has resorted to blackmail tactics to get an agreement, defaulting on payments to the World Bank and the Inter-American Development Bank and threatening to skip a payment due to the IMF itself -- moves that could have damaged the credit ratings of those international institutions.

The new agreement gives Argentina only enough money to roll over its debts to the IMF between now and August, in exchange for a promise of continued fiscal austerity. But Mr. Duhalde's government is hailing the accord as a breakthrough that takes the country "out of intensive care" and vindicates his hardball negotiating tactics. His economy minister has proclaimed, wrongly, that the country's economic crisis is over. Bush administration officials are supposing that the IMF will induce the new president to commit to more serious reforms in exchange for another agreement next summer. Yet it seems just as likely that the winner among the leading candidates -- none of whom is seriously committed to free-market economic policies -- will conclude that adopting Mr. Duhalde's intransigence is preferable to swallowing the IMF's medicine. In that case, Argentina, the IMF and the Bush administration will soon be at loggerheads again -- and real solutions to Argentina's problems will be further postponed.