Argentina's agreement with its bankers ends the first stage of the recovery from a great crisis of foreign debt that engulfed Latin America two years ago. All of the indebted countries have now worked out manageable agreements with the lenders, through the assistance of the International Monetary Fund. Far from bailing out the banks, as some of the sillier accusations in Congress ran, the IMF has forced the banks to meet their own responsibilities for the dangers that they helped to generate. As a condition for getting the interest on past loans, the IMF has forced the banks to put up enough new money to keep the Latin economies from strangling. In the case of Argentina, the new agreement requires them to put up quite a lot of money, and it remains to be seen hether all of the 331 banks will comply.

Earlier this year, some Argentines considered defying the banks and repudiating the debt. But that would have meant isolating their country from all its trading partners, except the Soviet bloc, and marching deliberately into a long decline in standards of living that would soon have threatened the stability of the new democratic government. It was in everybody's interest that Argentina remain within the world trading system and, when that central point was accepted all around the table, the only question was the precise terms of the settlement. That question has been answered in the intricate negotiations just concluded.

The financial arrangements worked out between the Latins and the banks provide time for these countries to continue reorganizing their economies. They have to consume somewhat less than they did before 1982, export a lot more and find their way back to steady expansion. This great change in policy is now visibly beginning in Argentina. It is already well under way in Mexico, Brazil and Venezuela. Throughout Latin America, this process has been distinguished by notable political courage on the part of national governments.

As Americans watch the Latins go through this drastic adjustment, they might remind themselves that the United States is now by far the world's biggest borrower. Like the Latin borrowers three years ago, the United States is enjoying a standard of living well above anything that its own productivity can justify. It is being supported -- temporily -- by other people's money borrowed abroad. Just as Latin America could not live forever on foreign loans, neither can the United States.