By Kevin Gray
Associated Press Writer
Thursday, December 20, 2001; 1:00 AM

BUENOS AIRES, Argentina –– President Fernando De la Rua declared a state of siege Wednesday, seizing special powers to deal with widespread rioting and looting sparked by a deepening economic crisis that prompted the economy minister to resign. At least six people were killed and 100 injured in a day of violence.

A government official requesting anonymity said Economy Minister Domingo Cavallo had offered his resignation. News reports said De la Rua's entire cabinet also offered to step down. There was no official confirmation. De la Rua would decide whether to accept Cavallo's resignation later Thursday, the official said.

As part of a series of protests that swept the capital after nightfall, thousands of angry Argentines gathered outside the Olivos presidential compound calling for the president's resignation and protesting the government's handling of the economy.

Hours earlier, De la Rua defended his emergency decree in a nationally televised address, saying it was needed to quell unrest that convulsed much of the Capital, Buenos Aires, and many of Argentina's largest cities.

The emergency declaration followed a Cabinet meeting called by De la Rua to respond to the frenzied violence. Riot police on Wednesday sent looters fleeing amid a fusillade of rubber bullets and tear gas in poor neighborhoods ringing Buenos Aires and in more than a dozen cities nationwide.

"I urge those that are doing violence to cease those acts," De la Rua said, suggesting some of the looting had been organized by criminals. "With violence, we won't solve any of our problems."

Six people died, some from gunshot wounds, and more than 100 were reported injured during Wednesday's violence, which marked a troubling new chapter in the crisis that has tormented Argentina for four years. Authorities reported more than 320 arrests.

The president didn't discuss details of the state of siege. But government spokesman Juan Pablo Baylac said the measure would be in place 30 days, allowing authorities the right to suspend constitutional guarantees such as the right to assemble and travel freely, while giving police greater powers to make arrests.

Baylac also said the government would release $7 million in food aid for many of the impoverished areas where looters overran supermarkets, shops and some government buildings to protest harsh austerity policies.

It was the most furious unrest after sporadic looting that has taken place daily since a national strike Dec. 13 – the eighth in two years. It also marked the most serious challenge to the increasingly unpopular president and his economy minister, Domingo Cavallo.

By nightfall, looting had spread to at least a half dozen cities across Argentina, including Mendoza, Rosario, Santiago del Estero and San Juan, as hundreds of people descended on stores and carried away everything from bicycles and home appliances to washing machines.

The government sent federal police to back up the local Buenos Aires police in cat-and-mouse games with angry crowds that shifted from street to street, forcing shop owners to shutter metal gates and flee.

In western Argentina, police stormed city hall in the major city of Cordoba, 475 miles northwest of the capital, where rioting workers had trashed their offices, smashing and overturning furniture.

Argentines are desperate after years of recession that has stopped South America's second-largest economy in its tracks. The government, strapped to make payments on the country's staggering $132 billion public debt, has partially frozen accounts to halt a run on the banks. The jobless rate has soared to near record levels.

Rising social tensions are expected to make it more difficult for De la Rua to push 2002's austerity budget slashing an extra $4 billion in public spending through a factious Congress.

Agreement on the budget is seen as key in persuading the International Monetary Fund to release $1.3 billion of emergency funds that cash-strapped Argentina needs to keep up payments on its debt. Failure to secure IMF funding could lead to a default, which could spark further unrest.

Violence erupted late Tuesday night, with some 2,000 people looting in the San Miguel commercial district in greater Buenos Aires. Police finally used tear gas to quell the crowd.

But thousands of angry, disgruntled Argentines regrouped during the day Wednesday in poor and widely scattered neighborhoods around the capital.

"We want food and if the government won't give us any, we'll just take it!" shouted Liliana Gimenez, a 62-year-old woman among the crowd that massed outside a supermarket defended by riot police and two tractor-trailer trucks blocking the gates.

Police brandished riot shields and rifles and stood shoulder-to-shoulder outside the huge supermarket, where edgy managers tried to calm hundreds of people with promises to distribute hundreds of bags of foodstuffs.

After a half hour of negotiations with the supermarket officials, an 18-wheeler supermarket truck was rolled out to the crowd and leaders of the mob hurled bags of rice, cooking oil, even holiday sweet bread, to outstretched hands in the frenzied crowd.

"We are hungry and we are desperate. We will keep looting. We need food for Christmas," said one man who only gave his name as Osvaldo. He hauled away milk, rice and jars of mayonnaise. Others piled shopping carts with groceries or shoveled food into duffel bags – scenes that were repeated around the country.

At Cinco Estrellas, a grocery near a Buenos Aires housing project, the crowd fled as police waded in, firing rubber bullets and tear gas that left a stench wafting over the streets. Crowds of teen-agers, some with their faces covered, hurled rocks at supermarket officials and passing trucks. Elderly people also joined in the looting, picking up scattered goods.

The scenes recalled images of Argentina's last financial crisis, in 1989, when supermarkets were looted amid triple-digit hyperinflation. Then-President Raul Alfonsin was forced to leave office six months early.

Wednesday was the first time violence crept into the capital, a move which bodes ill for De la Rua's embattled government.

Just two years after taking office, the president is trying to implement his government's ninth austerity plan. So far, the belt-tightening has included 13 percent cuts in state workers' wages, higher taxes and moves to slash pensions.

Hoping to blunt the rising hunger and poverty, the government this week began disbursing more than 400,000 pounds of food aid.

The recession was triggered by years of public overspending and heavy borrowing. The jobless rate has hit near-record levels of over 18 percent, with nearly 15 million of the 36 million population are living at or below the poverty line.

© 2001 The Associated Press