Essentially, they are a country controlled by labor unions (the Peronists). They have enormous burdens of social security and other subsidy programs. They do nothing to make Argentina competitive in the international arena, such as limiting union power. Hence, they are destined to fail.
Some poster mentioned that bankers are the problem. Not at all. They were willing to lend Argentina money, knowing that they may not get it back - hence, the interest rate is higher than what a AAA consumer is used to. The problem for Argentina, like the old Soviet Union, is where the money goes from the loans. A large percentage is skimmed towards political officials and Peronist party leaders. The middle class is folding because the wealthy loot the country and promise the poor and elderly massive entitlements. Hey, it sounds like the Democratic Party in the US!
Argentina is a classic example of the failure of socialism. Unlike Marx' view of utopian society, modern socialism is the destruction of a country by destroying the middle class. The poor get poorer (although they don't think so at first), the rich get richer (as law and order degenerate and you can't prosecute anyone - not even the President for lying under oath), and the middle class vanishes.