"This has been a catastrophe for us," Dardo Paes, owner of the duty-free shop just inside the Uruguayan border, said as he stood in an aisle devoid of clients, alongside French perfume, name-brand clothing, single-malt Scotch and cases of Cuban cigars. "We all have friends or families on both sides of the border. Now there is this tension."
Complicating any prospective resolution is a deeply wounded sense of national pride in both countries.
Uruguayan authorities and representatives of the companies have insisted that the plants will comply fully with international environmental standards. The bleaching technology to be used, known as elemental chlorine free, is a relatively clean method that is employed in European mills, supporters say.
The Argentines have been derided as hypocrites here because Argentina itself is host to almost a dozen paper plants that employ an older technology that Vazquez has called highly polluting.
"That won't happen in Uruguay," he vowed.
In a visit to Venezuela this month, Vazquez called the border blockades "a brutal aggression" and likened his country's plight to that of Cuba, whose communist government has been banned from trading with the U.S. for decades.
Such criticism is especially pointed in contemporary South America, where Vazquez and Kirchner are part of a new generation of leftist leaders on warm terms with Cuba's Fidel Castro and Venezuelan President Hugo Chavez, Latin America's most prominent U.S. critics.
The paper war -- dubbed "Pulp Friction" by one headline writer -- has underscored the differences among South America's ascendant leftist governments, which pursue often-conflicting agendas in search of economic advantage.
Kirchner has, in effect, backed the bridge blockaders. He would not send police to open the border crossings, something he has not hesitated to do elsewhere when marchers blocked roads, a common protest tactic in Argentina. His administration has threatened to take Uruguay to the International Court of Justice in The Hague.
On the hushed streets of this Uruguayan town, where the occasional 1930s roadster accentuates a sense of being lost in time, residents wonder why their Argentine friends and relatives have turned against them. The riverside resort of Las Canas, long popular with Argentine campers, saw a dramatic drop in business this summer.
"What can we do?" asked an exasperated Mayor Lafluf, sipping strong mate through a metal straw as he spoke in a conference room of the venerable City Hall. "I guess I could act like a great Uruguayan nationalist, call the people to the plaza and march to the bridge. But ... what good would that be?"
Across the river, the current cooling-off period has sparked Argentine fears of a sellout.
"This is something being worked out between Buenos Aires and Montevideo, but people there don't even know the Rio Uruguay and are not taking us into consideration," said Enrique Caballero, 60, a writer and craftsman who is among the protesters. "We have to make them understand that this is not a tango. This is real life."
Researcher Andres D'Alessandro of The Times' Buenos Aires Bureau contributed to this report, and Reuters was used in compiling it.