Libertarianism Ruins Argentina
Anarcho-capitalist Javier Milei made a bad situation worse.
In December of 2023, libertarian politician Javier Milei was elected the president of Argentina. A former radio host known for his hardline rhetoric and outlandish behavior, Milei’s victory was celebrated by the American right, who saw the election as proof their blend of anti-wokeism and laissez-faire capitalism was a political winner. Campaigning with a prop chainsaw, Milei promised an aggressive budget-cutting program to combat inflation along with social conservatism, such as allegiance to Israel and a crackdown on reproductive freedom. All together, Milei offered rightists a glorious opportunity: he could prove capitalist economics were the paramount policy by fixing Argentina’s economic woes while owning the left with his #epic rhetoric and unconventional persona.
There’s only one problem. Seven months into the presidency of this self-described anarcho-capitalist (that’s an attempt to make “conservative” sound cool), Argentina is spiraling into disaster. While inflation was a serious problem before Milei took office, it has only gotten worse under his watch. Combined with his austerity programs, Javier Milei has made life significantly worse for the average Argentinian.
The Argentina Crisis
If there’s anything nice to say about Javier Milei, it’s that he’s a man of his word. Since taking office he has kept his chainsaw promise, hacking through any and all government spending programs with little thought to the consequences. He cut fuel and transportation subsidies, ended public works programs, devalued the peso by 50%, and laid off approximately 70,000 government workers. From a slanted view, his slash-and-burn strategy appears to be on the right track. Argentina’s inflation rate rose by 8.8% in April, the first single-digit increase in 18 months. Milei and his supporters have praised it as a sign of his success, but the full picture tells a different story. As a whole, Inflation has risen by 45% since Milei took office, placing Argentina at a whopping 289.4% inflation rate. It’s currently the second highest in the world, behind Zimbabwe (541%). As you can tell from these graphs, Milei has not delivered on his promise to combat inflation. His inaugural month of December 2023 was the largest inflation increase (50.5%) in Argentina since 1990.
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Supporters of laissez-faire economics argue that reform takes time and that the President hasn’t been given enough opportunity to see his program play out. While I agree you can’t measure his economic performance in a single month, Milei has been in office for seven. So far, he’s overseen a drastic inflation increase (161% to 289%) while eliminating the only programs supporting the Argentinian people. Outside of a slight reduction in the inflation rate (which is still rising) and Milei’s assurances, there’s no indication things will get better.
In addition to the devalued peso, Milei slashing every public goods and welfare program he can get his hands on has put his constituents between a rock and a hard place. Retail sales have fallen 20% in the first quarter of 2024, the same decrease as when the economy shut down in 2020. Wages have fallen and stagnated, rent has skyrocketed up to 90%, and the poverty rate is now at 57% — a twenty-year high. And things are only forecast to get worse. The International Monetary Fund, which is sympathetic to Milei’s libertarian economics, predicts Argentina’s GDP will shrink by 2.8% this year.
Given the crisis — and Milei’s promise things will only “get worse” before they get better — Argentina has fallen into social unrest. In April, tens of thousands protested cuts to public education. A few weeks later, a 24-hour general strike to protest Milei’s legislative assault on workers’ rights shut down public transportation, granaries, airports, supermarkets, and banks, bringing the country to a standstill. There’s another nationwide strike planned for today (I’m writing this on June 5th), which aims to last 48 hours.
The Argentina Crisis shouldn’t be understood as a study of the dangers of electing an unseemly zealot president but as an indictment of the entire laissez-faire economic strategy. Unlike some of its South American neighbors, Argentina has not been crippled by economic sanctions or IMF-imposed austerity. Javier Milei entered office with a popular mandate (he still polls around 50% popularity), and has faced little obstacle to implementing the budget-cutting, pro-capitalist policies American conservatives dream of. Seven months in, the results speak for themselves. Inflation rises while Argentinians fall into poverty, fueling the increasing frequency and intensity of strikes and protests.
Were Milei a leftist, American media would be rush-printing op-eds entitled “The Failed State of Argentina” while the State Department issues travel advisories and calls for a sanctions package. But, because Milei manifests everything Americans have been told about economics — cutting government budgets is good, labor protections hurt the economy, and markets are a natural phenomenon — the capitalist ideologues quietly look away. This strategy might work for now, but if current trends hold, the Argentinian crisis will be unable to be ignored. The unrest will grow, fueling a wave of immigration that conservatives will only use to fearmonger so they can replicate the same policies that destroyed Argentina here at home.
Undoubtedly, they will eventually sacrifice their once-hailed hero to save their ideology. There’s no denying the Argentinian President is far from the picture of a posh statesman. But Argentina isn’t in social decay because Javier Milei curses and wields a chainsaw. As all available data shows, the country is failing because Javier Milei is a libertarian.
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And he's an abject idiot.
Sad testament to the apparent inability of Argentina to get any kind of shit together. How anyone could vote for an arsehole like Milei is beyond me. Best the Argies can do now is follow Brazil. Along with the rest of the continent, they should follow Africa's example and purge themselves of foreign influence...Or at least American influence... Or at least wise up to the multipolar world and see that they can shop for stuff (for sure with strings, just not neofascist American strings) in Russian and Chinese stores too.