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Libertarianism could save Argentina with Javier Milei?

By the time this article is being written, Argentina’s inflation rate is approximately 140%. The political arena seems complicated, divided between neoliberalism and progressivism in Latin America. The far-right economist, Javier Milei, newly elected president, woke up the social claim of a society who had been suffering an economic mismanagement with the past governments. On the other hand, the socialist leader Sergio Massa, ex-minister of economy under the president Alberto Fernandez, was the opponent in the past elections celebrated on the 19th of November. Despite the social discontent, the ex-minister of economy, Sergio Massa surprisingly won the first round in the elections. However, it was not enough to show the strength of a change that people were expecting. The elections ended up with 55.7% for Libertad Avanza, political party supporting Milei and 44.3% for Union por la Patria, political party supporting Sergio Massa. The statistics show a huge increase in the number of poverties reaching up to the 40%. Difficult to imagine in a country such as Argentina, in which the past century was finding a way to become a developed economy. How can we find an explanation of the chaotic economy in Argentina? 

Checking in history, it is important to take into account that Argentina’s GDP per person, a century ago was higher than Germany or Italy. This leads to the idea that the second largest economy in South America was strong enough to overcome challenges, thus in 1946, Juan Domingo Peron was elected president, radical ideas came into power with him. Influenced by the ideas of socialism and nationalism, radically changed the course of the economy. Government intervention, populism, high increase in wages were the prominent actions of Peron. Leading afterwards for an economic isolationism. Peronism, as the movement was named, has been influencing the politics in Argentina for decades. The left-wing wave of politicians in Latin America have had a mismanagement in the economy, coming with corruption situations and authoritarianism, making no other option for the people to start supporting the new wave of the radical right-wing politicians. Javier Milei, a libertarian economist being influenced by the Austrian School, brings new ideas to the table such as removing their own national currency and the central bank. Influenced by his political allies such as Donald Trump who mentioned that the only solution for the country is Milei and ‘he would make Argentina great again’. On the other hand, we have Jair Bolsonaro, promising that Milei will bring prosperity and real change to Argentina. For Milei, the only possibility for real change comes from the global far right ideas. He promised that the dictatorships around the world would not be close allies (North Korea, Venezuela, Russia, China) to Argentina and declared that Pope Francis uses his power to support these dictatorships. Despite of sharing the same nationality, it does not seem a good commencement for the political atmosphere. Between his new radical ideas, it is found establishing the USA Dollar as the new national currency of Argentina. In the region, there are already examples in which the idea has worked well, including Panama and Ecuador. It is such a complex economic idea, which hopes to stop the inflation that has been increasing with no return. 

Consequently, having a big influence by the Jewish community, considering himself as one of them, Milei proposes to move the Embassy of Argentina from Tel-Aviv to Jerusalem, and Israel will become one the closest economic and political allies for the trading in Argentina. Milei proposes a huge reduction in the power of the state. Nowadays, Argentina has 18 ministries and the plan is to reduce them to 8 ministries. He expects at least a reduction of about 15% in the public spending, cutting subsidies and removing the free access to education. 

Milei, considered as ‘El Loco’ (the crazy man), plans to make a revolution in Argentina. A country that is exhausted of going backwards in its economy. Inflation and the economy clash make the people choose for a leader who expects to remove all the problems in the state. Blaming all the fault in the left-wing, it is time for these revolutionary ideas produce the outcomes that were promised. Exposing the ideas that are not politically correct has made Milei feel heard all around the world. 


Gerson Singana

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