Javier Milei ascended to the presidency of Argentina in 2023 amidst a surge of voter discontent with the country's political elite. Hyperinflation, devaluation of the currency, fiscal deficits, and rising poverty fueled the discontent. The elite and media pundits mercilessly ridiculed Milei and labeled him a madman and predicted he would be a disaster for Argentina. As more numbers and results pour the case that the elite and media were mistaken strengthens. Milei may be a bit crazy, but crazy in a good way, like a fox.
Following the election of Libertarian President Javier Milei, the establishment and media pundits snapped into action labelling the new President a "madman". They predicted his fall and that a struggling Argentina would descend even further and even faster than it had under Peronist rule.
The establishment was deadly wrong as evidenced by their silence and the results Milei has achieved rapidly for his country.
Milei's Achievements So Far
Inflation has fallen to 11 percent and prices are returning to normal after soaring to above 300 percent. Milei predicts inflation will fall further.
Under Milei, the country has recorded its first quarterly budget surplus since 2008.
Rents are falling by 20 percent annually as landlords put more supply on the market now that price controls have been eliminated. Ironically, the market rents are proving to be lower than what the Personist government forced on property owners.
"The road to prosperity begins with fiscal responsibility, and we are taking the necessary measures to balance our budget and reduce our debt." - President Javier Milei
Bloomberg has labeled the Argentine peso as the best-performing currency in the world in the first quarter of 2024. Albeit, the increases are off an abysmal base.
Unemployment fell from 10.6 percent to 9.1 percent in Milei's first 100 days. Foreign direct investment increased 25 percent in the first quarter of 2024. New business registrations jumped 40 percent, and tourist visits up 30 percent, in the first quarter of 2024.
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Melei's Methodology
How did Milei achieve what the establishment said was impossible and nothing more than the wild dreams of a madman?
First, he slashed entire government departments. He cut, cut, cut. The departments were phased out, they were slashed overnight. He took a chainsaw to the problem, not a scalpel.
Second, he devalued the peso rapidly and immediately. At the same time, he removed rent subsidies and controls and eliminated other state-imposed price restrictions. He took the financial hits upfront when his mandate was clear and all at once.
Third, Milei's government has been working on eliminating or changing more than 300 rules and regulations, including those on rent and other sectors. The hope is that removing regulations will stimulate investment, create jobs, and foster an economic environment conducive to growth.
Next Steps
Following the successful implementation of President Javier Milei's "omnibus bill" and fiscal reforms, Argentina now faces the challenge of sustaining its economic momentum and addressing long-standing structural issues. The government must focus on further stabilizing the economy, implementing comprehensive tax and regulatory reforms, and promoting deregulation in key sectors such as energy, telecommunications, mining, and agriculture.
The early successes of Milei's administration, marked by a significant decrease in inflation, a budget surplus, and a surge in foreign direct investment, have demonstrated the effectiveness of his approach. The Argentine people are experiencing a newfound sense of economic stability and growth, a stark contrast to the dire predictions made by his critics.
To achieve lasting change, President Milei will need the support of the entire government, not just his political party. This broad support will be critical in navigating the potential backlash from vested interests and ensuring that the benefits of his reforms are felt by all Argentinians, particularly the most vulnerable members of society.
As the world watches Argentina's progress under President Milei's leadership, his success could serve as a model for other countries facing similar economic challenges. The bold, decisive actions taken by the Milei administration could pave the way for positive change and demonstrate the potential for economic transformation through effective governance.
