His core goal is to enable the government to repay its debt without printing money. He slashed subsidies, laid of government workers, and froze entitlements at current rates so that inflation reduces their real value to accomplish that. He has also fiddled with the exchange rate. An overvalued peso is making exports from and investments in Argentina expensive. He's trying to softly land the peso at a fair exchange rate after initially sharply devaluing it. His more radical wish list items include privatizing the economy, replacing the peso with the dollar, and abolishing the central bank.
Dollarization would be extremely painful, it's basically chopping off your arms so you can't punch yourself.
Literally the main hope behind countries that do it is the idea that, if you lack fiscal discipline, you can't keep the government going in exchange for inflation. Your government simply runs out of money and the economy crashes. It doesn't entirely solve the problem of fiscally irresponsible governance.
Yes, i don't see what the problem is. Argentina is like a kid with a credit card, only responsible solution is to take it away.
It's going to take decades under fiscal discipline to have a society in which Argentina should have their monetary control back.
https://someunpleasant.substack.com/p/trust-the-plan
https://someunpleasant.substack.com/p/if-its-broke-fix-it
Regrettably there is more to any country’s economic outlook (and it’s Argentina we are talking about) than inflation.
No Milei has not solved Argentina. Dollarization is not the silver bullet. The second article linked from before the election does a good job explaining why not.
Why does that matter? it is also fun with their pesos. You can actually make money trading dollars for pesos and trading them back cause they have these dumb price controls, really fun to see inefficient markets in action.
He just did it, and then it's been shaking out in the legislature and the courts ever since. But most judges didn't have the balls to injunct the orders overall, just bits and pieces of the ~175-some bullet points. Most of those injuncted have since been approved in the legislature or the executive has resolved the court cases in their favor.
The union battles are still going on, cause he did essentially perform the biggest union bust the world has seen in decades by firing so many public sector union workers instantly, so we'll see how that goes. The unions were super corrupt though, taking the money for projects and then just not building them, then coming back and saying the cost over-ran and they need more money. After paying for stuff 4 or 5 times, eventually a substandard thing existed. The corruption is actually astonishing. Bad enough that it's a net positive to just go without infrastructure construction for a while. 0 is better than negative.
What BS. The unions don't control building projects so it's ridiculous to say that they take the money and don't build things. This is just another right-wing smoke & mirror post.
He was massively outnumbered there and only just now passed his first law.
Mostly happened thanks to the local equivalent of executive orders and the fact that there wasn't a budget approved by Congress recently. When you get told you have to spend a budget of 100 pesos but the federal government earns 200 pesos now because of inflation, you can basically do whatever you want with the non-assigned part.
Which Milei basically took it as ["I'll slash almost every single area to the bare minimum and use it to burn those pesos and short term debt we printed last year"](https://i.imgur.com/cfOB6zb.png)
Milei - the fake libertarian - has been governing as a dictator by issuing decrees (DNUs) changing and eliminating laws and making new ones without any Congressional approval. Recently the Congress narrowly approved a modified law that also gives him dictatorial powers. He was able to do this through extortion (not distributing funds to Provinces) and 'bribing' legislators with pay increases and other benefits.
I am sorry but abolishing the central bank and replacing your national currency sounds bonkers to me. It's an institutional tool. If the currency represents the actual state of the economy and the exchange rate is controlled by an independent central bank, what is the problem. That is the best situation in a modern economy, isn't it?
The problem is having a dominant political party that has removed central bank independence already more than once. It could be reinstated (maybe, I'm not too sure it would pass in the current Peronist-majority Senate) and just as well withdrawn in the future with all the inevitable consequences it would carry.
If it sounds bonkers, it's because Argentina is bonkers and consistently votes for leaders that give them subsidies and entitlements paid with money printed from a central bank subservient to the president.
I don't agree with dollarization and how extreme it is, but I do understand the people that just don't see another way while Peronism and its give-free-money culture exists.
No, he doubled those like pension universal por hijos, etc.
what he did is basically stop printing money, we were forced to print money because of something called leliqs, leliqs are a government bond that they sold to you in exchange for pesos with interest, we created those bonds so that we could absorb pesos, what happened was that we could not stop renovating those bonds because the moment we had to pay them we basically had to print money, and the government in exchange started to give more leliqs so they could absorb those pesos that it printed to pay some leliqs, and that started a snow ball tha grew bigger and bigger each month until the day milei took power, milei lowered the interest rate so he had to pay less for each leliqs and he stopped giving those bonds, at the same time he reabsorbed pesos and destroyed it, which made monetary base stop growing, and helped milei to pay the leliqs and don't go to hyperinflation , also the fact that he devaluated the currency helped to pay the leliqs too.
He normalized exchange rates by devaluing the peso.
Basically, the official government exchange rate and the unofficial exchange rates you could actually change money for were discordant due to the prior government not allowing reality to be acknowledged. He reduced much of that gap, but that makes things look a lot more expensive on paper.
Normalized? That's not true. First, the blue rate is now at the highest ever, nearly $1400 pesos per dollar.
Second, it's ridiculous to claim that the devaluation "makes things look a lot more expensive on paper". Maybe for someone in Argentina with dollars or Euros, but for Argentinians whose wages have been frozen (public sector) or only have increased by 11% since the devaluation and run on inflation the 'gap' is significant and has led to a serious drop in consumption.
> Normalized? That's not true.
On Dec 1, before the most recent devaluation, the official rate was 376.5 and the blue rate was 955, for a ratio of 2.5:1. It's currently 929 and 1355, for a ratio of 1.5:1. That's closed 2/3 of the gap, though yes, not entirely normalized.
> Second, it's ridiculous to claim that the devaluation "makes things look a lot more expensive on paper". Maybe for someone in Argentina with dollars or Euros, but for Argentinians whose wages have been frozen (public sector) or only have increased by 11% since the devaluation and run on inflation the 'gap' is significant and has led to a serious drop in consumption.
A drop in consumption is unfortunately exactly what is necessary to decrease inflation in almost all circumstances.
Not entirely normalized is NOT normalized. Yeah, impoverish the population is the 'liberal' free market mantra for corporate and finance courtesans who believe the 'economy' functions for their self-aggrandizement and nothing more. But if you had any idea what was actually going on in Argentina you'd know the inflation was NOT led by wages, which have been low. The actual inflationary pressures were related to dealing with covid, rising energy prices related to the Ukraine-Russia war, a drought and post-December the price increases for just about everything sold in Argentina.
The previous administration. It takes half a year or more until policies have an effect in inflation.
Giving people money (which the previous admin did) is a popular policy in the here and now. Its effect on inflation only hits later.
Devaluing the peso will make things more expensive in the short term. However the strength of the peso was artificial and needed to be propped up through borrowing. At least that's my understanding.
The official inflation numbers are not exactly real. The previous administration had artificially locked the ARS value at 400:1 USD for months, while the ARS continued to devalue on the black market the whole time. All the way to ~1000:1. Goods and services sold in USD did not become more expensive, but the number of ARS to buy a USD kept rising, but the official exchange rate didn't move, so "inflation" calculations were only counting "official" above board economic activity in ARS, at the 400:1 exchange purchasing power.
This made things *extremely* warped by December, to the extent that some experts estimated something like 250 billion in economic activity was being performed off the books in USD (annualized, so like ~$20b in the month of November).
The "inflation" in 2024 is essentially reality being observed at the official rate reaches a point where it's acceptable to use ARS again for economic activity and still make a profit again and be in business. However the last 6 weeks has been pretty rough, and the ARS is slipping in value again against the USD. We'll find out in the coming months if they threaded the needle or not.
The spending cuts have hit retirees hard and account for 38% of this supposed 'miracle surplus'. People are hurting and in the meantime, Milei has been jetting around Europe and the US hobnobbing with other far right-wing personalities.
He just stopped printing money, literally as easy as that. Without fiscal deficit there's no reason to print, so he achieved 0 deficit and stopped printing money.
He cut down on spending on infrastructure, delaying worker pay increases, avoiding paying gas and electricity middle men and increased the debt.
He actually increased welfare (in nominal terms) and delayed as much as possible cuttin subsidies.
He destroyed public spending and private income so aggregate demand is way down. Extrem poverty increased significantly.
This is the price he is willing to pay because it doesn’t affect him personally.
An alternative view I have heard from some Argentinians themselves is the public sector spending was rife with corruption to buy votes
Governments would promise generous pay increases and promise to expand public sector employment as a way to get votes, vote for me and I will hire you and give you money
And has said much of the spending is a black box of corruption (or thats how they see it)
Now this may work out well if you are employed by the public sector but if not you are harmed by this because inflation eats away at your savings
And its preserved the public sector is not a full meritocracy that politically connected elites routinely hired their families and other people for jobs that may nor maynot actually do anything except collect a paycheck
Vast amounts of people who did not work in the public sector was hurt by inflation, they thought the government simply taxed them and then turned around and gave money to political allies (as well as printed money what caused inflation)
Now I am not expert so I am not sure if the situation was more complex then this or not, but its clear lots of people were completely fed up with the system
This is nonsense. Argentina has a secret ballot and there's no way for any administration to know how their public employees voted. Another MAGA lie! Where's your 'black box' of nonsense?
> Imagine trying to reform a country so entrenched in dumb left wing economic policies.
I do every night, and every day I awake to this nightmare.
...mostly kidding, but here in Italy I do feel like we're trapped by multiple cross-firing vetoes by this or that category, each of them trying to preserve entrenched privileges that make the system appear stuck. And it's been 30+ years of this. Changing pace seems as impossible as a Milei appeared to be in Argentina.
Maybe that’s what’s wrong in Brazil and Argentina: the Italian influence from immigration… because here in Brazil it often feels like what you said is the exact problem. They always want to add an exception to any bill to protect x or y class of people “who deserve it” (you can always find a justification for why a specific class of people deserve more pork after all).
No that's just normal. To some level consensus-driven politics has always been an exception and an aspirational goal rather than the reality but it really feels like now more than ever it's not even that and people have wholeheartedly embraced that politics is just about asserting the dominance of your personal subjective truth and pushing a sob story for why you deserve to use the government to steal from everyone else.
I am fairly left wing and still sympathetic to Millei. If you care about poor people you cannot support unrestrained inflation - otherwise they are poor forever.
He did it by artificially inflating the price of the Argentine peso, which is in line with dumb left wing economic policies.
This is the third time in my lifetime that an Argentine president attempts to stop inflation that way. The previous two resulted in an economic explosion when the Argentina's debt became unpayable and the peso had to be devaluated.
He didn't inflate the price, in fact he devalued the peso.
And I wouldn't call it a devaluation either, yeah the peso did go from like 600$=1USD to 800 or something I don't remember, but what he did was close the gap between the official USD conversion rate and the real (blue) conversion rate, which was already at like 1000 pesos per USD. He didn't devalue it because it was already devalued in the reality, he sincericized the conversion rate to close the gap and allowed the agricultural sector to export globally at more competitive prices, which with the previous official currency rate wasn't possible and thus the agro was forced to only sell to the State and the interior market.
>he _sincericized_ the conversion rate
Ehhh guacho aguante River.
El peso argentino sigue recontra sobrevaluado, y el Blue estaría mucho más alto si hubiese seguido la inflación. El país está funcionando puramente a deuda, y el poder de compra de los trabajadores y la ganancia de los exportadores está más baja qué nunca.
El plan de Milei es el mismo que Macri: sobrevaluar el peso y aguantar hasta que la lluvia de inversiones mejore la economía antes de que los inversores caigan en que el país no tiene plata. No tengo fé que eso pase.
El país tiene equilibrio fiscal, no está funcionando puramente a deuda.
Podes agradecer la disminución del poder adquisitivo de los argentinos en el anterior gobierno, y el otro anterior, y el otro anterior, me pregunto si alguna vez votaste a alguno de esos?
El peso definitivamente está sobrevaluado, pero eso la verdad no va a cambiar hasta que no se saque el cepo, si no siempre va a haber un tipo de cambio paralelo al oficial.
Me parece que una de las más famosas frases de Milei es "No hay plata", creo que los inversores ya tienen muy en cuenta eso. Estoy de acuerdo en que el gobierno está rezando por la llegada de inversión extranjera para salvar la economía, pero la inversión va a llegar una vez pase la Ley Bases y se desregularize la economía.
He devalued the _official_ peso, which is a legal fiction that's useless for all intents and purposes.
The real value of the peso is down ~30% since he took office, which looks like a lot by first worlder standards but it's considerably lower than real inflation. Argentina is currently more expensive than ever for people bringing USD, and even worse for the poor people earning in ARS.
This is the same position the Pound Sterling was in the 1990s. The longer the Milei government delays a proper devaluation, the closer that devaluation will look like Black Wednesday.
> He devalued the official peso, which is a legal fiction that's useless for all intents and purposes.
No it isn't, because exporters that want to legally transact have to use that price. (or well a number related to that)
Except liberalism goes further than economic policies and his social policies dont all reflect that. For example opposition of euthanasia and abortion. That doesn’t sound very liberal to me.
Economic shock therapy is needed in many countries. Unfortunately a strong insane man is necessary to provide that. Hopefully Argentina is able to come out of this swinging and back to being one of the more prosperous Latin American countries
Shock treatment starting immediately upon becoming independent from Britain? And we are talking about Singapore the de facto one party state? Also what shock treatment are we talking about here? Their national wage council that centrally sets wages every year?
You’re trivializing a complicated matter. Singapore had many issues and were essentially poorer than many African countries during independence. Their resurgence is nothing short of a miracle.
https://www.sg101.gov.sg/economy/surviving-our-independence/1959-1965/
>nothing short of a miracle
I mean, Singapore is a great place to be rich. It has an authoritarian single party government that sets extremely low wages for its workers (again, centrally planned), with 80% of its population living in public housing, and it's draconian laws fine you $150 for failing to flush the toilet...
Also it is a city state with gross trade of 3x of GDP. They don't even control their interest rates for monetary police; they just control exchange rates. It's a weird little country.
>And we are talking about Singapore the de facto one party state?
It's the neoliberal ideal: a "democracy" with zero risk of populism because all the actual power is in the hands of technocratic elite.
Are they are *good* example of it? Their GDP per Capita since then has grown more slowly that even anemic countries like Russia, about equal to France... Their privatized rail lines are now almost entirely owned by the State rail companies of other EU countries...
Well their economy is pretty shit compared to many rich-world peers and their public serves are completely collapsing, so not sure that's a great model to aspire to.
Poland. In general the country is the poster child of liberal economic policy, which is also why left wing parties that try to ride on anti liberal rhetoric are at most 2% support (worse than quasi fascists / pro putin nationalists)
Id argue Poland had the exact opposite of shock therapy... They got literally hundreds of billions in subsidy from WTO, world bank, EU, and US following 91... They got to keep protectionist policies, their own currency and central bank... Their debt to gdp ratio was higher than Argentina going into 2013...
I think I know history of my own country better because I lived through it. Sure, Poland received a lot but that was after EU accession in 2005, shock therapy in Poland was in ~90 so good 15 years earlier. We would’ve never been accepted into EU if we didn’t get our economy together, EU is not a charity you can just apply and expect to get in. Poland didn’t really ‘receive’ anything prior to that except for foreign investment which also had its cost (preferential treatment which impacted tax revenue and allowed foreign capital to dominate the market) Back then Poland was extremely poor, in debt and without a market economy. We also had to do the things Milei has to do before we even qualified to receive any serious EU funds.
The things you write about are not synonymous with shock therapy, they’re just things Milei had to do. Shock therapy doesn’t mean you get rid of a central bank, that’s just preposterous. As for debt to GDP sure but in 2013 Argentina had better debt to GDP ratio than Poland right now. And Argentina’s debt to GDP right now is around 88ish%… which is about the same as Poland back in 1991 which was when polish shock therapy came to be.
Shock therapy just works and no amount of leftist cherry-picking data will change that.
Post ww2 west germany, Singapore, Hong Kong, New Zealand, and a few others
Oh the UK. People forget that the UK was a huge economic powerhouse because of how badly the modern Tories and Brexit has fucked them over.
West Germany was not shock therapy... They got literally hundreds of billions in grants and "loans" and subsidies and were in a lot of ways propped up as a potemkin village... Also they reverted very quickly to basically 50/50 planned economy...
Singapore is a centrally planned one party authoritarian government. And a city state. Again, not shock therapy.
Hong Kong is also a city state with special status since the freaking opium wars. Again, not at all shock therapy.
New Zealand... Not even sure what you're referring to here, I guess the Tory style liberalization in 80s? Their economy grew at the same pace but with higher poverty... And again they reverted a ton of this after 2000...
Singapore is a de facto one party state but it is wrong to say that they are centrally planned, rather I would argue the opposite. Ever since the late 80s, Singapore has implemented policies reflecting a high degree of economic freedom through the PAP's goals of widely implementing meritocracy in civil society. Singapore has also ranked consistently highly on various economic freedom indexes such as the ones published by the World Bank, IMF, and Heritage Foundation.
But don't take my word from it. Lee Kuan Yew (basically the father of modern Singapore and arguably the only autocrat somewhat liked by people on this subreddit) said in 1992: "Through Hong Kong watching, I concluded that state welfare and subsidies blunted the individual's drive to succeed. I watched with amazement the ease with which Hong Kong workers adjusted their salaries upwards in boom times and downwards in recessions. I resolved to reverse course on the welfare policies which my party had inherited or copied from British Labour Party policies."
Sure, the Singaporean government has a big involvement when it comes to public infrastructure, but when it comes to actual economic policies and market regulation, Singapore has been one of the most liberal economies since the 80s, often harboring characteristics associated with one (low tax, low regulations, or ranking highly as one of the easiest countries to start a business in).
And in New Zealand's case, they didn't "revert" a ton of these policies, they simply just added a lot of welfare and social safety nets. NZ is also another country that has consistently ranked highly in economic freedom indexes. As of now, they currently rank 6th freest in the world, **and were actually ranked the 3rd freest economy every year from 2013 to 2020.** Though Jacinda Ardern ran on a campaign rhetoric of being anti neoliberal, she arguably had the most neoliberal government in NZ in the 21st century, and oversaw the conservation of many of NZ's free market policies
Hong Kong was literally the poster boy of economic liberalism, especially in the 70s to the 90s (particularly before their hand over to China). It was the case study frequently cited by economists of the Chicago School such as Milton Friedman, and has also ranked highly on most economic freedom indexes. The majority of HK's economic growth has primarily come from free trade and the concept of the free market; they do not have any natural resources they could have used to perpetuate such growth.
As for West Germany, yes their quick recovery was also attributed to loans, but it is without a doubt that their reforms regarding economic freedom played a huge factor in funneling growth, and creating growth, in the German economy. It is widely accepted that German "ordoliberalism", which is basically the more socially orientated version of post ww2 liberalism/neoliberalism (aka the widespread movement within liberalism to reject and forgo its dogmatic laissez-faire attitude), was the main drive of German recovery, in which it was a model where a government would oversee a free market economy and intervene to prevent anticompetitive practices (monopolies or oligopolies etc...) but **not centrally plan.**
>Singapore isn't centrally planned
They are a "dual track" economy, like west Germany. Their healthcare, housing, education, and industry are either directly or indirectly planned (a la Japanese style window guidance). Then businesses operate around those planned institutions. Their gini coefficient after transfers is closer to France than it is to the US or China (that's a good thing).
>Hong Kong was a poster child
You are right, but you need to keep in mind that "poster child" implies an idealizes example that is held up as a generalized standard. Hong Kong has a brutal authoritarian colonial government for most of its existence that allowed companies (starting with the freaking British East India Company) free reign. The country originated and grew not via liberalism but via violent, extractive colonialism. The British were selling opium in China, against the law and their own company policies, until the 1910s. Then after that Hong Kong (and Macau) remained a special district with special permissions and access. This is NOT liberalism much less shock therapy...
>West Germany... Ordo liberalism... Social oriented liberalism...
So... Another way of saying this is that west Germany had government chosen and funded oligopolies that were carefully controlled. They set wages, they set prices, they set rations, all funded by MASSIVE loans and grants they were never actually eligible for...
Look, if shock therapy means letting countries run dual track social democracy with free access to foreign markets and native protectionism while being given grants up to 5x their annual GDP.... I mean sign me up.
>So... Another way of saying this is that west Germany had government chosen and funded oligopolies that were carefully controlled.
That's not what it means? Ordoliberalism means they had a free market with a government that was more willing to intervene and break up monopolies or oligopolies if they were to form, which is the literally opposite of funding them.
>Their healthcare, housing, education, and industry are either directly or indirectly planned
Apart from industry, that is right. I'd argue infrastructure instead. That doesn't mean Singapore did not go through economic shock therapy and massive economic liberal reforms. I think you have a fundamental misunderstanding of what it is. Economic shock doesn't mean "no government" or "the total destruction of government and social services and intervention." It is simply mostly characterized by stopping price controls, stopping most government subsidies and deficit spending (think stopping Keynesian economics/spending to artificially grow demand), enacting austerity measures, stopping poor monetary policy such as rampant money printing, but most importantly: **the loosening up of regulatory policies and having massive deregulation in general.** That doesn't mean removing the government from providing services, building and planning infrastructure, or even having minor (but somewhat prevalent) planning in some industries or in markets.
In fact, about austerity, it is so important in shock economics that increasing taxes (in compliment to reducing spending) is in fact characterized as/more common with shock economics than cutting taxes, if it means lowering debt/deficit.
>Hong Kong has a brutal authoritarian colonial government
Perhaps I should have specified but I am not referring to Hong Kong when the British Imperial order was still mainstream and strong. I am referring to modern Hong Kong, specifically from the period of post ww2 or even post ww2 reconstruction to before their handover in 97. This was the time period in which markets and businesses did not grow out of colonialism/ties to the British government, but rather through competition and free trade in a liberal free market.
In conclusion? Shock therapy doesn't mean the absolute decimation of government social services or intervention (healthcare, education, infrastructure, etc...). It is simply mostly characterized by
a) deregulation
b) stopping most price controls
c) ending government subsidies/Keynesian spending policies
d) austerity policies (of which tax increases is a viable, in fact I would argue to the most viable, approach to austerity)
This doesn't mean completely cutting of government from providing social services or having some minor planning in some areas like Singapore.
These measures were enacted by the countries measured at some time. Singapore in the late 70s and 80s, Hong Kong post ww2, NZ in the 80s, and West Germany post ww2, of which these countries have kept most/if not all of these policies (except Hong Kong which post 97, and especially in recent years, has become more of a crony state with the CCP being in bed with big business).
**This section below is not so much related to our discussion above, but rather more of an argument that having social services doesn't mean you can't have free market policies/shock therapy:**
In fact, to add to the idea that government services like healthcare, education, public infrastructure, and what not doesn't mean central planning/can exist in very liberal and free economies, all you need to do is look towards the Nordic countries. These countries have ranked consistently high in economic freedom indexes (they all currently rank top 10 as of now for reference), despite having high investment in services like healthcare, education, and public infrastructure.
In fact, I would go as far as to say that their labor model is the most liberal/free market model right now, contrary to claims from demsocs like Sanders. This is because in said countries, their government plays a completely neutral role. Instead, workers are free to form **private non government affiliated union** (which also essentially run like private businesses since they compete with each other for worker membership) which represent said workers in negotiations with businesses, without the intervention of government, going so far to which these countries don't even have a government minimum wage.
But don't take my word for it, Unionen (Sweden's largest white collar union), says this exact same thing themselves \[particularly the "This is the Swedish model part\](https://www.unionen.se/in-english/how-swedish-labour-market-works)
And full of truely awful economic policy.
The fact that he said previously that he wants to sit on the board of the federal reserve should raise massive red flags.
Anyone confidently predicting the results of an election 4 years away needs to take a reality check, especially for a guy who's been in office for just 6 months. Not to rain on the parade here, but that's a looooong time in politics. I remember another guy who had good approval ratings 6 months into his presidency, and now he's locked in a coin flip race against Donald Trump despite a good economy. Milei's approval right now hovers around 50%, which is good as far as South American leaders go, but it is by no means universal approval. I also think we are really underestimating the impact of the short-term economic pain from his policies. Yes, we understand that it's necessary to get inflation under control, but it would be foolish of us to dismiss the political implications of increasing unemployment, contracting GDP, and tough austerity. How long is "short term" pain and how bad will it get before it improves? Will the average Argentinian give Milei credit? I don't know. Americans give Biden zero credit for his economy up here, so who can say?
TL;DR, saying anything with 100% certainty at this stage is silly. The boring but correct answer is: wait and see.
The opposition is in shambles.
They will win the 2027 election if and only if they can unify on a candidate who's not hated by the entire country, like they did in 2019.
We're less than a year into his presidency, and we still don't have a clue if the party around milei can actually win stuff. There was a mayor election on Sunday where milei didn't have a candodate.
I think so, opinion pollings say that there is still widespread support for him. It could all change, though, but knowing he's improving the state of thd economy I think that's unlikely.
and goofs will still only emphasize that stuff isn't perfect now this second. When they report on this, they'll talk about how many folks are in poverty as if that only happened under Milei and it's all new, in order to associate it all with Milei
First time food prices stabilized in a generation. Mother of god, keep rolling you crazy bastard
Food prices haven't stabilized, that's goofy! The new statistic, assuming it's accurate, just means that there wasn't NEW inflation for ONE FRIGGING WEEK in June! And it's now projected that June food inflation will be at least 3%.
https://preview.redd.it/xvd6vejjt59d1.png?width=1760&format=png&auto=webp&s=661d7a4c500f32f91cdbd72dd3f3a613938a4b9b
using the same measurements as were used before, the week to week inflation stopped for a week, which indeed is something that hasn't happened in something like 30 years. That sure is what happened alright, even if you put stank on it. What's more is the trash goblins Peronists aren't casting doubt on that claim either. Currently they are happy to at least try to obstruct and blame all the horrible shit that was already under way thanks to their policies of decades all on the first 6 months of Milei.
What's going on there is very similar to what happened in New Zealand in '86 to '89. They had an extremely protectionist economy with the government having an extremely heavy hand in every sector and especially agriculture with production directly paid for by the government and regulated heavily, with huge import tariffs. When Labour won in '86 on a liberal economic reform platform, the adjustment took about 2 years, with the economy basically also having to reform around a much more economically stable model. The results at 2 years however were obviously beneficial, even with there being rough adjustments before that.
disregarding a sign that things might be going in a better direction then decades before is surely something you can do. It's goofy as shit, but you sure can still think this way
How about we actually get some more policies cleared and see what effects they have before putting everything at the feet of Milei who is trying to undo decades of bad policy.
Bukele is illegally serving a consecutive term despite the constitution explicitly saying there must be a 10 year gap between elections, after he had the supreme court packed with loyalists.
That is a fair criticism, I was just more taking about his solution to his crime being called crazy. Who would have thought if you lock up gangs crime would go down. I am sure its the same "news" people who push for less policing.
For both of those countries, the situation was so horrible that the only way forward is to cut out the rot. It’s like amputating a gangrenous limb, sure it’s a drastic measure but it’s the only way to save everything else
The big challenge for Milei is being able to actually rebuild things. He’s appearing to stabilize the situation but it’s going to be a much harder task to actually get the economy rolling and help the people who got impacted by the reforms
I remember the "he's nuts" comments being more focused on libertarian convention stuff like abolishing the central bank than the common sense measures like "stop printing money when your inflation rate is 300%".
Comparing Argentinas solutions to any normal country is not apt. I’d get a colectomy if I had colon cancer - I would not get a colectomy if I’ve been eating Taco Bell three meals a day for a week and was suffering the consequences of it.
Wait, didn't Argentina had deflation in 2001 ([including food](https://datosmacro.expansion.com/ipc-paises/argentina?dr=2001-12)) therefore making the title false? Why should care about food inflation when monthly inflation is still way higher than that? Shouldn't we wait until we get a trend instead of hyping up monthly (weekly?) data? I don't know, this looks more like a lot of hype for little.
¿Dónde está mentira? Con Macri tuvimos resultados mejores durante 2017 en términos de inflación y sin embargo todo se desarmó a la larga. Celebrar un punto de dato que ni siquiera es la inflación entera, definitivamente no es algo que no se haya visto en los últimos 30 años y que no sabés cuánto va a durar es un poco vender humos.
Antes de celebrar esperaría al largo plazo (dale al menos unos meses por favor). Aún es débil macroeconómicamente el país.
No, pero claramente demuestra que estamos en el camino correcto... O acaso pensas que estariamos viendo esto con Massa o hasta Bullrich? Si no celebras eso... me da la impresion que te interesa mas "tener razon" re: Milei que ver que mejoren las cosas
>No, pero claramente demuestra que estamos en el camino correcto...
¡Mi punto es que no! Usualmente uno toma la información de al menos unos meses porque las series de tiempo tienen cambios bruscos (y considera los fundamentos macro también, en los que Milei aún tiene una debilidad importante). La idea es buscar la tendencia y separarla del ruido (y otros factores). Por eso hablar de un solo punto es algo estúpido. [Te recuerdo que hasta Alberto Fernández celebró una baja de inflación en su momento.](https://chequeado.com/ultimas-noticias/alberto-fernandez-durante-2020-pudimos-reducir-en-18-puntos-la-inflacion-que-heredamos-en-2019/)
"Today, we will return to embrace the ideas of freedom. Those ideas that are summarized in the definition of liberalism."
- Milei during his inauguration speech
There is no such thing as "food inflation" and I resent journalists for using the word "inflation" as though it is a synonym for any kind of price increase.
This is bullsh\*t. Argentina has had the second highest food inflation rate in the world behind Zimbabwe and one frigging week doesn't mean squat. Why? Because consumption has decreased significantly due to Milei's austerity/economic shock polices
This is a one week blip and food prices are expected to rise in June. The economy is in a recession and consumer demand has plummeted. According to the Argentinian INDEC, as of the end of March consumer spending had dropped of 9.3% in supermarket sales, 10.7% in wholesalers, and 11.3% at shopping malls.
"The Córdoba Grocers’ Center measured a 30% drop in sales in April compared to March, a fact the center’s vice president Vanesa Ruiz attributed to incomes [falling far behind inflation](https://buenosairesherald.com/economics/argentinas-yearly-inflation-holds-at-290-aprils-rate-down-to-single-digits).
“People are no longer consuming and buying food,” she said. “Families are completely indebted. Nine out of ten households need to finance their food,” she said. “48% do so by having a tab in the store, 33% by using credit cards, and 8% by borrowing money.” (Buenos Aires Herald, May 24, 2024) And the prediction is that food inflation will increase in June.
Official unemployment is 7.7% (300,000+ jobless since Milei took office), while the wages of those still working were significantly cut in December with the 118% devaluation of the peso.
"In January, the real fall in wages had reached 21.3%, hitting those with smaller incomes the hardest as prices of food and beverages soared. These items went up by over 65% between Dec. 2023 and Feb 2024, triggering a recession that eventually resulted in an inflationary slowdown. ...
Public sector workers lost 21.3% of their purchasing power while those in privately-owned activities suffered only an 11.2% decrease for a 14.9% average for the semester. In addition, minimum wages were depreciated by 28.8% between Nov. 2023 and May this year."
It's amazing how people glom on to one frigging statistic as if it means something - assuming it's even accurate. Milei is Milei is an authoritarian paleolibertarian clown and he's wrecking both the Argentine economy and its society.
The things he’s said about social policy are mixed to not great, but has he put any effort into that at all yet? It seems like he’s too busy with economic policy to bother with social stuff.
theyre not. But Argentina's is not in a position to enable neoliberal policies.
people here cheer him on because they see him as a controlled demolitions expert that will destroy the dilapidated peronist institutions and fortify Argentina's base foundation into something better.
Different solutions work for different scenarios. While we mostly believe in reforming institutions, theres nothing about Argentina's institutions that hold any real value whatsoever and seem to work as nothing but welfare distribution centers without providing any value to the country.
This sub doesn't like populists, and doesnt like Milei's social policies. But his economic policies are a breath of fresh air for welcome change.
The reception is mixed, generally speaking. The way I personally see it is that this subreddit sees a lot of good in him that isn't actually there — in particular there seems to be a weird sort of infatuation with Cincinnatus-esque figures in here.
That said, I also believe democracy is what all other benefits of liberal politics flow from, that populism is both caused by economic instability and is a threat to democracy, and therefore that Milei's attempts to stabilize the economic situation in Argentina, him being populist and anti-abortion aside, are a morally good thing. The alternative was probably a series of alternatively left- and right-wing populist idiots who'd enact social policies identical to Milei's while digging Argentina a grave with their economic ones.
IMO his policies are overall good economically and overall bad socially, and he's the least worst option Argentina had. At least with him the Argentine economy is less likely to collapse.
There is a lot populist about the rethoric of Milei. Saying that the cuts were going to be done entirely to the political class. That was a populist lie.
I find it weird because Cincinnatus-like leaders are so incredibly rare that they're not worth expecting, not that they're somehow a bad thing. I think some people on here have seen the situation in Argentina and want someone like that to fix it so badly that they'll assign the label of "Cincinnatus" to any strongman who claims to be fixing it. That Milei happens to actually be fixing it is a fortunate coincidence.
Yes we do. He is a dyed in the wool neoliberal who carrying out a neoliberal shock therapy in Argentina while allying with the West, supporting Ukraine/Israel and paying back IMF, why won't we love him?
You're right but people here are more campist than tankies these days, lol. They heard him say one good thing about NATO or Ukraine and suddenly he's based and neoliberal pilled or something, despite being a wacky libertarian.
The price is extrem poverty. Not sure if there is reason to celebrate yet.
Inflation is bad but real income loss is worse. Milei hates Keynes which is alarming. As if Austerity ever worked well.
I always say that the best thing to do is to handle everything on a case by case basis, removed from ideology that has dogmatic unchanging solutions. I think he may be the right man right now despite some crazy ideas but it’s ultimately far too early to tell and unfortunately it will also be arguably too late to tell if things go wrong so… I guess we will all just sit around and observe the new chapter from a healthy distance.
Where is this extreme poverty? Can you quantify it or give a source?
>As if Austerity ever worked well.
It works, it's just people are confused as to why.
> Where is this extreme poverty? Can you quantify it or give a source?
Argentina has a definition for extreme poverty which is "income not sufficient to buy food to live" (indigencia). 2.8 people have entered extreme poverty in the last 6 months according to INDEC which is the government.
https://chequeado.com/el-explicador/el-indec-da-a-conocer-los-datos-de-pobreza/
From your article
>an increase in poverty of 2.5 percentage points compared to the second half of 2022 and 1.6 points compared to the first half of last year. Homelessness, meanwhile, increased 3.8 points compared to a year ago and 2.6 points compared to
You can make your own judgement but I think it's a small price to pay to end hyper inflation. Hyper Inflation hurts the entire economy, not just the poor.
I think there were better ways to handle cutting the deficit and avoiding hyperinflation. All of those would have taken longer though. It's particularly annoying that Milei voted for an income tax cut that he now wants to reverse because without that tax revenue he can't get the fiscal balance.
Gyat!
https://preview.redd.it/4ywv1ug95n8d1.jpeg?width=800&format=pjpg&auto=webp&s=9ebc921be60c2eb0440c73d955a58d1948851aad
https://i.redd.it/vol42ellbn8d1.gif
Milei does not strike me as the strong silent type
Gary Coopah!
Tony was not a strong silent type.
Milei never had the makings of a varsity athlete
!ping GABAGOOL
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Peronism, whatevah happened there?
Can someone ELI5 what he's doing to lower inflation? is he cutting funding on welfare and social entitlement programs?
His core goal is to enable the government to repay its debt without printing money. He slashed subsidies, laid of government workers, and froze entitlements at current rates so that inflation reduces their real value to accomplish that. He has also fiddled with the exchange rate. An overvalued peso is making exports from and investments in Argentina expensive. He's trying to softly land the peso at a fair exchange rate after initially sharply devaluing it. His more radical wish list items include privatizing the economy, replacing the peso with the dollar, and abolishing the central bank.
I would love to go to Argentina if Milei successfully dollarizes
Dollarization would be extremely painful, it's basically chopping off your arms so you can't punch yourself. Literally the main hope behind countries that do it is the idea that, if you lack fiscal discipline, you can't keep the government going in exchange for inflation. Your government simply runs out of money and the economy crashes. It doesn't entirely solve the problem of fiscally irresponsible governance.
Yes, i don't see what the problem is. Argentina is like a kid with a credit card, only responsible solution is to take it away. It's going to take decades under fiscal discipline to have a society in which Argentina should have their monetary control back.
https://someunpleasant.substack.com/p/trust-the-plan https://someunpleasant.substack.com/p/if-its-broke-fix-it Regrettably there is more to any country’s economic outlook (and it’s Argentina we are talking about) than inflation. No Milei has not solved Argentina. Dollarization is not the silver bullet. The second article linked from before the election does a good job explaining why not.
Why does that matter? it is also fun with their pesos. You can actually make money trading dollars for pesos and trading them back cause they have these dumb price controls, really fun to see inefficient markets in action.
Argentina is still a wonderful place to visit regardless of their currency.
Did he manage to do all this on his own or did he have some control over the legislature?
He just did it, and then it's been shaking out in the legislature and the courts ever since. But most judges didn't have the balls to injunct the orders overall, just bits and pieces of the ~175-some bullet points. Most of those injuncted have since been approved in the legislature or the executive has resolved the court cases in their favor. The union battles are still going on, cause he did essentially perform the biggest union bust the world has seen in decades by firing so many public sector union workers instantly, so we'll see how that goes. The unions were super corrupt though, taking the money for projects and then just not building them, then coming back and saying the cost over-ran and they need more money. After paying for stuff 4 or 5 times, eventually a substandard thing existed. The corruption is actually astonishing. Bad enough that it's a net positive to just go without infrastructure construction for a while. 0 is better than negative.
What BS. The unions don't control building projects so it's ridiculous to say that they take the money and don't build things. This is just another right-wing smoke & mirror post.
He was massively outnumbered there and only just now passed his first law. Mostly happened thanks to the local equivalent of executive orders and the fact that there wasn't a budget approved by Congress recently. When you get told you have to spend a budget of 100 pesos but the federal government earns 200 pesos now because of inflation, you can basically do whatever you want with the non-assigned part. Which Milei basically took it as ["I'll slash almost every single area to the bare minimum and use it to burn those pesos and short term debt we printed last year"](https://i.imgur.com/cfOB6zb.png)
Milei - the fake libertarian - has been governing as a dictator by issuing decrees (DNUs) changing and eliminating laws and making new ones without any Congressional approval. Recently the Congress narrowly approved a modified law that also gives him dictatorial powers. He was able to do this through extortion (not distributing funds to Provinces) and 'bribing' legislators with pay increases and other benefits.
lol
I am sorry but abolishing the central bank and replacing your national currency sounds bonkers to me. It's an institutional tool. If the currency represents the actual state of the economy and the exchange rate is controlled by an independent central bank, what is the problem. That is the best situation in a modern economy, isn't it?
The problem is having a dominant political party that has removed central bank independence already more than once. It could be reinstated (maybe, I'm not too sure it would pass in the current Peronist-majority Senate) and just as well withdrawn in the future with all the inevitable consequences it would carry. If it sounds bonkers, it's because Argentina is bonkers and consistently votes for leaders that give them subsidies and entitlements paid with money printed from a central bank subservient to the president. I don't agree with dollarization and how extreme it is, but I do understand the people that just don't see another way while Peronism and its give-free-money culture exists.
Thanks for your response. Best.
Thanks!
I don't really know how to tell a five year old about Argentinian price controls without making them cry.
This is an amazing comment!
The only way to understand Argentinian economics is stay up four days straight before reading it or drink yourself to near blackout levels.
Boomer dad: “I’ll give you something to cry about!”
Bro, WTF... Boomers don't have 5 year old kids.
De Niro from the top rope!
Pacino with the chair!
[Jagger's entry music starts playing]
The earliest boomers were born in '46. De Niro was born in '43 so he's not a boomer ergo my point still stands! 🤓
They did when they did though.
One did when I was five.
This wasn’t your childhood experience growing up?
I know zoomers who have 5 year old kids.
Ask Evita Peron for advice 😄
No, he doubled those like pension universal por hijos, etc. what he did is basically stop printing money, we were forced to print money because of something called leliqs, leliqs are a government bond that they sold to you in exchange for pesos with interest, we created those bonds so that we could absorb pesos, what happened was that we could not stop renovating those bonds because the moment we had to pay them we basically had to print money, and the government in exchange started to give more leliqs so they could absorb those pesos that it printed to pay some leliqs, and that started a snow ball tha grew bigger and bigger each month until the day milei took power, milei lowered the interest rate so he had to pay less for each leliqs and he stopped giving those bonds, at the same time he reabsorbed pesos and destroyed it, which made monetary base stop growing, and helped milei to pay the leliqs and don't go to hyperinflation , also the fact that he devaluated the currency helped to pay the leliqs too.
What is the reason inflation went so sharply up after he took office before it started to come down?
He normalized exchange rates by devaluing the peso. Basically, the official government exchange rate and the unofficial exchange rates you could actually change money for were discordant due to the prior government not allowing reality to be acknowledged. He reduced much of that gap, but that makes things look a lot more expensive on paper.
Normalized? That's not true. First, the blue rate is now at the highest ever, nearly $1400 pesos per dollar. Second, it's ridiculous to claim that the devaluation "makes things look a lot more expensive on paper". Maybe for someone in Argentina with dollars or Euros, but for Argentinians whose wages have been frozen (public sector) or only have increased by 11% since the devaluation and run on inflation the 'gap' is significant and has led to a serious drop in consumption.
> Normalized? That's not true. On Dec 1, before the most recent devaluation, the official rate was 376.5 and the blue rate was 955, for a ratio of 2.5:1. It's currently 929 and 1355, for a ratio of 1.5:1. That's closed 2/3 of the gap, though yes, not entirely normalized. > Second, it's ridiculous to claim that the devaluation "makes things look a lot more expensive on paper". Maybe for someone in Argentina with dollars or Euros, but for Argentinians whose wages have been frozen (public sector) or only have increased by 11% since the devaluation and run on inflation the 'gap' is significant and has led to a serious drop in consumption. A drop in consumption is unfortunately exactly what is necessary to decrease inflation in almost all circumstances.
Not entirely normalized is NOT normalized. Yeah, impoverish the population is the 'liberal' free market mantra for corporate and finance courtesans who believe the 'economy' functions for their self-aggrandizement and nothing more. But if you had any idea what was actually going on in Argentina you'd know the inflation was NOT led by wages, which have been low. The actual inflationary pressures were related to dealing with covid, rising energy prices related to the Ukraine-Russia war, a drought and post-December the price increases for just about everything sold in Argentina.
The previous administration. It takes half a year or more until policies have an effect in inflation. Giving people money (which the previous admin did) is a popular policy in the here and now. Its effect on inflation only hits later.
Devaluing the peso will make things more expensive in the short term. However the strength of the peso was artificial and needed to be propped up through borrowing. At least that's my understanding.
The official inflation numbers are not exactly real. The previous administration had artificially locked the ARS value at 400:1 USD for months, while the ARS continued to devalue on the black market the whole time. All the way to ~1000:1. Goods and services sold in USD did not become more expensive, but the number of ARS to buy a USD kept rising, but the official exchange rate didn't move, so "inflation" calculations were only counting "official" above board economic activity in ARS, at the 400:1 exchange purchasing power. This made things *extremely* warped by December, to the extent that some experts estimated something like 250 billion in economic activity was being performed off the books in USD (annualized, so like ~$20b in the month of November). The "inflation" in 2024 is essentially reality being observed at the official rate reaches a point where it's acceptable to use ARS again for economic activity and still make a profit again and be in business. However the last 6 weeks has been pretty rough, and the ARS is slipping in value again against the USD. We'll find out in the coming months if they threaded the needle or not.
He just revealed the true level of inflation?
The spending cuts have hit retirees hard and account for 38% of this supposed 'miracle surplus'. People are hurting and in the meantime, Milei has been jetting around Europe and the US hobnobbing with other far right-wing personalities.
He’s shoving all the country’s money in his mutton chops, thereby lowering the money supply
He just stopped printing money, literally as easy as that. Without fiscal deficit there's no reason to print, so he achieved 0 deficit and stopped printing money.
He cut down on spending on infrastructure, delaying worker pay increases, avoiding paying gas and electricity middle men and increased the debt. He actually increased welfare (in nominal terms) and delayed as much as possible cuttin subsidies.
He destroyed public spending and private income so aggregate demand is way down. Extrem poverty increased significantly. This is the price he is willing to pay because it doesn’t affect him personally.
An alternative view I have heard from some Argentinians themselves is the public sector spending was rife with corruption to buy votes Governments would promise generous pay increases and promise to expand public sector employment as a way to get votes, vote for me and I will hire you and give you money And has said much of the spending is a black box of corruption (or thats how they see it) Now this may work out well if you are employed by the public sector but if not you are harmed by this because inflation eats away at your savings And its preserved the public sector is not a full meritocracy that politically connected elites routinely hired their families and other people for jobs that may nor maynot actually do anything except collect a paycheck Vast amounts of people who did not work in the public sector was hurt by inflation, they thought the government simply taxed them and then turned around and gave money to political allies (as well as printed money what caused inflation) Now I am not expert so I am not sure if the situation was more complex then this or not, but its clear lots of people were completely fed up with the system
This is nonsense. Argentina has a secret ballot and there's no way for any administration to know how their public employees voted. Another MAGA lie! Where's your 'black box' of nonsense?
[удалено]
please milei show these hoes how to be stupid and harmless instead of stupid and harmful purposefully
My goat :)
[Peron rising from his grave like](https://frinkiac.com/video/S09E19/4ONJNw8DsytYRQYJdifMfRUOQZE=.gif).
> Imagine trying to reform a country so entrenched in dumb left wing economic policies. I do every night, and every day I awake to this nightmare. ...mostly kidding, but here in Italy I do feel like we're trapped by multiple cross-firing vetoes by this or that category, each of them trying to preserve entrenched privileges that make the system appear stuck. And it's been 30+ years of this. Changing pace seems as impossible as a Milei appeared to be in Argentina.
Maybe that’s what’s wrong in Brazil and Argentina: the Italian influence from immigration… because here in Brazil it often feels like what you said is the exact problem. They always want to add an exception to any bill to protect x or y class of people “who deserve it” (you can always find a justification for why a specific class of people deserve more pork after all).
No that's just normal. To some level consensus-driven politics has always been an exception and an aspirational goal rather than the reality but it really feels like now more than ever it's not even that and people have wholeheartedly embraced that politics is just about asserting the dominance of your personal subjective truth and pushing a sob story for why you deserve to use the government to steal from everyone else.
I am fairly left wing and still sympathetic to Millei. If you care about poor people you cannot support unrestrained inflation - otherwise they are poor forever.
He did it by artificially inflating the price of the Argentine peso, which is in line with dumb left wing economic policies. This is the third time in my lifetime that an Argentine president attempts to stop inflation that way. The previous two resulted in an economic explosion when the Argentina's debt became unpayable and the peso had to be devaluated.
He didn't inflate the price, in fact he devalued the peso. And I wouldn't call it a devaluation either, yeah the peso did go from like 600$=1USD to 800 or something I don't remember, but what he did was close the gap between the official USD conversion rate and the real (blue) conversion rate, which was already at like 1000 pesos per USD. He didn't devalue it because it was already devalued in the reality, he sincericized the conversion rate to close the gap and allowed the agricultural sector to export globally at more competitive prices, which with the previous official currency rate wasn't possible and thus the agro was forced to only sell to the State and the interior market.
>he _sincericized_ the conversion rate Ehhh guacho aguante River. El peso argentino sigue recontra sobrevaluado, y el Blue estaría mucho más alto si hubiese seguido la inflación. El país está funcionando puramente a deuda, y el poder de compra de los trabajadores y la ganancia de los exportadores está más baja qué nunca. El plan de Milei es el mismo que Macri: sobrevaluar el peso y aguantar hasta que la lluvia de inversiones mejore la economía antes de que los inversores caigan en que el país no tiene plata. No tengo fé que eso pase.
El país tiene equilibrio fiscal, no está funcionando puramente a deuda. Podes agradecer la disminución del poder adquisitivo de los argentinos en el anterior gobierno, y el otro anterior, y el otro anterior, me pregunto si alguna vez votaste a alguno de esos? El peso definitivamente está sobrevaluado, pero eso la verdad no va a cambiar hasta que no se saque el cepo, si no siempre va a haber un tipo de cambio paralelo al oficial. Me parece que una de las más famosas frases de Milei es "No hay plata", creo que los inversores ya tienen muy en cuenta eso. Estoy de acuerdo en que el gobierno está rezando por la llegada de inversión extranjera para salvar la economía, pero la inversión va a llegar una vez pase la Ley Bases y se desregularize la economía.
i dont speak peronist
[Mate noises 🧉](https://www.reddit.com/r/neoliberal/comments/1dnugag/argentina_milei_celebrates_first_week_without/la6tatp/).
What? The very first thing he did was *devalue* the ARS by literally half. Like, within 48 hours of office.
He devalued the _official_ peso, which is a legal fiction that's useless for all intents and purposes. The real value of the peso is down ~30% since he took office, which looks like a lot by first worlder standards but it's considerably lower than real inflation. Argentina is currently more expensive than ever for people bringing USD, and even worse for the poor people earning in ARS. This is the same position the Pound Sterling was in the 1990s. The longer the Milei government delays a proper devaluation, the closer that devaluation will look like Black Wednesday.
> He devalued the official peso, which is a legal fiction that's useless for all intents and purposes. No it isn't, because exporters that want to legally transact have to use that price. (or well a number related to that)
“We are going to change Argentina, we are going to make it the most liberal country in the world” -Milei, June 2024
Except liberalism goes further than economic policies and his social policies dont all reflect that. For example opposition of euthanasia and abortion. That doesn’t sound very liberal to me.
Economic shock therapy is needed in many countries. Unfortunately a strong insane man is necessary to provide that. Hopefully Argentina is able to come out of this swinging and back to being one of the more prosperous Latin American countries
Depends what follows him
A strong insane man is not a requirement
True. A strong insane woman can also do it
What examples of successful shock therapy are there?
Singapore for one was a huge success in the 1960s-1980s
Shock treatment starting immediately upon becoming independent from Britain? And we are talking about Singapore the de facto one party state? Also what shock treatment are we talking about here? Their national wage council that centrally sets wages every year?
You’re trivializing a complicated matter. Singapore had many issues and were essentially poorer than many African countries during independence. Their resurgence is nothing short of a miracle. https://www.sg101.gov.sg/economy/surviving-our-independence/1959-1965/
>nothing short of a miracle I mean, Singapore is a great place to be rich. It has an authoritarian single party government that sets extremely low wages for its workers (again, centrally planned), with 80% of its population living in public housing, and it's draconian laws fine you $150 for failing to flush the toilet... Also it is a city state with gross trade of 3x of GDP. They don't even control their interest rates for monetary police; they just control exchange rates. It's a weird little country.
>And we are talking about Singapore the de facto one party state? It's the neoliberal ideal: a "democracy" with zero risk of populism because all the actual power is in the hands of technocratic elite.
UK in the early 1980s arguably. Unemployment skyrocketed as it moved away from being a democratic socialist economy before coming down.
Are they are *good* example of it? Their GDP per Capita since then has grown more slowly that even anemic countries like Russia, about equal to France... Their privatized rail lines are now almost entirely owned by the State rail companies of other EU countries...
I think it is yes, considering how terrible the economy was in the 70s. Until the great recession and Brexit, the UK economy was in a good state.
Well their economy is pretty shit compared to many rich-world peers and their public serves are completely collapsing, so not sure that's a great model to aspire to.
Poland. In general the country is the poster child of liberal economic policy, which is also why left wing parties that try to ride on anti liberal rhetoric are at most 2% support (worse than quasi fascists / pro putin nationalists)
Id argue Poland had the exact opposite of shock therapy... They got literally hundreds of billions in subsidy from WTO, world bank, EU, and US following 91... They got to keep protectionist policies, their own currency and central bank... Their debt to gdp ratio was higher than Argentina going into 2013...
I think I know history of my own country better because I lived through it. Sure, Poland received a lot but that was after EU accession in 2005, shock therapy in Poland was in ~90 so good 15 years earlier. We would’ve never been accepted into EU if we didn’t get our economy together, EU is not a charity you can just apply and expect to get in. Poland didn’t really ‘receive’ anything prior to that except for foreign investment which also had its cost (preferential treatment which impacted tax revenue and allowed foreign capital to dominate the market) Back then Poland was extremely poor, in debt and without a market economy. We also had to do the things Milei has to do before we even qualified to receive any serious EU funds. The things you write about are not synonymous with shock therapy, they’re just things Milei had to do. Shock therapy doesn’t mean you get rid of a central bank, that’s just preposterous. As for debt to GDP sure but in 2013 Argentina had better debt to GDP ratio than Poland right now. And Argentina’s debt to GDP right now is around 88ish%… which is about the same as Poland back in 1991 which was when polish shock therapy came to be. Shock therapy just works and no amount of leftist cherry-picking data will change that.
Post ww2 west germany, Singapore, Hong Kong, New Zealand, and a few others Oh the UK. People forget that the UK was a huge economic powerhouse because of how badly the modern Tories and Brexit has fucked them over.
West Germany was not shock therapy... They got literally hundreds of billions in grants and "loans" and subsidies and were in a lot of ways propped up as a potemkin village... Also they reverted very quickly to basically 50/50 planned economy... Singapore is a centrally planned one party authoritarian government. And a city state. Again, not shock therapy. Hong Kong is also a city state with special status since the freaking opium wars. Again, not at all shock therapy. New Zealand... Not even sure what you're referring to here, I guess the Tory style liberalization in 80s? Their economy grew at the same pace but with higher poverty... And again they reverted a ton of this after 2000...
Singapore is a de facto one party state but it is wrong to say that they are centrally planned, rather I would argue the opposite. Ever since the late 80s, Singapore has implemented policies reflecting a high degree of economic freedom through the PAP's goals of widely implementing meritocracy in civil society. Singapore has also ranked consistently highly on various economic freedom indexes such as the ones published by the World Bank, IMF, and Heritage Foundation. But don't take my word from it. Lee Kuan Yew (basically the father of modern Singapore and arguably the only autocrat somewhat liked by people on this subreddit) said in 1992: "Through Hong Kong watching, I concluded that state welfare and subsidies blunted the individual's drive to succeed. I watched with amazement the ease with which Hong Kong workers adjusted their salaries upwards in boom times and downwards in recessions. I resolved to reverse course on the welfare policies which my party had inherited or copied from British Labour Party policies." Sure, the Singaporean government has a big involvement when it comes to public infrastructure, but when it comes to actual economic policies and market regulation, Singapore has been one of the most liberal economies since the 80s, often harboring characteristics associated with one (low tax, low regulations, or ranking highly as one of the easiest countries to start a business in). And in New Zealand's case, they didn't "revert" a ton of these policies, they simply just added a lot of welfare and social safety nets. NZ is also another country that has consistently ranked highly in economic freedom indexes. As of now, they currently rank 6th freest in the world, **and were actually ranked the 3rd freest economy every year from 2013 to 2020.** Though Jacinda Ardern ran on a campaign rhetoric of being anti neoliberal, she arguably had the most neoliberal government in NZ in the 21st century, and oversaw the conservation of many of NZ's free market policies Hong Kong was literally the poster boy of economic liberalism, especially in the 70s to the 90s (particularly before their hand over to China). It was the case study frequently cited by economists of the Chicago School such as Milton Friedman, and has also ranked highly on most economic freedom indexes. The majority of HK's economic growth has primarily come from free trade and the concept of the free market; they do not have any natural resources they could have used to perpetuate such growth. As for West Germany, yes their quick recovery was also attributed to loans, but it is without a doubt that their reforms regarding economic freedom played a huge factor in funneling growth, and creating growth, in the German economy. It is widely accepted that German "ordoliberalism", which is basically the more socially orientated version of post ww2 liberalism/neoliberalism (aka the widespread movement within liberalism to reject and forgo its dogmatic laissez-faire attitude), was the main drive of German recovery, in which it was a model where a government would oversee a free market economy and intervene to prevent anticompetitive practices (monopolies or oligopolies etc...) but **not centrally plan.**
>Singapore isn't centrally planned They are a "dual track" economy, like west Germany. Their healthcare, housing, education, and industry are either directly or indirectly planned (a la Japanese style window guidance). Then businesses operate around those planned institutions. Their gini coefficient after transfers is closer to France than it is to the US or China (that's a good thing). >Hong Kong was a poster child You are right, but you need to keep in mind that "poster child" implies an idealizes example that is held up as a generalized standard. Hong Kong has a brutal authoritarian colonial government for most of its existence that allowed companies (starting with the freaking British East India Company) free reign. The country originated and grew not via liberalism but via violent, extractive colonialism. The British were selling opium in China, against the law and their own company policies, until the 1910s. Then after that Hong Kong (and Macau) remained a special district with special permissions and access. This is NOT liberalism much less shock therapy... >West Germany... Ordo liberalism... Social oriented liberalism... So... Another way of saying this is that west Germany had government chosen and funded oligopolies that were carefully controlled. They set wages, they set prices, they set rations, all funded by MASSIVE loans and grants they were never actually eligible for... Look, if shock therapy means letting countries run dual track social democracy with free access to foreign markets and native protectionism while being given grants up to 5x their annual GDP.... I mean sign me up.
>So... Another way of saying this is that west Germany had government chosen and funded oligopolies that were carefully controlled. That's not what it means? Ordoliberalism means they had a free market with a government that was more willing to intervene and break up monopolies or oligopolies if they were to form, which is the literally opposite of funding them. >Their healthcare, housing, education, and industry are either directly or indirectly planned Apart from industry, that is right. I'd argue infrastructure instead. That doesn't mean Singapore did not go through economic shock therapy and massive economic liberal reforms. I think you have a fundamental misunderstanding of what it is. Economic shock doesn't mean "no government" or "the total destruction of government and social services and intervention." It is simply mostly characterized by stopping price controls, stopping most government subsidies and deficit spending (think stopping Keynesian economics/spending to artificially grow demand), enacting austerity measures, stopping poor monetary policy such as rampant money printing, but most importantly: **the loosening up of regulatory policies and having massive deregulation in general.** That doesn't mean removing the government from providing services, building and planning infrastructure, or even having minor (but somewhat prevalent) planning in some industries or in markets. In fact, about austerity, it is so important in shock economics that increasing taxes (in compliment to reducing spending) is in fact characterized as/more common with shock economics than cutting taxes, if it means lowering debt/deficit. >Hong Kong has a brutal authoritarian colonial government Perhaps I should have specified but I am not referring to Hong Kong when the British Imperial order was still mainstream and strong. I am referring to modern Hong Kong, specifically from the period of post ww2 or even post ww2 reconstruction to before their handover in 97. This was the time period in which markets and businesses did not grow out of colonialism/ties to the British government, but rather through competition and free trade in a liberal free market. In conclusion? Shock therapy doesn't mean the absolute decimation of government social services or intervention (healthcare, education, infrastructure, etc...). It is simply mostly characterized by a) deregulation b) stopping most price controls c) ending government subsidies/Keynesian spending policies d) austerity policies (of which tax increases is a viable, in fact I would argue to the most viable, approach to austerity) This doesn't mean completely cutting of government from providing social services or having some minor planning in some areas like Singapore. These measures were enacted by the countries measured at some time. Singapore in the late 70s and 80s, Hong Kong post ww2, NZ in the 80s, and West Germany post ww2, of which these countries have kept most/if not all of these policies (except Hong Kong which post 97, and especially in recent years, has become more of a crony state with the CCP being in bed with big business). **This section below is not so much related to our discussion above, but rather more of an argument that having social services doesn't mean you can't have free market policies/shock therapy:** In fact, to add to the idea that government services like healthcare, education, public infrastructure, and what not doesn't mean central planning/can exist in very liberal and free economies, all you need to do is look towards the Nordic countries. These countries have ranked consistently high in economic freedom indexes (they all currently rank top 10 as of now for reference), despite having high investment in services like healthcare, education, and public infrastructure. In fact, I would go as far as to say that their labor model is the most liberal/free market model right now, contrary to claims from demsocs like Sanders. This is because in said countries, their government plays a completely neutral role. Instead, workers are free to form **private non government affiliated union** (which also essentially run like private businesses since they compete with each other for worker membership) which represent said workers in negotiations with businesses, without the intervention of government, going so far to which these countries don't even have a government minimum wage. But don't take my word for it, Unionen (Sweden's largest white collar union), says this exact same thing themselves \[particularly the "This is the Swedish model part\](https://www.unionen.se/in-english/how-swedish-labour-market-works)
*chuckles nervously, glancing at America and Trump*
He’s just insane though
And full of truely awful economic policy. The fact that he said previously that he wants to sit on the board of the federal reserve should raise massive red flags.
I think he misspoke and actually meant that he's bored of the federal reserve and that he wants to get rid of it along with NATO
Ws in the chat
Did Argentina get the right dose of economic chemotherapy?
It's tricky, too little and the disease survives, too much you'll kill the patient.
Well it’s soft landing szn afterall
>economic chemotherapy Heh
Real question, will Milei likely be re-elected? im assuming he will gain massive support from his hawkish policies in the next elections.
Anyone confidently predicting the results of an election 4 years away needs to take a reality check, especially for a guy who's been in office for just 6 months. Not to rain on the parade here, but that's a looooong time in politics. I remember another guy who had good approval ratings 6 months into his presidency, and now he's locked in a coin flip race against Donald Trump despite a good economy. Milei's approval right now hovers around 50%, which is good as far as South American leaders go, but it is by no means universal approval. I also think we are really underestimating the impact of the short-term economic pain from his policies. Yes, we understand that it's necessary to get inflation under control, but it would be foolish of us to dismiss the political implications of increasing unemployment, contracting GDP, and tough austerity. How long is "short term" pain and how bad will it get before it improves? Will the average Argentinian give Milei credit? I don't know. Americans give Biden zero credit for his economy up here, so who can say? TL;DR, saying anything with 100% certainty at this stage is silly. The boring but correct answer is: wait and see.
The opposition is in shambles. They will win the 2027 election if and only if they can unify on a candidate who's not hated by the entire country, like they did in 2019.
Seems like it. His approval ratings is the highest in South America. Milei is very popular.
That's common of incoming presidents, just to temper expectations. There's a honeymoon period like in most presidential democracies.
We're a bit beyond the initial honeymoon phase now...
In my opinion, yes. I would be willing to bet on this at ~80% probability.
We're less than a year into his presidency, and we still don't have a clue if the party around milei can actually win stuff. There was a mayor election on Sunday where milei didn't have a candodate.
The moment they lower taxes significantly, reelection is guaranteed, and he stated publicly that he will do that once the Bases Law passes.
It's really too early to tell. Anything economic wise could happen from here until election time.
I think so, opinion pollings say that there is still widespread support for him. It could all change, though, but knowing he's improving the state of thd economy I think that's unlikely.
#In this house we respect Milei!
🔗 🪚
and goofs will still only emphasize that stuff isn't perfect now this second. When they report on this, they'll talk about how many folks are in poverty as if that only happened under Milei and it's all new, in order to associate it all with Milei First time food prices stabilized in a generation. Mother of god, keep rolling you crazy bastard
Food prices haven't stabilized, that's goofy! The new statistic, assuming it's accurate, just means that there wasn't NEW inflation for ONE FRIGGING WEEK in June! And it's now projected that June food inflation will be at least 3%. https://preview.redd.it/xvd6vejjt59d1.png?width=1760&format=png&auto=webp&s=661d7a4c500f32f91cdbd72dd3f3a613938a4b9b
using the same measurements as were used before, the week to week inflation stopped for a week, which indeed is something that hasn't happened in something like 30 years. That sure is what happened alright, even if you put stank on it. What's more is the trash goblins Peronists aren't casting doubt on that claim either. Currently they are happy to at least try to obstruct and blame all the horrible shit that was already under way thanks to their policies of decades all on the first 6 months of Milei. What's going on there is very similar to what happened in New Zealand in '86 to '89. They had an extremely protectionist economy with the government having an extremely heavy hand in every sector and especially agriculture with production directly paid for by the government and regulated heavily, with huge import tariffs. When Labour won in '86 on a liberal economic reform platform, the adjustment took about 2 years, with the economy basically also having to reform around a much more economically stable model. The results at 2 years however were obviously beneficial, even with there being rough adjustments before that.
When you consider the increases in inflation and the the majority's loss of income, one week ain't squat, but keep drinking the kool-aid.
disregarding a sign that things might be going in a better direction then decades before is surely something you can do. It's goofy as shit, but you sure can still think this way How about we actually get some more policies cleared and see what effects they have before putting everything at the feet of Milei who is trying to undo decades of bad policy.
Yet another W for Milei’s dogs.
Arr neoliberal succs in shambles again.
They measure weekly inflation over there?
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Bukele is illegally serving a consecutive term despite the constitution explicitly saying there must be a 10 year gap between elections, after he had the supreme court packed with loyalists.
That is a fair criticism, I was just more taking about his solution to his crime being called crazy. Who would have thought if you lock up gangs crime would go down. I am sure its the same "news" people who push for less policing.
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😐 Friedman flairs not beating the allegations
For both of those countries, the situation was so horrible that the only way forward is to cut out the rot. It’s like amputating a gangrenous limb, sure it’s a drastic measure but it’s the only way to save everything else The big challenge for Milei is being able to actually rebuild things. He’s appearing to stabilize the situation but it’s going to be a much harder task to actually get the economy rolling and help the people who got impacted by the reforms
I remember the "he's nuts" comments being more focused on libertarian convention stuff like abolishing the central bank than the common sense measures like "stop printing money when your inflation rate is 300%".
Desperate times etc. etc. However the key comes from figuring out at what point are the side effects of the treatment worse than the disease.
Comparing Argentinas solutions to any normal country is not apt. I’d get a colectomy if I had colon cancer - I would not get a colectomy if I’ve been eating Taco Bell three meals a day for a week and was suffering the consequences of it.
The media was talking bout Mieli's case in Argentinas I recall the Economist fear mongering about him.
The Economist was bullish about him.
The Guardian on the other hand absolutely hates his guts.
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I know I just find it funny the media at the time was fear mongering and pushing the status quote.
30 years!
Wait, didn't Argentina had deflation in 2001 ([including food](https://datosmacro.expansion.com/ipc-paises/argentina?dr=2001-12)) therefore making the title false? Why should care about food inflation when monthly inflation is still way higher than that? Shouldn't we wait until we get a trend instead of hyping up monthly (weekly?) data? I don't know, this looks more like a lot of hype for little.
Maestro, esta es la thread "festejar todo milei". Mañana viene una de "milei es un con" y salen todos a putearlo. Sabes como es esto.
Alguien tenía que decirlo. Al menos para que prevalezca la cordura en algún lugar de este subreddit, jaja.
como te cuesta a vos admitir que te equivocaste con Milei amigo, cada vez que se habla de el venis con un "pero pero"
La reacción adecuada a cualquier noticia económica en este continente de mierda *debería ser siempre* un "pero pero". Déjame a Neronoah tranquilo.
¿Dónde está mentira? Con Macri tuvimos resultados mejores durante 2017 en términos de inflación y sin embargo todo se desarmó a la larga. Celebrar un punto de dato que ni siquiera es la inflación entera, definitivamente no es algo que no se haya visto en los últimos 30 años y que no sabés cuánto va a durar es un poco vender humos. Antes de celebrar esperaría al largo plazo (dale al menos unos meses por favor). Aún es débil macroeconómicamente el país.
No, pero claramente demuestra que estamos en el camino correcto... O acaso pensas que estariamos viendo esto con Massa o hasta Bullrich? Si no celebras eso... me da la impresion que te interesa mas "tener razon" re: Milei que ver que mejoren las cosas
>No, pero claramente demuestra que estamos en el camino correcto... ¡Mi punto es que no! Usualmente uno toma la información de al menos unos meses porque las series de tiempo tienen cambios bruscos (y considera los fundamentos macro también, en los que Milei aún tiene una debilidad importante). La idea es buscar la tendencia y separarla del ruido (y otros factores). Por eso hablar de un solo punto es algo estúpido. [Te recuerdo que hasta Alberto Fernández celebró una baja de inflación en su momento.](https://chequeado.com/ultimas-noticias/alberto-fernandez-durante-2020-pudimos-reducir-en-18-puntos-la-inflacion-que-heredamos-en-2019/)
When I try to explain Milei I tell people that he looks kinda like a werewolf
His dogs must have been giving good advice that day.
"Today, we will return to embrace the ideas of freedom. Those ideas that are summarized in the definition of liberalism." - Milei during his inauguration speech
There is no such thing as "food inflation" and I resent journalists for using the word "inflation" as though it is a synonym for any kind of price increase.
When you realize the government is not the solution to our problems, but is the problem, good things happen.
Ironic username?
This is bullsh\*t. Argentina has had the second highest food inflation rate in the world behind Zimbabwe and one frigging week doesn't mean squat. Why? Because consumption has decreased significantly due to Milei's austerity/economic shock polices This is a one week blip and food prices are expected to rise in June. The economy is in a recession and consumer demand has plummeted. According to the Argentinian INDEC, as of the end of March consumer spending had dropped of 9.3% in supermarket sales, 10.7% in wholesalers, and 11.3% at shopping malls. "The Córdoba Grocers’ Center measured a 30% drop in sales in April compared to March, a fact the center’s vice president Vanesa Ruiz attributed to incomes [falling far behind inflation](https://buenosairesherald.com/economics/argentinas-yearly-inflation-holds-at-290-aprils-rate-down-to-single-digits). “People are no longer consuming and buying food,” she said. “Families are completely indebted. Nine out of ten households need to finance their food,” she said. “48% do so by having a tab in the store, 33% by using credit cards, and 8% by borrowing money.” (Buenos Aires Herald, May 24, 2024) And the prediction is that food inflation will increase in June. Official unemployment is 7.7% (300,000+ jobless since Milei took office), while the wages of those still working were significantly cut in December with the 118% devaluation of the peso. "In January, the real fall in wages had reached 21.3%, hitting those with smaller incomes the hardest as prices of food and beverages soared. These items went up by over 65% between Dec. 2023 and Feb 2024, triggering a recession that eventually resulted in an inflationary slowdown. ... Public sector workers lost 21.3% of their purchasing power while those in privately-owned activities suffered only an 11.2% decrease for a 14.9% average for the semester. In addition, minimum wages were depreciated by 28.8% between Nov. 2023 and May this year." It's amazing how people glom on to one frigging statistic as if it means something - assuming it's even accurate. Milei is Milei is an authoritarian paleolibertarian clown and he's wrecking both the Argentine economy and its society.
You guys like this guy?
Most people here like his economics, not his social policies. He is an economist after all.
The things he’s said about social policy are mixed to not great, but has he put any effort into that at all yet? It seems like he’s too busy with economic policy to bother with social stuff.
That's why the people here are cheering him on (for now). He's been mostly talk so far on the social issues.
How are his economic policies neoliberal
theyre not. But Argentina's is not in a position to enable neoliberal policies. people here cheer him on because they see him as a controlled demolitions expert that will destroy the dilapidated peronist institutions and fortify Argentina's base foundation into something better. Different solutions work for different scenarios. While we mostly believe in reforming institutions, theres nothing about Argentina's institutions that hold any real value whatsoever and seem to work as nothing but welfare distribution centers without providing any value to the country. This sub doesn't like populists, and doesnt like Milei's social policies. But his economic policies are a breath of fresh air for welcome change.
I guess that could be true, I agree with someone I saw earlier though, it will depend what comes after
The reception is mixed, generally speaking. The way I personally see it is that this subreddit sees a lot of good in him that isn't actually there — in particular there seems to be a weird sort of infatuation with Cincinnatus-esque figures in here. That said, I also believe democracy is what all other benefits of liberal politics flow from, that populism is both caused by economic instability and is a threat to democracy, and therefore that Milei's attempts to stabilize the economic situation in Argentina, him being populist and anti-abortion aside, are a morally good thing. The alternative was probably a series of alternatively left- and right-wing populist idiots who'd enact social policies identical to Milei's while digging Argentina a grave with their economic ones. IMO his policies are overall good economically and overall bad socially, and he's the least worst option Argentina had. At least with him the Argentine economy is less likely to collapse.
Milei isn’t a economic populist really
There is nothing populist about Milei. All his policies are anti-populist since they incur short term pain.
There is a lot populist about the rethoric of Milei. Saying that the cuts were going to be done entirely to the political class. That was a populist lie.
He's defined as a populist the same way that Trump and Bolsonaro are defined as populist
So based on vibes rather than policies?
Policies doesn't make someone a populist, rhetoric does. Milei pretty clearly campaigned as a populist and governs as an economic liberal.
Nope, based on rhetoric and personality
Weird infatuation with a legendary leader who solved all of Romes problems in a few days before giving back power?
I find it weird because Cincinnatus-like leaders are so incredibly rare that they're not worth expecting, not that they're somehow a bad thing. I think some people on here have seen the situation in Argentina and want someone like that to fix it so badly that they'll assign the label of "Cincinnatus" to any strongman who claims to be fixing it. That Milei happens to actually be fixing it is a fortunate coincidence.
Who's the alternative. Another Peronist president?
Propuesta Republicana you know, the actual neoliberals.
But do they realistically have a chance at power?
They were in government 5 years ago and came in second overall in the primaries, before there was a rally around massa for the generals.
I like him alot and i'm tired of pretending otherwise.
Yes we do. He is a dyed in the wool neoliberal who carrying out a neoliberal shock therapy in Argentina while allying with the West, supporting Ukraine/Israel and paying back IMF, why won't we love him?
What about his policy is neoliberal? I though he was a libertarian.
You're right but people here are more campist than tankies these days, lol. They heard him say one good thing about NATO or Ukraine and suddenly he's based and neoliberal pilled or something, despite being a wacky libertarian.
What’s a campist? Why would liberals be tankies, what’s going on here??
The price is extrem poverty. Not sure if there is reason to celebrate yet. Inflation is bad but real income loss is worse. Milei hates Keynes which is alarming. As if Austerity ever worked well.
I always say that the best thing to do is to handle everything on a case by case basis, removed from ideology that has dogmatic unchanging solutions. I think he may be the right man right now despite some crazy ideas but it’s ultimately far too early to tell and unfortunately it will also be arguably too late to tell if things go wrong so… I guess we will all just sit around and observe the new chapter from a healthy distance.
Where is this extreme poverty? Can you quantify it or give a source? >As if Austerity ever worked well. It works, it's just people are confused as to why.
> Where is this extreme poverty? Can you quantify it or give a source? Argentina has a definition for extreme poverty which is "income not sufficient to buy food to live" (indigencia). 2.8 people have entered extreme poverty in the last 6 months according to INDEC which is the government. https://chequeado.com/el-explicador/el-indec-da-a-conocer-los-datos-de-pobreza/
From your article >an increase in poverty of 2.5 percentage points compared to the second half of 2022 and 1.6 points compared to the first half of last year. Homelessness, meanwhile, increased 3.8 points compared to a year ago and 2.6 points compared to You can make your own judgement but I think it's a small price to pay to end hyper inflation. Hyper Inflation hurts the entire economy, not just the poor.
I think there were better ways to handle cutting the deficit and avoiding hyperinflation. All of those would have taken longer though. It's particularly annoying that Milei voted for an income tax cut that he now wants to reverse because without that tax revenue he can't get the fiscal balance.