A year ago, Argentine voters entrusted power to a particular and divisive man: Javier Milei. In the space of just three years, the person who has just given a long interview in The Economist went from the role of loudmouthed columnist to that of President of the Republic. Rock, aggressive and educational, this sharp economist was able to convince the crowds to stand on the head of his sworn enemy: the State. His election made the unthinkable possible: testing libertarian theories. Not since the Russian Revolution has an innovative economic policy been applied in such a brutal manner. Freedom above all, freedom for all, freedom everywhere, what results?
If the roaring wind of freedom blows across the Pampas, it is no coincidence. At the end of 2023, Argentina found itself on the brink of collapse, exhausted by decades of socialism. Inflation of 211%, poverty, exploding crime, corruption and deficits financed by debt and money printing. Anger grows, everyday life becomes unbearable. Milei promises simple things: less state, more freedom. He opposes “the caste”, which brings together the political and bureaucratic elites as well as civil servants, journalists and intellectuals, showered with public money, with the hardworking middle class, producer of wealth and exploited through taxes. His message touched the hearts of Argentines. Inflation is their first concern. It destroys purchasing power and prevents any projection or investment. Its cause: unreasonable monetary creation. The State creates money because it lives beyond its means. Milei then does what no country has ever done: cut the budget by 15 points of GDP in one month.
The list of his reforms is dizzying and some particularly resonate for us, French. For example, the ousting of 33,500 civil servants and the elimination of 50% of political positions while keeping only eight ministries. Added to this is the end of subsidies to the media, cinema and public companies, as well as the freezing of all public projects that have not started. Every day, the Minister of Deregulation issues a decree causing a massive simplification of import/export standards, making the labor market more flexible, and abolishing hundreds of laws as well as dozens of state organizations. Even the tax office was abolished with the aim of being completely reformed.
The results are almost miraculous. “Almost”, because they are not a matter of chance or divine intervention. They make perfect sense. Freedom always wins. The sprawling state is amputated with a chainsaw. From the first month, the budget surplus appeared in a country which continued 107 years of deficit and nine payment defaults. The external debt has already fallen by 10% and public spending by 30% while Milei has allowed itself the luxury of increasing benefits for the most deprived and pensions for retirees.
The Argentines are reaping the fruits of this weight loss treatment imposed on “the caste”. The IMF forecasts 5% growth for 2025. Inflation, once at 25% a month before Milei’s arrival, fell to 2.7% last month. Since January, real wages have increased by 11.2%. Exports are breaking records, the trade balance is in surplus of 15 billion dollars. Stocks and Treasuries show best global performance in 2024. After an increase from 35% to 42% under the previous presidency, and a peak to 53% after Javier Milei turned off the public money taps, poverty fell to 51% in the third quarter. Credits are making a comeback in a country that no longer knew savings.
The action of the Minister of Security already shows its effectiveness after years of judicial laxity assumed by the former government. In Rosario, the most dangerous city in Argentina, the homicide rate has been cut in half. The Argentine president, more popular than ever, declared that the recession was over and that growth was returning. Even if the road remains long, each day will be a little better than the last.
The rise of Javier Milei allows lovers of freedom to dream of a fairer, more pragmatic, more prosperous world. The parallels to be drawn with a France stifled by taxes, standards and the weight of its debt are numerous. The empty formulas of our socialist leaders, from the left as well as the right, will perhaps soon be replaced by a victorious cry echoing that from Argentina: Freedom, damn it!
* Romain Dominati is entrepreneur in France and Argentina
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