The upcoming general election in Argentina would pass moderately unnoticed in the rest of the world, as it normally does, except for an unexpected fly in the ointment that is making headlines internationally: libertarian candidate Javier Milei is leading the polls to become the next president of Argentina.
Colorful character Milei has shaken the consciences of a country which, after decades of mismanagement, has experienced one of the most brutal and devastating economic collapses of a Western nation. Argentines have undergone multiple hyperinflations, crises, an unremitting erosion of their wealth and perennial structural inflation. At present, some 40% of the population is in situation of poverty, having the annual inflation rate reached 124.4% in August.
The corporatist system of Juan Domingo Perón set the standards in the 40s, developing a populist, protectionist and interventionist rhetoric which has more or less been the norm until now. Save some punctual exceptions and despite having had governments of different signs, they all normally shared an inordinate fondness for extensive public expenditure and money printing. The result is evident: the transition from one of the richest countries in the world at the beginning of the 20th century into the economic cesspit we know today.
The structural economic problems of the South American country are rooted in a vicious circle difficult to break: the nefarious symbiotic relationship between a political class and a population addicted to State expenditure. In this scenario, resignation would seem inevitable. But when everything appears futile, there comes an Austrian economist proposing to slash public spend and close the Central Bank of Argentina who actually gets heeded by the people.
Have all the Argentines started to read Mises and Hayek all of a sudden? The truth is sometwhat more frivolous than that, as Javier Milei is actually a high-profile character famous for his TV and radio appearances who has only recently embarked in his political endeavour. With a past as a footballer and singer in a Rolling Stones cover band, a rather boisterous demeanour and an eccentric image, the professor of economics has long been a habitual face in the Argentine media as a political commentator.
Known as “El Peluca” (the wig) due to his dishevelled, epic, Boris Johnson-esque mop of hair (which he claims to be styled by “the invisible hand”), Javier combines his knowledge of economics and libertarian philosophy with a salt-of-the-Earth rambunctious personality which has seemed to captivate the Argentinian audience. Indeed, his style (not uncommonly adorned by expletive-ridden tirades) might not be palatable to all sensitivities, but he has chosen to get off his academic high horse and down in the mud to challenge the discourse of servile journalists and demagogic media personalities.
This candid and somewhat rustic approach has allowed Milei to reach the bulk of Argentinian population and put on the table questions unheard of until then. He has patiently debunked many long-believed myths and educated the viewers in all sorts of issues, from the most basic moral philosophy, such as not being OK to use violence to steal from others even though they have more than you, to more intricate economic questions such as hyperinflation being exclusively a monetary phenomenon (and inflation to a large extent, in most cases).
He has also brought to the forefront taboo issues like social justice or cultural Marxism. And such was his popularity that he decided to pursue a political career some years ago, first with the Libertarian Party and thereafter with the libertarian/conservative coalition “La Libertad Avanza” (Freedom Advances), wherewith he became a Lower House representative in 2021 (and whose official salary he monthly raffles out through his website). As a presidential candidate, he shockingly won the primary election in August, which is seen as an indicator of the voting intentions for the general election in October.
So, what are his proposals for making Argentina great again? Despite his bombastic rhetoric, his program is quite sensible and realistic, sometimes even vague and tepid. It does not advocate for an anarcho-capitalist revolution but offers a series of measures and steps to redirect the economy in the right direction gradually and gently. Public expenditure is not to be slashed mercilessly in a country with such a high rate of poverty, but to be reduced progressively combined with optimised social programs, decentralization of services, reduction of ministries and public workers, labor market flexibilization, energy reform, privatization of public companies, tax reduction or a new unemployment insurance system, to name a few.
The measure that is sending most shockwaves across the world, however, is the so-called dollarization of the economy: that is to say the adoption of the U.S. dollar as official currency (currency that Argentines already prefer and widely use over the devalued peso) with a system of open and free currency competition in the private market, leading eventually to the closure of the Central Bank of Argentina.
This is not to be confused with the failed experiment of the Convertibility Plan in the 1990s, whereby the peso was simply pegged to the dollar. Although dollarisation is not a panacea and it is not devoid of challenges and risks, it certainly will protect the wealth of Argentinians and restrain the government’s impulse to monetise debt, acting as a counterpoise and constituting the best alternative to combat the country’s systemic inflation, as extensively analysed in Ocampo and Cachanosky’s book “Dolarización: Una Solución para la Argentina”.
Milei has been brutally honest to the voters, and his honesty seems to have been rewarded rather than penalized as is normally the case in politics. He does not have a magic wand to instantly solve the deeply engrained and structural problems of Argentina, but he can give Argentines the freedom and tools to strive and prosper. In most unpolitical fashion, he claims that it might take some 35 years to revert all the maladies of the country after these measures are taken. And many Argentines, perhaps already weary of deceitful and vacuous promises, seem ready to step up to the task, embodying the old Argentine virtue that the magnificent Borges evoked when warning of the dangers of dictatorships in the dawn of Peronism.
As a libertarian, Milei is perfectly aware of the iron law of oligarchy, the perverse nature of the political game and its limitations. Therefore, possibilities of seeing his measures implemented and achieving substantial changes are limited. But just as Gramsci believed that socialism ought to be instilled into people’s minds to become inherent to the common sense (thesis that unfortunately has succeeded to a large extent), freedom and prosperity will only arrive when people hanker after it. The real triumph of Javier Milei is not in the ballot box or potentially in government: it is to have helped Argentines realize that they need and want freedom.
