Milei wants to paint Argentina violet

All politicians are prone to exaggerate the importance of elections, even minor ones in unrepresentative places, in which their side does better than others. A still remembered example of this was given by Carlos Menem back in 1997 when, after suffering a string of defeats, he made much of a Peronist success in Perico, a small town in Jujuy Province. It was therefore to be expected that Javier Milei would treat Manuel Adorni’s underwhelming victory in Buenos Aires City where he got just over 30 percent of the votes cast by those who bothered to show up, as evidence that he already had the enthusiastic backing of most porteños and that before too long he would have that of most other Argentines. He boasted that, having painted Buenos Aires – which until then had favoured the yellow of Mauricio Macri’s PRO party – his own colour, violet, he would go on to do the same to the entire country.

For this to happen, Milei would have to win the allegiance of a large number of people who still consider themselves loyal Peronists. Unlike Macri, who assumed that by handling the economy in a rational manner and obeying the democratic rules he would eventually convert them to his way of thinking, Milei and his sister, Presidential Chief-of-Staff Karina Milei, are well aware that this would not be enough. They know that political loyalties usually owe more to a person’s sense of belonging to a vaguely defined community than to reasoned arguments. Handouts can help, but peer pressure counts for more than anything else. In Argentina, it has long been normal for members of the working class and the “structurally” poor to see themselves as Peronists and to vote accordingly, even though that particular movement has done them far more harm than good.

For Milei and his followers, colonising PRO was fairly easy. They had only to point out that the economic policies that were applying were much the same as those favoured by Macri but that, unlike the former president and his team, they refused to let themselves be cowed by the Peronist trade unions, social justice warriors, leaders of organisations allegedly representing the poor and others who for so long had thwarted attempts to modernise a woefully outdated economy. It was thanks to Milei’s sheer bloody-mindedness when it came to managing the economy that he won the 2023 presidential elections and then went on to subject Macri’s outfit to a hostile takeover.

Dealing with Peronism will require a very different approach. To reach his objectives, Milei will have to play the part of an authoritarian caudillo whose heart is in the right place and who, in his way, understands what it is like to be poor and unappreciated by those who are better off. Though there is no reason to think that he is playacting when he indulges in one of his expletive-filled rants against journalists or economists who say things he dislikes, he clearly believes it helps him get in touch with the kind of people who for decades have supported the local Peronist bosses without asking themselves why they should prefer them to their rivals.

Even before last Sunday’s elections, Milei could assume that the wind was in his sails and that, after some months in which he appeared to be on the retreat, good news on the economic front was helping him recover from the setbacks that he had inflicted on himself. To the surprise of the many who suspected that inflation would rise a bit after currency restrictions were loosened, so far this has not happened. A keen disciple of the late Milton Friedman, Milei thinks that, since inflation is an exclusively monetary phenomenon, by clamping down on the money supply he will eliminate it entirely by the middle of next year. While reaching this ambitious target would not put an end to the country’s many economic and social problems, if he comes close to it he will have given himself time in which to work out what would have to be done to allow the millions of men and women who are unskilled and, in many cases, functionally illiterate, to make positive contributions to a more efficient national economy and, what is even more important, to their own sense of worth.   

To judge from what he says and from his behaviour, Milei wants the movement he has engendered to combine the tribal loyalty that has allowed Peronism to survive for three-quarters of a century despite its truly abject performance in office with a fervent devotion to neoliberalism on steroids. Though the synthesis he seems to have in mind could not work in the real world because it would require many people to acquire skills and aptitudes that are vouchsafed to very few, as a distant objective it has its attractions. However, before getting anywhere near it, the country’s government would have to cater to the needs of those who will be hard put to find an acceptable place in the “anarcho-capitalist” utopia the head of state dreams about. Those leftists and populists who say that, while Milei’s “model” could be wonderful for a smallish minority, there would be no place in it for the rest of the country’s inhabitants, are not wrong. However, luckily for the probable losers in the competition Milei wants to start, Argentina does possess natural material resources that are much in demand and which, once developed, would allow her to finance the social programmes that will surely be necessary.

This is not the case in many other parts of the world where economies shaped by technological change which, spurred by artificial intelligence, seems certain to accelerate in the coming years, are leaving behind more and more people. In the United States, Donald Trump wants to help them by bringing back industries that had been entrusted to low-wage countries, among them China and Mexico, but despite such efforts automation will continue to eliminate more and more decent jobs.

Thanks to all the petroleum, gas, copper, lithium and the like that are waiting to be exploited, and the fact that, for obvious reasons, for now at any rate people hereabouts tend to be less demanding than their counterparts in wealthy countries whose inhabitants are accustomed to a high standard of living as measured by the consumption of material goods, Argentina could be better placed than most to weather the coming storms even if she does not become as enviably rich as Milei promises to make her.