On Monday, Argentina got a new president. Unlike his predecessor, whose name he shares, he is a soft-spoken technocrat with a professorial manner who began his term in office by treating his compatriots to a lecture on the need to keep public spending under control. The televised address he gave proved memorable not because the President’s budget proposals were thought controversial but because of the way he presented them. Instead of insulting those who are bound to oppose the measures he says he will take by calling them “fiscal degenerates,” “mandrills” or something even more demeaning, he limited himself to explaining that overspending never ends well and it is foolish to pretend otherwise. He also abstained from reminding us that his government is better than any other in recorded history.
Just about everyone agrees that Javier Milei changed his tune in such a striking fashion because he knows that, to survive in office for much longer, let alone to get re-elected in 2027, he will have to reconcile himself with the large number of moderates who backed him in the final round of the 2023 presidential elections, after having voted for Patricia Bullrich several weeks earlier, but have since been put off by his often appallingly uncouth behaviour and worried by his emotional dependence on his sister Karina, which suggests that at any moment he could suffer a mental seizure. His party’s poor performance in the Buenos Aires Province elections taught him that, without the support of the fairly large number of people who demand rather more from their president than a strong attachment to fiscal rectitude, he would be unable to prevent Argentina from continuing her slide into penury and he would be remembered as yet another unsuccessful head of state.
Until very recently, Milei attributed his popularity – most opinion polls still put him ahead of his political rivals – to his quite extraordinary eccentricity and assumed that the nuttier he looked, the more people would put their faith in him. After all, he owed his success to the fact that he was undeniably different from other politicians. However, while a noisy minority did find his willingness to break all the standard rules very attractive and loudly said so in the social media, few others felt tempted to join them. Though it would appear that much of the population has come to recognise that, for Argentina to recover from the harm done to her by many years of economic fecklessness, all future governments will have to take a rigorous approach to public finances, most fail to see the connection between this common-sense approach and Milei’s wild tirades against those who dare criticise him or his antics on the international stage. His personal brand of right-wingery may be innocuous in comparison with some others, but libertarianism is not about to become as influential as was Peronism, which is still with us, for many ruinous decades.
There can be little doubt that Milei’s delight in trashing the country’s political class, plus the awareness that, unlike its members, he could be relied upon to take swingeing measures in order to keep hyperinflation at bay, are what allowed him to leap straight from the television screen into the Pink House in a remarkably short time. Two years ago, many came to the conclusion that what the country desperately needed was a madman prepared to do whatever would be necessary to put it back on track.
Is this still the case? Thanks largely to Milei, since then circumstances have changed. Perhaps prematurely, many have come to the conclusion that “the dirty work” has already been done and that the time has come for a less belligerent approach to the country’s many ills. Needless to say, this change of attitude entails many risks. Not only diehard Peronists but also many others would dearly like to see the old order, which they helped create and learned to profit from, recover from the battering it has received.
If Milei really is convinced that he would benefit from a facelift and that instead of snarling at most of his fellow politicians he should smile sweetly at them in an effort to get them onside, he will start trying to widen his formal base of support in the national and provincial parliaments. This is something that he and Karina – in thrall as both have been to the notion that there was nothing to stop their version of libertarianism from turning into a mass movement capable of sweeping all before it not merely here but in the rest of the planet as well – did not want to see happening, which is why they did their utmost to keep Mauricio Macri and the people surrounding him at arm’s length. Quite naturally, they feared that the former president could become the dominant figure in any coalition and that his supporters, many of whom had spent years in senior positions in government and knew how to manage the system, would quickly take over from the inexperienced neophytes and assorted oddballs who became libertarians in order to get a share of the power that the electorate handed to Milei.
Chainsaws may be useful when it comes to slaying inflationary dragons or at least wounding them but, as the government is beginning to appreciate, for Argentina to prosper in the years ahead she will need rather more than to have the economy put on a relatively sound financial footing. Milei seems to have assumed that, after inflation went down to what by local standards would be a reasonable level, production and, with it, consumption, would immediately start booming. This has not happened. Instead, uncompetitive businesses kept alive by a captive market guarded by protectionist walls of one kind or another are getting clobbered, jobs are beginning to disappear and the shortage of skilled, or even literate, workers is making itself felt.
All this should have been predictable. Free-market capitalism works far better than any known alternative, but for those who lack the abilities it demands, it can be impossibly challenging and there is no shortage of politicians who can be relied upon to make the most of the grievances of the many that, for whatever reason, get left behind. What is more, thanks to headlong technological progress, the gap between those who do well and the stragglers is getting wider almost everywhere. This means that, if the transition Milei dreams of gathers steam, it will face even more difficulties than it would have in the past when reform programmes, less ambitious than the one he has in mind but going in the same direction, were tried and, after a promising start, had to be abandoned under intense public pressure.
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