Tag: Argentina

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Winning Through Identification

Javier Milei, Argentina, freedom, government

Argentina’s libertarian president, Javier Milei, perceives that many political battles amount to a clash between producers and thieves. Between those who work for living (using what sociologist Franz Oppenheimer called the “economic means”) and those who steal for a living (using the “political means”).

Politics can’t always be reduced to this conflict, of course. But it can pretty often — certainly in a country where socialists have been pulverizing the economy.

Now, this knowledge is not kept by Milei as a dark secret, about which he would be embarrassed to be caught mentioning to a select few supporters.

Milei is not coy! That we learned during his campaign for president; and, no matter what his ups and downs in office, he still seems to be just as candid, just as willing to blast his opponents, to their faces, for —

Well: “Listen up, you ignorant fools! ‘Social justice’ is theft. It implies unequal treatment before the law and is preceded by theft. You bunch of thieves! Criminals!”

Also: “The world has only two kinds of people: those who live off what others produce — that is, the parasites, that is, you — and those who produce everything that is possible in modern life.

“The true battle of our time is cultural, philosophical, and moral. It is about choosing the system that lifted millions out of poverty. It is about ceasing to be an immature nation that squanders the future to distribute benefits in the present. . . .”

Probably even better in the original Spanish.

This is Common Sense. I’m Paul Jacob.

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Rents After the Chainsaw

Javier Milei, Argentina, free markets, regulations, housing

Argentina’s Ministry of Deregulation — yes, it now has one — reports that by June 2024, little more than half a year after chainsaw-wielding libertarian candidate Javier Milei won the presidential election, the housing market boomed . . . into a magnificent recovery.

Back in March, Reason magazine observed that listings on the Argentinian real-estate platform Zonaprop had increased from 5,500 before Milei’s deregulation “to 15,300 today, a staggering 180 percent rise.”

Why the big jump?

Strict national rent controls had been imposed in 2020, by the previous administration. When Milei lifted them, replacing them “with nothing,” tenants and landlords could then make whatever arrangements they could agree upon.

One method of evading the punishing controls had been switching to an Airbnb model of renting, with contracts renewable every three months. Such expedients were almost mandatory . . . given Argentina’s galloping inflation. But they introduced their own kinds of uncertainty.

Owners also took units off the market.

Annual rentals plummeted under this anti-market regime. In late 2023, Valentina Morales saw maybe “12 apartments advertised in the entire Palermo neighborhood,” a region with a population of almost 250,000.

Rents on the few apartments available with annual contracts skyrocketed. Tenancies were required by regulation to last for three years, with arbitrary and unrealistic caps on rent increases. And rent had to be paid only in pesos. But since inflation did not pause under the pre-Milei regime, owners were forced to guess how high inflation would go over the three years . . . and they charged accordingly.

Now? All such nonsense is gone.

This is Common Sense. I’m Paul Jacob.

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budgets & spending cuts international affairs political economy

Was Milei Bailed Out?

Javier Milei, Argentina, bailout, foreign policy

You saw it on the news, newscasters almost gloating: Argentina’s peso plunged — triggered by  low reserves and political defeats for President Javier Milei.

Then the U.S. Treasury under Secretary Scott Bessent finalized a $20 billion currency swap line with Argentina’s central bank. This was on top of direct U.S. purchases of pesos in the market and plans for another $20 billion from private sources. The deal was seen as a U.S. strategic play to counter instability in Latin America.

Some called it a bailout.

Were Milei’s radical reforms saved at the expense of the U.S. taxpayer?

Bessant was asked this, yesterday, directly on MSNBC, and had a response: “Do you know what a swap line is?”

I had to brush up on it. (I don’t engage in any cross-currency swaps, understandably, not being a major corporation, a central bank, or a sovereign state.) A currency swap is a financial agreement between two parties to exchange principal amounts and interest payments in different currencies over a set period — a temporary loan in one currency backed by collateral in another, designed to provide liquidity, hedge exchange rate risks, or access cheaper funding without the full risks of outright borrowing.

“In most bailouts you don’t make money,” Bessent said. “The U.S. government made money.”

In an exchange, both parties gain. But in any exchange involving extended spans of time, there is risk, so any initial win for Treasury could be wasted by a failure of Milei’s course.

Unlike American politicians opposing inflation, Milei’s been quite honest with Argentinians: “To cure inflation, you have to go through a recession. There is no way around it.” So why Milei didn’t just peg the Argentine peso directly to the U.S.; why a “crawling peg” rather than strict? Milei has been clear: he lacked political clout.

Milei insists that his crawling peg reform isn’t gradualism (which he despises), and that the swap isn’t a bailout; Bessant agrees, saying the swap’s “a profitable move for America.”

This is Common Sense. I’m Paul Jacob.

Note: Milei’s party gained in the most recent election.

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The Argentine Ratline

Hitler, Argentina, Nazi

In less than one month, the 80th anniversary of Adolf Hitler’s death may be celebrated — unless President Javier Milei’s formal disclosure of the Argentine “ratline” shows what a lot of people believe: that Hitler didn’t kill himself in that bunker.

Ratlines are what the human smuggling routes of Nazis out of falling Germany in 1945 were called.

And yes, Argentina was the chief receiver of Nazis. This is known. Confirmed. Not controversial.

But did the South American country accept Nazis higher up than Dr. Josef Mengele and Adolf Eichmann?

Well, the FBI was searching for Hitler in South America for decades, into the 1960s. And rumors of Hitler’s escape to Argentina have been bandied about for years and years.

But the official story, of Hitler’s suicide in the Berlin bunker on April 30, 1945, has been stuck to, its skeptics frequently “debunked,” and “experts” have been mocking “conspiracy theorists” on this matter for a very long time.

Now, however, Javier Milei — perhaps inspired by Donald Trump’s disclosure attempts regarding the JFK assassination and Jeffrey Epstein’s honeypot scheme — has set in motion the release of Argentina’s “ratline files.” 

The Argentine government has committed to declassifying and releasing all government-sequestered information related to Nazi war criminals who sought refuge in the country after World War II. Formally announced by Cabinet Chief Guillermo Francos on March 24, the documents are said to include financial details and relevant records held by Argentina’s Defense Ministry.

What will we learn?

If we learn that Hitler lived long after 1945, what would be the repercussions?

Maybe it depends: who exactly — and in which government — arranged the escape?

Whatever the revelations, whatever the ultimate result, the Age of Deference is over; the Age of Disclosure has begun.

This is Common Sense. I’m Paul Jacob.

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Age of Arms

Argentina, gun rights, Javier Milei, economic recovery

While it is entirely reasonable to treat children and adults differently, and for laws to reflect this basic division, questions of precisely when children should become adults have eluded rationality. 

In Argentina, where the legal age to vote is 16, young people may join the military at age 18, but had to wait till 21 to own a gun. 

Until Argentine president Javier Milei’s reduced the minimum age to purchase and carry a firearm to 18, a step towards greater consistency.

But that is not how the culturally dominant left-wing media and intelligentsia see it. They paint dire dystopian visions of violence as a consequence of Milei’s libertarian pro-carry, pro-armament philosophy.

 A December article in The Epoch Times shows that this old, elitist attitude is falling to the wayside as “Residents of Argentina’s Crime-Ridden Cities Welcome Milei’s Gun Reform.”

Key point? Dire dystopia is current reality.

Years of inflationism, government growth and regulation, as well as the seemingly endless political struggle between communists and Peronistas, has left a rising rate of homelessness and poverty.

And the homeless are getting grabby. 

In public. 

More daring and violent everywhere.

Against this, the pre-Milei government’s soft-on-criminals approach left normal people feeling defenseless. So gun ownership has understandably increased. The Epoch Times quotes a Buenos Aires resident who “believes that the public’s attitude toward firearms ownership is shifting away from the notion of less guns equals less gun crime, an ideology that was promoted by the previous administration.”

While Javier Milei’s program to reduce inflation appears to be on course, Argentina has been so dystopian for so long, most changes for the good will be incremental.

Like setting the age to carry firearms to equal the military service age.

This is Common Sense. I’m Paul Jacob.

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Denial Is a River in Argentina?

“In the history of the Earth, there is a cycle of temperatures,” said Javier Milei during a presidential debate in 2023. “We are not going to adhere to the 2030 Agenda [a United Nations list of dozens of goals for curtailing countries’ use of resources]. We do not adhere to cultural Marxism. We do not adhere to decadence.”

Now Argentina’s President Milei is acting to formally withdraw from accords requiring countries to become poorer in order to “save the planet,” etc.

Although Milei has axed many government departments, his government still has a chief environmental officer. This personage had been leading the Argentine delegation attending the COP29 climate summit in Azerbaijan, happening November 11-22, 2024. But Argentina had told the delegation not to participate.

Now Milei has pulled them from the summit. Why? That was not immediately announced. But “Milei has consistently denied the existence of a climate crisis,” moans the Buenos Aires Herald.

Denialist Milei doubtless recognizes hurricanes, tornadoes, and other incidents of drastic weather. He’d probably add, though, that planet earth has seen plenty of crisis-level weather before carbon-emitting industry arrived to take the blame.

Milei’s decision to exit COP29 came a day after his meeting with President-elect Donald Trump, of like mind on environmental and other questions.

Trump is expected to re-withdraw the U.S. from the 2015 Paris agreement, another anti-industrial environmental accord. We don’t know yet whether Argentina will also withdraw. 

But if you’re betting Yes, I like your chances.

This is Common Sense. I’m Paul Jacob.

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inflation and inflationism international affairs too much government

Is Milei Making It?

After libertarian economist Javier Milei surprised the rest of the world by winning the presidency of Argentina in 2023, the question became whether — or how quickly — he could slash government programs, privatize nationalized firms, and set free a flatlining government-controlled economy.

A president can do some things on his own. But Milei requires the cooperation of the legislature to institute many substantial reforms. And for months his legislative agenda has stalled.

Now some of it is being enacted. On June 28, the Chamber of Deputies passed a sweeping package of bills that Reuters dubbed Milei’s “first big legislative win” and Bloomberg’s Manuela Tobias characterized as “deregulat[ing] vast swaths of the economy and boost government revenues. . . .”

The enacted reforms include provisions to make it easier for employers to fire workers and to deregulate the oil and gas industry. Milei was able to privatize only a few of the dozens of state firms that he wanted the government to unload.

Tobias notes that the passage of Milei’s reform package, “albeit significantly watered down,” is impressive considering that members of Milei’s own party constitute less than 15 percent of the lower chamber.

Milei’s most obvious success has been fighting inflation, which according to Deutsche Welle is “down from around 25 percent per month last December to 4.2 percent this May.” This is a major achievement for a figure outside the mainstream of globalist standard opinion, who has called himself an “anarcho-capitalist” (of all things) and was labeled by the German paper “right-wing populist and economically liberal.”

Terms mean different things in different countries: it’s pretty obvious that Milei’s program has nothing to do with that of American “liberals” such as President Biden and his partisans.

This is Common Sense. I’m Paul Jacob.

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free trade & free markets international affairs repeal

The Milei Option

Argentina, socialism, communism, Milei, president, economy

Argentina’s new president promised to take a chainsaw to the high taxes and controls that have been killing the country’s freedom and prosperity.

He has had successes. One of his decrees removed rent controls, and as a result the supply of rentals has jumped and rents have dropped.

But Milei cannot simply issue decrees to free up markets. He’s got to go through the legislature. And Argentina’s Senate recently rejected a mammoth Milei-issued emergency decree to deregulate the economy apparently in one fell swoop—revising or killing some 300 regulations.

The Financial Times reports that Milei’s coalition, La Libertad Avanza, “controls less than 10 per cent of Senate seats.” Many of the “centrist” senators could have helped pass Milei’s reforms over the objections of the adamantly leftist members. But these centrists profess to have constitutional reservations about the decree.

The real problem is probably that there is still a very large constituency for the subsidies and grift that have impoverished so many Argentinians.

The decree remains in effect until the House votes on it too. Milei’s administration is negotiating with the lawmakers of that chamber and with others who may have an impact on their vote.

If President Milei loses this fight in the near term, he must keep reminding voters why he can’t do more to lift them out of poverty and serfdom. His election to the presidency was a huge political change. But it’s not the only one Argentina needs.

This is Common Sense. I’m Paul Jacob.

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Accountability deficits and debt international affairs

The Shock of Surplus

Rooting for Argentina and President Milei

The current president of Argentina is an avowed “anarcho-capitalist.” He isn’t really — but close enough for government work.

It’s more accurate to say that Javier Milei is a capitalist and libertarian. He has taken on the job of extricating the Argentinian economy from the mire of socialism and corruption — unleashing outlawed market processes.

He seeks to do it not by pushing for micro-changes around the edges of the margins of government spending and intrusions but by figuratively wielding the chainsaw that he literally wielded during his election campaign.

One sign of the success of his “shock therapy” cited by The New York Sun is the “first budget surplus in more than a decade.” A monthly surplus of almost $600 million is the first surplus since the summer of 2012.

But, the Sun quickly adds, Milei’s various radical proposals still face an uphill battle in the legislature. All those people who created the mire are still around.

There are hopeful signs. The lower chamber has already passed a preliminary or framework agreement to make various basic reforms. These include privatizing of currently state-operated companies, deregulation, and revamping of criminal and environmental laws.

The lawmakers “chose to end the privileges of the caste and the corporate republic, in favor of the people,” Milei says.

Meanwhile, though, egged on by unions, thousands of Argentinians have taken to the streets in a general strike to protest the reforms. Milei can win, but it won’t be easy.

This is Common Sense. I’m Paul Jacob.

PREVIOUS COMMENTARIES ON JAVIER MILEI

Milei Defends Capitalism
January 24, 2024

Market Rents Work in Argentina
January 23, 2024

Milei’s Chainsaw
January 6, 2024

To End the Great Declension
December 13, 2023

The Outsider Who Won
November 20, 2023

The Ultimate Outsider
October 24, 2023

Two Libertarians, North and South
September 19, 2023

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Milei Defends Capitalism

Argentina, Javier Milei, Capitalism, WEF

Capitalism is better than socialism.

The new libertarian president of Argentina, Javier Milei, recently explained the virtues of the free market to attendees of the annual World Economic Forum in Davos, Switzerland.

Milei said that capitalism generates “an explosion of wealth,” that capitalism and the industrial revolution “lifted 90 percent of the world’s population out of poverty,” that a free market society is both practical and just.

“Far from being the cause of our problems, free enterprise capitalism as an economic system is the only tool we have to end hunger, poverty, and destitution across the planet. The empirical evidence is unquestionable.”

As its answer to the practicality and justice of a capitalist social system, the left proposes the injustice of “social justice,” according to which “capitalism is bad because it is individualistic” and “collectivism is good because it is altruistic.”

Collectivism hobbles the entrepreneur and “makes it impossible for him to produce better goods and offer better services at a better price.” Which only impoverishes us. This is neither practical nor moral.

The West is in danger because it is allowing capitalism to be destroyed. We need to remember why we need it.

Will any of the dignitaries who heard Milei’s talk learn its lessons? Maybe not if they’re like WEF’s founder, Klaus Schwab, who looks at the international predations of the Chinese Communist Party and sees a “responsible, responsive” state.

But maybe a few others will. And then a few more.

This is Common Sense. I’m Paul Jacob.

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