Argentina’s much-mocked Javier Milei might just get the last laugh
Published by The Washington Post (12th December, 2024)
It is easy to mock Argentine President Javier Milei, with his crazy hair, cloned dogs and claims of expertise at tantric sex. He was, after all, nicknamed “El Loco” (The Madman) as a teenage goalkeeper and seems often determined to perpetuate this reputation with his egotistical boasts and brutal attacks on critics. Yet, when this explosive character said recently he was one of the two most ‘relevant” politicians on this planet alongside Donald Trump, he might just turn out to be right.
The self-styled “anarcho-capitalist,” who campaigned with a chainsaw as a symbol of his desire to slash the bloated state and free the economy, has embarked upon a messianic mission to salvage his stagnant nation. Carried unexpectedly to power on a wave of public contempt for failed politicians and a corrupt elite, Milei is trying to unleash, in a statist society, a libertarian revolution that one aide described to me as “turbocharged Thatcherism.”
Milei’s radical experiment is being watched closely around the world. Debt-laden governments are grappling with surging spending — not least in Washington, where Elon Musk has been tasked by Trump to perform similar surgery to the federal budget, and in Britain, where shattered Conservatives are searching for fresh ideas after ejection from office. Milei has responded with a typical lack of modesty, bragging that he is “exporting the model of the chainsaw and deregulation to the whole world,” while telling the Economist magazine that his contempt for the state remains “infinite” after his first year in office.
This mercurial loner, who once sang in a Rolling Stones cover band, is engaged in a high-risk gamble: to shake his country out of its decades-long stupor by slashing subsidies, sacking public servants, scrapping taxes, shutting ministries, ripping up regulations and privatizing scores of state enterprises from airlines and banks to football clubs and waterways. He has rattled his many foes, who often write him off as a political joke or a poisonous far-right populist. But this week, as he marks the anniversary of his ascent to power, Milei can point to significant successes in curbing the curse of inflation and shrinking the state — though consumer spending has crashed, poverty has risen and growth remains elusive.
Sources close to the president tell me that whatever the outcome of his revolution, Milei believes it will offer valuable lessons for the world. “He might fail, but he thinks the experience will be important and benefit others — not just in Argentina,” says one. At the very least, this unusual leader is proving to be a rare politician who keeps his word and does not hide from telling harsh truths. He warned people that his medicine would be hard for them to swallow, insisting “there is no alternative to adjustment, there is no alternative to shock” in an inauguration speech that predicted “negative impact” on jobs, real wages and the number of people living below the breadline.
This prediction proved right as prices surged to create the world’s highest annual inflation rate. Since then, his tough austerity measures have restrained further rises, reducing monthly inflation from 25 percent to 2.7 percent, according to the latest data. The gap between the official dollar and the blue (illegal) dollar has fallen. A generous tax amnesty brought £20 billion out from under mattresses into the formal economy. But Milei’s actions, including the firing of 30,000 federal workers — about 10 percent of the government’s staff — have also reduced consumption by one-fifth since he took power last December. And more than half of the population of 46 million are living in poverty, with the minimum wage plummeting by almost one-third over the past year.
Inevitably, Milei’s reforms sparked protests, especially over cuts to university funding and from people such as pensioners or teachers whose incomes fell. Yet remarkably, this leader of a country in its second year of recession has retained his popularity and has the support of about half the electorate, with an uptick in his ratings this fall. Much of his backing comes from fed-up younger voters, who flocked last year to support him and his exuberantly populist message of change. “People are suffering, but they know someone has to fix the mess,” said political scientist Sergio Berensztein. “He won because a large proportion of voters said enough is enough. We are a failed state that is overspending.”
Critics, though, accuse Milei of ideologically pursuing a cruel experiment in “social Darwinism” in which only the strongest survive. “It works in books, it works in lessons, but it does not work in the real world,” said one leading Argentine banker when we met this year in Buenos Aires. Yet even this man — worried about the lack of growth strategy to go with savaging the state — readily admitted there had been “some very good financial results” when we spoke again last week. And, as he said, “the old system was rotten,” with the nation living beyond its means, and with incomes for ordinary people stagnating while a succession of corrupt leaders milked the system.
Milei’s path to victory was fueled by scandals involving the Peronists who had long ruled Argentina. They left the country owing an astonishing $263 billion to foreign creditors — yet the state’s size had doubled over two decades as left-wing populists sought to buy support with costly subsidies and corrosive interventions such as price and rent controls.
Enter Milei, who sees taxes as a form of state coercion, is such a devout free marketeer that he has supported the concept of trade in human organs, and has argued that the only true role for government should be defense and law enforcement. While often called far-right, or compared with Trump and his combative populism, Milei is, in reality, an intellectual character — a libertarian, not an insular protectionist.
This wildly eccentric yet fiercely ideological politician knows how to get noticed. During Milei’s election campaign, an interview with Tucker Carlson attracted the attention of Elon Musk, who commented online that “government overspending, which is the fundamental cause of inflation, has wrecked countless countries.” After his victory, Milei flew to Davos in Switzerland, where he argued that the West was in danger from dark forces such as feminism, socialism and environmentalism, putting its values in jeopardy from a vision “that inexorably leads to socialism and thereby to poverty.” Last month, the 54-year-old firebrand became the first foreign leader to visit Trump after his election victory — Milei’s attacks on the state, its political sinecures and power hubs have made him a hero among many U.S. conservatives and members of the MAGA crowd.
But where did he come from?
The son of a bus-driver-turned-businessman, Milei alleges he was beaten and verbally abused by his parents. “They are dead to me,” he said later. “My father always told me that I was trash, that I was going to die of hunger and that I was going to be useless all my life.” His biographer claimed this treatment left him so embittered that other pupils at his Catholic school in Buenos Aires nicknamed him El Loco for his angry outbursts. He went on to play soccer in lower-level leagues, then worked as an economist at a bank and a conglomerate, but this forceful — some would say furious — nature led to prominence as a pundit on television, where he would lambaste the ruling caste.
His freewheeling discussions on everything from the perils of inflation through to the pleasures of sexual threesomes won him fame, followed three years ago by a seat in the legislature, where he continued to show great skill at grabbing attention with stunts such as donating his salary to a monthly raffle giving “stolen” cash back to the people. His most trusted adviser is his younger sister Karina, who stood by his side during those dark childhood days. He adores his four mastiffs, named after economists and cloned from his first dog, Conan, calling them his “little four-legged children” and once claiming to have telepathic conversations with Conan.
A government adviser described Milei to me as a “very 21st-century politician,” with his disheveled image, insults and social media diatribes. “He has very direct communications with the people,” he said. “Remember just two years ago he was a crazy economist on TV. He’s also genuine — he says what he thinks and does what he says. He speaks his truth and made it clear he wants to adjust the economy.” This adviser added that he was very different in private. “He’s like a nice child — he’s very warm and does not appear egotistical. He is very willing to talk and listen. He is a much nicer personality than the public image: the lion calling everyone names.”
Argentina — which a century ago had higher gross domestic product per capita than France and Germany — should rival the success of its world-beating footballers, given its well-educated citizens, substantial energy resources and formidable agriculture. Instead, half its workers disappeared into the informal economy because of labor laws that Milei calls a “cancer”. Import duties pushed up the prices of many goods. One analyst told me that this meant a refrigerator made in South Korea cost 10 times as much in Argentina than in the United States. Meanwhile, the government also tried imposing price controls.
Peronist efforts to protect workers, restrain prices and fleece successful sectors, such as agriculture, prevented Argentina from competing economically in the global market, resulting in some of the world’s lowest levels of trade as a percentage of GDP. The state’s payroll rose 10 times faster than the private sector’s over the past decade. A bus driver told me he failed to stop his daughters from backing Milei because of their fury at the “ñoqui” — a derogatory nickname for officials who rarely turn up to work.
So can Milei salvage this nation? “I would give him a 40 percent chance of success,” said one well-placed observer. Though the president has minimal current opposition — traditional parties were left shell-shocked and rudderless following his insurgency — his coalition has little support in parliament and none among the 23 powerful provincial governors. He has never run anything in the past, loathes consensus, becomes easily embroiled in distracting culture wars and won power by railing against the political elite he needs to pass his reforms. Yet Milei has discovered the art of pragmatism in office, scaling down his pivotal “omnibus bill” after it was picked apart by legislators. “He has overachieved anybody’s expectations,” said one insider.
There have been stumbles. Milei embarrassingly signed a decree that included a 48 percent presidential pay increase soon after his accession, which he blamed on his predecessor after it was seized on by foes, then hastily ditched and sacked a minister. One ally — a former Peronist minister who defected and helped swing a key vote — was arrested recently in Paraguay after entering with $200,000 in undeclared cash. And there is anger among those who are losing out from Milei’s reforms — such as at a national scientific institute where staff were lined up in pouring rain outside their building to be told whether they still had a job. “Perhaps we will have to emigrate, forced to do so by the destruction of science and public education,” a woman who works at the unit said. “You cannot live on a scorched earth.”
Others rail against Milei’s weaponizing of the culture wars and his direct appeal to angry young men frustrated by feminism. Among his early edicts was one to end use of gender-neutral language in government, and many of his young and liberal supporters loathe his anti-abortion stance and ambivalence over their nation’s military past. There are also fault lines in his coalition between liberals and conservatives: Milei has already fallen out with his vice president, Victoria Villarruel, a hard-line culture warrior whose father was an army colonel, to such an extent she no longer attends cabinet meetings.
Milei has launched a fascinating revolution — and as we have seen often in the past, such events are highly unpredictable. He knows he is likely to be judged on his economic success, especially his ability to curb inflation and kick-start growth — and that the most important weapon in his political arsenal is his personal appeal, based on despair, disenchantment and desperation for change that he has marshaled for an assault on the state and key power hubs of the left.
Yet political popularity is a fragile beast, especially in a place scarred so badly by atrocious leaders. So, Milei is engaged in a race against time: to prove to people that his remedy is effective and that the pain they suffer is worth enduring for the sake of their children and their nation’s future. The impact of this shock therapy will be watched intently around the world — and the waves could be felt far beyond Argentina.