CAN ARGENTINA SHOW US THE WAY?

The Miracle of Milei

The new Argentinean President, Javier Milei, promises major changes to the way Argentina has been run (unsuccessfully) for generations.  Fans of Evita may not realize how dire the Peron regime was for the majority of citizens.  And nothing seems to have improved…until now…hopefully.

Milei speaks of socialism as the enemy and explains how the much more expansive state has crippled the country.  At one time, Argentina was one of the richest nations, but now, redistribution has ruined it. He says, “Government spending in the name of social justice is a form of theft,” echoing those who inspired him, namely Friedrich Hayek and Ludwig von Mises. 

Pillars of his new presidency are as follows:

1.   The use of the word “free” describing government benefits or services is prohibited.  Instead, citizens need to be informed that they (the taxpayers) are paying for these benefits.

2.   No central bank government official may issue money to finance budget deficits; if he/she does, the official will go to jail.

3.   Reducing federal spending by a significant amount.  After his first month, the budget was reduced 39.4%.  He got rid of government subsidies, froze public works and reduced the number of public employees.

4.   Replace the peso with the American dollar.  China is worked hard to replace the dollar with the yuan, so this is a striking affirmation of our system.  The prior president had been quite willing to do a currency swap with China to pay down Argentina’s IMF debt.

5.   He withdrew the country from BRICS (Brazil, Russia, India, China and South Africa)), challenging this organization. By doing so, the rich reserves of lithium, so essential to modern technology, will not be as available to the BRICS countries.

6.   Freedom, democracy and private enterprise are at the core of his platform.  America long has claimed these values, but ever since FDR, it isn’t clear that politicians understand what these values mean.

What This Means for America

The rapid turnaround on the budget and spending shows that such action is not impossible and provides immediate benefit.  We know our government is too large and unwieldy.  The federal government has taken over large swaths of economic activity, far beyond anything mentioned in the Constitution.  As such, it is one of the biggest spenders and employers in the country.  This is not a good thing.

There are many proof points that having the government run something is generally the least efficient, effective or budget-friendly way to do things.  FedEx towered over USPS almost immediately, when it started service.  Yes, door-to-door regular mail is more difficult, but I bet a private-government partnership could make it far more efficient.  We’ve already seen that Obamacare didn’t “fix” the health care cost problem, because it failed to actually understand why there is a cost problem. 

What we need to do:

1.   Restore our dollar to prominence by using Milei’s strategy to slash the budget, cutting personnel, departments and areas of federal governance.  Many things are done better by private actors.

2.   Implement a law requiring a balanced budget now, and in the future

3.   Prohibit the Fed from creating money, unless a dire emergency occurs and 66% of the House and the Senate vote to implement a one-time expansion of the money supply.

4.   Get rid of all benefits for elected officials who leave office.  This will probably act as a term-limiter.

5.   Implement a line-item veto for Congressional bills, while vetting that no bill has more than three areas included.  No omnibus bills which hide what they are actually doing.

6.   Require that Congress no longer give over power to the administrative state, rather than passing actual laws.

7.   Eliminate many of the Cabinet Departments, as most are not the role of the federal government, such as Education, Health and Human Welfare, Agriculture, Commerce (never has worked), Energy, Housing and Urban Development, and Labor. 

8.   Evaluate the departments in Homeland Security, as it isn’t working well and fund only what is needed.

9.   Force the government to act on their vows and ensure the laws of our country are upheld, specifically as regards to immigration.

10.                Take away the power of the President to dole out money, i.e., for loan forgiveness or illegal immigrant services.

This would be a great start.  Supporting a democratic republic that gives opportunity to all through laissez-faire capitalism will again show the world what works, and help Milei succeed, as well as inspire others to follow our lead.  Let’s not forget that several Russian presidents were shocked and inspired by the simple choice offered by our grocery stores.  Freedom works.