Cautious Pessimism About Javier Milei

Campaigns often lull voters into trusting candidates. Elections usually remind us why they shouldn’t.

As did Monday’s Wall Street Journal. There, pasted prominently above the fold, was the new president of Argentina hugging his corrupt counterpart from the Ukraine. 

Inaugurated yesterday, Javier Milei evokes nods and smiles when discussing what’s needed to fix his country. Yet his remarks on matters beyond La Plata tend to tighten lips and furrow brows.

After extensive experience with slippery politicians, this shouldn’t be surprising. But it is disappointing. Milei has consistently expressed appreciation for the U.S. government, support for the Ukraine, and adoration for Israel. 

He recently made a public performance of his conversion to Judaism. Like anyone, Milei should be able to adopt whatever religion he wants. God bless him (presumably that’s the point).

But why the theatrics? In front of cameras, there’s always a political motive for whatever politicians do. Given recent events roiling the Levant, it’s reasonable to wonder what those might be.

In a sense, Milei’s stance on distant skirmishes and imperial wars doesn’t matter. On the world’s periphery and with its own plethora of problems, Argentina can’t do much about them anyway. So why prioritize them as he assumes office?

It’s not that Milei shouldn’t meet with his more repulsive counterparts. If only US leaders were more inclined to exchange words than wage war!

But why make shows of obsequious support for the foreign fingers on America’s imperial arm? Most Argentines…almost half of whom have been impoverished by rampant inflation and economic malpractice…couldn’t care less which far-flung gangsters America is backing. 

So why would the empire’s most prominent puppet travel to a remote region while his country is in peril? 

Argentina isn’t on the way to anywhere. It’s the opposite of Denny’s after midnight. You don’t just stumble onto the Pampas; you must make a concerted effort to go there. 

Granted, the Russian ambassador to Argentina also attended Milei’s inaugural. But that makes sense. After all, he was already in Buenos Aires. That’s his job. It’s why he’s there. 

Why was Volodymyr Zelensky there? We don’t know. Has he attended other inaugurations while the U.S. proxy war has ravaged the Ukraine?

In what looks like a futile effort to throw dogs off the scent, he also stopped in Uruguay, Paraguay, and Ecuador before raiding his perpetual piggy bank in the U.S.

Fortunately, while Milei’s international instincts look awful, his domestic actions have been pretty good. His inaugural address was encouraging, and was immediately followed with a machete to almost half the ministries of the Argentine state.

This is terrific. But much rancid meat remains on the bone. And with the moderation of Milei’s recent rhetoric, it looks likely to remain…and to continue to rot. 

Despite campaign pledges, the central bank still exists, as does Argentina’s place in the Paris Climate Accords. 

It’s only been two days. But patience is thin when expectations are high. We don’t expect miracles. Yet removal of the abominable bank was the most prominent promise of the Milei campaign. And now his softened tone suggests it’s here to stay.

Also disconcerting are his initial cabinet appointments. Like a river erecting its own dam, Milei appointed Luis Caputo, a former central bank president, as economic minister. He also chose one of Caputo's allies to lead the bank Milei promised to obliterate.

This is disturbing. But we mustn’t make the perfect the enemy of the good. Fulfilling even a portion of his pledges will be extremely beneficial. And, again, it’s only been a couple days. Maybe a fine wine needs time to ferment. 

As we sip and savor what he’s already done, we note Milei’s first hours accomplished more than the full terms of other “disrupters” to whom he’s often (usually absurdly) compared. 

In his inaugural address, he turned his back on the legislature to speak to the people. Wisely, Milei dispensed with niceties.

Unlike most new leaders promising paradise, Milei was astute enough to acknowledge the difficulties to come. After decades of rampant regulation, incessant spending, and unbridled inflation, pain is inevitable. 

A hangover follows the binge. After a fling comes the divorce. And decades of economic sins demand a journey thru hell.

The question is whether the trip will be short and sharp…as in the “forgotten depression” of 1920…or grinding and grueling, like the Great Depression of the 1930s. 

Milei needs to be Harding and Coolidge rather than Hoover and Roosevelt.

But how? 

It’s simple, if not easy. He should do what he promised. In addition to dismantling the central bank, he must take his chainsaw to the rest of the State.

Taxes should come down and price controls come off. Legal tender laws and dual exchange rates should go. And Milei must dispense with punitive export taxes that cripple one of the greatest natural resource regions in the world. 

Based on the economic appointments already made, dollarization seems out of the cards. To truly prosper, the country should go directly to gold. Not a gold standard, but gold itself. 

That’s more than unlikely. It’s unthinkable.

Regardless, we should be encouraged that in a sizable country an unadulterated message of anarcho-capitalism could win an election. Granted, it was in a place desperate for change after decades of debasement. 

As economist Peter Atwater put it, when people are forced to stand in a cold rain for a long enough time, they’ll eventually get in a car with anyone. We can only hope Javier Milei doesn’t take them for a ride.

It’s OK to be optimistic that he won’t. But perhaps cautious pessimism is more appropriate. In any event, we mustn’t be naive. 

When assessing the acts of any politician, we should heed the counsel of an earlier one who regularly lauded liberty while letting us down:

Trust, but verify.