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You have to consider why Milei was elected in the first place - a dramatic break from typical Peronist politics with a historic 55% of the vote. The picture in

by Empact 2y ago

You have to consider why Milei was elected in the first place - a dramatic break from typical Peronist politics with a historic 55% of the vote. The picture in Argentina was not rosy before Milei took office, it was a country on the verge of hyperinflationary collapse, with a population declining through emigration, a largely informal economy in decline, and people struggling to keep up with dramatic inflation. I don’t know of another case where hyperinflation was arrested without introducing a new currency. Milei has apparently done it by simply cutting spending, which naturally comes with some pain as the subsidies and government employment are curtailed, but a sound currency sets the stage for distributed investment, lending, entrepreneurship and growth. More recent policy changes have focused on opening up the country to exports and imports, which will be key to bringing about prosperity through growth in industry, and bringing prices into line with international norms. https://www.msn.com/en-us/politics/government/javier-milei-deregulates-food-imports-and-exports/ar-AA1xAZA5 https://www.msn.com/en-us/politics/government/javier-milei-d...

asveikau 2y ago
I feel like the overall trend in global elections of the last few years is to blame global problems on local politicians. It's correct that Argentina's fiscal situation has long been difficult. But if it improves, is that on Milei? Or is it just waiting out the worst of a bad economic boom-bust cycle? Rather like waiting for the weather to improve, then the politician says he brought the sunshine.
- xienze 2y ago
  > But if it improves, is that on Milei? Or is it just waiting out the worst of a bad economic boom-bust cycle? This might be a valid observation in most other countries, but Argentina has been a basket case for ages. It’s defaulted nine times in a little over 200 years, and two of those defaults were in 2014 and 2020. I think this is one of those cases where you might could attribute a dramatic one or two year turnaround to the person actually doing something new (spending less).
  - asveikau 2y ago
    When I look at Argentina I still see boom-bust cycles that subside. The most prominent crashes I can remember are in the late 90s/early 2000s and the current one.
- nradov 2y ago
  In the case of Argentina they literally are waiting for the weather to improve. Much of their economy is based on agricultural exports and crops have suffered from drought lately.
tptacek 2y ago
I'm not rendering a verdict on Milei. I don't know enough about his status quo ante; my priors are that Argentina was an economic basket case before, so I'm not predisposed to defend his predecessors. I have longtime friends from Argentina that absolutely loathe Milei, but they don't read HN so I feel pretty safe being open here. I'm just commenting on this specific article, in which the author repeatedly makes firsthand contact with the immediate outcomes of Milei's policies, finds them to be generally bad, and concludes that the experience is evidence that things are going well.
vitorgrs 2y ago
Inflation in Argentina is still not under control. If the current number continues, they will have 30%~ yearly inflation. Argentina already saw this number before numerous time, including under Macri government.
- Empact 2y ago
  In Argentina, the informal (free market) peso to dollar rate is called the “blue dollar,” it rose from about 200 to 1200 pesos per dollar in the 2 years prior to Milei taking office and has held relatively steady since: https://bluedollar.net/informal-rate/ https://bluedollar.net/informal-rate/
  - vitorgrs 2y ago
    Yes, I'm aware of that. Doesn't change the fact that inflation is still high. But the real issue is, the "oficial" dollar rate is controlled by Central Bank, and it won't be for long. When, as he promised, he let the peso float totally free, we'll really know even if the inflation can continue at 30% yearly. Let alone, together with this, the growth of this year, that will likely pressure the inflation. They managed to reduce the inflation to 2.7% monthly, while the country was in a 3% GDP recession.

by Empact 2y ago

asveikau 2y ago

I feel like the overall trend in global elections of the last few years is to blame global problems on local politicians. It's correct that Argentina's fiscal situation has long been difficult. But if it improves, is that on Milei? Or is it just waiting out the worst of a bad economic boom-bust cycle? Rather like waiting for the weather to improve, then the politician says he brought the sunshine.

xienze 2y ago
> But if it improves, is that on Milei? Or is it just waiting out the worst of a bad economic boom-bust cycle? This might be a valid observation in most other countries, but Argentina has been a basket case for ages. It’s defaulted nine times in a little over 200 years, and two of those defaults were in 2014 and 2020. I think this is one of those cases where you might could attribute a dramatic one or two year turnaround to the person actually doing something new (spending less).
- asveikau 2y ago
  When I look at Argentina I still see boom-bust cycles that subside. The most prominent crashes I can remember are in the late 90s/early 2000s and the current one.
nradov 2y ago
In the case of Argentina they literally are waiting for the weather to improve. Much of their economy is based on agricultural exports and crops have suffered from drought lately.

tptacek 2y ago

I'm not rendering a verdict on Milei. I don't know enough about his status quo ante; my priors are that Argentina was an economic basket case before, so I'm not predisposed to defend his predecessors. I have longtime friends from Argentina that absolutely loathe Milei, but they don't read HN so I feel pretty safe being open here. I'm just commenting on this specific article, in which the author repeatedly makes firsthand contact with the immediate outcomes of Milei's policies, finds them to be generally bad, and concludes that the experience is evidence that things are going well.

vitorgrs 2y ago

Inflation in Argentina is still not under control. If the current number continues, they will have 30%~ yearly inflation. Argentina already saw this number before numerous time, including under Macri government.

Empact 2y ago
In Argentina, the informal (free market) peso to dollar rate is called the “blue dollar,” it rose from about 200 to 1200 pesos per dollar in the 2 years prior to Milei taking office and has held relatively steady since: https://bluedollar.net/informal-rate/ https://bluedollar.net/informal-rate/
- vitorgrs 2y ago
  Yes, I'm aware of that. Doesn't change the fact that inflation is still high. But the real issue is, the "oficial" dollar rate is controlled by Central Bank, and it won't be for long. When, as he promised, he let the peso float totally free, we'll really know even if the inflation can continue at 30% yearly. Let alone, together with this, the growth of this year, that will likely pressure the inflation. They managed to reduce the inflation to 2.7% monthly, while the country was in a 3% GDP recession.