New Argentinian Conservative Leader Achieves First Budget Surplus in Over a Decade
The Argentinian government has managed to run its first budget surplus in over a decade just two months after its new president, Javier Milei, took office.
A budget surplus occurs when a government collects more money than it spends. This means taxes can be lowered and the economy will be stimulated by increased consumer spending.
Milei, a libertarian, achieved a surplus of roughly $620 million through an ambitious plan equivalent to 5% of the nation’s GDP. For the United States, this would be equivalent to a spending reduction of $1.4 trillion during a single year.
Details include:
- Firing every public employee who was hired within the past year
- Cutting appointed government positions by 34%
- Pausing all public infrastructure projects, government publicity campaigns, and money transfers to local governments
- Devaluing the local currency by roughly 56%
- Halting import/export quotas and licenses
- Increasing taxes for non-agricultural imports and exports
- Expanding direct aid programs for childcare and access to food
The plan, described by Milei as “shock therapy,” is designed to treat an economic crisis brought on by years of over-spending, excessive money printing, and Peronism (a mix of socialism and fascism) that saw Argentina devolve from prosperity to poverty.
According to a recent study, inflation in Argentina is above 200% and 57.4% of its citizens live in poverty.
“The main leaders of the Western world have abandoned the model of freedom for different versions of what we call collectivism,” argues Milei. “We’re here to tell you that collectivist experiments are never the solution to the problems that afflict the citizens of the world – rather they are the root cause.”
Milei’s free market approach is similar to strategies that have helped Ireland, Hong Kong, Estonia, and others recover from economic crises (and reduce the government’s influence over individuals). However, as journalist Jon Miltimore points out in the first article linked below, the mainstream media in the US all but refused to comment on Argentina’s success.
This could be due to embarrassment (the US, which is more than $18 trillion in debt, hasn’t seen a budget surplus since 2001), but is more likely due to the close relationship between the mainstream media and the US government, the latter of which opposes free-market libertarians like Milei in the interest of self preservation.
Reuters published a brief article that mentions the budget surplus, but primarily focuses on Milei’s decision to devalue the peso as the reason poverty in Argentina jumped from 49.5% in December to 57.4% in January. That may be true, but it’s clear that dramatic steps were necessary in order to put Argentina on the right path.
Milei, 53, was elected on campaign promises to “dollarize” Argentina’s economy, slow the inflation rate, eliminate the fiscal deficit, and remove some power from political dynasties. It seems like he is doing exactly what he promised.
Javier Milei Delivers Argentina’s First Surplus in Over a Decade – and US Media is Silent
The left will try and destroy him too. Just like they are trying to do to Trump. But it’s great that the select committee has been caught withholding evidence and lying. But like most democrats crooks nothing will be done. But if it clears trump we will take the win and move on. So go ahead and spin it Frank. You think everyone else is stupid
Richard, I did provide some facts, and opinion below. I can undertand that facts make you feel stupid, but rest assured, I don’t think you are stupid. I think you are a ……. oh, nevermind.
That’s how conservatives are supposed to roll
“The Argentinian government has managed to run its first budget surplus in over a decade just two months after its new president, Javier Milei, took office.” Anyone believe it’s this guy’s efforts? Two months? Ought to own the world in a year?
Why do conservative journalists have to lift themselves by falsely claiming no coverage by MSM? This one ran in Reuters, Barrons, Bloomberg, Youtube, fox, france24, NYSun, Yahoo News, WION, Skynews, and many more. What hasn’t played yet is a thorough review and analysis: the guy could be lying.
As Alice did not note, no review of this report, not sure anyone has seen it to review. Gee, after half the government gets fired, what kind of report might come out of the folks that are left? Why didn’t Alice mention that? Why did she leave that out? What else did she leave out? Is she being paid by Milei? Or by Russians? Sorry, I started thinking like Alice, my bad.
And unlike Alice who seems warm and fuzzy on this, most journalists reported on the human tragedy that the Argentine economy and this austerity plan has caused and how Milei’s program has taken that suffering to even higher levels. On a positive note, IMF says yippee! Looking good, feeling good about Argentina’s ability to pay them back. But at what toll?
As Alice notes, poverty is at 57.4% having jumped 15% under Milei — that’s got to cause great human suffering. That’s 3.5M people added with over 28M in total. That’s a lot of poor folk. A lot of hungry poor folks. A lot of hungry poor folks that can’t even afford the bus to get to work.
He devalued the peso raising inflation from 143% to over 254%, that’s got to cause great human suffering. Note that inflation has lessened in past two months, but it’s still the highest in Argentinian history.
He fired half of the federal government tossing thousands to the street.
He refused to update pensions for inflation. This represents 33% of the budget cuts coming from the retired and elderly. They don’t scream as loud when starving.
He cut energy and transportation subsidies which means public transport suffers.
Slashed spending tossing thousands more to the street.
As Alice states, she believes: “That may be true, but it’s clear that dramatic steps were necessary in order to put Argentina on the right path.” NOT. That’s Alice’s opinion, I say there are kinder, gentler ways to achieve the same results with less human suffering and less stress on the social fabric. Ask Greece; took them 12 years, but they didn’t suffer this crap.
Alice also missed that he redid Argentine’s debt getting an extension for pretty good rates, a real coup for the President.
While I agree that drastic measures are needed, that previous governments spent them into a hole, chances are this is unnecessarily cruel. Adding 3.5M to poverty rolls, and that’s Argentinian poverty, not US poverty, is very bad. Having so many poor, so many unemployed is not a New Deal. It’s the old way.
As I noted when he took office, time will tell and the proof will be in the pudding which after a couple of months, has not set yet. They were in a disaster before he took office, they are in a disaster now. The fact that he says he’s in the black, got the bonds refinanced, IMF likes him, all good news. But millions added to poverty, tens of thousands newly out of work, his next opportunity will be how to handle the riots. Hopefully the words harsh and drastic will not be used.
And Alice, there’s no comparison to the US economy. None. So stop that conservative clap trap.
Bottom line: he cut so much to the bone with shock and awe that the economy shrank overnight, he’s in recession, people can’t even afford a bus to work, and it’s a nation of idle hands. Time will tell if he is pulling out or circling the bowl. Right now it looks like pulling out, but it’s very early and the data may be tainted.
Finally, Alice: you state: “This could be due to embarrassment (the US, which is more than $18 trillion in debt, hasn’t seen a budget surplus since 2001), but is more likely due to the close relationship between the mainstream media and the US government, the latter of which opposes free-market libertarians like Milei in the interest of self-preservation,” an opinion for which you provide no factual support, sources, or other confirmations that a real journalist would be forced to provide before publication. To begin with, Alice, the WORLD rejects free-market libertarians. World renown economists reject free-market libertarians. There are no libertarian countries. There are reasons for that. Perhaps Argentina will be the first, will show us the way, but not prudent to conclude that yet.
But on this one: at best, the jury is still out, starting with seeing the report showing the budget surplus.