Date: 08/14/2023
Author: Mr. X
Javier Milei, until recently considered something of a quack at worst and a protest candidate at best, is now the winner of the first round of Argentina’s presidential election. He secured about 30% of the vote, surpassing what polls suggested he would bring in by about 10 points. This means that polls have been massively underestimating his appeal – and so the press had better stop snickering.
The general election will take place on October 22 but is likely to head to a November runoff, so this won’t be over soon.
Milei’s has many controversial ideas, notably making the American dollar the official currency of Argentina. That would certainly be one way of alleviating Argentina’s chronic inflation and currency problems, though some in the country claim it would be a humiliating abandonment of sovereignty. However, considering Argentina’s economic problems, including inflation over 100%, high poverty, and chronic debt, many are clearly ready for drastic solutions. The time is especially promising for change given that the leftist establishment party has been in charge for 16 of the last 20 years.
Milei also offers a bevy of other right-libertarian proposals, including liberalizing laws on gun ownership to fight crime. Yet his party, roughly translated as Freedom Advances, has little institutional support. On the other hand, this means some of the more extreme proposals may have little chance of becoming law – which could encourage more voters to take a chance.
Certainly, Mr. Milei’s has strong ambitions. “We will put an end to Kirchnerism and the parasitic, thieving political class that is sinking this country,” he said, slamming former president Cristina Fernandez de Kirchner. The competition now may focus on uniting the right wing, as another candidate, Patricia Bullrich, won over a more moderate candidate to head up a right-of-center party. Likely only one right-wing challenger will survive to contest the left-of-center party for power.
Expect the media to, frankly, lose its mind in the coming weeks. Yet it may be the economy that determines what happens in the election. Ironically, Milei’s strong showing could further destabilize the Argentinian economy – which may end up helping him if inflation spikes and the current government can’t deal with it. The International Monetary Fund is also scheduled to make a decision soon on loan disbursement. The IMF may decide to extend the current government a lifeline – lest it have to deal with a candidate utterly outside the governing establishment. But if the international and national powers that be can’t get Argentina’s government under control, there’s little reason for Argentina not to take a chance on the challenger.
Mr. X is an investment analyst working in the Washington DC area who specializes in the intersection of business and public policy. After fifteen years working in politics, he writes on a classified basis for RogueInvesting.com to bring you news on what those with power are debating, planning, and doing
