New Delhi: In what is being perceived as an unusual move, the US has extended a proverbial lease of life to Argentine President Javier Milei. In a post on X, American Treasury Secretary Scott Bessent wrote that the US is prepared to do “what is needed” to steer the Latin American nation out of its “long history of decline”.
A known Trump faithful, Libertarian President Milei’s stint in power –– he was elected in 2023 –– has been marred by crises. He was most recently in hot water for a corruption scandal when his “powerful” sister Karina was accused of bribery. Soon after, the Argentine parliament overturned Milei’s veto of a law which “increases spending and protection for people with disabilities”. The house was filled with opposition MPs decrying Karina’s corruption to the tune of the popular Cuban song Guantanamera. Things have grown bleaker since—he recently lost a crucial legislative election in Buenos Aires by 13 percentage points.
While a legislative election may seem like small fry, in Argentina, Buenos Aires covers 40 per cent of the Argentine electorate—and this result could be a primer of what is to come on 26 October, the day of midterm elections.
Saved by the US
When Milei was elected to power, he promised his people “economic shock therapy”. But as of last year, his free-market revolution had left 60 per cent of Argentines living below the poverty line– from 44 per cent 6 months earlier. Milei had been elected on the grounds of revival and the rekindling of the Argentine economy.
“The fiery economist, who describes himself as a libertarian, cut primary government spending by 40% in the first quarter of 2024, largely by slashing financial transfers to provinces, stopping public works, and holding salaries and pensions at steady levels instead of raising them with inflation,” said the Wall Street Journal about Milei.
In the same report, a supporter went on to say that “people are starving” in Argentina.
The reforms suggested by Milei rely on a “strong peso to contain inflation.”
“His government’s interventions to prop up the currency, even after committing to a limited float, have long worried both voters and investors. Voters dislike the economic damage that is the inevitable side-effect of intervention,” said The Economist.
Last week, the Argentine peso was briefly 1475 to the US dollar, and the already overwrought Central Bank was forced to spend an additional $1 billion of its foreign reserves as respite to the Latin American economy. Now, the US has swooped in as a much-touted saviour — to keep Argentina afloat.
“These options may include, but are not limited to, swap lines, direct currency purchases, and purchases of U.S. dollar-denominated government debt from Treasury’s Exchange Stabilization Fund,” said Bessent.
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Chainsaw-carrying populist
Other than his populist promises, Milei is also known for the bizarre, eccentric ways in which he presents himself in public. In 2019, he arrived at the Buenos Aires Comic Con in the avatar of his alter ego: General AnCap. He was obnoxious. He shouted expletives. He cursed “Keynesians” and “collectivists” –– avowing to remove them from the country.
“The anarcho capitalist branding, the rude tone, the obscenities, and the underlying message of hostility toward elites were basic features of Milei’s political character. Four years and nine months later, Argentines elected him president with almost 57 percent of the vote in a runoff,” is how the Journal of Democracy describes Milei’s ascendancy to power.
Milei was elected, as populists are, on a mandate grounded in grandstanding and powerful imagery. At a rally in La Plata, he brandished a chainsaw, which he said would be used to eviscerate social programmes, government spending, and the ostensible “privileges of the political class.”
It took about a year for Milei’s Ministry of Deregulation and State Transformation to shut down over 200 national secretariats and undersecretariats. As a result, 40,000 government employees were rendered jobless.
US President Donald Trump and Milei are said to share a close relationship, and there’s a common refrain that suggests that the US President took a leaf out of his Argentine counterpart’s book when setting up the Department of Government Efficiency (DOGE), which was helmed by tech billionaire Elon Musk.
In February at the Conservative Political Action Conference (CPAC), Milei, who is ordinarily seen sporting a leather jacket, was dressed in a suit, as he gifted a chainsaw to Musk –– who christened it the “chainsaw of bureaucracy.” Engraved on the chainsaw was a message: ‘Viva la libertad, carajo’, which, when translated to English, reads, ‘Long live liberty, damn it’.
Milei is a through-and-through character. When seeking advice, he turns to his five dogs –– whom he has called “the best strategists”. Conan, his first dog, a mastiff, died in 2017. Milei then had a telepathic conversation with his dead dog –– who told him that it was God’s mission for him to become President of Argentina. The dogs that have come since are clones –– created using Conan’s DNA.
Post news of Trump’s bailout, Milei wrote on X: “Huge thanks to @SecScottBessent and President @realDonaldTrump for the unconditional support to the Argentine people, who two years ago chose to turn around a century of decline with a lot of effort. Those of us who defend the ideas of freedom must work together for the well-being of our peoples.”
“LONG LIVE FREEDOM, DAMN IT…!!!,” were his parting words.
(Edited by Ratan Priya)