Milei: The only real news of the year

 

Milei: The only real news of the year

The year 2023 has been far from uneventful and there are scores of very good “year in review” posts. But for an Italian like me, and for the world in general, nothing in my opinion comes close to the free election of Milei in Argentina.

Argentina has been a sick man of South America for longer than I have been alive. But that was not always the case, and while present day society, with its weak familial relationships and indifference of history can ignore it, It was indeed a wealthy and thriving society in the latter part of the 1800 and early 1900. For me, that's part of the family lore since of the five brothers one of which was my paternal grandfather, three emigrated to Argentina in the early part of the past century. I probably have more relations there than here in Italy.

That was partly due to a federalist constitution and a series of market friendly governments which allowed the country to make the most of its advantages and go on to reach a standard of living better than most of Europe. After this “golden age”, things went downhill during the interwar years between the First and the Second World wars, in both of which Argentina tried to stay neutral, succeeding in WW I but due in part to the quite unstable political situation, with military coups and strife not managing to remain neutral until the end in WW II.

Then Peron ascended to power. Nationalizations and political repression ensued, opening a dark period of civil war that lasted decades and to all intent and purposes only ended in the early 1980ies, after democracy returned after Argentina lost in the Falklands war.

There have been some attempts of re-establishing a market based economy, most notably under Macrì, but those failed, and successive governments imposed further neo keynesian policies and added government spending and inflation.

It is then peculiar, and doubly so seen from Italy, that eventually this year Javier Milei won.

Italy and Argentina are culturally very similar, with a quite dominant left of centre culture that places “the common good” over the individual. Of course the outcome in Argentina has been worse, but Italy is no slouch, having accumulated a -25% GDP growth gap vs. similar #EU countries, and a Total Tax Rate (income plus capital taxes plus compulsory social security contribution) on the “legal”effective GDP skirting 50%, making the State the majority owner of citizen lives.

Yet.... Argentine citizens managed to defy the global elites by electing someone whose main exclamation when speaking of ministries and bureaucracies is “Afuera!”, and that in his electoral program has indicated that he wants to cut 15% of GDP from government expenses, mainly by closing or consolidating the very bureaucracies that are dominant elsewhere in Western society.

Majority Rule or Average Rule?

So why I surmise that of all the news of 2023, Milei's election is the most important?

Well, to understand that, one has to look back to 2023 in Europe or the US and check how the political sausage is made.

In Europe, the centralized command structure rendered doubly immune from voter control by the voting structure and the Byzantine way decisions are actually made, but above all, how they act as a straitjacket on any tendency of any individual country to stray from the pack. In addition to that, the EU commission, a significant part of the political process, is to all extent and purposes immune from any semblance of popular validation: EUCO President Von der Leyen was airdropped AFTER the last round of European Elections, and I remember that well since I am one of the high and increasing number of Italians who think going to vote in the polls can be pointless. So, last time, I was duped by the effort by then parties to present each a “Spitzenkandidat”. So when I whined with my more dutiful wife that was trying to convince me to go that “I wanted no part in an EU who might give a spot to Von der Leyen”, she spun a convincing argument that she wasn't on the indicated list. A fool as always, I went, thinking I was voting for Manfred Weber. After the elections, goodbye Weber, hello Von der Leyen, who continued her shining career after a stint as probably the worse German defence minister since WW II by refusing to produce documentation she was compelled by her post to keep and is been sued by the New York Times.

But be it as it may, the EU passes for a feature what is actually a bug: by imposing an ever increasing number of Beds of Procustes through EU directives, all the while claiming that these are “markets”, it reduces both the occurrence of dispersal in responses and the ability of the whole of the EU to learn though diversity. The shining example of this rigidity comes from COVID response. My daughter was attending University in Sweden at the time, and when Sweden's COVID response architect refused to impose the harsh lockdowns so preferredby the rest of the EU, Sweden disappeared from mainstrem media altogether. “The boss can do no wrong”, the real motto of the EU.

So Milei is “news” on three counts, two mediocre to good, and one scary, for an Italian.

The two positives depend only on Argentinians. If Milei goes at the apparatchiki with his now famed buzzsaw and ultimately fails to make the economy recover.... it will be still very difficult to nonviable to rehire all those useless mouths at one go. Not good, but not bad, and it might locally cause a rethink about what is needed and what is a luxury.

If he succeeds, I expect Argentine to disappear from main stream media in Europe and possibly the US as well. That success would be for the Brussels crowd more ominous that opening a window in the morning and see Putin's T72 tanks parked in front of Palais Berlaymont. After all, he's the devil they know and love, see their acquiescence from 2014 onwards.

But that, for me, it's the depressing thought: not only there is no chance ever of any EU country undergoing such a shock treatment, even under economic duress, but in a kind of “reculer pour mieux sauter” if Europe indeed falls through economic cracks (not my central case, but still) I do not want to know or experience the kind of upheaval that would be needed to lose the instinct to add unproductive debt to any kind of economic slowdown, as if government spending had by natural law a positive economic multiplier.