2023-08-27 04:09:09
The good choice of the libertarian Javier Milei in the recent PASO placed him as a favorite to repeat in the October general and enter an eventual ballot in November, given the scenario of thirds in which Argentina seems to have been divided. From the eccentric economist who obtained third place in the 2021 legislatures in the Capital, with 17% of the votes, he became the center of attention of analysts, journalists and the economic establishment, which seeks to delve into his proposals and their applicability. if it reaches the Rosada.
“I am a libertarian liberal. Philosophically, I am a market anarchist.” defines himself the presidential candidate. He also left clues in his book “The path of the libertarian” that compiles opinions and speeches written since its political launch, just 5 years ago. There he declares himself an admirer of authors belonging to the most radical faction of liberalism, the so-called “Austrian school”, among them Friederich Hayek and Edwing von Mises, who argue with classical liberals like Milton Friedman or John Rawls.
The main difference between these schools is that, for classical liberals, a state structure (government, laws, justice, education, etc.) is necessary to resolve conflicts and settle differences between people with different opportunities. For libertarians, “individual freedom is a supreme value” and they are suspicious of almost all state control, considering it intrusive and unnecessary. The forms of the social order are defined by mutual consent, unrestricted rights, and unlimited economic freedom. They propose a minimal state, limited to police and administrative functions.
During his public presentations, he has reaffirmed this profile with bold phrases: “the chainsaw plan in the State”, “dynamit the Central Bank”, “end public works”, “end co-participation”, “social justice is robbery”. ” “taxes are a hindrance to slavery”, or allow the free carrying of arms and the sale of organs. But he usually contradicts himself, such as when he talks about security and puts the State in the foreground, or when he develops his plans with long deadlines that play down the harshness of his statements.
In moral aspects, such as abortion, He has positions that are more compatible with a religious conservative than with libertarians he says he admires like Ayn Rand, that consider the fetus as “part of the body and therefore freely available private property”. Milei considers him “another individual” over whom the woman “cannot dispose”.
Others find populist traits in his discourse: his binary division between a hard-working and enterprising “people” hampered by a “caste” that appropriates the income and its continuous reference to an idealized “golden past” that situates at the beginning of the 20th century with the “Generation of 80” and a “national decadence” that is not only political or economic but also “moral”, for the abandonment of liberal principles.
For political analyst Julio Burdman, consulted by Río Negro, Milei’s great merit in these elections has been connecting with a part of society “that is experiencing a situation of anguish and is eager for solutions” by “putting on the table a government program, like it or reject it. In the post-PASO qualitative studies, everyone points out that Milei ‘proposes things’, for example for inflation, regardless of whether they see it feasible or not. For now, no one knows very well what JxC or UP propose to solve it”.
Beyond his charismatic leadership, which combines a “pop-punk” aesthetic between bland and aggressive, Milei “proposes deep ideological debates and review everything,” says Burdman, that highlights three axes. By proposing “destroy partnership” Milei questions the efficiency of the national state and proposes that the provinces be the ones who collect taxes and live on them, something that “not even the provincialist movements propose.”
Talking about dollarization, “implies reviewing all macroeconomic policy, because the entire board of your monetary policy would no longer be handled by you”, adds. And finally, Milei also comes to “to review the consensus of Argentine democracy, the reading of history that gave rise to 1983, the contradiction between the democracy of the parties and the military. Milei, but above all her partner Villarroel, proposes an alternative story, that there was a ‘civil war’ between two sides, something that no majority force had raised until now, except perhaps Ucedé in the ’80s, and very lukewarmly”, he adds .
Within the libertarian program, several proposals have a problem: they would need large majorities in Congress, such as co-participation, education, privatization, tax reform and the social security system, and some of them including constitutional reforms, something from little to nothing probable with the current and expected conformations of the Chambers of Deputies and Senators.
Given this, Milei argues that his proposals are designed in at least “three stages” and in terms of up to 35 years, which would take at least 9 efforts of 4 years each. The libertarian points out that his ambition is to generate “a cultural change” that would make it possible, without specifying how this continuity of policies would be established in such long terms and without making it clear what he would do in his first four years if elected. These are some
Dollarization is now “gradual”
The gradual expression is not minor, because Milei’s speech has varied towards a proposal that includes adopting the dollar as a long-term horizon, where the fiscal and monetary front should first stabilize. He proposes to use the gross reserves and public titles of the Central Bank, in addition to other funds. The exchange rate would be a “market dollar” of $700 (close to blue). She argues that the necessary foreign currency would come from funds that today are outside the country and from the formal circuit, thanks to the promotion of the use of foreign currency in operations. According to specialists consulted by Chequeado.com, this would imply market confidence and external financing that Argentina does not have today. She proposes releasing the stocks from day one, unifying the exchange rate and eliminating withholdings, without specifying how she would compensate for the loss of income. Milei spoke of an extra payment of Earnings from the farm. Economists warn that a sharp devaluation would trigger inflation to levels higher than the current ones.
Elimination of the Central Bank
It comes hand in hand with dollarization, since without monetary policy management, its role would be reduced to a “superintendency of banks” that regulates and audits the system, but he would no longer handle currency, lace, or Treasury bills.
Sharing and Natural Resources
drives Eliminate co-participation, which would have a strong impact on the budgets of the provinces. He talks about financing a tax reform with “royalties and concessions for the exploitation of natural resources”, that the 1994 Constitution granted to the provinces.
ministries and plans
Although he postulates reducing “15 points of GDP” in the fiscal deficit, this would be done “in three stages” and over “35 years.” Milei’s “chainsaw plan” reduces the ministries from 19 to 8. However, he later relativized the possible layoffs, saying that they will merge areas, the personnel “will be redistributed” and only the “political plant” would appear and not “workers”, without mentioning how they would be distinguished. The reduction of social plans would also be “progressive”. Immediately “they are not touched because those who receive them are victims”, said. They would be eliminated when private employment picks up.
pension system
raises back to the private retirement scheme similar to the AFJP, considering that private actors would offer services in a balanced way, for their own interest. Eliminates the employer contribution, with an exclusive scheme of personal contributions. It would liquidate the exception regimes.
Foreign policy
He rejected the entry of Argentina to the Brics (China, Russia, India, Brazil and South Africa) and also said that would leave Mercosur. In both blocks are 4 of the five main destinations for Argentine exports. It would move away from China and the US and Israel will be “strategic” partners.
Public works and services
It would eliminate the system of public works financed by the State to go to one of “private initiative” which, as detailed, would be “Chilean style, with details from Peru and something from Switzerland”, which you did not specify. Another source would be to eliminate transfers to the provinces and subsidies for electricity, gas, water and transportation. It will privatize public companies.
Labour reform
It would reduce employer charges and would change the compensation system towards unemployment insurance, similar to that of the UOCRA, without specifying how it would work and by whom. Promotes “free contracting” negotiated between companies and workers, eliminating collective and parity agreements.
educational vouchers
Proposes to change the public system by developing vouchers to decentralize “giving the budget to the parents”. Experts say that it is not possible to move to a system of financing on demand without changing the Constitution and the National Education Law.
paid health
In Health promotes “tariffing all benefits.” Added to this is the “creation of a universal health insurance proportional to ability to pay of the recipient of the service”, without defining how this ability to pay would be determined. It would charge health to non-resident foreigners.
Abortion
Proclamation “the defense of the right to life from conception”, although it does not explicitly refer to Law 27,610 that guarantees Access to Voluntary and Legal Interruption of Pregnancy, sanctioned in 2020 after a long debate in Congress . Milei proposed “a plebiscite. And, if the result is in my favor, the law is eliminated. But let the Argentines choose”. However, constitutionalists warn that the consultations established by the 1994 reform must be proposed by Congress and some believe that criminal law issues cannot be put to referendum.
Security
raises deregulate and simplify the gun ownership system, although for now it has abandoned the “free portability” proposal that it had supported in 2021. It does raise a privatization of the prison system, which in a first stage would include militarizing the penalties, perhaps in the style of what Bukele does in El Salvador.
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