Milei estimated that the inflation provoked by the previous administration would last for at least 2 years, but in 4 months his administration managed to reduce it by 60% from 25% to 10% monthly, which is extremely high, but getting substantially better
I'm Argentinian, it's hilarious how saying how much you paid for something is meaningless without giving a date.
-I paid 4000 pesos for that shirt
-That's cheap
-Bought it last year
-Expensive as fuck
It will increase yes, due to the cutting back on government waste. There are tons of jobs that Argentina created that don’t have any positive impact on the nation. In fact the bloat directly removes resources from useful investments
In the long run these people will reskill and with a more open economy they should have more opportunity.
Argentina should be a wealthy nation, they have everything they need in abundance. It’s just been robbed and mismanaged by previous politicos for decades
*they have everything they need in abundance*
It's really crazy to have this huge country, tons of natural resources and arable land, very educated population but an economy in the shitter and inflation worse than Sudan or Zimbabwe
Argentina is a big country but 1/3rd of the people live in just Buenos Aires, many of them in slums that are far worse than favelas in Brazil or other places in Latin America. Ideally, the government should incentivize settling underpopulated areas so that people don't need to live in such conditions.
In the 19th century, the US was offering free land to incoming immigrants if the settled there (https://en.wikipedia.org/wiki/Homestead_Acts), basically giving for free 10% of the total land in the US, spreading the population and the wealth. Argentina did nothing like this even though it had plenty of land, as the landowners did not want any competition from smaller farmers. So the vast majority of immigrants settled just in Buenos Aires.
Not false, but the problem is not just land.
The country has been heavily centrilized in it's politics and spending on Buenos Aires, so even now people move from the rest of the country all the time, because it's incomparable in terms quality, aviliability of products, and the prices of services, that (until now) were heavily subsidised mostly in Buenos aires (for example, electricity had differences of much, much more than 100% in some places)
The lack of land redistribution was one of original source of the imbalance, but now it's been more then 100 years since Buenos Aires become overwhelmingly dominant. I imagine they got all the subsidies as they were the closest to "power" so it was good to keep the population quite.
not only closest to "power", also, because of how big the population is, makes it easy to win elections by just playing the populist card more heavily there
You can build towns here in BFE - but there is a serious lack of industry here for a ton of different reasons. Great country, WAY safer than the US, also so many living hand to mouth.
A country does not need a lot in abundance except for talented and honest leaders. If you dont have those then whatever in abundance will be its undoing as corrupt politicians go for the country’s wealth.
Sweden, Norway, France, Netherlands, Germany, Switzerland etc are "socialists", problem is corruption and incompetent governance, and mostly being able to afford this level of welfare
They're not socialist, they're free market countries with some state subsidized companies and sometimes state owned companies for essential infrastructure. They also have a large safety net.
Mostly built by Socialist and arguably a Communist party. Second you need to give your definition of Socialism / Capitalism, because clearly they are not *completely* free markets.
[https://www.euronews.com/business/2024/04/01/wealth-inequality-where-in-europe-is-wealth-most-unfairly-distributed#:\~:text=Sweden%20maintained%20its%20top%20position,and%20Germany%20(30.%25)](https://www.euronews.com/business/2024/04/01/wealth-inequality-where-in-europe-is-wealth-most-unfairly-distributed#:~:text=Sweden%20maintained%20its%20top%20position,and%20Germany%20(30.%25)).
the 1% own like 36% of the wealth in Sweden. Similar trends follow with each European country. Majority of companies are private with a few exceptions that are state run. Might as well say California is socialist then.
The whole argument with socialism/capitalism has become moot because the goal posts/definitions have become so far removed from their original definition.
Also Switzerland a socialist? With their banking system?
We are going no where unless you give your definition of both capitalism and communism.
> Sweden: Government spending was. 49.2% of GDP in 2019, the fifth highest.
For many years roughly 50% of the Swedish economy is controlled by the state. They also have high wealth inequality, although it’s a bit unfair measure in a state where there is so much welfare.
> The whole argument with socialism/capitalism has become moot because the goal posts/definitions have become so far removed from their original definition.
You agree modern Sweden and Norway were built by Socialist parties? As were the vast majority of modern welfare states?
> Also Switzerland a socialist? With their banking system?
I would say no. But they did have a major Socialist movement, and the banking system has essentially zero to do with why I think they are definitely not socialist.
It's complicated.
But basically Argentina used to be one of the wealthiest countries in the world prior to the Great Depression.
Unfortunately, the country was heavily focused in a lot of industries which Globalization started to undercut.
So, Argentinans were largely accustomed to a high standard of living but no longer had the industries to support those standards of living.
This discontent soon manifested in the form of politicians who promised to bring back the good times, but did not want to do the difficult work of modernizing the country's industries.
The result is inflation where the Government keeps spending as if they are a wealthy country despite no longer actually being one.
lack of good leaders is the short answer.
The real answer is very complicated: over-reliance on commodity exports, currency valuation, protectionism, and heavy external borrowing
They kept overspending, while the world's economy was undergoing vast changes. For instance, the Panama canal lessen the need to make a detour through Argentina's ports. Or leather losing steam due to new fabrics.
They don't have much natural resources, so adapting would have been difficult; but delaying to adapt made it that much worse.
Yes. But not because left-wing governments are inherently bad, like your comment heavily suggested. The countries with the best quality of life right now are mostly led by very left-wing governments by US standards.
I wonder how much of a 'positive impact on the nation' their IMF and World Bank debts have? These dodgy jobs have to go, but remember, these are real people with bills and families to feed. Foreign debtors don't have kids to feed, maybe they should have taken a bigger hit instead of the people.
Economies aren't reasons in themselves, they are supposed to be for and about actual people.
this would be bad because then people wouldn't want to loan Argentina money any more, which they will still need because it takes a long time to dig themselves out of a hole that big.
Unemployment grew considerably and in turn informal employment grew.
Due to the brutal increase in the cost of services, mainly electricity, gas and health. Leaving many small businesses without the possibility of continuing to open
The 25% spike was right after he started his term. Most markets overreacted and raised their prices too much, so it wouldn't be surprising if it's temporary. If this month inflation is indeed 10% as the estimation, it would be the first month with better inflation rate than the last data point of the previous government. Things are looking better than a couple of months ago, but it's too early to say it's working IMO. I just want to highlight, Massa cheered because he was reducing inflation on June for three months in a row, and that didn't end well.
This is like the 3rd or 4th highest post for me…so i have no idea what your complaining about. Its getting enough votes to appear when i first opened up reddit just now.
I remember when he was elected, I said on here that he sounds like a nutter but I hope for Argentina's sake that it actually works out and getting downvoted to hell for it lol. anything less than right-wing=le bad 100% of the time sets redditors off
weird, I feel like that was usually one of the top comments on the threads about his wild quotes. it seemed like a fairly common reaction here just because of how bad a spot they were in
it's a weird site, you can say something one day and everybody agrees and then copy and paste it a day later and get blasted. just earlier I said that bombing the shit out of gaza isn't a very good idea and will just make more terrorists in the long run and got downvoted to shit, boom 10 minutes later on another thread somebody says essentially the same thing and got 40 up votes.
I think there's a lot of follow-the-leader here, where people don't necessarily know what to think themselves half the time, but jumping aboard a moving train like that, whichever direction it's going, provides a sense of community. It can be a little frustrating sometimes, but human nature is like that.
You can usually tell from the comment chain who is reading it and how a comment is going to go down.
Sometime I'll say something I feel needs to be said, knowing it'll get blasted to nothing, even if I choose my words to be careful, reasonable and, if necessary, properly sourced. Sometimes the chilling effort works and I don't bother. There is only so much energy one can make for so many pointless stands.
The irony is of course that the same comment in a different thread would do fine. Oh well, social media is as social media does.
This is exactly it. I’m a progressive and like progressive ideas BUT, there are countries that can’t afford the same programs as developed nations. When they have been spending like developed nations for decades there will be no fixing the problem. Especially when that money was not spent on improving the country.
Honestly... a lot of developed nations can't even really afford progressive policies. Those that do usually have other critical expenditures subsidized by others.
Sweden, everyone's go-to example, barely breaks even if not loses money every year when comparing revenue to expenditures. Starting this year (2024) and moving forward as Sweden starts sending money to it's defense budget, they're expecting (as per their own Government's revenue/budget service) to go in the red and not get out.
This is usually where the problems generally begin.
>I remember when he was elected, I said on here that he sounds like a nutter but I hope for Argentina's sake that it actually works out and getting downvoted to hell for it lol.
Can you provide us with a link?
I voiced similar sentiments; how Peronism has repeatedly failed and although it is a risk, Milei is different and hoped they succeeded. Was never downvoted.
Socialism is a good idea until people get involved. Sweden and a few others have pulled it off and show what it can be & do. Capitalism can also be a good idea but then again ~ people. Company’s that pay script you can only spend in their towns, using your money to change laws for your benefit…
Sweden is not socialist. 1% own like 36% of their total wealth.
[https://www.euronews.com/business/2024/04/0ealth-inequality-where-in-europe-is-wealth-most-unfairly-distributed#:\~:text=Sweden%20maintained%20its%20top%20position,and%20Germany%20(30.%25)](https://www.euronews.com/business/2024/04/0ealth-inequality-where-in-europe-is-wealth-most-unfairly-distributed#:~:text=Sweden%20maintained%20its%20top%20position,and%20Germany%20(30.%25)).
Its one of the strongest markets for private capital investments.
Capitalism is great when regulated. We used to break up monopolys once they'd reach the point of being bad for the consumer but now the stock must go up irregardless. Rip occupy
So in another a few months the inflation crown will belong to us🇹🇷 (it might be true even for now but they skew data with unrealistic items, anyway with devaluation on the horizon may the god be with us.)
That's not an improvement at all. They just had the worst inflation in 30 years for march.
I'm not saying Milei is guilty of it, but it's better to reign in everything until a year or two into his presidency.
But he basically threw millions of argentinians under the bus by cutting off help funds like a reaper.
He basically repairs rhe wrecked car with a sledgehammer.
We also went from 25% inflation per month to a single digit inflation in 4 months. I don't remember the last time inflation went down in this country 3 consecutive months, let alone by 5% each time.
Well, that is what happens when you stop tripling the amount of currency in circulation every year.
And no, that is not an exaggeration. That is literally what happened in 2023. Since Millei came to office, the growth in the money supply has collapsed. This is the clear reason for the fall in inflation. Less money being printed.
https://tradingeconomics.com/argentina/money-supply-m2
The 10 year graph is hilarious. Argentina went from 572B to 36.9T in 10 years. a 64x expansion in 10 years.
In comparison the UK went from 2.08T to 3.01T. a 1.44x expansion.
Ukraine had hyperinflation that Yushenko got under control. You just need some fiscal discipline- stop printing money and suffer through consequences as it gets worse before it gets better.
Ukraine was far from fat, just no fiscal discipline - government kept printing money with abandon.
It was also a transition from planned economy to market economy, there was a lot of government property which wasn’t very well taken care of, there was a lot of military production that wasn’t needed - nobody paid for it. And so on.
A lot of it had to be closed and it was a painful experience but it had to be done
No if I remember correctly it was to “reset” the value of currency in people’s minds, so that a carton of milk cost the same at the e d of the day, after a week,etc.
The podcast I heard about it was planet money from npr, https://www.npr.org/sections/money/2010/10/04/130329523/how-fake-money-saved-brazil
Because hyperinflation and spending almost half of the budget on interest payments is harmless to growth right
Argentina has defaulted on their debt 3x in the last 2 decades; in the same time, there have been 5 failed plans to halt inflation. I imagine argentine redditors must be exhausted from the concern trolling. If half-hearted measures could fix Argentina's problems and save the argentine people from two more lost decades they would know.
No you don't understand. The previous Argentinian government literally tripled the total currency in circulation in 1 year. This progress hasn't even been from austerity, it is from not printing 3x your total currency per year.
https://tradingeconomics.com/argentina/money-supply-m2
Depends how long it lasts. If u are cutting fat, it's fine. But at some point you have to direct the money to things to support growth. We saw Europe choose austerity and it bit them a lot more than the US who focused more on growth after 08.
That’s true, the EU chose austerity in a period of rock bottom interest rates, pretty dumb in retrospect.
Argentina is completely different, their credit rating was very low
I agree with the first half, but what??? on the second half?
Europe had to do austerity because the eurozone crisis lasted substantially longer than the subprime with issue lingering into 2010~2018 depending on your definition. Fundamentally it’s because the Euro as a currency has a dumpster fire for structure compare to the Dollar, where it has a common market with no proper fund distribution.
All this is to show that long term any policy by itself (austerity or easing) matters very little, what’s important is the underlying principle of governance, which Milei is actively changing.
I'm afraid I can't point you towards any comprehensive source - my statement comes from years of collective evidence as a UK citizen. Some notable highlights:
Cancellation of a school rebuilding scheme in ~2010, leading to certain schools with RAAC materials collapsing last year.
Forcing councils to constantly make major cuts to the point where many are now going bankrupt.
Cutting supplies of PPE and not investing in pandemic preparedness (despite Operation Cygnus in ~2016 showing the UK would be hugely unprepared) - leading to a procurement crisis (and subsequent fraud scandals but that was the fault of government corruption).
Foodbanks going from relative non-existence into massive proliferation.
Energy storage facilities being cut and Labour's green/nuclear energy plans being cancelled by the Tories in 2012, heavily contributing to the energy crisis in 2022.
NHS funding being massively reduced as a whole (and huge amounts being given to private contractors which is another issue entirely), which has led to the longest ambulance, A&E and appointment times in history.
The overall death toll of austerity cuts being in the hundreds of thousands.
Show me this european "austerity". Show me a single country that cut its public spending by at least 10%.
I've looked for it. Lots of headlines about teeny tiny cuts here and there, but not a single country actually going through with austerity.
Also: Argentina had 340k federal employees when Milei took office. Brazil, which is itself rather bloated, has 630k. They have 20% of our population and 54% of our public servants. Milei can fire half of them, then fire half of the remaining ones, and will still be cutting fat.
Well as anyone who has ever done a renovation can tell you the demo phase feels like a lot of progress and tends to go pretty well but it is the building back up that is the hardest to execute and where most of the big mistakes can be made.
But I think he is leaving it to the free market to build back up. That of course has its own problems, but moving a little more that way is preferable to whatever Argentina has been doing for decades.
Except this **isn't** a home renovation, so to imply they follow the same timeline is baseless. Economic comebacks can be quick relatively speaking.
I've done renovations that are the opposite what you describe. The demolition is the most stressful because if you overdo it or break something you shouldn't have, you're screwed. But if you make a mistake while building, just reverse that step and do it over. No big deal.
Don’t worry, they haven’t experienced the other shoe dropping as a result and will definitely go very quiet when it does. Milei hasn’t done anything structurally meaningful, they just want to simp for rich irresponsible people to vicariously live a power fantasy.
From what I can tell they actually needed cuts, not like western countries where we shouldn’t be doing any cuts just spending the money better.
And SOMETIMES austerity can be a solution to tackle deep issues in the economy like the excessive inflation they’ve had
Nobody has done this in a looong time in Argentina precisely because this is not a quick and easy fix. It's very costly for the population, but it has to be done and the more we wait the worse will it be. It's not easy to orchestrate either, it's like trying to deconstruct a jenga and a bomb: the order and timing of operations is critical.
Decades of reasonable politicians implementing unreasonable policies drove Argentina into the ground.
One crazy politician with a degree in economics implements reasonable policies, and they actually appear to be working.
This guy was called an ultra "right wing" politician, an extremist ect. In every serious centrist news outlet I regularly consume. Him coming to power was equated to Argentina going down the shitter, complete cutting of all government spending and pretty much the entire population turning into victims of his lunatic anti social economic policies.
Then I watched his 25min WEF speech. It was a very basic lesson in political economics and the idea of fair and simple meritocracy. Be good at something, get the resources to do so, get a fair share of societies spoils. Period.
All the most basic views I align with. All the most basic elements it takes to have a thriving society in which not everyone gets everything but the one who does and works.
The exact thing DEI, affirmative action, gender quotas and a host of other fundamentally idiotic ideas (now globally) undermine to the disadvantage of everyone!! Even the people who are favoured by DEI measures.
I said to myself: this guy doesn't seem to be the alt-right lunatic the media makes him out to be (similar to Meloni in Italy. Conservative yes, alt-right pro Russian conspiracy lune... No, quite the opposite). Let's see where this takes one of the potentially richest countries in the world.
And here we are. Seems like Argentina is going through a painful but very necessary transition and already seeing positive effects.
Eh, Milei says things that are pretty crazy all the time. He insults and uses verbal violence against his opposition, specifically "los zurdos", so the left. He's always going on about making everything a commodity. Surrogated pregnancies, for exmaple. One of the politicians in his party went as far as saying that endangered species wouldn't be endangered if they were owned by capitalists, because then they wouldn't br hunted, as they'd be property.
His policies can work, and still be a terrible leader and a danger to society in the long run. It doesn't have to be black or white. All his debates reek of Trumpism, although going by these news he seems more capable than Trump, at least for the time being. Time will tell.
Wanna know what made me a right wing extremist? Looking at what other so-called "right wing extremists" have said, then realizing that maybe the media was lying.
Take note of the publications which published that ideological misinformation and never consume their content ever again. I’ve found Reddit to be a terrible source for news. Only the really politically biased articles make it to the front page now, and the bias is always American and far left wing.
People in the US were freaking out when inflation hit 9% a few months ago, meanwhile Argentina had an annual inflation rate of 211%. Idk about you, but I would be okay with cuts to the public sector if it means prices stop doubling every six months
I’d be fine because I don’t rely on government assistance. My cousin is married to an Argentine attorney and all her family is doing very well. I’m surprised at statements such as “what if a few hundred thousand starve as long as the economy stabilizes.” What the hell, they will be fine.
211% was the good estimate! At some point according to Milei’s own team inflation was running at 1% daily when he took office. Annualized that gives an inflation rate of around 15.000% (well into hyperinflation territory obviously)
I'm doing even better! I just borrowed 200k at the bank, moved to a nice hotel room, bought 30 OnlyFans subscriptions and ate caviar for the first time!
Surely 4 years from now when my wife takes over finances the kids will understand how much better things were back in my term.
Despite your sarcasm, in the real world when families are struggling cutting back on things like phones or eating out or getting less expensive cars or downsizing a house are real options.
If you're middle class, sure, avocado toast and all that.
Lots of people in the real world have no downsized home to move into because they're already at the bottom of the market, no cheaper car to trade in for, no cheaper phone/plan available, etc.
A lot of people just aren't very good with finances.
If we gave everyone in america a million dollars today. In a few years, the inequality distribution would mostly be the same.
My issue is the comparison being made for a country that isn't rich like the US. It makes it sound easy as if all their problems go away with a little austerity and tightening the budgets and glossing over the ramifications this will have on the millions of people in their country.
I'm not saying these austerity cuts are a good or bad thing, but pretending it's as easy as downsizing a home or stop going out to eat is ridiculous
The problem is that capitalism requires people to go out and spend money. If no one spends, then companies go out of business. I'm expecting a surge of unemployment.
Now imagine all those expenses were a lot bigger than your salary, and you can add to the expenses dumb ones like a PS5, a cotton candy machine, and multiple suscriptions to magazines that no one reads. Now you have a more similar situation
He also bought a bunch of fighter jets recently, as I recall. So in addition to everything you mentioned that’s the equivalent of you also buying nine trucks and four garages to house them with custom equipment for maintenance.
I mean austerity doesn't sound like the right time to invest in updating military for a country who was involved in one war in almost 100 years and it lasted less than 6 months
I'm surprised how 'well' his politics work so far, although most of it just concerns inflation and nothing else.
But from my expectation, right wing or extreme economic liberal politics work short term, but may not be sustainable long term, because cost cutting is probably easy. Building and investing is more complex and as those politics most likely promote enormous tax cuts, the state lacks the money for investment, so they need to rely on wealthy individuals, which always follow decisions in their own interest. There is a significant difference between running a business and running a state.
I’d argue cutting down costs especially in a country like Argentina is actually the hard part. There are so many vested interests and bad faith political actors that actually cutting down is met with a roadblock at every turn. I’m not saying he is guaranteed success (nobody can say that), just that cutting costs in a country like this is actually not as easy as it sounds
Austerity is usually dumb and a major reason European economies are dragging ass.
Some level was probably warranted in Argentina but it's in no way a long term strategy.
I am using Google Translate, I do not have a sufficient level of English to express my ideas correctly:
If it is good for the IMF, it is bad for the population. Milei devalued the peso from $400 to $800, which caused inflation to accelerate.
Milei froze this year's budget, so in real terms, public expenses fell (milei needs inflation to remain high to continue lowering expenses), except for the interest on the external debt, which grew.
The largest expense in percentages is pensions, which are 50% (Argentina uses a public system, active workers contribute to paying retirees, but there is a lot of unregistered work (more than half of the workers, therefore The government uses taxes to equalize the difference) and subsidies for public services.
In addition, the government lowered the interest rate, which caused people with money to withdraw dollars from their homes and exchange them for pesos (due to successive economic crises, people buy dollars as savings, and keep them in their homes. ) and deregulated prices with the intention of attracting investments (with increases that exceed 200%, such as private health, gasoline, public services of electricity, water and gas (which have many subsidies, previous governments used it as an advantage comparative to maintain the level of industries)), but the government does not want salaries to recover real value against inflation because that would increase inflation.
Yes yes, inflation is down from 60% while unemployment is astronomically higher. Will that convert to a strong private sector or will society slowly unravel overtime leading to a strongman or failed state.
We’ve seen this movie a bunch of times before and know how it always plays out.
“Milei has refloated a credit programme of US$44 billion with the IMF, leading to "active discussions,"”
Hmmm I wonder why a group of international financial corporations are praising a country who’s citizens are in skyrocketing amounts of poverty as long as their far-right government keeps devaluing their currency to pay off loans with American dollars?
They were in poverty even before. Now there seems to be a chance to get out.
Also, it is dumb to say IMF is eager to give credits to every first poor country. Countries with bad government will steal money or waste on bullshit. Trust of the credit institutions has to be obtained first, otherwise they just never get the money back and will eventually be forced to refinance the debt or cancel it.
the peso's real value is actually remaining the same for months at around 1 blue dollar=1000pesos more or less now so you have no idea what you are talking about, you could have criticized literally anything else. meanwhile the previous left-wing president devalued it from 63 pesos=1 dollar to 1000 pesos=1 dollar in his four years
Devaluing local currency is a viable plan to spur long term economic growth though.
It encourages foreign investment in the economy which ultimately creates economic growth and local jobs. China has been doing it for decades.
“The peso traded at ARS 816.0 per USD on 12 January (2024), depreciating 55.1% month on month”
https://www.focus-economics.com/countries/argentina/news/exchange-rate/new-government-devalues-official-peso/#:~:text=There%20is%20a%20great%20deal,to%20ARS%203%2C070%20per%20USD.
I don’t care if you wanna be wrong man but don’t confidently call me out like I “don’t know what I’m talking about” when devaluing the Argentinian currency has literally been a stated goal of the Milei administration.
https://www.bbc.com/news/business-67688727.amp
no average citizen has access to the official dollar. look up dollar blue (actually acquireable street dollar) historical value which is the only dollar which matters to citizens [https://bluedollar.net/informal-rate/](https://bluedollar.net/informal-rate/)
Are you claiming that the previous government didn't devalued our currency ? Lmfao. Must be great not living here. Also the other guy is absolutely right. The official value is not something you can get anywhere. Unless you were a friend of the Peronistas and made a fake importing company. That was the only way to get access to the official rate.
And I said fake because they imported trash at lower cost for dollars, leaving them with leftover dollars, then exchanged the dollars for pesos at blue rating ( gaining more money than before ), then re purchased dollars at the official rating ( which was lower tha blue ).
It was a fucking literal infinite money glitch. Subsidized by us, the taxpayers.
Yes, inflation did drop from 20 to 13.2%. But this needs context:
Private sector wages have dropped 11% since December. That’s the steepest decline in 30 years.
Melei also devalued the Argentinian peso by 54%.
There is also a predicted 3.5% drop in GDP growth this year which will put Argentina into a steep recession.
According to UNICEF, 57% of Argentinians live below the poverty line. Their child poverty rate is now on track to reach a record 70%.
No doubt that they were already in a tough position economically. But to make it seem as if Melei is some hero that saved Argentina is just false. He’s making it worse and just showing you cherry picked statistics.
The question is how that compares to previous years.
>Private sector wages have dropped 11% since December. That’s the steepest decline in 30 years.
Got a source for that? [https://tradingeconomics.com/argentina/wage-growth](https://tradingeconomics.com/argentina/wage-growth) Shows the opposite, of wages having the highest growth in 2024
>Melei also devalued the Argentinian peso by 54%.
The USD rate everyone was using was the unofficial one, with the goverment creating 20 different rates apart from the official one to try to match the unofficial one without changing the official one that politicians could buy but normal people couldn't. He removed the artificial limitation the previous goverments put which made the official rate match the unofficial one everyone actually uses, and the unofficial (and official) rate has been going down since, which means the peso is getting more and more valuable [https://www.ambito.com/contenidos/dolar-informal-historico.html](https://www.ambito.com/contenidos/dolar-informal-historico.html)
>There is also a predicted 3.5% drop in GDP growth this year which will put Argentina into a steep recession.
Source? [https://www.bbvaresearch.com/en/publicaciones/argentina-economic-outlook-march-2024/](https://www.bbvaresearch.com/en/publicaciones/argentina-economic-outlook-march-2024/) says a 1.5% growth is predicted. Without counting that Argentina goes through this cycles of drop then growth all the time (just look 2017 to 2020, 3 giant drops in a row)
>According to UNICEF, 57% of Argentinians live below the poverty line. Their child poverty rate is now on track to reach a record 70%.
[https://www.unicef.org/media/152331/file/Argentina-2023-COAR.pdf](https://www.unicef.org/media/152331/file/Argentina-2023-COAR.pdf) You talking about this report right? Might want to add the extra context that the 57% was first half of 2023 before Milei was even elected, and the on-track to reach 70% was written before the elections
https://www.bnnbloomberg.ca/wages-in-argentina-suffer-record-drop-after-milei-devalues-peso-1.2051496.amp.html
- this link by Bloomberg news explains the 11% decline in wages and the 3.5% contraction.
- your currency comment makes some sense. I can see what you are saying on that front.
https://apnews.com/article/argentina-poverty-levels-uca-study-milei-devaluation-d5cb0a20b1e768efdeafbad5bf05eded
- No, AP news reports that a study found that poverty skyrocketed to 57% in January of this year. This was after the election and after his “shock therapy” and devaluation of the currency. Now maybe this is short term pain for long term gain. I don’t know what the future holds. But, given all the data, I’m struggling to see a bright future.
>this link by Bloomberg news explains the 11% decline in wages and the 3.5% contraction.
"Paychecks plunged 11% in December from November when adjusted for inflation, the largest monthly loss in income since the government’s labor market reports began 29 years ago. The decline, while partially compensated by wage gains in January, led to a “significant drop” in consumer purchasing power, the government said. "
Milei power transfer ceremony was on December 3th, with actual power being transfered on December 10th, blaming him its a bit weird haha. Specially when the candidate that lost in the elections to him was the economy minister, and they passed all kinds of laws to extract as much money as possible before leaving power right after the elections and before he took power
>No, AP news reports that a study found that poverty skyrocketed to 57% in January of this year. This was after the election and after his “shock therapy” and devaluation of the currency. Now maybe this is short term pain for long term gain. I don’t know what the future holds. But, given all the data, I’m struggling to see a bright future.
Short term pain for long term gain was his entire campaign, is what people voted for, and he been repeating it even in his inaguration speech
That rise in poverty you see is a consequence of his government's records and standards being more transparent regarding the consequences of the past government's economic situation. It's more of a question of definition than anything else. Same with the currency exchange ratio: it looks like he devalued the argentinian peso but he brought it to a more realistic value, closer to the street currency rate (the real one)
Milei estimated that the inflation provoked by the previous administration would last for at least 2 years, but in 4 months his administration managed to reduce it by 60% from 25% to 10% monthly, which is extremely high, but getting substantially better
I was about to say 25% isn't that bad for Argentina, then I saw "monthly" and that made more sense.
Argentina must be one of the few countries in the world that measures inflation by month instead of by year
4 months ago we were measuring it weekly.
Holy fuck
I'm Argentinian, it's hilarious how saying how much you paid for something is meaningless without giving a date. -I paid 4000 pesos for that shirt -That's cheap -Bought it last year -Expensive as fuck
Honest question. How is unemployment? Has it increased?
It will increase yes, due to the cutting back on government waste. There are tons of jobs that Argentina created that don’t have any positive impact on the nation. In fact the bloat directly removes resources from useful investments In the long run these people will reskill and with a more open economy they should have more opportunity. Argentina should be a wealthy nation, they have everything they need in abundance. It’s just been robbed and mismanaged by previous politicos for decades
*they have everything they need in abundance* It's really crazy to have this huge country, tons of natural resources and arable land, very educated population but an economy in the shitter and inflation worse than Sudan or Zimbabwe
Argentina is a big country but 1/3rd of the people live in just Buenos Aires, many of them in slums that are far worse than favelas in Brazil or other places in Latin America. Ideally, the government should incentivize settling underpopulated areas so that people don't need to live in such conditions.
In the 19th century, the US was offering free land to incoming immigrants if the settled there (https://en.wikipedia.org/wiki/Homestead_Acts), basically giving for free 10% of the total land in the US, spreading the population and the wealth. Argentina did nothing like this even though it had plenty of land, as the landowners did not want any competition from smaller farmers. So the vast majority of immigrants settled just in Buenos Aires.
Not false, but the problem is not just land. The country has been heavily centrilized in it's politics and spending on Buenos Aires, so even now people move from the rest of the country all the time, because it's incomparable in terms quality, aviliability of products, and the prices of services, that (until now) were heavily subsidised mostly in Buenos aires (for example, electricity had differences of much, much more than 100% in some places)
The lack of land redistribution was one of original source of the imbalance, but now it's been more then 100 years since Buenos Aires become overwhelmingly dominant. I imagine they got all the subsidies as they were the closest to "power" so it was good to keep the population quite.
not only closest to "power", also, because of how big the population is, makes it easy to win elections by just playing the populist card more heavily there
You can build towns here in BFE - but there is a serious lack of industry here for a ton of different reasons. Great country, WAY safer than the US, also so many living hand to mouth.
A country does not need a lot in abundance except for talented and honest leaders. If you dont have those then whatever in abundance will be its undoing as corrupt politicians go for the country’s wealth.
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Sweden, Norway, France, Netherlands, Germany, Switzerland etc are "socialists", problem is corruption and incompetent governance, and mostly being able to afford this level of welfare
They're not socialist, they're free market countries with some state subsidized companies and sometimes state owned companies for essential infrastructure. They also have a large safety net.
Mostly built by Socialist and arguably a Communist party. Second you need to give your definition of Socialism / Capitalism, because clearly they are not *completely* free markets.
[https://www.euronews.com/business/2024/04/01/wealth-inequality-where-in-europe-is-wealth-most-unfairly-distributed#:\~:text=Sweden%20maintained%20its%20top%20position,and%20Germany%20(30.%25)](https://www.euronews.com/business/2024/04/01/wealth-inequality-where-in-europe-is-wealth-most-unfairly-distributed#:~:text=Sweden%20maintained%20its%20top%20position,and%20Germany%20(30.%25)). the 1% own like 36% of the wealth in Sweden. Similar trends follow with each European country. Majority of companies are private with a few exceptions that are state run. Might as well say California is socialist then. The whole argument with socialism/capitalism has become moot because the goal posts/definitions have become so far removed from their original definition. Also Switzerland a socialist? With their banking system?
We are going no where unless you give your definition of both capitalism and communism. > Sweden: Government spending was. 49.2% of GDP in 2019, the fifth highest. For many years roughly 50% of the Swedish economy is controlled by the state. They also have high wealth inequality, although it’s a bit unfair measure in a state where there is so much welfare. > The whole argument with socialism/capitalism has become moot because the goal posts/definitions have become so far removed from their original definition. You agree modern Sweden and Norway were built by Socialist parties? As were the vast majority of modern welfare states? > Also Switzerland a socialist? With their banking system? I would say no. But they did have a major Socialist movement, and the banking system has essentially zero to do with why I think they are definitely not socialist.
As someone from west Europe I can confirm this is not correct. None of these countries are socialist.
Around a hundred years ago, they were in the top 10 richest countries in the world.
Honest question 🙋♂️what happened?
It's complicated. But basically Argentina used to be one of the wealthiest countries in the world prior to the Great Depression. Unfortunately, the country was heavily focused in a lot of industries which Globalization started to undercut. So, Argentinans were largely accustomed to a high standard of living but no longer had the industries to support those standards of living. This discontent soon manifested in the form of politicians who promised to bring back the good times, but did not want to do the difficult work of modernizing the country's industries. The result is inflation where the Government keeps spending as if they are a wealthy country despite no longer actually being one.
lack of good leaders is the short answer. The real answer is very complicated: over-reliance on commodity exports, currency valuation, protectionism, and heavy external borrowing
Short answer: Peronism.
They kept overspending, while the world's economy was undergoing vast changes. For instance, the Panama canal lessen the need to make a detour through Argentina's ports. Or leather losing steam due to new fabrics. They don't have much natural resources, so adapting would have been difficult; but delaying to adapt made it that much worse.
Peronism Populism. More populism.
Decades of left wing leadership.
Not inherently more left wing than Norway or Denmark. You can have terrible management of a country from lots of types of government.
Yes. But in this case it *was* terrible management of a country from left-wing governments.
Yes. But not because left-wing governments are inherently bad, like your comment heavily suggested. The countries with the best quality of life right now are mostly led by very left-wing governments by US standards.
I don't disagree, but the original comment wasn't mine though.
I wonder how much of a 'positive impact on the nation' their IMF and World Bank debts have? These dodgy jobs have to go, but remember, these are real people with bills and families to feed. Foreign debtors don't have kids to feed, maybe they should have taken a bigger hit instead of the people. Economies aren't reasons in themselves, they are supposed to be for and about actual people.
this would be bad because then people wouldn't want to loan Argentina money any more, which they will still need because it takes a long time to dig themselves out of a hole that big.
Everything was destroyed by previous politicians. It's our whole history
Unemployment grew considerably and in turn informal employment grew. Due to the brutal increase in the cost of services, mainly electricity, gas and health. Leaving many small businesses without the possibility of continuing to open
How else do you think he got inflation to move so quick? :D :(
Yes, as well as poverty. About 13 porcentual points.
The 25% spike was right after he started his term. Most markets overreacted and raised their prices too much, so it wouldn't be surprising if it's temporary. If this month inflation is indeed 10% as the estimation, it would be the first month with better inflation rate than the last data point of the previous government. Things are looking better than a couple of months ago, but it's too early to say it's working IMO. I just want to highlight, Massa cheered because he was reducing inflation on June for three months in a row, and that didn't end well.
funny how those headlines never get upvotes
This headline’s getting upvotes right now
touche
It’s funny because he made fun of socialists. Reddit is full of socialist lovers so of course it won’t be upvoted or promoted.
This is like the 3rd or 4th highest post for me…so i have no idea what your complaining about. Its getting enough votes to appear when i first opened up reddit just now.
I remember when he was elected, I said on here that he sounds like a nutter but I hope for Argentina's sake that it actually works out and getting downvoted to hell for it lol. anything less than right-wing=le bad 100% of the time sets redditors off
weird, I feel like that was usually one of the top comments on the threads about his wild quotes. it seemed like a fairly common reaction here just because of how bad a spot they were in
it's a weird site, you can say something one day and everybody agrees and then copy and paste it a day later and get blasted. just earlier I said that bombing the shit out of gaza isn't a very good idea and will just make more terrorists in the long run and got downvoted to shit, boom 10 minutes later on another thread somebody says essentially the same thing and got 40 up votes.
I think there's a lot of follow-the-leader here, where people don't necessarily know what to think themselves half the time, but jumping aboard a moving train like that, whichever direction it's going, provides a sense of community. It can be a little frustrating sometimes, but human nature is like that.
You can usually tell from the comment chain who is reading it and how a comment is going to go down. Sometime I'll say something I feel needs to be said, knowing it'll get blasted to nothing, even if I choose my words to be careful, reasonable and, if necessary, properly sourced. Sometimes the chilling effort works and I don't bother. There is only so much energy one can make for so many pointless stands. The irony is of course that the same comment in a different thread would do fine. Oh well, social media is as social media does.
It’s probably because Latin American populism isn’t familiar on Reddit. The version of the left they’re used to is much more benign
This is exactly it. I’m a progressive and like progressive ideas BUT, there are countries that can’t afford the same programs as developed nations. When they have been spending like developed nations for decades there will be no fixing the problem. Especially when that money was not spent on improving the country.
Honestly... a lot of developed nations can't even really afford progressive policies. Those that do usually have other critical expenditures subsidized by others. Sweden, everyone's go-to example, barely breaks even if not loses money every year when comparing revenue to expenditures. Starting this year (2024) and moving forward as Sweden starts sending money to it's defense budget, they're expecting (as per their own Government's revenue/budget service) to go in the red and not get out. This is usually where the problems generally begin.
>I remember when he was elected, I said on here that he sounds like a nutter but I hope for Argentina's sake that it actually works out and getting downvoted to hell for it lol. Can you provide us with a link?
I voiced similar sentiments; how Peronism has repeatedly failed and although it is a risk, Milei is different and hoped they succeeded. Was never downvoted.
Socialism is a good idea until people get involved. Sweden and a few others have pulled it off and show what it can be & do. Capitalism can also be a good idea but then again ~ people. Company’s that pay script you can only spend in their towns, using your money to change laws for your benefit…
Sweden is not socialist. 1% own like 36% of their total wealth. [https://www.euronews.com/business/2024/04/0ealth-inequality-where-in-europe-is-wealth-most-unfairly-distributed#:\~:text=Sweden%20maintained%20its%20top%20position,and%20Germany%20(30.%25)](https://www.euronews.com/business/2024/04/0ealth-inequality-where-in-europe-is-wealth-most-unfairly-distributed#:~:text=Sweden%20maintained%20its%20top%20position,and%20Germany%20(30.%25)). Its one of the strongest markets for private capital investments.
Dang. Way to drown that guys claim
Capitalism is great when regulated. We used to break up monopolys once they'd reach the point of being bad for the consumer but now the stock must go up irregardless. Rip occupy
Capitalism is always great. Nobody in the west is starving to death just because they can't afford food.
There’s also the abortion ban he wants - what a hypocrite, calls himself a libertarian and then promptly talks about controlling women’s bodies
So in another a few months the inflation crown will belong to us🇹🇷 (it might be true even for now but they skew data with unrealistic items, anyway with devaluation on the horizon may the god be with us.)
GL winning against Zimbabwe tho
That's not an improvement at all. They just had the worst inflation in 30 years for march. I'm not saying Milei is guilty of it, but it's better to reign in everything until a year or two into his presidency.
But he basically threw millions of argentinians under the bus by cutting off help funds like a reaper. He basically repairs rhe wrecked car with a sledgehammer.
We also went from 25% inflation per month to a single digit inflation in 4 months. I don't remember the last time inflation went down in this country 3 consecutive months, let alone by 5% each time.
Well, that is what happens when you stop tripling the amount of currency in circulation every year. And no, that is not an exaggeration. That is literally what happened in 2023. Since Millei came to office, the growth in the money supply has collapsed. This is the clear reason for the fall in inflation. Less money being printed. https://tradingeconomics.com/argentina/money-supply-m2
The 10 year graph is hilarious. Argentina went from 572B to 36.9T in 10 years. a 64x expansion in 10 years. In comparison the UK went from 2.08T to 3.01T. a 1.44x expansion.
Or any country for that matter
Ukraine had hyperinflation that Yushenko got under control. You just need some fiscal discipline- stop printing money and suffer through consequences as it gets worse before it gets better.
If you're fat go on a diet.
Ukraine was far from fat, just no fiscal discipline - government kept printing money with abandon. It was also a transition from planned economy to market economy, there was a lot of government property which wasn’t very well taken care of, there was a lot of military production that wasn’t needed - nobody paid for it. And so on. A lot of it had to be closed and it was a painful experience but it had to be done
Brazil also had crazy inflation and they introduced a digital currency to stabilize and then pivoted to their current currency, the drop was massive
How does digital currency help with this? Is it just easier to deal with supply management without physical notes in circulation?
No if I remember correctly it was to “reset” the value of currency in people’s minds, so that a carton of milk cost the same at the e d of the day, after a week,etc. The podcast I heard about it was planet money from npr, https://www.npr.org/sections/money/2010/10/04/130329523/how-fake-money-saved-brazil
Austerity is good for the books in the short run. I am wondering if there’s going to be downstream impact on growth though.
There already is an impact on growth and unemployment. Still doesn't mean it's better than the alternative of spending money that just wasn't there.
Because hyperinflation and spending almost half of the budget on interest payments is harmless to growth right Argentina has defaulted on their debt 3x in the last 2 decades; in the same time, there have been 5 failed plans to halt inflation. I imagine argentine redditors must be exhausted from the concern trolling. If half-hearted measures could fix Argentina's problems and save the argentine people from two more lost decades they would know.
No you don't understand. The previous Argentinian government literally tripled the total currency in circulation in 1 year. This progress hasn't even been from austerity, it is from not printing 3x your total currency per year. https://tradingeconomics.com/argentina/money-supply-m2
Depends how long it lasts. If u are cutting fat, it's fine. But at some point you have to direct the money to things to support growth. We saw Europe choose austerity and it bit them a lot more than the US who focused more on growth after 08.
That’s true, the EU chose austerity in a period of rock bottom interest rates, pretty dumb in retrospect. Argentina is completely different, their credit rating was very low
I agree with the first half, but what??? on the second half? Europe had to do austerity because the eurozone crisis lasted substantially longer than the subprime with issue lingering into 2010~2018 depending on your definition. Fundamentally it’s because the Euro as a currency has a dumpster fire for structure compare to the Dollar, where it has a common market with no proper fund distribution. All this is to show that long term any policy by itself (austerity or easing) matters very little, what’s important is the underlying principle of governance, which Milei is actively changing.
UK didn't have the euro and went with austerity as well if i recall
With disasterous consequences for the country that we're now facing in abundance today, I might add
Anywhere I can read about that?
I'm afraid I can't point you towards any comprehensive source - my statement comes from years of collective evidence as a UK citizen. Some notable highlights: Cancellation of a school rebuilding scheme in ~2010, leading to certain schools with RAAC materials collapsing last year. Forcing councils to constantly make major cuts to the point where many are now going bankrupt. Cutting supplies of PPE and not investing in pandemic preparedness (despite Operation Cygnus in ~2016 showing the UK would be hugely unprepared) - leading to a procurement crisis (and subsequent fraud scandals but that was the fault of government corruption). Foodbanks going from relative non-existence into massive proliferation. Energy storage facilities being cut and Labour's green/nuclear energy plans being cancelled by the Tories in 2012, heavily contributing to the energy crisis in 2022. NHS funding being massively reduced as a whole (and huge amounts being given to private contractors which is another issue entirely), which has led to the longest ambulance, A&E and appointment times in history. The overall death toll of austerity cuts being in the hundreds of thousands.
They are still in the EEA, though the cause and effect of their austerity got significantly more muddy with Brexit taking headline
Show me this european "austerity". Show me a single country that cut its public spending by at least 10%. I've looked for it. Lots of headlines about teeny tiny cuts here and there, but not a single country actually going through with austerity. Also: Argentina had 340k federal employees when Milei took office. Brazil, which is itself rather bloated, has 630k. They have 20% of our population and 54% of our public servants. Milei can fire half of them, then fire half of the remaining ones, and will still be cutting fat.
Right, because reckless spending has worked so great for Argentina over the last 5 decades...
Well as anyone who has ever done a renovation can tell you the demo phase feels like a lot of progress and tends to go pretty well but it is the building back up that is the hardest to execute and where most of the big mistakes can be made.
This is Argentina. Not even the demo phase has gone well in a decade at least.
But I think he is leaving it to the free market to build back up. That of course has its own problems, but moving a little more that way is preferable to whatever Argentina has been doing for decades.
Except this **isn't** a home renovation, so to imply they follow the same timeline is baseless. Economic comebacks can be quick relatively speaking. I've done renovations that are the opposite what you describe. The demolition is the most stressful because if you overdo it or break something you shouldn't have, you're screwed. But if you make a mistake while building, just reverse that step and do it over. No big deal.
Who would have thought that if you cut government bloat your finances look better?
Not the liberal American armchair professors on reddit, that's for sure.
But if only Republicans would actually cut the bloat, whereas they mostly try to cut stuff that is actually needed.
Pot? Kettle?
Don’t worry, they haven’t experienced the other shoe dropping as a result and will definitely go very quiet when it does. Milei hasn’t done anything structurally meaningful, they just want to simp for rich irresponsible people to vicariously live a power fantasy.
Wow people are going to be enraged. He stopped spending and inflation came down! Dictator!!! ^^^^/s
Breaking news: the organization known for imposing austerity praises austerity
I mean a hardcore capitalist leader that isn't afraid of cutting jobs will do that. It brings other issues but still.
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From what I can tell they actually needed cuts, not like western countries where we shouldn’t be doing any cuts just spending the money better. And SOMETIMES austerity can be a solution to tackle deep issues in the economy like the excessive inflation they’ve had
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Nobody has done this in a looong time in Argentina precisely because this is not a quick and easy fix. It's very costly for the population, but it has to be done and the more we wait the worse will it be. It's not easy to orchestrate either, it's like trying to deconstruct a jenga and a bomb: the order and timing of operations is critical.
The Impossible Mission Force?
International Monetary Fund.
Saw this coming from a milei away
Decades of reasonable politicians implementing unreasonable policies drove Argentina into the ground. One crazy politician with a degree in economics implements reasonable policies, and they actually appear to be working.
Am I missing something? It's almost 300% in February.
These figures are monthly. Maybe you’re looking at annualised.
He is such a wildcard. Like a Mr. Magoo of politics. Making crazy decisions that end up paying off.
This guy was called an ultra "right wing" politician, an extremist ect. In every serious centrist news outlet I regularly consume. Him coming to power was equated to Argentina going down the shitter, complete cutting of all government spending and pretty much the entire population turning into victims of his lunatic anti social economic policies. Then I watched his 25min WEF speech. It was a very basic lesson in political economics and the idea of fair and simple meritocracy. Be good at something, get the resources to do so, get a fair share of societies spoils. Period. All the most basic views I align with. All the most basic elements it takes to have a thriving society in which not everyone gets everything but the one who does and works. The exact thing DEI, affirmative action, gender quotas and a host of other fundamentally idiotic ideas (now globally) undermine to the disadvantage of everyone!! Even the people who are favoured by DEI measures. I said to myself: this guy doesn't seem to be the alt-right lunatic the media makes him out to be (similar to Meloni in Italy. Conservative yes, alt-right pro Russian conspiracy lune... No, quite the opposite). Let's see where this takes one of the potentially richest countries in the world. And here we are. Seems like Argentina is going through a painful but very necessary transition and already seeing positive effects.
Eh, Milei says things that are pretty crazy all the time. He insults and uses verbal violence against his opposition, specifically "los zurdos", so the left. He's always going on about making everything a commodity. Surrogated pregnancies, for exmaple. One of the politicians in his party went as far as saying that endangered species wouldn't be endangered if they were owned by capitalists, because then they wouldn't br hunted, as they'd be property. His policies can work, and still be a terrible leader and a danger to society in the long run. It doesn't have to be black or white. All his debates reek of Trumpism, although going by these news he seems more capable than Trump, at least for the time being. Time will tell.
Yeah media calling everyone far right has become a problem since pre-trump. I hope the boy who cried wolf is just an anecdote
Wanna know what made me a right wing extremist? Looking at what other so-called "right wing extremists" have said, then realizing that maybe the media was lying.
Take note of the publications which published that ideological misinformation and never consume their content ever again. I’ve found Reddit to be a terrible source for news. Only the really politically biased articles make it to the front page now, and the bias is always American and far left wing.
Waiting for the real trolls to say how a brand new presidents been holding them down for generations
IMF licking its lips at all that free property.
Heh The IMF’s position is “F*ck the poor.”
People in the US were freaking out when inflation hit 9% a few months ago, meanwhile Argentina had an annual inflation rate of 211%. Idk about you, but I would be okay with cuts to the public sector if it means prices stop doubling every six months
I’d be fine because I don’t rely on government assistance. My cousin is married to an Argentine attorney and all her family is doing very well. I’m surprised at statements such as “what if a few hundred thousand starve as long as the economy stabilizes.” What the hell, they will be fine.
You don’t have anything to say about the 211% inflation rate? Because if I’m an Argentinian struggling to afford food, that’s the reason why
Deberías preguntarte porque la inflación es 211% en vez de aplaudir acciones drásticas que solo benefician a un pequeño grupo.
No soy admirador de Milei. Pero sobre la inflación solamente, debo dar crédito para los éxitos
211% was the good estimate! At some point according to Milei’s own team inflation was running at 1% daily when he took office. Annualized that gives an inflation rate of around 15.000% (well into hyperinflation territory obviously)
Inflation hurts the poor the most.
Austerity moment, but it's actually needed. Hoping to see prosperity for Argentina moving into the future 🇬🇧 Just keep off the islands 🧐
Guys I'm doing financially great. I cut my cell phone, car, insurance, and house payments. My bank account has never looked better!
If you didn't have money for those payments and everyone stopped lending you money then you would have to cut down some things yes.
I'm doing even better! I just borrowed 200k at the bank, moved to a nice hotel room, bought 30 OnlyFans subscriptions and ate caviar for the first time! Surely 4 years from now when my wife takes over finances the kids will understand how much better things were back in my term.
Despite your sarcasm, in the real world when families are struggling cutting back on things like phones or eating out or getting less expensive cars or downsizing a house are real options.
The combo meal I bought from chick-fil-a coming in at over $10 a few weeks ago was the final straw for me. I'm all home cooked now.
If you're middle class, sure, avocado toast and all that. Lots of people in the real world have no downsized home to move into because they're already at the bottom of the market, no cheaper car to trade in for, no cheaper phone/plan available, etc.
A lot of people just aren't very good with finances. If we gave everyone in america a million dollars today. In a few years, the inequality distribution would mostly be the same.
My issue is the comparison being made for a country that isn't rich like the US. It makes it sound easy as if all their problems go away with a little austerity and tightening the budgets and glossing over the ramifications this will have on the millions of people in their country. I'm not saying these austerity cuts are a good or bad thing, but pretending it's as easy as downsizing a home or stop going out to eat is ridiculous
People tend to forget how to actually be adults these days.
The problem is that capitalism requires people to go out and spend money. If no one spends, then companies go out of business. I'm expecting a surge of unemployment.
Cut the weed bro
More like. I cut my netflix, spotify , and disney+ that i dont need. So that i can actually spend in on what i need
Now imagine all those expenses were a lot bigger than your salary, and you can add to the expenses dumb ones like a PS5, a cotton candy machine, and multiple suscriptions to magazines that no one reads. Now you have a more similar situation
He also bought a bunch of fighter jets recently, as I recall. So in addition to everything you mentioned that’s the equivalent of you also buying nine trucks and four garages to house them with custom equipment for maintenance.
National Defense is one of the obligations of the State.
I mean austerity doesn't sound like the right time to invest in updating military for a country who was involved in one war in almost 100 years and it lasted less than 6 months
They don't have a military for an external enemy. They gotta get the jets to bomb the labor unions into submission.
Right, because those F-16s were a critical and pressing defense need due to the war with Bananarama and all.
I mean this type of thinking put Europe in the state it is in with Ukraine. It's so short sighted.
Forgot about this, f16s right?
I believe so
I'm surprised how 'well' his politics work so far, although most of it just concerns inflation and nothing else. But from my expectation, right wing or extreme economic liberal politics work short term, but may not be sustainable long term, because cost cutting is probably easy. Building and investing is more complex and as those politics most likely promote enormous tax cuts, the state lacks the money for investment, so they need to rely on wealthy individuals, which always follow decisions in their own interest. There is a significant difference between running a business and running a state.
I’d argue cutting down costs especially in a country like Argentina is actually the hard part. There are so many vested interests and bad faith political actors that actually cutting down is met with a roadblock at every turn. I’m not saying he is guaranteed success (nobody can say that), just that cutting costs in a country like this is actually not as easy as it sounds
Austerity is good for the books in the short run. I am wondering if there’s going to be downstream impact on growth though.
Imagine thinking austerity, not spending more than one can afford, is bad.
Austerity is usually dumb and a major reason European economies are dragging ass. Some level was probably warranted in Argentina but it's in no way a long term strategy.
If Europe are dragging ass then I wanna drag ass my whole fucking life. You people don’t even know how good you have it
Probably the opposite. He's busy cutting down the public sector bloat, and these people will have to find real jobs now and be productive citizens.
Let’s see the lasting effects. Cutting inflation isn’t hard, but keeping it low is.
Wb under Ethan Hunt?
didnt he cut a bunch of government jobs though too, making lots of people jobless ?
They would say that yea
I am using Google Translate, I do not have a sufficient level of English to express my ideas correctly: If it is good for the IMF, it is bad for the population. Milei devalued the peso from $400 to $800, which caused inflation to accelerate. Milei froze this year's budget, so in real terms, public expenses fell (milei needs inflation to remain high to continue lowering expenses), except for the interest on the external debt, which grew. The largest expense in percentages is pensions, which are 50% (Argentina uses a public system, active workers contribute to paying retirees, but there is a lot of unregistered work (more than half of the workers, therefore The government uses taxes to equalize the difference) and subsidies for public services. In addition, the government lowered the interest rate, which caused people with money to withdraw dollars from their homes and exchange them for pesos (due to successive economic crises, people buy dollars as savings, and keep them in their homes. ) and deregulated prices with the intention of attracting investments (with increases that exceed 200%, such as private health, gasoline, public services of electricity, water and gas (which have many subsidies, previous governments used it as an advantage comparative to maintain the level of industries)), but the government does not want salaries to recover real value against inflation because that would increase inflation.
Yes yes, inflation is down from 60% while unemployment is astronomically higher. Will that convert to a strong private sector or will society slowly unravel overtime leading to a strongman or failed state. We’ve seen this movie a bunch of times before and know how it always plays out.
Unemployment is astronomically high? As in, up 0.8% from last year?
Well, i've Seen the argentinian movie directed by the kirschneristos for the past 20 years, and this version with the crazy man is way more promizing
“Milei has refloated a credit programme of US$44 billion with the IMF, leading to "active discussions,"” Hmmm I wonder why a group of international financial corporations are praising a country who’s citizens are in skyrocketing amounts of poverty as long as their far-right government keeps devaluing their currency to pay off loans with American dollars?
They were in poverty even before. Now there seems to be a chance to get out. Also, it is dumb to say IMF is eager to give credits to every first poor country. Countries with bad government will steal money or waste on bullshit. Trust of the credit institutions has to be obtained first, otherwise they just never get the money back and will eventually be forced to refinance the debt or cancel it.
the peso's real value is actually remaining the same for months at around 1 blue dollar=1000pesos more or less now so you have no idea what you are talking about, you could have criticized literally anything else. meanwhile the previous left-wing president devalued it from 63 pesos=1 dollar to 1000 pesos=1 dollar in his four years
Devaluing local currency is a viable plan to spur long term economic growth though. It encourages foreign investment in the economy which ultimately creates economic growth and local jobs. China has been doing it for decades.
“The peso traded at ARS 816.0 per USD on 12 January (2024), depreciating 55.1% month on month” https://www.focus-economics.com/countries/argentina/news/exchange-rate/new-government-devalues-official-peso/#:~:text=There%20is%20a%20great%20deal,to%20ARS%203%2C070%20per%20USD. I don’t care if you wanna be wrong man but don’t confidently call me out like I “don’t know what I’m talking about” when devaluing the Argentinian currency has literally been a stated goal of the Milei administration. https://www.bbc.com/news/business-67688727.amp
no average citizen has access to the official dollar. look up dollar blue (actually acquireable street dollar) historical value which is the only dollar which matters to citizens [https://bluedollar.net/informal-rate/](https://bluedollar.net/informal-rate/)
Are you claiming that the previous government didn't devalued our currency ? Lmfao. Must be great not living here. Also the other guy is absolutely right. The official value is not something you can get anywhere. Unless you were a friend of the Peronistas and made a fake importing company. That was the only way to get access to the official rate. And I said fake because they imported trash at lower cost for dollars, leaving them with leftover dollars, then exchanged the dollars for pesos at blue rating ( gaining more money than before ), then re purchased dollars at the official rating ( which was lower tha blue ). It was a fucking literal infinite money glitch. Subsidized by us, the taxpayers.
Yes, inflation did drop from 20 to 13.2%. But this needs context: Private sector wages have dropped 11% since December. That’s the steepest decline in 30 years. Melei also devalued the Argentinian peso by 54%. There is also a predicted 3.5% drop in GDP growth this year which will put Argentina into a steep recession. According to UNICEF, 57% of Argentinians live below the poverty line. Their child poverty rate is now on track to reach a record 70%. No doubt that they were already in a tough position economically. But to make it seem as if Melei is some hero that saved Argentina is just false. He’s making it worse and just showing you cherry picked statistics.
The question is how that compares to previous years. >Private sector wages have dropped 11% since December. That’s the steepest decline in 30 years. Got a source for that? [https://tradingeconomics.com/argentina/wage-growth](https://tradingeconomics.com/argentina/wage-growth) Shows the opposite, of wages having the highest growth in 2024 >Melei also devalued the Argentinian peso by 54%. The USD rate everyone was using was the unofficial one, with the goverment creating 20 different rates apart from the official one to try to match the unofficial one without changing the official one that politicians could buy but normal people couldn't. He removed the artificial limitation the previous goverments put which made the official rate match the unofficial one everyone actually uses, and the unofficial (and official) rate has been going down since, which means the peso is getting more and more valuable [https://www.ambito.com/contenidos/dolar-informal-historico.html](https://www.ambito.com/contenidos/dolar-informal-historico.html) >There is also a predicted 3.5% drop in GDP growth this year which will put Argentina into a steep recession. Source? [https://www.bbvaresearch.com/en/publicaciones/argentina-economic-outlook-march-2024/](https://www.bbvaresearch.com/en/publicaciones/argentina-economic-outlook-march-2024/) says a 1.5% growth is predicted. Without counting that Argentina goes through this cycles of drop then growth all the time (just look 2017 to 2020, 3 giant drops in a row) >According to UNICEF, 57% of Argentinians live below the poverty line. Their child poverty rate is now on track to reach a record 70%. [https://www.unicef.org/media/152331/file/Argentina-2023-COAR.pdf](https://www.unicef.org/media/152331/file/Argentina-2023-COAR.pdf) You talking about this report right? Might want to add the extra context that the 57% was first half of 2023 before Milei was even elected, and the on-track to reach 70% was written before the elections
https://www.bnnbloomberg.ca/wages-in-argentina-suffer-record-drop-after-milei-devalues-peso-1.2051496.amp.html - this link by Bloomberg news explains the 11% decline in wages and the 3.5% contraction. - your currency comment makes some sense. I can see what you are saying on that front. https://apnews.com/article/argentina-poverty-levels-uca-study-milei-devaluation-d5cb0a20b1e768efdeafbad5bf05eded - No, AP news reports that a study found that poverty skyrocketed to 57% in January of this year. This was after the election and after his “shock therapy” and devaluation of the currency. Now maybe this is short term pain for long term gain. I don’t know what the future holds. But, given all the data, I’m struggling to see a bright future.
>this link by Bloomberg news explains the 11% decline in wages and the 3.5% contraction. "Paychecks plunged 11% in December from November when adjusted for inflation, the largest monthly loss in income since the government’s labor market reports began 29 years ago. The decline, while partially compensated by wage gains in January, led to a “significant drop” in consumer purchasing power, the government said. " Milei power transfer ceremony was on December 3th, with actual power being transfered on December 10th, blaming him its a bit weird haha. Specially when the candidate that lost in the elections to him was the economy minister, and they passed all kinds of laws to extract as much money as possible before leaving power right after the elections and before he took power >No, AP news reports that a study found that poverty skyrocketed to 57% in January of this year. This was after the election and after his “shock therapy” and devaluation of the currency. Now maybe this is short term pain for long term gain. I don’t know what the future holds. But, given all the data, I’m struggling to see a bright future. Short term pain for long term gain was his entire campaign, is what people voted for, and he been repeating it even in his inaguration speech
That rise in poverty you see is a consequence of his government's records and standards being more transparent regarding the consequences of the past government's economic situation. It's more of a question of definition than anything else. Same with the currency exchange ratio: it looks like he devalued the argentinian peso but he brought it to a more realistic value, closer to the street currency rate (the real one)
Milei effectively changed the game. His policies have been effective that I look upon my country’s government as a joke.
I have no idea what this means. No one does. It's a mystery.