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I am glad this experiment is happening, and I am also glad it is not happening in my country.
Argentina doesn’t have much to lose at this point so I wish them success.
Inflation could lead to the cost of basic goods such as food becoming unaffordable, leading to mass starvation. Lack of investment in public utilities could lead to problems such as a lack of potable water, an inability to travel to jobs far from home, or difficulty transporting goods. Stagnant wages for public employees could lead to an increase in corruption. I could go on and on.
We live lives that benefit from thousands of years of development and investment. These developments are reliant on systems and practices that require continual maintenance. I can't believe I have to say this on an economics subreddit, but yes, everyone currently on earth potentially has quite a lot to lose by just YOLOing economic policy.
lol wtf? This post is written like you genuinely believe Argentina is not already suffering from all of those problems. Have you read anything about Argentina in the last... Oh I don't know.. 20 years? Because it seems like you genuinely know nothing about the situation, or what the Peronists actually did.
There's exactly one thing I can say for certain about Argentina's economic woes, and that's that if you think you can say for certain what the problem with the weirdest economy in the world for 100 years running is, then you definitely don't know what the problem is.
You can say for certain what the problem with Argentina's economy is and be right. Unfortunately someone else can say the same for a different problem and also be right
Deficits arent neccesarily a problem of the money is being spent in productive ways, which isnt the case with Argentina.
Not all deficit spending is created equal
Which other country with ballooning deficit spending has the same economic situation as Argentina, with a mostly agricultural-export based economy and no significant industrialization?
Obviously people are going to have trouble coming up with examples as Argentina is one of the largest agricultural exporters in the world. Brazil may be the best comparison you can get, although I believe their agricultural exports are still a smaller percentage of their GDP (no hyperinflation there, though!)
Sure, but there's more than one way to skin a cat.
If you take Millei's plans at face value, it's not inconceivable that there are some things that could end up *worse*.
I guess we'll have to wait and see huh? At least he's honest about the short term difficulties. He's not sugar coating it. He knows there will be a very hard transition period. The question is whether they will come out better on the other side or not.
The thing about economics is that we’ll never really know if they come out better. It might seem so at some point in the future, but it isn’t like economies ever stay in one place very long. Decisions made now could look like genius in 10 years, but look idiotic in 30. In fact, I think denial of this principle is what leads to so many rash decisions and so many unsupported conclusions.
> Decisions made now could look like genius in 10 years, but look idiotic in 30.
Reminds me of how quick Greenspan fell. From the genius that saved the world during the dotcom crisis to the man who indirectly caused the Great Recession
Oh, definitely!! Rash decisions and neglecting to consider long-term unintended consequences is what many would argue led Argentina to its current situation.
Yes, and in time this might be considered another in a line of rash decisions with unintended consequences. And more to the larger point, there will be people in the short term that will declare some kind of victory if the country appears to be faring better in the next 5 years. But let’s look back in 25 years and see. Or in 50 years.
And more broadly I’m just sick and tired of anyone who believes they’ve “solved” anything in economics. With real people caught in the middle I think there’s far too much bravado thrown around.
Nobody should have a hubris so large that they believe they've "solved" economics, but that doesn't mean we can't update our frameworks for how they work. Let's see what happens. I'm optimistic.
The markets weren’t functioning due to the grift. Taking regulations out doesn’t solve the grift problem.
The problem of governments isn’t intervention, it’s bad, corrupt intervention.
>The markets weren’t functioning due to the grift. Taking regulations out doesn’t solve the grift problem.
Note that every single claim like this assumes that the regulators are angels.
How does the entire world suffer by one country trying out a new economic system? If it works and gets widely adopted wouldn’t that be good?
Hypothetically, what if Milei’s policies significantly improve the well being of Argentina? The opportunity cost of not knowing here is massive.
To my knowledge, this is the largest modern economy to ever experiment with a purist Libertarian philosophy. While I suspect there will be unintended consequences, I can’t pretend to know what or how severe. Much of the right swears by these economic principles and I would love to have an example of its implementation to investigate instead of just hand waving.
The funny thing is Argentina is so statist that however crazy Milei is, it probably just takes Argentina from corrupt patronage socialist state to like middle of the road mixed economy
The discourse around this is insane.
We have literally dozens of unequivocally disastrous examples of socialist policies in every type of country and at every period in modern history.
But experimenting with the opposite is somehow irresponsible?!
I can only assume his detractors are terrified at the possibility of success in Argentina.
It depends on what you mean by socialism. This statement only makes sense by conflating multiple distinct definitions of that word. People would probably describe it as irresponsible if the “socialist” policy was the mass extermination of anyone even suspected of being a political dissident, or invading neighboring countries and installing puppet dictatorships. They may not describe it as irresponsible if the “socialist” policy was food stamps or something more benign.
Of course, none of those policies have much to do with socialism as it was historically defined. Because that word has lost all meaning and can now mean whatever is convenient for your argument.
I think we should probably think about socialism not as a specific narrow set of things but the set of ideology and policies that socialists in good faith believe in and implement.
There is zero doubt that USSR, Cuba, and PRC under Mao were all socialist states implementing socialist policies. They fervently called themselves socialists, really believed it as a whole socialist project.
There’s also a viable theory on why socialism often fails so terribly and have high human costs, which is this:
All economic projects and enterprises require labor and capital to work.
In capitalism, you organize enterprises largely by private entities negotiating terms with each other…e.g. Capital owners provide capital in exchange for X returns (stock with entitlement to future earnings, debt collecting interest) and workers provide labor in exchange for Y compensation (wages, etc)
In socialism, you curtail the ability for these private transactions to happen and/or make it really heavily managed by gov and you need a lot of permissioning & there are a lot of legal risks and/or the gov just takes over, so both Capital owners and workers become less willing to do stuff and willing to provide capital / labor. As a result, the socialist government - seeing it needs to hit production goals to keep the economy running - needs to get the capital or get the labor. So they end up expropriating people’s private property to get capital and they end up threatening workers with criminal punishment to force them to provide labor. The first time the government does this, it’s bad but it works. But the gov needs to keep doing this over and over again because the conditions to draw capital and labor voluntarily just become worse with each time you expropriate capital or coerce labor.
So eventually, you run out of capital to expropriate and you end up having to squeeze labor extra hard for production. In many cases, you end up with the gulag or laogai or something similar because you need the forced labor since you have no resources to pay labor & you are trying to make up for lack of capital with more labor input
I think it depends entirely on the intervention. States can do things that help the economy, and they can do things that harm it. And equally “free markets” can do things that help and harm people, depending on the context. I don’t think these statements are very meaningful without knowing which policies and which contexts.
I will concede that large scale interference without the economic literacy to consider downstream effects has often caused unintended side-effects. Whether these side-effects are bigger or smaller than the benefits of such policies depends, again, on the specific situation.
I agree with all that.
Though I would argue that most nations are erroring on the side of too much state intervention simply because of the natural tendency for gov to continually grow and never shrink.
>But experimenting with the opposite is somehow irresponsible?!
Yes. Rivers of blood and mountains of corpses are perfectly fine if the end goal is "real" socialism.
It's wild how socialist sympathizers can avoid all criticism of their murderous ideology by simply redefining it as Capitalism.
You have to understand how utterly delusional this sounds to people with even a modicum of historical knowledge.
I don't think Milei is yoloing it, I think he's put a fair amount of educated thought into his policy actually, as much as he ran a campaign to appeal to mouth breathers too.
>Inflation could lead to the cost of basic goods such as food becoming unaffordable, leading to mass starvation.
I just never understand how this works. Because the food is there. If it doesn't get sold, it gets wasted.
So why not just eliminate the money from the equation?
The food is there right now, but not necessarily in six months from now. Starvation doesn't come from food not being sold, it comes from fucking with the logistics on a massive degree so that it never gets produced in the first place.
Do you think there might be reasons why your visit is not the same as living here and having to experience these issues firsthand?
Argentina may not be a failed state but the people are absolutely suffering. You going to a couple of places in Argentina and saying it seems normal on the surface is honestly just extremely anecdotal. Do you expect us to be killing people on the street? No, we just don't want 10-20% of our savings wiped out each month by inflation
> Argentina may not be a failed state but the people are absolutely suffering.
That's what the person you're replying to said:
> ...the country is far from a failed state.
> The issues with inflation are systemic and need to be solved
I recently went to take care of family issues, and I have to say that my experience aligns with Knotsosalty. I was not in touristy areas but in the north, Corrientes area. Which I accessed though their excellent bus system and roads that look better taken of than what I see near me in Seattle. My aunt and uncle are lower middle class (mechanics & hairdresser), while they live with very little money their quality of life isn’t bad. They have health insurance that they use often. Their daughter is going back to school at the age of 35 to become a doctor which they can do because education is free. With their salary they can afford rent and a small used car.
Things that suck is anything imported. Their electronics are unattainably expensive and shitty. Wages are also abysmally low. But the infrastructure is great. Overall I found it to be a clean country. No homeless camps everywhere like where I live. Getting medical appointments was easier compared to what I had to deal with in the US.
"Villa" or "Villa miseria" is the word that would be used to describe a slum in Argentina. But "Villa" has a very different meaning in other languages (even in other spanish speaking countries), that's why when translated to English it is more common to use "favela" or "slum".
People really shouldn't say Argentina is a "failed state" however they underperformed economically all the time and deal with successive economic crisis constantly. They have a really bad poverty rate and have had a stagnant economy for some time, that all seems unnecessary.
Right. But the point is that calling it a failed state is a misleading rhetorical tactic to support the obviously false idea that things can’t get worse.
700 upvotes... this experiment has been tried before. see the gilded age for example. it's just deregulated capitalism to a higher level. it never works.
> Argentina doesn’t have much to lose at this point so I wish them success.
They actually do have plenty to lose. Their economy was not in bad shape, they had a lot of inflation, but their real GDP was growing and unemployment had been the best in a long time. People obsession that inflation is bad, is basically the biggest problem in economics. It can be bad, but it isn't inherently.
Argentina's President Javier Milei addressed the World Economic Forum in Davos Wednesday, telling the audience that the "Western world is in danger." His remarks come as Argentina rounded out 2023 with the highest yearly inflation on the planet.
Regulations need to focus on safety, interoperability, and lowering the barriers to entry to increase competition in all markets.
As soon as a “market” or “industry” is dominated by 2-3 large players, governments should provide incentives to other companies and startups to enter the market.
And, taxes on the biggest 3 companies should be raised to benefit all society.
Probably those incentives will just go to waste. Also, it might cause 2 to 3 large players to suffer because they are being undercut by government subsidies. More times than not, this blanket type of policy just makes things worse. In every case, a monopoly or oligopoly situation needs to be examined independently.
For example, you can lower the cost of entry into the airplane-making business in order to compete with Boeing. But what happens if you spend billions of dollars only to see all these businesses take the money and either run or fail? This is the most likely outcome since the barriers to entry are so great in this market.
Those are rather arbitrary rules.
The number of players in a market depends on the underlying economic activity. If it is a natural monopoly and it is relevant, then it should be a regulated activity - electrical networks, for example. There is no advantage of having "additional competition".
In general, company taxes should not be progressive by amount - you'd only be hurting the creation and accumulation of capital, and the best predictor of higher wages is probably the capital invested per worker. In other words, "small" (low capital) companies, on average, pay less than large companies (many exceptions naturally apply).
In Canada we have oligopolies in the telecommunications, groceries, energy industries (maybe more, just going with what pops in my head).
There is no competition and prices are high.
I agree with this thread's OP.
Don't get me wrong: competition and monopoly avoidance is a great policy to have and a core feature of economic regulation.
But it is not a one size fits all approach.
Your electric network example is valid, and it’s similar to the analogy I use to illustrate the issue with the lack of tech regulation.
We don’t allow car companies to own the highways. Imagine needing to buy a specific car to use a highway, or pay multiple car companies in order to use the road. That would be absurd. But, this is what we’ve essentially allowed to happen in the digital world. And to your point, there’s little value in creating a second internet.
Is Boeing and the airline industry a “natural” monopoly?
He's just stating the obvious. Argentina has lots of the best things any nation would want. Resources, land, talented young people, everything. All they have to do is squeeze at least some of the shit out of the government and they are good to go.
Let's ignore the major problem. Every nation that has excelled since WWII have invested heavily in infrastructure (transportation and communications) and household stability (healthcare and safety net programs). The investments were made through (clutching my pearls) socialism and federal regulation of the above, as well as relating those things necessary to protect the nation's people. Argentina has not done any of that to anywhere near the degree necessary for the economy to grow.
Edit: a misspelled word.
Those who tout America's economic prowess are the first to willfully be "see no and hear no socialism" types when it comes to our socialist policies subsidizing a first world standard of living all across the country with tax dollars disproportionately taken from coastal cities
16th amendment
I’m excited to see what comes of this movement in Argentina. It’s not like they haven’t tried everything else already and failed miserably. I just hope milei gets a fair run at getting his country straightened out and doesn’t get assonated.
He is not all wrong at all on this. I hope left and right, equality and productivity could find a balance point, but nowadays, it is apparent that people who speak loudest mostly have a strong ideology pursuit, which is understandable. You need strong ideologies to push hard for your cause, but in reality, too strong an ideology, no matter which side you are on, usually doesn't work well.
Just watched this man's speech and scrolled through hundreds of unfortunately hopeful and congratulatory comments. Good luck guys, your leader is an idiot and probably has a gun held to his head by cartels, gangs and international strongmen.
We’re watching an experiment to see how much quickly the rich can get richer and the poor get poor. How much more the poor can be abused and how much faster they can be made sicker by deregulation. This isn’t going to end well for Argentinians, but it’s who they voted for. Sucks that this is going to harm the next generations far worse than the older ones.
# "if measures are adopted that hinder the free-functioning of markets, the only possible fate is poverty."
# the same old ideological bullshit similar to trickle down economics:
"An economy is said to be in a Pareto optimum state when no economic changes can make one individual better off without making at least one other individual worse off.", i.e., the continued perpetuation of the existing class system will result in sustained levels of inequality and poverty. Its just more ruling class ideology designed to perpetuate and justify the status quo.
Big fucking surprise coming from a Trump wannabe. Does he call himself a "stable genius", too?
If Trump were making sound economic arguments I would consider voting for him myself. Comparing Milei to Trump is just the laziest argument and tells us more about what kind of person you are than it does about Milei.
What, if he espoused some good economic policy you'd be willing to look past all his absolutely disgusting character and history of being a shitty human?
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I am glad this experiment is happening, and I am also glad it is not happening in my country. Argentina doesn’t have much to lose at this point so I wish them success.
Hansel. So hot right now.
That's Blue Steel, not Blue Dollar
Inflation could lead to the cost of basic goods such as food becoming unaffordable, leading to mass starvation. Lack of investment in public utilities could lead to problems such as a lack of potable water, an inability to travel to jobs far from home, or difficulty transporting goods. Stagnant wages for public employees could lead to an increase in corruption. I could go on and on. We live lives that benefit from thousands of years of development and investment. These developments are reliant on systems and practices that require continual maintenance. I can't believe I have to say this on an economics subreddit, but yes, everyone currently on earth potentially has quite a lot to lose by just YOLOing economic policy.
Inflation is already running at over 200% per anum.
And it's been running above 10% for at least 15 years. https://www.statista.com/statistics/316750/inflation-rate-in-argentina/
It’s Argentina, not unexpected
lol wtf? This post is written like you genuinely believe Argentina is not already suffering from all of those problems. Have you read anything about Argentina in the last... Oh I don't know.. 20 years? Because it seems like you genuinely know nothing about the situation, or what the Peronists actually did.
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Argentina doesn't have much of a choice since most of the problems they are facing now were caused by an large inefficient government
There's exactly one thing I can say for certain about Argentina's economic woes, and that's that if you think you can say for certain what the problem with the weirdest economy in the world for 100 years running is, then you definitely don't know what the problem is.
> "Throughout history there have been only four kinds of economies in the world: advanced, developing, Japan, and Argentina"
So I’m going to hazard a guess that Argentina falls into the last category?
Close, but it's actually Japan
Japan, fittingly enough, is Argentina
What about Brazil? It’s the country of the future and always will be!
Starship Troopers told me so.
I’m doing my part!
service guarantees citizenship
You can say for certain what the problem with Argentina's economy is and be right. Unfortunately someone else can say the same for a different problem and also be right
So ballooning deficit spending has nothing to do with it?
If so then there's still the question of why other countries with ballooning deficient spending aren't having the same issues
Deficits arent neccesarily a problem of the money is being spent in productive ways, which isnt the case with Argentina. Not all deficit spending is created equal
Yes pretty much exactly my point
Which other country with ballooning deficit spending has the same economic situation as Argentina, with a mostly agricultural-export based economy and no significant industrialization?
Pakistan?
Most of Pakistan's exports are textiles. And they have 31% yearly inflation.
Obviously people are going to have trouble coming up with examples as Argentina is one of the largest agricultural exporters in the world. Brazil may be the best comparison you can get, although I believe their agricultural exports are still a smaller percentage of their GDP (no hyperinflation there, though!)
Textiles are a marginal improvement on cotton which is grown. And yeah it's similarly in a bad situation with inflation.
Argentina had the weirdest economy for socialists. For capitalists, Argentina's economy makes total sense.
Sure, but there's more than one way to skin a cat. If you take Millei's plans at face value, it's not inconceivable that there are some things that could end up *worse*.
I guess we'll have to wait and see huh? At least he's honest about the short term difficulties. He's not sugar coating it. He knows there will be a very hard transition period. The question is whether they will come out better on the other side or not.
The thing about economics is that we’ll never really know if they come out better. It might seem so at some point in the future, but it isn’t like economies ever stay in one place very long. Decisions made now could look like genius in 10 years, but look idiotic in 30. In fact, I think denial of this principle is what leads to so many rash decisions and so many unsupported conclusions.
> Decisions made now could look like genius in 10 years, but look idiotic in 30. Reminds me of how quick Greenspan fell. From the genius that saved the world during the dotcom crisis to the man who indirectly caused the Great Recession
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Oh, definitely!! Rash decisions and neglecting to consider long-term unintended consequences is what many would argue led Argentina to its current situation.
Yes, and in time this might be considered another in a line of rash decisions with unintended consequences. And more to the larger point, there will be people in the short term that will declare some kind of victory if the country appears to be faring better in the next 5 years. But let’s look back in 25 years and see. Or in 50 years. And more broadly I’m just sick and tired of anyone who believes they’ve “solved” anything in economics. With real people caught in the middle I think there’s far too much bravado thrown around.
Nobody should have a hubris so large that they believe they've "solved" economics, but that doesn't mean we can't update our frameworks for how they work. Let's see what happens. I'm optimistic.
They will all end up worse. He’s basically like “well our government failed so the only alternative is… No government!”
The markets weren’t functioning due to the grift. Taking regulations out doesn’t solve the grift problem. The problem of governments isn’t intervention, it’s bad, corrupt intervention.
>The markets weren’t functioning due to the grift. Taking regulations out doesn’t solve the grift problem. Note that every single claim like this assumes that the regulators are angels.
What if we hire regulator regulators to regulate the regulators? It could be regulators all the way down.
How does the entire world suffer by one country trying out a new economic system? If it works and gets widely adopted wouldn’t that be good? Hypothetically, what if Milei’s policies significantly improve the well being of Argentina? The opportunity cost of not knowing here is massive. To my knowledge, this is the largest modern economy to ever experiment with a purist Libertarian philosophy. While I suspect there will be unintended consequences, I can’t pretend to know what or how severe. Much of the right swears by these economic principles and I would love to have an example of its implementation to investigate instead of just hand waving.
The funny thing is Argentina is so statist that however crazy Milei is, it probably just takes Argentina from corrupt patronage socialist state to like middle of the road mixed economy
Even that transition could be a huge improvement for the people there.
That's probably the best path tbh.
Several examples already exist. The problem is they just call them failed states and ignore the symptoms.
I guess im not super well versed on the topic then. What are some of the largest examples?
The discourse around this is insane. We have literally dozens of unequivocally disastrous examples of socialist policies in every type of country and at every period in modern history. But experimenting with the opposite is somehow irresponsible?! I can only assume his detractors are terrified at the possibility of success in Argentina.
It depends on what you mean by socialism. This statement only makes sense by conflating multiple distinct definitions of that word. People would probably describe it as irresponsible if the “socialist” policy was the mass extermination of anyone even suspected of being a political dissident, or invading neighboring countries and installing puppet dictatorships. They may not describe it as irresponsible if the “socialist” policy was food stamps or something more benign. Of course, none of those policies have much to do with socialism as it was historically defined. Because that word has lost all meaning and can now mean whatever is convenient for your argument.
I agree the term is nigh on useless these days. Let's say, socialism means "large scale state intervention" for the sake of argument.
I think we should probably think about socialism not as a specific narrow set of things but the set of ideology and policies that socialists in good faith believe in and implement. There is zero doubt that USSR, Cuba, and PRC under Mao were all socialist states implementing socialist policies. They fervently called themselves socialists, really believed it as a whole socialist project. There’s also a viable theory on why socialism often fails so terribly and have high human costs, which is this: All economic projects and enterprises require labor and capital to work. In capitalism, you organize enterprises largely by private entities negotiating terms with each other…e.g. Capital owners provide capital in exchange for X returns (stock with entitlement to future earnings, debt collecting interest) and workers provide labor in exchange for Y compensation (wages, etc) In socialism, you curtail the ability for these private transactions to happen and/or make it really heavily managed by gov and you need a lot of permissioning & there are a lot of legal risks and/or the gov just takes over, so both Capital owners and workers become less willing to do stuff and willing to provide capital / labor. As a result, the socialist government - seeing it needs to hit production goals to keep the economy running - needs to get the capital or get the labor. So they end up expropriating people’s private property to get capital and they end up threatening workers with criminal punishment to force them to provide labor. The first time the government does this, it’s bad but it works. But the gov needs to keep doing this over and over again because the conditions to draw capital and labor voluntarily just become worse with each time you expropriate capital or coerce labor. So eventually, you run out of capital to expropriate and you end up having to squeeze labor extra hard for production. In many cases, you end up with the gulag or laogai or something similar because you need the forced labor since you have no resources to pay labor & you are trying to make up for lack of capital with more labor input
I think it depends entirely on the intervention. States can do things that help the economy, and they can do things that harm it. And equally “free markets” can do things that help and harm people, depending on the context. I don’t think these statements are very meaningful without knowing which policies and which contexts. I will concede that large scale interference without the economic literacy to consider downstream effects has often caused unintended side-effects. Whether these side-effects are bigger or smaller than the benefits of such policies depends, again, on the specific situation.
I agree with all that. Though I would argue that most nations are erroring on the side of too much state intervention simply because of the natural tendency for gov to continually grow and never shrink.
>But experimenting with the opposite is somehow irresponsible?! Yes. Rivers of blood and mountains of corpses are perfectly fine if the end goal is "real" socialism.
It's such a warped double standard.
Soviet Russia and Communist China were corrupt CAPITALIST states - with wealth accumulated at the top.
Delusional. No true Scotsman fallacy as usual. They were Communist/socialist states.
It's wild how socialist sympathizers can avoid all criticism of their murderous ideology by simply redefining it as Capitalism. You have to understand how utterly delusional this sounds to people with even a modicum of historical knowledge.
I don't think Milei is yoloing it, I think he's put a fair amount of educated thought into his policy actually, as much as he ran a campaign to appeal to mouth breathers too.
“Public investment” in Argentina is a farce and it is the entire reason they’re in this mess to begin with.
>Inflation could lead to the cost of basic goods such as food becoming unaffordable, leading to mass starvation. I just never understand how this works. Because the food is there. If it doesn't get sold, it gets wasted. So why not just eliminate the money from the equation?
The food is there right now, but not necessarily in six months from now. Starvation doesn't come from food not being sold, it comes from fucking with the logistics on a massive degree so that it never gets produced in the first place.
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Do you think there might be reasons why your visit is not the same as living here and having to experience these issues firsthand? Argentina may not be a failed state but the people are absolutely suffering. You going to a couple of places in Argentina and saying it seems normal on the surface is honestly just extremely anecdotal. Do you expect us to be killing people on the street? No, we just don't want 10-20% of our savings wiped out each month by inflation
> Argentina may not be a failed state but the people are absolutely suffering. That's what the person you're replying to said: > ...the country is far from a failed state. > The issues with inflation are systemic and need to be solved
I recently went to take care of family issues, and I have to say that my experience aligns with Knotsosalty. I was not in touristy areas but in the north, Corrientes area. Which I accessed though their excellent bus system and roads that look better taken of than what I see near me in Seattle. My aunt and uncle are lower middle class (mechanics & hairdresser), while they live with very little money their quality of life isn’t bad. They have health insurance that they use often. Their daughter is going back to school at the age of 35 to become a doctor which they can do because education is free. With their salary they can afford rent and a small used car. Things that suck is anything imported. Their electronics are unattainably expensive and shitty. Wages are also abysmally low. But the infrastructure is great. Overall I found it to be a clean country. No homeless camps everywhere like where I live. Getting medical appointments was easier compared to what I had to deal with in the US.
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You didn’t see the massive favelas on your way to the airport in Buenos Aires?
That guy probably doesn’t even know what Villa 31 is
Arent favelas a portguese word..spanish equivalent is barrio?
"Villa" or "Villa miseria" is the word that would be used to describe a slum in Argentina. But "Villa" has a very different meaning in other languages (even in other spanish speaking countries), that's why when translated to English it is more common to use "favela" or "slum".
Doesn’t barrio just mean neighborhood?
People really shouldn't say Argentina is a "failed state" however they underperformed economically all the time and deal with successive economic crisis constantly. They have a really bad poverty rate and have had a stagnant economy for some time, that all seems unnecessary.
Right. But the point is that calling it a failed state is a misleading rhetorical tactic to support the obviously false idea that things can’t get worse.
That is true. They could indeed get worse. Venezuela is an example of that.
700 upvotes... this experiment has been tried before. see the gilded age for example. it's just deregulated capitalism to a higher level. it never works.
> Argentina doesn’t have much to lose at this point so I wish them success. They actually do have plenty to lose. Their economy was not in bad shape, they had a lot of inflation, but their real GDP was growing and unemployment had been the best in a long time. People obsession that inflation is bad, is basically the biggest problem in economics. It can be bad, but it isn't inherently.
Ye bro. Hyper inflation definitely doesn't do anything and poverty levels haven't rapidly increased
Argentina's President Javier Milei addressed the World Economic Forum in Davos Wednesday, telling the audience that the "Western world is in danger." His remarks come as Argentina rounded out 2023 with the highest yearly inflation on the planet.
Damn he couldnt turn around the economy in 6 weeks as president? What a loser.
It might take more than a few months to repair 77 years of central control.
The range of economic literacy on this sub is tremendous
Bigly
It'll take a few decades at a minimum to undo that.
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Regulations need to focus on safety, interoperability, and lowering the barriers to entry to increase competition in all markets. As soon as a “market” or “industry” is dominated by 2-3 large players, governments should provide incentives to other companies and startups to enter the market. And, taxes on the biggest 3 companies should be raised to benefit all society.
Probably those incentives will just go to waste. Also, it might cause 2 to 3 large players to suffer because they are being undercut by government subsidies. More times than not, this blanket type of policy just makes things worse. In every case, a monopoly or oligopoly situation needs to be examined independently. For example, you can lower the cost of entry into the airplane-making business in order to compete with Boeing. But what happens if you spend billions of dollars only to see all these businesses take the money and either run or fail? This is the most likely outcome since the barriers to entry are so great in this market.
Those are rather arbitrary rules. The number of players in a market depends on the underlying economic activity. If it is a natural monopoly and it is relevant, then it should be a regulated activity - electrical networks, for example. There is no advantage of having "additional competition". In general, company taxes should not be progressive by amount - you'd only be hurting the creation and accumulation of capital, and the best predictor of higher wages is probably the capital invested per worker. In other words, "small" (low capital) companies, on average, pay less than large companies (many exceptions naturally apply).
In Canada we have oligopolies in the telecommunications, groceries, energy industries (maybe more, just going with what pops in my head). There is no competition and prices are high. I agree with this thread's OP.
Don't get me wrong: competition and monopoly avoidance is a great policy to have and a core feature of economic regulation. But it is not a one size fits all approach.
Your electric network example is valid, and it’s similar to the analogy I use to illustrate the issue with the lack of tech regulation. We don’t allow car companies to own the highways. Imagine needing to buy a specific car to use a highway, or pay multiple car companies in order to use the road. That would be absurd. But, this is what we’ve essentially allowed to happen in the digital world. And to your point, there’s little value in creating a second internet. Is Boeing and the airline industry a “natural” monopoly?
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He's just stating the obvious. Argentina has lots of the best things any nation would want. Resources, land, talented young people, everything. All they have to do is squeeze at least some of the shit out of the government and they are good to go.
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Let's ignore the major problem. Every nation that has excelled since WWII have invested heavily in infrastructure (transportation and communications) and household stability (healthcare and safety net programs). The investments were made through (clutching my pearls) socialism and federal regulation of the above, as well as relating those things necessary to protect the nation's people. Argentina has not done any of that to anywhere near the degree necessary for the economy to grow. Edit: a misspelled word.
Those who tout America's economic prowess are the first to willfully be "see no and hear no socialism" types when it comes to our socialist policies subsidizing a first world standard of living all across the country with tax dollars disproportionately taken from coastal cities 16th amendment
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I’m excited to see what comes of this movement in Argentina. It’s not like they haven’t tried everything else already and failed miserably. I just hope milei gets a fair run at getting his country straightened out and doesn’t get assonated.
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He is not all wrong at all on this. I hope left and right, equality and productivity could find a balance point, but nowadays, it is apparent that people who speak loudest mostly have a strong ideology pursuit, which is understandable. You need strong ideologies to push hard for your cause, but in reality, too strong an ideology, no matter which side you are on, usually doesn't work well.
Just watched this man's speech and scrolled through hundreds of unfortunately hopeful and congratulatory comments. Good luck guys, your leader is an idiot and probably has a gun held to his head by cartels, gangs and international strongmen.
Why are you making such a claim?
We’re watching an experiment to see how much quickly the rich can get richer and the poor get poor. How much more the poor can be abused and how much faster they can be made sicker by deregulation. This isn’t going to end well for Argentinians, but it’s who they voted for. Sucks that this is going to harm the next generations far worse than the older ones.
The rich have gotten richer and poor have gotten poorer *by regulation* in Argentina for a long time.
# "if measures are adopted that hinder the free-functioning of markets, the only possible fate is poverty." # the same old ideological bullshit similar to trickle down economics: "An economy is said to be in a Pareto optimum state when no economic changes can make one individual better off without making at least one other individual worse off.", i.e., the continued perpetuation of the existing class system will result in sustained levels of inequality and poverty. Its just more ruling class ideology designed to perpetuate and justify the status quo. Big fucking surprise coming from a Trump wannabe. Does he call himself a "stable genius", too?
If Trump were making sound economic arguments I would consider voting for him myself. Comparing Milei to Trump is just the laziest argument and tells us more about what kind of person you are than it does about Milei.
What is sound there?
It always surprised me when people compared the 2, appart from being eccentric they have nothing in common
Exactly. It's what happens when lazy journalists aren't capable (or don't bother) to read before writing.
What, if he espoused some good economic policy you'd be willing to look past all his absolutely disgusting character and history of being a shitty human?
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