I think so far this is what people wanted: end the status quo and apply shock therapy.
His supporters hope that in the long run the economy will become independent and the country would come out of the never ending crisis. My guess is that everything will simply end up owned by private interests and while (best case scenario) the economy will do better, people will suffer even more.
The Argentinian economy will not do better, only the wealth of the neocolonial compradors will, and the wealth of their Global North capitalist masters.
Well, I guess we’ll see. Currently I don’t really see how privatizing everything and opening real estate market to foreign investors helps poor children but maybe it will. My guess is that when the private corporations take over everything they will squeeze even more money out of the poor but maybe the wealth will somehow trickle down. It’s definitely an interesting experiment. My other guess is that if this fails all the libertarians will say that it’s because he implemented all the policies they like so much wrong. If he succeeds I’m definitely voting for the right wing nutjobs in the next elections.
The historical record shows that there are no maybes about this. It’s obviously not an “interesting experiment.” There’s no sense in giving these rhetorical inches while they’re taking miles.
I guess the right wing theory is that the president makes Argentina a great place to do business, business people rush in, and wealth trickles down.
But, that “trickle down” idea doesn’t ever seem to have actually worked anywhere. Maybe the best Argentina can hope for is that at one point when the economy is booming, the working people suddenly form or join unions and the companies decide it’s too risky / expensive to leave, so they negotiate with those unions.
OTOH, these days it’s so easy to move corporations around to wherever the laws are the most corporation-friendly. So, even if somehow the new president does make corporations want to do more business in Argentina, it’s hard to see how the people of Argentina will really benefit.
If he succeeds I’m definitely voting for the right wing nutjobs in the next elections.
Uh, I saved this comment of yours for that one sentence.
My views are rather libertarian, but I wouldn’t trust most of the real life libertarians (too trusting into thousands of shitcoins or excited with reading sci-fi and busy writing and discussing articles about mechanisms of anarchy in the ancap meaning of the word).
However, if it comes to you voting for the “right wing nutjobs”, please remember that GOP in USA is not libertarian in any way, no more than Ukraine’s ruling party which uses the word sometimes.
This is just the price the poor are going to have to pay while the rich get to loot the country.
He did say he would apply shock therapy to the economy. He never mentioned if the economy would come out alive.
Who could’ve guessed that a rightwing government wouldn’t solve their issues (which were originally caused by rightwing policies)?
The implosion of Argentina is a very complex issue, but, essentially, the country allowed itself to be informally dollarized and ceded control over most of its industries to international (read corporativist) interests. When Perón restructured the country, it was done with a limited scope and with relatively short term changes, causing their economy to collapse again later (it doesn’t help that Brazil, a powerful potential ally, had undergone a rightwing U.S.-backed coup at the time). Then, the whole Falklands/Malvinas war happened, all rightwing bullshit, and the country still hasn’t bounced back.
You just reminded me of an art display that went up in a park in Buenos Aires when I lived there. Basically the park is oriented around a fountain with a large circular area of brick around that, then pathways that go to the corners and sides of the square (ie to the sidewalks).
They put up a series of walls in that outer circle that told the story of the Malvinas conflict. What stood out to me was that they referred to the UK not by any name or country reference, they were just called “The Enemy”.
People remember and they don’t forgive.
The previous leftist government had used complicated currency controls, consumer subsidies and other measures to inflate the peso’s official value and keep several key prices artificially low, including for gas, transportation and electricity.
Yea devaluing peso from 360 for a dollar to 790 for a dollar instantly meanwhile is such a big brain play.
there is no such thing as a ‘natural’ price. every price is artificial. OPEC is literally a cartel ffs. The concept of ‘artificial’ pricing is so libertarian brained.
The invisible hand of Chicago School pseudoscience.
A Mileista friend of mine keep complaining about 140% of inflation a year for the past government, but now that yhey had like 300% in a week suddenly is ok and is just the true price of everything. Of course he dosen’t live in Argentina and dosen’t has his salary cut by a third in a week so it’s ok.
I think in his bigbrain libertarian mind, the money market pricing of the peso to usd is what defined the value previously and he decided that the market’s pricing is not correct for that of the Argentinian currency.
By devaluing the currency, it makes Argentinian labor and goods comparatively cheaper on the international market. This is a similar move to how China grew at such a tremendous rate in the 90’s - they intentionally devalued their currency in order to use foreign investment in their relatively cheap labor pool to fund the creation of their manufacturing industries.
That solution probably won’t work here, though. Corporations are scared of investing in countries with unstable political leadership that performs brash actions like his. (Libertarian economics cannot account for such beliefs though since everyone must be a perfectly rational actor that chooses price above all). They are afraid that he may unilaterally nationalize certain industries and claim all assets for the state. Or he may rugpull outside investments and say that all profits must go to the state for some amount of time. Whatever flavor of stupid chainsaw wielding antics he comes up with one day is what they will see and use as a justifiable rationalization for not investing in the devalued market of Argentina.
also China was handpicked by the American capitalists to be the manufacturing hub (cheap currency was a cherry on top). Countries recently forced to devalue currencies haven’t had a similar manufacturing boom especially because global economy is doing kinda shit.
I think in his bigbrain libertarian mind, the money market pricing of the peso to usd is what defined the value previously and he decided that the market’s pricing is not correct for that of the Argentinian currency.
You’re half right here. The idea is that the black market Peso:USD price represents the actual real value of the Peso, while the government’s official rate was miles away from this and completely divorced from reality and only remotely sustainable by endless amounts of borrowing, price controls, and money printing, which just contributes to worsening the problem. The hope is that a necessary but painful adjustment to the actual economic reality will eventually provide the stability necessary for real growth.
A smart government will know that, if you want to actually pull this kind of thing off, you need to do everything possible to make the transition as minimally painful as possible and do what you can to help protect the most vulnerable. We’ll see how Millei does, but I can’t say I’m exactly confident.
There’s a meaningful difference between a government arbitrarily mandating a price and buyers and sellers reaching an equilibrium, whatever you want to label it.
You can say that price controls are worth it in some cases, and plenty of economists would agree with that, but they do come with consequences compared to raw market prices, and we shouldn’t ignore that, whatever label we want to use.
there is no such thing as a ‘natural’ price.
Have you seen a middle-eastern market? Of the kind where they bargain. Like in fairy-tales.
That’s how markets actually look in the wild.
And the natural price is the mathematical expectation of the price you get by bargaining.
It’s very simple and in this particular case “mainstream” economics and libertarian economics get along pretty well.
no. because the prices are influenced by external factors. i live in a country where markets like these exist and the price is not ‘natural’ in any way, in an idealized world maybe but not in reality.
firstly, transporting any commodity (and inputs such as fertilizers) requires fuel and fuel prices aren’t determined by such idealized markets you mentioned, its determined by what cartels and oligopolies want it to be. you are also ignoring subsides, not just by the national governments but foreign governments. for example, developed countries provide a shit ton of subsidies which pull down prices in the international markets, without restrictions and tariffs these displace local production.
there is also the fact that food prices are very inelastic, the seller can push prices very high and the consumer will be forced to accept it because you can’t live without food.
i dont really get the middle eastern market you are mentioning because in reality there is absolutely price discrimination going on.
OK. Natural prices exist as an unreachable ideal point, but there are no absolutely natural prices in real world. I agree, and, BTW, no ancap would argue with that.
Have you seen a middle-eastern market? Of the kind where they bargain. Like in fairy-tales
imagine citing a fantasy trope to justify economic policy jfc
I don’t need to justify anything to you. It’s an example for educational purposes.
EDIT: And if you think it’s just a fantasy trope, then you probably haven’t been out of your state.
