From Populism to Reforms: Why Argentina’s History Under Miley’s Presidency Is Important for Ukraine
“Radical libertarian economist”, “great combiner”, “TikTok star who supports Ukraine and Trump”, “freak” and “scientist genius” – all these nicknames are addressed by the media to Javier Milea, who recently celebrated a year in power. The president of Argentina, who promised to pull the country out of the bottom, really managed to achieve a lot in a year. Thus, inflation in the state decreased from 25.5% per month to 2.7%, the poverty level curve decreased from 54.9% to 41.7%. If at the beginning of his tenure the budget deficit was 2.7%, then a year later the budget surplus reached 1.7%.
For the first time in 123 years, the country received a stable budget without default. Dollar deposits and savings, real incomes of the population are rapidly increasing, the shadow currency exchange market has disappeared, the exchange rate has been deregulated, the refusal of artificial intervention in the currency market promotes the inflow of investments into the country.
Before Miley came to power, Argentina was next to the 35 countries with the lowest level of economic freedom, but now it has rapidly risen to the top of the ranking and has the ambition to become the freest economy in the world, striving to implement another 3,200 structural reforms before the end of the current President’s term.
The secret of the success of the eccentric president of Argentina
After a year of Javier Millay as president of Argentina, his activities are active is discussed in the media. IA It’s already a fact wrote that Millay resorted to radical reforms to lead the country out of economic crisis, that his ideas based on free market principles inspired many Argentines disillusioned with years of economic decline, hyperinflation and poverty, which Milley sees as the consequences of the policies of “socialism with an Argentine face “.
In the opinion leading media, Javier Miley won the election, because he became a symbol of radical changes, which Argentines had been waiting for a long time. The country was experiencing a serious economic crisis: prices were rising, the currency was depreciating, and the level of poverty was skyrocketing. People have lost trust in traditional politicians.
To save the economy, Miley proposed bold ideas such as replacing the Argentine peso with the US dollar, cutting government spending, and eliminating the central bank. He actively criticized his predecessors, accusing them of corruption and inability to solve problems.
Miley stood out for his eccentricity, which is to be expected from a man who, in his youth, was the goalkeeper of a soccer team and the lead singer of a rock band. Photos where he spoke at rallies with a chainsaw, clearly demonstrating his intention to “cut” unnecessary government spending, went viral in the info field, and he campaigned on social networks, attracting young people. His ideas about freedom and the reduction of state influence found a response among those who sought change.
Also, the key to his success was the weakness of his opponents. Traditional parties could not offer anything new and people were disappointed with their policies. Against this background, Miley looked like a viable alternative. His radical promises and strong personality convinced the voters that he is the one capable of changing the situation in the country.
The phenomenon of the “Argentine experiment”
This concept characterizes the experience of the country, which in the 20th-21st centuries tried to find its way to economic development, but often faced instability. This is a story about how different politicians and economic decisions radically influenced the country: sometimes bringing it to great success, sometimes bringing it to the bottom.
At the beginning of the 20th century, thanks to the export of agricultural products, Argentina was one of the most successful countries in the world. But due to political instability and corruption, it lost this advantage.
Thus, attempts to stabilize the economy by tying the currency to the dollar in the 1990s ended in failure. In 2001, the country declared the largest default in the world, failing to pay its debts of $93 billion.
The government intervened constantly in the economy, which was especially noticeable under President Juan Peron: the state bought businesses, controlled prices, and provided subsidies. Although it helped people in the short term, it created financial problems in the long term. Great attention was paid to improving people’s living conditions: supporting workers, health care and education. But due to huge expenses, the state constantly accumulated debts.
The country constantly changed its approach: sometimes it protected its market and limited imports, then it opened the door to international trade. These changes depended on the ideas of the authorities at the time, but neither strategy brought stability.
The Argentine experiment is a lesson about how important it is to consistently plan economic policy. Populism, frequent rate changes and corruption can destroy even a strong economy. This story illustrates that success requires a balance between state intervention, confidence in international markets, and stable governance. For many countries, Argentina’s experience is a warning: it is necessary to think ahead and avoid mistakes that can cost too much.
What lessons can Ukraine learn from the “Argentine experiment”
Argentina is an example of a country that had every chance to become rich and successful, but due to bad decisions, populism and instability lost its potential and now has to rise from the bottom again. For Ukraine, this experience can be instructive in order to avoid similar mistakes and build a stable economy.
Argentinians had the opportunity to see for themselves: populism is harmful. The leaders of the state often made expensive promises, gave out subsidies, froze prices, and raised salaries, without having real resources for this. This naturally led to inflation and debt. Ukraine needs to carefully weigh the pros and cons of these populist gestures and focus on reforms that will bring long-term stability.
Argentina accumulated debts that it could not repay. The state relied on international loans, but spent them inefficiently. Therefore, it is worth using international aid for reforms and development, and not for temporary solutions to problems. It is important for Ukraine to take loans carefully and plan their repayment.
In the “Country of Silver” money was constantly depreciating. Ukraine needs to maintain the stability of the hryvnia and strengthen confidence in the banking system.
Argentina was spending a lot of money on subsidies for everyone, which was ineffective. The national government, which is obsessed with the distribution of “Thousand of Wool” and “National Cashback”, should resort to targeted assistance to those who really need it and save state resources.
In the “Land of Tango” strong education was maintained even during crises. It is important for Ukraine to invest in education and training of specialists so that people can work in the modern labor market.
The Argentine establishment had too much control over business and this only made things worse. Ukraine needs to create conditions so that entrepreneurs can work without unnecessary barriers, and to fight corruption. Argentina sold and repossessed businesses in a chaotic manner, causing chaos. Ukraine should carry out privatization openly, attracting investors and ensuring business stability.
The Argentine economy was hampered by its frequent self-isolation from the world market. So, we can conclude about the importance of permanent openness for international investors, export development and strengthening of European integration.
Argentina’s instability has constantly undermined the economy. Ukraine needs to strengthen state institutions, ensure the rule of law and fight against the influence of oligarchs.
In Argentina, people did not trust the government, and this caused tension in society. Ukraine should be as open as possible, fight corruption and show people how resources are used effectively.
…Argentina thus stands before us as a bitter but instructive example of how mistakes in economic policy and management can fetter a nation’s progress. Her experience is a warning bell that rings through time: one should not promise the impossible, one should not waste resources and believe in illusions. Instead, the path to prosperity lies in the wise use of credit and resources, deep integration with the global economy, inflows of investment, and most importantly, an unwavering commitment to transparency and the rule of law. The conclusions from the Argentine experiment are simple, but inexorable: only reason, restraint and honesty can become the pillars that will hold the future of any country on their shoulders.
Tetyana Viktorova
