President Javier Milei signed the May Pact with 18 governors in the Historic House of Tucumánwhere he gave a national message in which he also announced the creation of a “May Council” to push through reforms to that agreement in Congress.
Milei He said that the 10 points of the May Pact “are basic, unalterable laws of the economy” and “unobjectionable mathematics,” noting: “When we obeyed these principles as a nation, we did so well in such a short time that we were the envy of the entire world.”
The head of state announced that “economic shamanism is over” and stressed that “we must do what has worked all over the world.”
The document addresses issues related to the deregulation of the economy; fiscal, labor and pension reforms; reduction of public spending, with fiscal balance; exploitation of natural resources; opening of the economy; and re-discussing co-participation with the provinces.
This is how he referred Milei to points linked to economic activity:
The inviolability of private property
Private property is the first and most basic institution of our society. The defense of property is not only a right but the formula for economic growth. Argentines know better what to do with their property than a government does. They do not need a bureaucrat to tell them what to produce, with whom to trade, how much they can earn, with whom to work or whom to hire. The freer a people is, the richer they become.
In line with this mandate, the government will pursue an aggressive agenda of deregulation in all areas of economic activity. Respecting the inviolability of private property is to confirm to Argentines that they are the owners of their own lives and destinies, in short, that they are adults and that in the exercise of their capacity they can and should choose for themselves. If the State decides over all aspects of the individual and has the right to claim property, the individual does not recognize himself as the owner of his own life and does not take responsibility for his actions.
The non-negotiable fiscal balance
Non-negotiable commitment to fiscal commitment. It is the ultimate origin of all the problems that the economy has had in the last 100 years. We are assuming a non-negotiable commitment to common sense. We cannot spend more than we take in. We must do what has been tested throughout the world and abandon the recipes that have failed. I promise that we will live in a country without inflation for the rest of our days.
Public spending around 25 points of GDP
We are committed to reducing it to historic levels. Our country has enormous natural resources and a highly talented and hard-working human capital, but it has not prospered because the private sector, companies, workers and entrepreneurs, bear more than 40 points of GDP of state spending that we are reducing with great effort. Excessive public spending is the core of all our ills.
Drastically reducing the weight of the State in our economy is our most difficult mission. That is why we are calling for this pact, so that we can all do our part.
JAVIER MILEI MAY PACT
Presidency
44% of the state expenditure in our country corresponds to the provinces and municipalities. For every employee of the national state there are 5 provincial employees. Reaching a reasonable weight of 235 points of GDP requires everyone to do their part.
From the national government we have demonstrated our commitment by having made the largest spending reduction in national history in eight months. The signatories committed to doing their part in their districts.
A tax reform that reduces the tax burden, simplifies the lives of Argentines and promotes trade
We signed the commitment to carry out a tax reform that reduces the tax burden, simplifies the lives of Argentines and promotes trade. Our tax system is labyrinthine and suffocating.
Reducing the State’s weight in the economy must be accompanied by a reduction in the tax burden.
The re-discussion of federal tax sharing to end forever the current extortionate model suffered by the provinces
Commitment to re-discuss tax sharing to end the extortionate model that the provinces suffer. Our model is fraudulent and punishes those who are fiscally responsible and productive, and only serves to allow politicians to extort the provinces.
They do not need a fraudulent federalism that only serves the leadership of Buenos Aires. We have to find an agreement on this matter.
The commitment of the Argentine provinces to advance in the exploitation of the country’s natural resources
Commitment to exploiting the natural resources that God has given us. Politicians have listened more to the demands of noisy minorities and environmental organizations financed by foreign millionaires. We have come to change that. Nature must serve human beings and not the other way around.
A modern labor reform that promotes formal work
Nothing will be possible without moving forward with a modern labor reform that promotes formal work. There can be no doubt. The regime that has prevailed in Argentina for 50 years is harmful. It is a regime with outdated regulations that make it impossible to hire someone formally.
A pension reform that gives sustainability to the system and respects those who contributed
A reform of the pension system that makes the system sustainable and guarantees respect for those who have contributed. The system is broken and has an incentive system that makes it unsustainable and immoral.
We have labor legislation that encourages informality and a pension system that steals from those who contribute. We need a system that respects the contributions and savings of a lifetime.
Opening up to international trade, so that Argentina can once again become a protagonist in the global market
Opening up international trade. There is no possibility of growth if we do not open ourselves to the world. We have everything to do so.
Source: Ambito
