Last week the president Javier Milei He spoke at the Argentine Rural Society. As we are used to, his speech (full of insults and expletives) was also full of statements that contradict the economic reality of the country. His statements, which seemed more like an exercise in propaganda than an honest analysis, reflect a biased and simplified understanding of the challenges facing the Argentine economy. Meanwhile, from Mexico, Cristina Fernández de Kirchner insists on a democratic and consensus-based solution, but putting the well-being of the majority at the center.
But in times of daily fake news, where “data does not kill the story”, I am going to highlight three ideas from the speech to show the barbarities stated, and urge us to leave intellectual laziness behind and think about the real challenges facing our country.
Milei N1’s lie: “The happiest days in Argentine history were the happiest days in the history of the countryside”
Milei tries to establish a direct connection between rural prosperity and national happiness, seeking to antagonize Peronism and the historic Peronist phrase that “the happiest days were Peronist.” It is true that a strong agricultural sector contributes to economic growth, mainly by contributing to the accumulation of the country’s international reserves, but this success is not always combined with a process of national development.
Economic growth does not imply development, and the countryside knows this very well. In fact, it should also be a driving force to diversify and strengthen other sectors, such as industry and technological development, which are crucial for sustainable and equitable development in the current international context, something that is not in Javier Milei’s mind.
So, whose happiness are we talking about? Reducing the well-being of a country to the fate of a single sector is simplistic and short-sighted. If we think about it from the perspective of today’s world, we can say that it is a statement – at least – mediocre. But at the same time, it is deeply unfair. If there is one thing we are seeing in the latest INDEC indicators on inequality, it is that this “anarcho-capitalist” economic model increases inequality, and many are far from happy: they are sad and defeated.
Milei N2’s lie: “Instead of becoming the industrial country we were promised, all the wealth we had accumulated was squandered”
Milei accuses his predecessors of squandering the country’s wealth, leading to a situation of misery that, according to him, reached its lowest point last December. First of all, Milei does not take charge of his first month of management, where his brutal exchange rate adjustment allowed him to apply the blender and the chainsaw to the popular and working classes and to national production. Secondly, if there is one thing that Milei cannot talk about, it is industry: the Manufacturing Production Index plummeted to pandemic levels during his mandate and we are simply seeing a rebound effect. Consequently, it is estimated that the economy this year will be 5% smaller, that is, a recession of -5% of GDP, so: what wealth is Javier Milei talking about?
Source: INDEC
In turn, this destruction of small and medium-sized businesses and large chains only leads to a further deterioration of our labour market, which undoubtedly has historical debts. This deterioration, of course, is reflected in the numbers of poverty and indigence. If Milei is doing anything, it is generating poverty, not wealth.
In the second half of 2023, we observed the sad indicator that 58% of children under 14 years of age were poor, but to date all indicators show that this government has increased it, in some cases surpassing the 60% barrier.
That is to say, under Milei’s government, -in 6 months- more than 6 out of 10 children under 14 years old are poor. During his administration, monthly inflation in December reached 25.5% and unemployment has increased, worsening the vulnerability of thousands of Argentines.
Milei N3’s lie: “Today, the real inflation in Argentina is running at 8% annually and will continue to fall”
First of all, how does he slow down inflation? Milei’s anti-inflationary anchor is low, miserable wages. Starvation wages, with no internal market to allow the adjustment made at the beginning of the year to materialize. Added to this is a strategy of intervention in the USD financial market to reduce the exchange rate gap at the expense of international reserves, and therefore of short-term exchange rate stability.
Second, Milei distorts reality. In June 2024, core inflation (which excludes volatile elements such as tariffs and seasonal prices) was 3.7% per month. This figure does not align with Milei’s narrative that inflation is under control. And even less with the forced annualization he performs. Let us remind the president that the interannual inflation for June was 271% according to the same INDEC. The corollary, a brutal adjustment in consumption in supermarkets and in the domestic market.
Downplaying the severity of current inflation is not only misleading but also dangerous, as it underestimates the real challenges citizens face in their daily lives. In his recent appearance, Macri also mentioned the same thing. We see that it is not only the current president’s illness, but also that some former presidents do not know how to add and subtract, much less the country’s inflationary situation.
Conclusion
Milei’s speech at the Rural Society attempts to create science fiction, to rewrite history and manipulate numbers. The most serious thing is that the government is thus ignoring the structural problems that must be addressed in order to achieve inclusive and sustainable economic growth. As Cristina said in Mexico: why should we expect Elon Musk to care about the environment or social inclusion? Clearly that is the role of the StateNo one can be happy alone, so we need to rebuild the country for the majority. The truth is that Argentina’s problems will not be solved with grandiloquent speeches, but with concrete actions and a clear and coherent approach to economic development. It would be desirable for the most influential economic sectors of our country to stop applauding the jester and start building patriotic consensus.
Economist, Director of Banco Ciudad
Source: Ambito
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