Libertarian Argentine Breaking the Leftist Mold in South America

Argentine congressman Javier Milei waves to his supporters during the presentation of his book "El Camino del Libertario" at the Buenos Aires International Book Fair on May 14, 2022. (Photo by Luis Robayo / AFP via Getty Images)

Argentina is gearing up for a highly anticipated election in October, and with the country facing economic turmoil, voters are looking for a change. With an annual inflation rate of 109 percent, a rapidly depreciating black-market peso, and a severe drought affecting a large part of the country, the electorate has undergone a dramatic shift.

Enter Javier Milei, a libertarian economist and congressman whose policies are striking a chord among voters facing economic chaos. At 52 years old, Milei is currently leading in some polls as the most popular individual politician, particularly among men younger than 30.

Milei’s rise in popularity is surprising in a country where left-wing populism has been the norm for decades. His coalition—La Libertad Avanza, or “Liberty Advances”—aims to drastically cut government spending, deregulate private gun ownership, and even enact a controversial plan to privatize the market for organ donors.

Supplanting the Argentine peso with the U.S. dollar is the libertarian economist’s cornerstone proposal, an idea that has caught the attention of one prominent U.S. economist.

“Given Argentina’s institutions, there’s only one way forward: dollarization,” Steve Hanke, professor of applied economics at the Johns Hopkins University, told The Epoch Times in an email. “Milei clearly understands this and has the right ideas about what to do with Argentina’s endemic currency problem—dump the peso.”

Formerly an economic adviser to the Reagan White House, Hanke also advised Argentine President Carlos Menem throughout the 1990s. The professor has been a decades-long proponent in favor of the South American country’s dollarization.

Some economists have argued that while dollarization would cure inflation, it would leave Argentina with fewer tools to combat shocks to the economy and likely require partial defaults on the country’s fiscal obligations.

Steve H. Hanke, professor of applied economics at Johns Hopkins University, in his office. (Courtesy of Steve Hanke)

Milei’s Twitter feed features quotes from prominent free-market philosophers, such as early 19th-century French economist Frédéric Bastiat: “Everyone wants to live at the expense of the state. They forget that the state lives at the expense of everyone.”

Milei also quoted mid-20th-century U.S. economist Murray Rothbard: “The State is a gang of thieves writ large—the most immoral, grasping, and unscrupulous individuals in any society.”

Hanke hopes for Milei’s success since currency reform is long overdue.

“I’ve been involved in the trials and tribulations of currency reform in Argentina for 34 years, primarily for over 10 years when I was advising President Carlos Menem and Minister Domingo Cavallo,” Hanke said. “I first proposed dollarization over 25 years ago to President Menem. It’s time to mothball the Central Bank of Argentina and the peso and put them in a museum and replace them with the U.S. dollar.”