We Should All Pay Attention to What is Happening in Argentina
President Javier Milei is implementing a programme of radical free market reform that it is already bearing fruit for ordinary Argentinians and his popularity. UK politicians must take note.
On 1st March, President Javier Milei delivered his State of the Nation address to the Argentinian Congress.
Since he was elected in November 2023, the world’s only openly libertarian president has implemented a programme of radical free market reform. Unlike many who take office, Milei has talked the talk and turned his rhetoric into action. That action is now bearing extraordinary fruit for ordinary Argentinians.
What is going on in Argentina is something the modern world has never before seen. A libertarian President, elected on a radically free market agenda, who is actually implementing these ideas and has been working to shrink the size of the state from day one. I am reluctant to call it an “experiment”1, as some have: Milei’s policies are rooted in an expansive tradition of free market ideas, of which too many are unacquainted. Few members of our Parliament could even quote figures like Hayek or Mises, let alone explain their work on national television.
I recall conversations with other liberty-minded parliamentary staffers, and some liberty-minded parliamentarians, when Milei was elected. We discussed if he would even be able to implement his agenda in the face of the legacy corporatist Argentinian opposition and, indeed, if he were to implement this vision and it then failed, would we be forced to question our own beliefs.
Thankfully, the early stages of Milei’s agenda have been a roaring success, as some have noticed. The Department of Government Efficiency (DOGE) is the USA’s comparatively less radical attempt to replicate these successes and shrink the size of America’s bloated state.
The UK must now take note. Our problems have been caused by a crisis of big government, not because we have been taxing too little, spending too frugally, or not regulating enough. The UK will only begin to prosper again when it begins to move away from statism to a genuine free market and a genuinely free society.
Milei’s Success
It cannot be overstated just how bad an economic situation Argentina was in prior to the election of Milei in November 20232.
Annual inflation had risen to over 140%, the highest in the world. Monthly inflation was in double digits.
Argentina’s economy entered a recession in 2023 with an economic contraction of 1.6%.
It ended 2023 as the IMF’s biggest debtor having taken out a $44 billion loan from the IMF in 2018, the largest in the IMF’s history.
Their debt as a percentage of GDP was the highest in South America.
Milei won the 2023 Presidential Election having campaigned on three core promises: to slash public spending, lower inflation, and to restore law enforcement in the country. He had a radical plan to do so and implemented it from day one of his presidency.
His first actions as President included3:
Cutting the number of central government ministries from 18 to 8.
Abolishing rent controls.
Abolishing price controls.
Abolishing state funding to news media.
Abolishing mandatory payments to unions from employee’s pay cheques.
These efforts brought immediate success for Argentina4 - early 2024 saw monthly inflation fall to under 5% and Argentina reach a primary surplus of $2.4 billion and a fiscal surplus of $620 million. This was the first time in 123 years that Argentina did not have a budget deficit5.
Throughout 2024, Milei continued to put old school classical liberal and libertarian ideas into action6. In early 2024, he created the Ministry for Deregulation, which has and is eliminating an average of three regulations a day. In five months, the Ministry has also shut down over 200 Government offices and state entities with its Director describing them as simply “unnecessary”7. Similarly, twelve federal taxes were lowered or eliminated. Despite all of these significant cuts to Government spending, Milei was also able to increase welfare payments to cover 100% of the basic food basket through reforming the welfare system, including how payments were delivered.
Milei’s deep reforms have continued to bear fruit8. In 2025, Argentina’s monthly inflation rate fell to under 3% and figures showed that Argentina officially exited recession in Q3 2024. More significantly, Milei has cut the size of the Argentinian state by 30% without mass unrest - and he has done this in a country with a long history of social turmoil.
Enduring Popularity
Courage, charisma, and a radical agenda, which has focused on putting classical liberal and libertarian ideas into action, has not dented Milei’s popularity. Our politicians should take note. Milei has shown that you can enact deep and significant reforms while remaining popular.
Milei’s approval rating has remained at roughly the same level of 50% since he was first elected9. For comparison, Sir Keir Starmer, Kemi Badenoch, and Nigel Farage all possess approval ratings of less than 30%10. As we approach the Argentinean legislative elections in October of this year, their equivalent of the US midterm elections, polls have shown Milei’s La Libertad Avanza coalition as consistently ahead of or only single digits behind Union for the Homeland (the coalition of Peronist political parties in Argentina). Either of these results would represent an improvement on the 2023 congressional elections, which may well have seen Milei elected President, but saw his coalition finish 10% behind Union for the Homeland.
The Future
In his State of the Nation address to the Argentinian Congress11, Milei announced that by 2027, Argentina’s public spending will legally not be able to rise above 25% of GDP in all levels of the state. He set out his plans to reduce the amount of federal taxes by 90% and see Argentina have only six federal taxes. He set out plans to give fiscal autonomy for taxation to the provinces of Argentina to create competition between them.
2025 will be another year of radical reform for Argentina under Milei. GDP growth projections suggest that 2025 will be an even better year for Argentina and Argentinians than 2024 was12.
How Milei has Been Reported in the West
Western mainstream reporting of Milei was certainly not favourable at the beginning. Warnings that Milei was “pushing a disastrous old agenda”, according to the Washington Post, were accompanied by the sentiment that his "predecessors have tried and failed to turn the economy around…[and] Milei will be no exception”, as the BBC reported13.
Similarly, as Milei implemented his radical reforms, the BBC and Sky News enjoyed reporting on the street protests that were organised in response to them14 - often failing to note that these kinds of street protests were a regularity in Argentina before Milei came to power.
One would assume Milei’s startling successes would have similarly excited the Western press, but in researching this article, I found that there has been little written by mainstream UK news outlets about the success of Milei’s reforms in turning Argentina’s economy around.
World outlets that do report on Milei tend to still call his plans “austerity”: the tainted word which brings forth visions of poverty, falling living standards, and a state that is unduly harsh on its citizens15. Yet Milei’s plans have only lifted millions of Argentines out of poverty, raised living standards through cutting inflation, and Argentinians now experience more freedoms than they have for decades.
Similarly, the term “austerity” implies that Milei’s reforms are merely another Government programme - and that those always come to an end. Yet Milei has made clear that this is not another Government programme, but a new way of governing: he is redefining the relationship between the state and the citizen, and the role of the state in the 21st century:
The chainsaw plan is not a Government programme, it is a state policy that will continue for years and won’t stop until it ends the role of the state in the economy16.
I should add that libertarian media has done an excellent job at cataloging and reporting on Milei and Argentina’s accomplishments, supported by excellent X accounts like @ArgMilei and @Milei_Explains.
The UK’s Worsening Economic Situation
Many people will say that the UK’s economic situation is nowhere near as serious as that which Argentina faced. They are not wrong. However, we should be under no illusions about just how serious the economic problems the UK faces are.
The last Government Actuary’s Department review of the Great Britain National Insurance Fund projected that the UK will effectively default on its welfare spending commitments, including those related to pensions, in 2043-4417.
These problems are not to mention a gridlocked planning system, a historically high tax burden, and failing public services. Yet the OBR’s September 2024 Fiscal Risks and Sustainability Report18 still projects government spending continuing to rise well above revenues.
The UK is in deep trouble. We simply cannot go on as we have. We must look to what Milei is achieving in Argentina for an idea of the radical reforms necessary to fix our own broken economy and rebuild our country.
Radical free market reform has been immensely successful in such a short time in Argentina; imagine how successful it would be for a country starting from a much higher base, like the UK.
Many in the UK will inevitably shout ‘Liz Truss’. They will say that the UK experimented with libertarianism during her short time as PM with disastrous consequences: that it was an abject failure which was unambiguously rejected by the market. They are wrong. As Tom Harwood19 and other commentators have pointed out, the Energy Price Guarantee - an uncapped socialist spending policy that cost more than the entirety of the Covid-19 furlough scheme - spooked the markets far more than any component of her pro-growth agenda.
Tell the Public the Truth
In the UK, even minor reform to how the NHS operates, or to our pension system, is considered electoral suicide by the vast majority of politicians. All one has to do is look at the fever in the press and from opposition parties over the Labour Government removing the Winter Fuel Payment from pensioners. Yet, it will not be long before we will be forced to both remove the triple-lock on pensions and have a serious conversation about sustainable welfare spending in the UK.
There are many reasons we find ourselves in this perilous economic position: Boris cakeism, Covid spending recasting the relationship between the state and its citizens, a decade of Conservative governments failing to govern in fiscally conservative ways, and many more.
Above all of these though, there is one reason that sticks out consistently: UK politicians aren’t willing to be honest with the British public. They simply are unwilling to tell the British people the truth: that our state is too bloated, that it has taken on too many responsibilities, that it has managed them too poorly, and that our entire welfare system is now unsustainable.
In the last General Election, both the Conservatives and Labour spent their time pretending that the public finances were not as they are. The IFS before, during, and after the GE repeatedly warned that politicians were not being honest about the state of the public finances or the trade-offs necessary for the next Government20. The election was run by both parties on a make-believe premise, because this was easier than telling the voters the truth.
Milei told the truth. He dared to be honest with the Argentinian people about their position, and they have rewarded him handsomely for it. Milei has made liberty attractive in Argentina and to ordinary Argentinians. This is something classical liberals and libertarians in the UK across the world yearn for, and we must now learn from it.
Lessons from Argentina
All people view benefits and programs close to their hearts and view their careers as valuable, and often as too valuable to cut, but as Milei has shown, deep spending cuts and significantly reducing the size of the state can lead to economic prosperity for all and continued popularity for politicians.
The UK must now have an honest conversation, not about how valuable each cause the state funds is, but about the fundamental role the state should play in the lives of its citizens. Unless we want to turn into pre-Milei Argentina, what has gone on simply must stop.
Politicians need to be honest with the British public and need to empower communities to take over many of the roles provided by the state themselves.
I have been shocked by how quickly Milei’s reforms have turned around Argentina’s economy. I had hoped for and expected his success, but never this quickly. There is of course much more for Milei to do, but if his first 16 months in office are anything to go by, the future of Argentina is bright.
Has Milei saved Argentina? No, the people saved Argentina when they elected him to office. If the rest of the world follows suit, as America is starting to do with DOGE, then they may just have saved the whole world.
Harry Richer is the Director of Fighting for a Free Future, working for Chairman the Rt Hon Steve Baker. Prior to this, he worked as the senior aide to Mr Baker for four years. He was intimately involved in all of Mr Baker's national campaigns including his work on the monetary system, Net Zero, and the Covid Recovery Group, acting as its Head of Research. He has also co-written multiple publications on Austrian School economics including a 2024 Springer book, the Age of Debt Bubbles.
https://europe.hss.de/en/news/detail/the-argentine-experiment-the-first-months-of-the-milei-government-news11224/; https://www.crystalfunds.com/insights/experiment-in-argentina-javier-milei-wins; https://www.omfif.org/2024/03/argentinas-libertarian-experiment-mileinomics-thrives-but-mileipolitics-falters/
https://www.freiheit.org/one-year-javier-mileis-economic-policy; https://www.cfr.org/backgrounder/argentinas-struggle-stability; https://www.imf.org/external/datamapper/CG_DEBT_GDP@GDD/CHN/FRA/DEU/ITA/JPN/GBR/USA; https://www.reuters.com/world/americas/argentina-annual-inflation-hits-114-monthly-rate-slows-unexpectedly-2023-06-14/