Who could possibly have guessed that the prophet and philosopher of a madcap ideological scheme to refound the UK after what he sees as decades of decline would be a fan of a dude with a similar, quasi-religious plan for Argentina. Well, here we are. I’ll leave to others his encomiums to Truss and Kwarteng and see what sense can be made of his comments on Argentina and Milei.
1.
Milei, by contrast, means what he says about shrinking the government. Already he has reduced the number of government departments from 18 to nine and fired 30,000 public sector workers.
Dan’s source for this is another Telegraph article so we could discount it straight away even if it wasn't written before Milei took office. Two minutes of googling suggests that Milei has not renewed the temporary contracts of between five and seven thousand people working in the public service. He hasn’t fired any public servants with permanent contracts. They can’t be removed without cause and if he tries to fire any of them they’ll go straight to the Labour Court and win an order that will oblige him to reinstate them. And reducing the number of government departments doesn’t actually reduce the size of government if the remaining ones have to cover the activities of the abolished ones.
2..
It is hard to stress the significance of such a move in Argentina, where presidents traditionally treat the state as a source of sinecures for their supporters. There are 200,000 placemen on the payroll – political appointees who draw government salaries without being expected to do any work. They are known as “ñoquis”, because they turn up on the last day of each month to collect their pay cheques – a reference to the Argentine tradition of eating gnocchi at the end of the month.
It’s not news that there are ñoquis at all levels of government in Argentina and in the case of some the word does indeed mean never or rarely showing up at work while still getting paid. It’s also used as a term of abuse for public servants in general, and for those working in the administration of a governor or mayor the speaker doesn’t like. How many ñoquis are there? Nobody knows, it would depend in the first place on agreeing a definition of what they are. Dan doesn’t give a source for his 200,000 figure and I suspect that he plucked it out of the air, or maybe part of his anatomy that also begins with “a”.
Milei has abolished the rent controls that, though notionally there to protect tenants, were pushing landlords to sell their properties. The resulting scarcity led to a spike in prices and worsened the housing crisis. Since the regulations were scrapped, new property listings have risen by 50 per cent. British MPs, take note.
There were no rent controls to abolish, in the sense of limits on what landlords could charge for their properties. There was a law setting out the rights and obligations of both landlords and tenants. Milei has annulled it by decree and now the rental market is a free for all. It’s too soon to say what the effects of this are going to be but I’ll take a wild guess they won't be great for tenants. I have no idea where Dan got the 50% figure, probably from the same place as above.
Milei’s pension reforms have led to the first budget surplus for 12 years. In January, the Argentine government took in $589 million more than it spent. Meanwhile, his omnibus deregulation bill would remove the state from almost every needless area of national life. Among other things, it would denationalise more companies, end monopolies, create an open skies policy, license driverless cars, cut taxes, free up farming (notably wine-growing), allow sports tickets to be resold, abolish price and wage controls and liberalise the employment market.
Coy Dan doesn’t tell us that the pension “reforms” consist of not raising them to match the surge in inflation caused by his devaluation of the peso, in other words, of impoverishing pensioners. Even conservative financial commentators think this is a trick that can be pulled just once. As for the omnibus law, Milei withdrew it from Congress when it became clear he hadn’t the votes to get it approved. Whether he’ll try again to get it through and in what form, no one knows.
There is one big disappointment so far, namely Milei’s decision to back away from his plan to replace the peso with the US dollar – a policy that has been a roaring success in Panama and Ecuador, and which is badly needed in a country where, since 1980, inflation has run at an average annual rate of 206 per cent, making for a total price rise of over 900 billion per cent.
Panama is one of the world’s dark money hotspots and Ecuador is racked by narco violence.
Milei is a down-the-line classical liberal who thinks politicians should do less. He supports free trade and is dismantling Argentina’s costly array of import and export controls. He cares little for culture wars, and has no issue with trans people “provided they don’t send me the bill for their operations”. He likes immigration.
Milei is culture war made flesh, he practically lives on X, insulting journalists and opposition politicians around the clock and RTing praise of himself. He’s also no stranger to attacks on those with disabilities and there are sexual undertones to many of his attacks on his critics: mentions of perversion and degeneracy are frequent His whole schtick is that a century ago Argentina started to fall into a moral black hole and only he can rescue it. He really believes he’s the Saviour. If that’s not culture war I don’t know what is
Dan goes on to say that Milei is relaxed on the Malvinas question, and that’s true. He also says that Milei is not anti-immigration. Indeed he’s not and any Argentine politician who wants to get on that bandwagon will first have to reform the Constitution’s Article 25 of which states,
The Federal Government shall encourage European immigration, and it may not restrict, limit, or burden with any tax whatsoever the entry into Argentine territory of foreigners whose purpose is tilling the soil, improving industries, and introducing and teaching the sciences and the arts.
The days of mass immigration from Europe are long gone (though quite a few Russians have arrived lately) but Argentina remains a magnet for immigrants from several Latin American states, especially Bolivia, Paraguay and Venezuela. Wherever they come from, Argentina remains a country that mainly welcomes immigrants and where it’s quite straightforward to regularise your status even if you didn’t jump through the correct hoops when you first arrived.
Finally, Dan doesn’t mention some of the costs of Milei’s initial months in power.
In January, new motorcycle registrations fell 16.7%, new car registrations by 32.7%, car production (...) cement sales by 20%, pharmacy sales by 45.8%, and food and beverages by 37.1 percent. "The real salary of registered workers in December saw the largest monthly drop in at least 30 years and it is very likely that in January salaries will have reached a lower level than in 2001. Food sales in retail stores fell 37.1 percent, something not seen even in a pandemic.
The real economy isn’t so much slowing down as grinding to a halt.
Dan promoted damage to the UK’s economy in order to save it, Milei seems to be on his way to destroying Argentina’s, with the same goal.
Never mind Bolivia or Venezuala. From this it's clearly the Peruvian diaspora you have to keep an eye on...