New Argentine Leader’s Economic Savvy: Whether Milei will free his statist economy is still unknown. But his understanding of crucial principles gives him a head start. (David R. Henderson, 12/07/23, Hoover: defining ideas)
Argentina’s economy and Argentina generally are in bad shape. That’s the result of decades of policies that follow the playbook of Juan Perón, the president of Argentina from 1946 to 1955 and again from 1973 to his death in 1974. Those policies consisted of heavy welfare spending, government nationalization of selected industries, and making the government the monopoly purchaser of grain, to name three. Various scholars have referred to Peron’s policies as fascistic. That charge is probably overstated. As Sheldon Richman wrote in his article on fascism in The Concise Encyclopedia of Economics, “fascism is socialism with a capitalist veneer.” Richman explained, “Where socialism sought totalitarian control of a society’s economic processes through direct state operation of the means of production, fascism sought that control indirectly, through domination of nominally private owners.” Perón didn’t go nearly as far as Mussolini did. Think of Peronist economics as “fascism light.”
Javier Milei wants to move in the opposite direction, by freeing Argentina’s people from government control of their economic activities. The uncertain news is that we can’t know how successful he will be. The good news is that, not surprisingly for someone who has been an economics professor, Milei shows a deep understanding of economics that will serve him, and Argentina, well.