Milei’s Remarkable Victory in Argentina Paves the Way for a ‘Dollar Zone’ | Cato at Liberty Blog

Javier Milei s unexpected victory in Argentina s presidential run off is a remarkable feat.

Not only did Milei defeat Peronism s formidable political machine while leading a new political party; he also convinced a majority of voters to choose a return to Argentina s lost tradition of classical liberalism, with an overt emphasis on the unqualified respect for the fundamental rights of life, liberty, and property as the true source of prosperity.

Nonetheless, the time for glee will be short lived. Milei will become Argentina s new president on December 10 with annual inflation levels above 140 percent, a practically worthless national currency, and 40 percent of the population living below the poverty line. The president elect seems aware, however, that the gravity of Argentina s economic crisis leaves no time for half measures.

Implementing Milei s economic program is Argentina s only chance of defeating inflation, regaining monetary stability, and returning to economic growth. A free market economist, the president elect understands that price and currency controls must be done away with, as is the case with all taxes on exports. Milei has even suggested that he will get rid of Argentina s barriers to global trade unilaterally, a radical and necessary volte face after eight decades of protectionist failure. 

Most importantly, Milei plans to dollarize Argentina s economy and shut down the central bank. Dollarization is the best available means to bring inflation down to single digits rapidly and permanently. Granting the dollar legal tender also protects citizens purchasing power by rendering the devaluation of a local currency vis à vis the dollar impossible.

via www.cato.org

Milei is a hopeful sign indeed. But he will have all the institutions against him.