Milei unleashed: Economist, not populist - Ivo Vegter

Key topicsMilei is a trained economist and adherent of Austrian free-market theory.He differs from Trump-style populists with pro-trade, anti-tariff reforms.Argentina saw sharp inflation drops and growth after Milei’s market reforms..Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa's bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..By Ivo Vegter*.Argentina’s president, Javier Milei, famously gave Elon Musk a chainsaw. As similar as he appears to Donald Trump, he differs in key respects.Milei is often compared to Trump and to other right-wing populist leaders, like Brazil’s Jair Bolsonaro.As a crude comparison this might be adequate, if you’re a left-winger and anyone who isn’t socialist looks the same to you. However, it obscures critical philosophical differences.The media’s comparison of Milei to Trump, Bolsonaro, and various far-right leaders or would-be leaders in Europe, does him a disservice, however. While he shares their contempt for “wokeism”, government bureaucracy and left-wing economic policies, Milei is an experienced professional economist who follows the Austrian School of free-market thought.Qualified economistDonald Trump actually did obtain a Bachelor of Science degree in economics from the Wharton School at the University of Pennsylvania, back in 1968 (hard though it is to believe, given his life-long ignorance about the nature and significance of trade deficits). Trump has no further education or practical economics experience, however.Milei, by contrast, has a degree in economics from the University of Belgrano and two Master’s degrees from the Instituto de Desarrollo Económico y Social and the Torcuato di Tella University.For more than 20 years, he was a Professor of Macroeconomics, Economics of Growth, Microeconomics and Mathematics for Economists. Milei has written more than 50 academic papers. He has worked as senior or chief economist for a range of private sector organisations, including most prominently the global bank HSBC Argentina. He has been an adviser to the government of Argentina, and served on a number of national and international think tanks and policy advisory bodies, including the G-20.Milei’s curriculum vitae as both an academic and working economist, in both the public and private sector, is impressive, which is a rarity among world leaders.Well-readMilei became an adherent of the Austrian School in 2014 after reading Murray Rothbard’s Man, Economy and State. In this influential (albeit radically anarchist) book, Rothbard argues that the state is neither necessary nor useful, and observes that all state intervention in the economy, for whatever purpose, is ultimately violent and unjust..Read more:.Javier Milei caught in crypto memecoin controversy ahead of US visit.(For a detailed description of the Austrian School of thought in economics, see this essay by Peter J. Boettke. For an Austrian critique of Keynesian economics of which Javier Milei would likely approve, see Spotlight on Keynesian Economics by Murray N. Rothbard. For a warning against simplistic Keynesian vs. Austrian School analysis in modern economies, see It’s Not Just Keynesians vs. Austrians, by Steven Horwitz.)Milei read Ludwig von Mises’s seminal work, Human Action, three times, and is also deeply familiar with the works of Friedrich von Hayek, Henry Hazlitt, Israel Kirzner and many other, less anarchist, classical liberal and libertarian economists.This deep grounding as an economist both in theory and in practice stands in stark contrast to someone like Bolsonaro, who has a purely military background, or Trump, who has an undergraduate economics degree but has never practiced as an economist, spent his career as an upmarket real-estate salesman, and who, according to close associates, does not read.It also stands in contrast with European right-wing populists such as France’s Marine Le Pen and her father, Jean-Marie, Viktor Orbán of Hungary, Geert Wilders of the Netherlands, and Jarosław Kaczyński of Poland, all of whom studied law to a greater or lesser (and in the case of Wilders, minimal) degree. The same goes for Italy’s Giorgia Meloni, whose educational background is most kindly described as “murky”, and Britain’s Nigel Farage, who acquired his allegedly fascist views at school, and didn’t bother to sully them with further study.ChainsawMilei did give Elon Musk a chainsaw, which he had used during his presidential campaign to symbolise tearing down the bloated government bureaucracy. Trump deputised Musk to do the same as the head of the Department of Government Efficiency.By all accounts, Milei went about it in a rather more thoughtful and orderly fashion than Musk did, however. Notably, he did not entrust the job to a corporate billionaire with glaring vested interests.Milei was also careful to maintain essential social services and entitlements, only promising to let their value be eroded by inflation, to bridge the gap between the start of free-market reforms and the economic dividends they would bring down the line.While Milei holds some socially conservative views, for example on abortion (which he opposes), and is on good terms with many right-wing populists over their shared disdain for left-wing culture and socialism, he differs from them in that he does not support authoritarianism, nationalism, xenophobia, protectionism, trade tariffs, or inflationary monetary policy.Import tariffsNotably – and in stark contrast to Trump’s policies – Milei acted swiftly to remove import tariffs in order to facilitate international trade. (Trump still slapped a “reciprocal” tariff of 10% on Argentina, though.)Milei also prepared state-owned enterprises for privatisation, abolished industrial policy plans that subsidised and offered tax breaks to favoured industries, and did away with localisation laws and the “Buy Argentine” programme.He also liberalised labour laws, shredded a raft of regulations and red tape, and removed the price controls previously maintained on 50,000 products and services under the government’s “Fair Prices” programme.The consequences of Milei’s actions were swiftly apparent. Inflation, after peaking at 292.2% in April 2024, four months after Milei became president, began to drop sharply. Ten consecutive months of decline saw inflation fall to 55.9% in March 2025, a three-year low.Again in stark contrast to the US, Argentina’s stock market responded extremely favourably to Milei’s free-market reforms. Though it has pulled back this year amid global market turmoil sparked by America’s trade war, Argentina’s leading market index remains 143% up from Milei’s inauguration in December 2023.Argentina’s country risk index, which measures the premium investors demand for Argentina’s bonds over equivalent US debt, fell to below 500 in January this year, a seven-year low. It, too, has risen again, to over 1,000, thanks to market fears stoked by the US’s erratic tariff announcements, but it remains far lower than the 2,500 peak it saw before Milei took office.The country exited a deep recession in the third quarter of 2024, and is on track to record vigorous economic growth, which most market observers expect to exceed 5% in 2025.No rivalMilei is the first Austrian School libertarian ever to be elected to lead the government of any country, and remains the only such leader on the world stage.It is a mistake to pigeonhole him with other right-wing populists, as much of the media has done, Trump included. His is a far more interesting and substantial mind.As an exponent of small government and truly free markets, Milei has no rival among international leaders..*Ivo Vegter is a freelance journalist, columnist and speaker who loves debunking myths and misconceptions, and addresses topics from the perspective of individual liberty and free markets..This article was first published by Daily Friend and is republished with permission.

Milei unleashed: Economist, not populist - Ivo Vegter

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