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Can Argentina’s New President Who Supports Bitcoin Make Argentina Stop Crying?

Three years ago, few could have predicted that Javier Milei, a Libertarian, Anarcho-Capitalist, Austrian School economist, and television commentator, would become the President of Argentina.

After a second round of elections, Javier Milei successfully won the Argentine presidential election on November 20, 2023, defeating his electoral opponent, Peronist Argentine Minister of Economy Sergio Massa.Bitcoin mining

Argentina’s second round of presidential election results Source:Bloomberg

Why was Millet elected?
To understand why Millet was able to be elected President of Argentina, it is important to look at the exchange rate of Argentina’s sovereign currency, the Argentine peso, over the past two decades. The official rate is currently 350 pesos to the dollar, but the black market rate is as high as 900 pesos.

Source: Google Finance

Then look at Argentina’s inflation rate since 1960, Argentina is a highly dysfunctional country with a chronically highly inflated currency.

Source: The Case of Argentina

Inflation prior to 1990 was above 100% year-round, with inflation rates exceeding 1,000% in 1974 and 1985, and 20,000% in 1989. inflation was in the low single digits in the years between 1994 and 2001 due to the Argentine peso being pegged to the US dollar, and then started to rise again in 2001, and started to soar from the 20% level in 2012. In 2019 inflation has reached more than 50%. the latest data for 2023 shows that the Argentine Peso inflation rate is 143% and growing.

With the above figures, you can probably visualize how Argentina is the only country that has fallen from developed to developing status. There is not only a “middle-income trap” but also a “developed country trap”. Argentina is an example of the “developed country trap”.

Although Madonna’s song “Don’t Cry For Me Argentina” (Argentina don’t cry for me) for Mrs. Perón won countless sympathy and praise, but Peronism is the main cause of the Argentine people cry. Peronism advocates big government, central planning, increased regulation, support for labor unions, social welfare, and exclusion of foreign investment. Since World War II, Argentina has been ruled by Peronist governments, and even when there has been a change of parties, it has only been to varying degrees of Peronism.

As a result, Argentina has lived with hyperinflation for three whole generations and has simply had enough. Argentines want change. Many see Mirai as their best option.

As Ayrton Ortiz, a 28-year-old voter, said at a rally before the Millay election, “Millay is the change Argentina needs.”

Some female voters chose to support Millet despite his opposition to female abortion. In an interview with AFP, one female voter said, “We want to see new faces, I bet on change, I bet on Millet.”

Who is Millet? What is its true color?
What kind of person is Millet? One can get a slight idea from the multiple labels on his body.

Born: October 1970 in Buenos Aires to a housewife mother and bus driver father.

Singer: As a young man, he sang lead vocals in the cover band Everest, which mainly covered Rolling Stones songs.

Player: As a teenager and early adult, he played as a goalkeeper for Chacarita Juniors until 1989.

Economics student: Mireille entered the University of Belgrano in 1989 and obtained a degree in Economics, followed by two master’s degrees at the Instituto de Desarrollo Económicoy Social (IDES) and the University of Torcuato di Tella.

Economist: After graduating from the University of Mirai, he worked as Chief Economist for various companies (Máxima AFJP, Estudio Broda, Corporación América), Senior Economist at HSBC Argentina, member of the B20, advisor to the G20 on the design of economic policies, member of the World Economic Forum, head of the economic research department of the national think tank Fundación Acordar. Acordar, a national think tank, and head of its economic research department, among others.

TV Networker: before entering politics, Millet was a TV networker. ejes 2018 rankings show that Millet is the most interviewed economist on Argentine television, with a total of 235 interviews.

Social media vlogger: he registered his personal Twitter feed in 2015 and currently has 1.6 million followers. He also runs and hosts his own podcast, Demolishing Myths (Demoliendo mitos), which has 320,000 and 640,000 subscribers on Youtube and Facebook, respectively.

Professor: Professor of Macroeconomics, Growth Economics, Microeconomics in several Argentine and foreign universities.

Writer: He is a prolific writer who preaches freedom and attacks inflation, and has authored several books on economics.

Source: Goodreads

And finally, politician and President of Argentina: In 2020, Millet joined Avanza Libertad (Forward in Freedom), in 2021 he founded and became leader of La Libertad Avanza (Forward in Freedom Coalition) and ran to become a member of the Argentine National Chamber of Deputies, and in 2023 he was successfully elected as the new President of Argentina after two elections.

What is the underlying color of Millet in all these identities? The author feels that it is the Austrian School economist. It was the inflation that several generations of Argentines have been experiencing that inspired him to think about what is the right economics.

Millet has said in interviews that he decided to become an economist out of interest in the exchange rate crash and inflation of the 1980s. This was especially true of the hyperinflation at the age of 18 (1989), the year he decided to quit the soccer association and formally devote himself to the study of economics. He later earned a degree in Economics from the University of Belgrano and two Master’s degrees from the Institute for Economic and Social Development (Instituto de Desarrollo Económicoy Social, IDES) and the University of Torcuato di Tella.

In 2013, Millet read Man, Economy, and State, the magnum opus of the famous Austrian School economist Murray Rothbard. Since then, Millet has called himself an anarcho-capitalist.

Millet himself has taken as his intellectual mentor Professor Jesús Huerta de Soto, a well-known Austrian School economist who is now a professor at the King Juan Carlos University in Spain. Millet has repeatedly and publicly expressed his admiration for de Soto. Millet was also one of the 52 authors of a collection of essays honoring Professor de Soto. Following Millet’s election as president of Argentina, de Soto said, “We are now advising him closely, especially on the need to establish a 100% reserve ratio in the dollarization process.”

Chainsaws, Dogs, and “Radical” Advocacy
During Millet’s campaign for the Argentine presidency, traditional media outlets such as Reuters, Bloomberg, and the BBC labeled Millet as “far right,” “populist,” and “crazy.” “Argentine Trump”, “radical” and so on. These labels are obviously due to the traditional media’s lack of understanding of the Austrian School of Economics and Free Willism.

“Ideas” make the man. The best way to get to know a person is through the ideas he or she believes in.

Let’s take a look at Millet’s “radical” ideas:

Abolish the Central Bank of Argentina, reduce the number of government departments (from 20 to 8), replace the Argentine peso with the US dollar, abolish labor laws and social welfare, accuse Keynesianism of being the root of all evil, support the right to bear arms, support the right to bodily autonomy (organ trade, legalization of prostitution, etc.), oppose abortion rights, oppose women’s rights and the LGBT, freeze the relationship between Argentina and China (while respecting agreements already signed between Argentine and Chinese companies), and allow for the abandonment of the horse and cartel.

These so-called “radical” claims may sound shocking, but they are commonplace for free willism, the Austrian school. Free Willism advocates free markets, small government, self-responsibility, strong monetary policy, 100% reserves, voluntary transactions, and opposition to welfare.

Among them, “abolish the Argentine central bank, reduce government departments, and replace the Argentine peso with the US dollar” are three of Millet’s core propositions.

For example, Millet’s idea of “closing down the central bank” reminds me of Mises’ famous moment in the 1920s.

In the 1920s, post-World War I Austria, like Germany, had hyperinflation. The Austrian government was at its wits’ end and asked the greatest economist of the 20th century, Ludwig von Mises, for help. Mises asked the visiting officials to meet at the government printing press at 12:00 midnight, saying that he would have a brilliant plan to pass on at that time. in front of the printing press at 12:00, Mises told them, “Hear the sound of the money printers next door that keep rolling? Turn them off.” The Austrian government complied with Mises advice, strict control of banknote issuance, Austria’s hyperinflation also came to an end, out of a different path with Germany.

Mirai with Mises “Human Action” Spanish Edition

Coincidentally or by fate, I recall that Mises gave six lectures at the Argentine Center for Liberal Studies (CELS) in 1959, which were later published as “Economic Policy: Thoughts for Today and Tomorrow”. At the time, Mises expressed the hope that “in a few years the number of supporters of the idea of freedom in Argentina and in other countries will have increased considerably.” More than 60 years later we are witnessing Mises’ expectations come true.

Millet’s second claim comes from empirical evidence from Argentina in the 1990s, when President Carlos Menem instituted a convertibility program that pegged the peso to the U.S. dollar and ended hyperinflation once and for all. The convertibility program was launched on April 1, 1991, and by 1993 Argentina had the lowest inflation rate in the world. Millet expressed hope for free currency competition and an overhaul of the financial system. “Most likely Argentines will choose the dollar outright.”

One of Millet’s hallmarks of this election is the “chainsaw,” his third proposition. He has strongly called for cuts in the government sector. A number of videos of Millet also circulated online during the Argentine election, showing Millet tearing down Post-it notes with the names of the government departments he intends to cut and shouting his slogan: “Viva la libertad damnada!”

Argentine voters hold up icons representing Mirai’s two major campaign promises

It was stated in the previous section that Millet’s undercurrent is that of a free-willist economist. This can also be seen in the five dogs he has.

Millet has five dogs, named after Conan (the protagonist of Schwarzenegger’s early 1980s movie Conan the Barbarian), Murry (Austrian School economist Murray Rothbard), Milton (Chicago School economist Milton Friedman), Robert and Lucas (Chicago School economist, Nobel Prize-winning economist, and Rational Expectations School economist Robert Lucas) are named after Murray Rothbard, Milton Friedman, and Robert Lucas, all of whom are famous economists in economic cycle theory, which centers on inflation and central banks. Murray Rothbard, on the other hand, was a flag-bearer figure in the revival of free-willism in the 1970s and 1980s, which pioneered anarcho-capitalism.

Millay with the Gadsden flag, the flag of Libertarianism.

Millet supports Bitcoin
As a follower of the Austrian School, Millet’s advocacy of “abolishing central banks” is obviously well understood. He would also unquestionably support Bitcoin.  Litecoin Miner Asic

He has preached that “central banks are a scam” and “supports Bitcoin” in a number of public appearances, although Millet has not yet advocated for Bitcoin to be used as a fiat currency or for BTC to be used as a national reserve asset.

He said that central banking is a scam, and that it is a mechanism for politicians to deceive the good people through inflationary taxes. The fiat currency of the central bank enables politicians to cheat the people through inflation tax. Bitcoin, on the other hand, is a natural response to the central bank scam and represents a return of money to its original creator, the “private sector,” whose algorithms dictate that it will not be issued in increments after it reaches a certain number on a certain day.

Millet said that the problem of fraud is worse in economies with higher inflation rates, which is why he proposed closing the central bank.

Will Bitcoin become Argentina’s fiat currency?
While Millet has publicly supported Bitcoin on several occasions, will Argentina let Bitcoin become Argentine fiat currency like El Salvador?

El Salvador’s ability to pass a “Bitcoin Act” in 2021, making it the first country to make Bitcoin fiat currency, has a lot to do with its unique situation. El Salvador is located in Central America, close to the United States, and its citizens have long relied on expatriates for foreign exchange in U.S. dollars, resulting in a heavily dollarized economy.

And from January 1, 2001 the central bank of El Salvador has no longer issued its own currency colones, but still can continue to circulate, the official has defaulted to the status of the dollar as legal tender. This means that El Salvador has not had its own independent monetary system since 2001. Therefore, there is little political resistance to El Salvador allowing Bitcoin to be used as a fiat currency alongside the U.S. dollar in 2021, and the impact on the Salvadoran economy will be minimal.

Unlike El Salvador, the Argentine economy



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