Shrinking the State in Argentina

Since I’m a huge fan of Javier Milei’s free-market agenda, it’s very exciting to be in Argentina this week.

Two days ago, I shared some slides about Milei’s achievements from the head of the International Chamber of Commerce for Argentina.

Today, let’s look at some slides from Maximiliano Matias Farina, who works for Ministry of Deregulation and State Transformation, which he presented at the Liberty International World Conference.

We’ll start with this 50-year comparison of Argentinian growth with the average for the rest of Latin America. As you can see, Argentina has has been a laggard, with per-capita GDP expanding only 15 percent while the rest of the region enjoyed 100 percent-plus growth.

Having share similar examples of Argentina and divergence (see here, here, here, and here), I’m not surprised at these grim numbers.

After all, Argentina before Milei was the world’s worst-performing economy over the previous 100 years.

So there’s no question that Milei inherited an economic crisis.

What makes Milei special is how he responded. Part of his agenda has been deep spending cuts, which I’ve highlighted, and here’s a slide showing a few of the bureaucracies that have been eliminated

Milei has also been getting rid of bureaucrats.

Here’s a slide from Maximiliano’s presentation showing that 15 percent of the bureaucracy is now looking for jobs in the productive sector of the economy.

Last but not least, I want to share his slide that reviewed the amount of red tape imposed on watermelon sellers.

The slide on the right shows how much paperwork was necessary before Milei took office (the back stack) and how much is necessary now (the front stack).

The photo on the right reminds me of the comparison of labor law in Switzerland and France, modern-day union contracts, and the European Union’s strange version of a free-trade agreement.