from hope for change to saving Trump

On December 10, 2023, the course of the country would change completely, plunged into a deep economic crisis and clearly in disbelief in the capacity for resolution of traditional leaders. Halfway through their mandate, which ends in 2027, Argentines point to their successes and mistakes, even if they agree on one point: what remains will not be easy at all.

Argentines agree on a second aspect, despite their varied political tastes: Argentina cannot continue as it was. The scourge of inflation – more than 200% per year –, the lack of predictability and corruption scandals are some of the factors that led to the victory of a so-called “foreigner” in politics.

“Milei arrived at a very difficult time in Argentina,” the economist told ABC. Christian Butler. And he adds that once at Casa Rosada, the current president made “abrupt changes: a strong devaluation, he froze the exchange rate… and obtained a significant reduction in spending.”

Among his main successes, the expert emphasizes that he succeeded in “making people understand that a country like Argentina cannot be chronically in deficit. “He needs balanced accounts.” As he explains, this allowed the government a strong improvement in the economy at the start of his administration, in addition to a drop in the inflation rate, which in two years fell from 12% to 2% per month.

In the same line, Rafael Salazara marketing expert, highlights as “something very positive” about Milei that “he does what he says” and cites as examples the fall in inflation and the stability of the dollar. “We see a certain stability and we have more peace and relief,” he summarizes. A third aspect that he welcomes is that “there are more and more companies that want to invest in Argentina”.

Both the reduction in inflation and the state adjustments, which made Milei famous around the world with his legendary chainsawcampaign promises were kept. But others remain unresolved, such as the dollarization of the country and the closure of the Central Bank, announced before arriving at Casa Rosada.

The ghost of corruption

Despite the initial successes, the economic balance obtained thanks to the efforts of the Argentines has begun to weaken since the beginning of this year. And this had a direct impact in the September elections, when the ruling party suffered a resounding defeat at the hands of Peronism in the legislative elections in Buenos Aires – Kirchnerism won with 45%, while the ruling party failed to reach 25%.

In turn, financial instability and successive scandals linked to those responsible for Casa Rosada – such as the Libra affair and the Andis affair – have shaken the government this year. A third controversy erupted when Milei’s primary candidate’s alleged ties were revealed, Jose Luis Espertwith drug trafficking.

But analysts also add a discursive error. “The election of the province of Buenos Aires was an election of mayors (mayors). Milei spoke by mistake of “never again Kirchnerism” and there was no proposal,” the political analyst explains to ABC. Aníbal Urios on the September electoral setback.

However, a month later and against all expectations, the head of state made a comeback – with more than 40% of the votes – in the October legislative elections at the national level, still at the worst moment of his administration.

Asked about the limited electoral impact of the accusations of corruption at Casa Rosada and the Libra affair scandal, due to which Argentine and foreign investors lost huge sums of money after the president’s recommendation, Urios believes that “everything that is generated around him, as long as he is not hurt, people think ‘it’s the environment, it’s not Milei’, even if it’s the sister – the secretary of the presidency, Karina Mileïimplicated in the Andis corruption scandal. “People need to believe and they cling to it. »

The Two Sides of Trump’s Rescue Plan

Most of those interviewed agree on the division of Milei’s presidential administration into two main stages: a first phase, more hopeful and imbued with change. And a second, in which they began to some cracks are evident in the model. Casa Rosada was forced to quickly seek help from its northern political ally, so that the economic crisis would not fully affect the October elections. In this sense, the link between Milei and the President of the United States, Donald Trumpwas crucial and allowed Argentina to access a swap – currency exchange – which could reach a maximum amount of 20 billion dollars.

“Milei visited the United States more than the Argentine provinces,” explains Buteler and adds that “this relationship – with Trump – which was developing in recent months, bore fruit, when Argentina experienced its second crisis and needed a rescue from the United States”. However, for the economist, economic aid has a double side: “On the one hand, it is positive, it allowed him to access the elections with a certain margin of stability and even to win them. It also marks something important: Argentina has faced two crises in the last eight months. “It means something in the model is not working.”

Regarding the connection with Trump, opinions in this South American country are – once again – divided. On the one hand, when the White House confirmed the financial lifeline days before the election, there was a climate of enthusiasm among pro-government activists. However, a significant part of the population does not look favorably on the fact that Milei had to ask for help from another country to triumph in the elections.

In dialogue with ABC, Nazarene Borgetan Argentinian entrepreneur, denounces a “total loss of sovereignty due to the interference of the United States and President Trump”. The young woman accuses the government of “setbacks” and an increase in “unemployment, public and private”. “Many jobs have been lost,” he says, referring to the loss of 138,000 formal employees. Furthermore, he questions the fact that “he continues to say that he came to get rid of caste and that is not true. “The worst political caste in our country for 40 years is that of the government.”

With focus on 2027

After the renewal of the vote of confidence in October by a large part of Argentines, the government’s next objective is to obtain presidential re-election in 2027. This was clearly expressed by the sister of the head of state, who called two weeks ago to vote for Milei in two years.

But what lies ahead will not be without challenges: growing unemployment could increase social discontent and the dollarization promised during the presidential campaign seems an increasingly distant goal. In this sense, Buteler analyzes that dollarization functioned as a “workhorse” during the presidential campaign, but that ultimately “the Minister of the Economy did not carry out any plan similar to dollarization. On the contrary: he made the peso a strong currency.

Along the same lines, the economist discusses the challenges facing Casa Rosada. It mainly refers to unemployment and dependence on another country. “It is difficult to maintain the (government) model as it is because it presents certain inconsistencies, including the loss of jobs,” he assures and concludes: “The support of the United States is important, but the problems are internal.”