By Henry Srebrnik, Moncton Times & Transcript
Javier Milei, the libertarian economist who is the current president of Argentina, won a decisive victory in the Oct. 27 midterm elections, significantly outperforming his polling numbers and dealing a crushing defeat to what remains of the country’s left-wing Peronist establishment.
The result solidifies Milei’s grip on power and ensures his ability to push forward his market-reform agenda, locking in his “chainsaw revolution” against big government waste. It also vindicates the Trump administration’s public bet on Milei, whom it has identified as one of its key allies in the Western hemisphere.
After defining the first two years of his presidency with radical spending cuts and free-market reforms, Milei’s party, La Libertad Avanza, won nearly 41 per cent of the vote, taking 13 of 24 Senate seats and 64 of the 127 lower-house Chamber of Deputies seats that were contested. His gains will make it easier for Milei to slash state spending and deregulate the economy.
The elections were the first national test of President Milei’s popularity since he took office in 2023, pledging to shrink state spending by taking a metaphorical “chainsaw” to it. He brandished a real one during his campaign rallies. He has since cut budgets for education, pensions, health, infrastructure, and subsidies, and laid off tens of thousands of public sector workers.
Milei told cheering supporters that “We must consolidate the path of reform we have embarked upon to turn Argentina’s history around once and for all” and “make Argentina great again.”
U.S. President Donald Trump congratulated Milei on social media. “He’s making us all look good,” Trump remarked. Before the vote, Trump had made it clear that a $40 billion lifeline for Argentina by Washington would depend on Milei keeping political momentum. “If he wins, we’re staying with him. If he doesn’t win, we’re gone,” Trump had threatened.
The Trump administration has identified Milei as a key ally in a region where anti-Americanism has long been a powerful political force. As with the Bolivian election earlier this year, which ended nearly 20 years of socialist rule, the result is a victory not only for Milei but also for pro-American forces throughout the region.
Specifically, Washington sees Argentina as a testing ground for its efforts to roll back Chinese influence in the Western hemisphere, going so far as to condition some U.S. aid to Argentina on Milei’s willingness to switch from Chinese to U.S. telecom providers.
To shore up American support, a framework agreement between the two countries signed Nov. 13 will see Argentina expand market access for a swath of U.S. products, including medicine, chemicals, machinery, and agricultural products. Washington will eliminate reciprocal tariffs for “certain unavailable natural resources” as well as non-patented materials used for pharmaceutical production. Imports from Argentina currently face a baseline 10 per cent tariff rate.
Prior to the elections Milei’s party had just seven Senate seats and 37 seats in the lower house. That meant his program of spending cuts and reforms faced various political obstacles. His vetoes of bills to boost funding for state universities, people with disabilities and children’s healthcare were all overturned by opposition lawmakers.
Milei needed to win at least one-third of the seats in Congress’ lower house, the Chamber of Deputies, or its upper house, the Senate, to prevent his decrees from being blocked by a two-thirds vote.
“This is the problem he was having in the last few months,” Daniel Di Martino, an economist at the Manhattan Institute of Policy Research in New York, told The Scroll website. “The leftists were proposing bills to raise government spending on popular things, like bonuses to pensioners or university students. Milei would veto, and then they would override his veto, and he would have to cut spending elsewhere. Their goal was to create a budget deficit so that markets would freak out and Milei would lose the election.”
That didn’t work. “He’s veto proof now, which is what the markets really needed to understand,” Di Martino said. “The deficit is never coming back, and now the expectation that he will be re-elected is much higher.” The uncertainty was always about whether the opposition would let Milei go through with his reforms. Because Milei is so much more popular now, Di Martino pointed out, “even the moderates now have a big incentive to say, Hey, if we don’t negotiate with this guy, we’re also going to lose our seats in two years.”
While supporters, including Trump, hail Milei for taming inflation, which hit triple figures annually before he took office, by cutting the deficit, and restoring investor confidence, his critics argue that the price has been job losses, a decline in manufacturing, crumbling public services, a fall in people’s purchasing power and an imminent recession.
“You see a lot of poverty,” one opponent reported. “It’s very hard for retirees, for people with children with disabilities, for young people. There’s a lot of unemployment. Many factories have closed.”
The election turnout was 67.9 per cent, the lowest in a national election in decades, representing widespread apathy with politicians of all stripes. Still, “It’s a great victory for the coalition of pro-freedom parties in the Americas who are trying to stop the narco-socialists, which is this alliance of criminals which was started by Cuba and Venezuela,” Di Martino contended.
