Headline: Milei Condemns Keynes‘ Theory, Blames Politicians for Argentina‘s Economic Woes
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In an extensive interview with Alejandro Fantino on the streaming platform Neura, Argentine economist and politician Javier Milei weighed in on the global influence of John Maynard Keynes, expressing his critical views on the economist’s theories and their impact on his home country.
Milei, a libertarian and outspoken critic of traditional economic polices, didn’t hold back his opinion of Keynes’ ‘General Theory’. "His theory is brilliant in destroying previous analyses," he began, "but it’s a ‘bad’ book in the sense that it has been used to serve corrupt, messianic politicians. It caused a lot of harm to the world."
Expanding on this, Milei pointed to Argentina’s political history, highlighting the Kirchnerist government’s use of populist energy policies and monetization of fiscal deficits. "Energy was cheap, so you’d buy the biggest air conditioner you could afford. But then the fiscal deficit would increase, leading to inflation and higher prices," he said.
Addressing the BCRA’s former president, Javier González Fraga, Milei explained, "He once said that past consumption was ‘fictitious’. But it wasn’t. They were stealing from one person to give to another, and while the other was enjoying themselves in Europe, you were being executed. That’s what they called ‘social justice’ and ‘income redistribution’."
Milei’s arrival in government, he said, was a reaction against the application of Keynesian economics. "They said that if I’d done a 15% PBI adjustment, I’d plunge the economy into the biggest recession ever. But we hit bottom in March and bounced back steadily."
On the topic of Argentina’s current economic status, Milei shared, "We’ve completed the largest fiscal adjustment in history. We’ve reduced the public sector, reinsured pensions, provided social support, and implemented market-friendly structural reforms. As a result, we’ve risen 70 spots in terms of economic freedom."
To tackle high inflation, Milei emphasized the need to curb monetary emission. "We’ve reduced the monthly wholesale inflation rate from 54% to 1.4%. If the rest is induced by crawling peg adjustments and international inflation, we’re actually in deflation," he assured.
Despite his libertarian beliefs, Milei acknowledged the need for government assistance to the poor, stating, "We must provide aid to those who are victims of political criminals. We’re helping people find work, lower inflation, and provide social assistance."
Looking ahead, Milei expressed his desire to negotiate new free trade agreements within Mercosur and between Argentina and the United States. Regarding Trump’s perceived protectionism, Milei argued, "That’s not true. Trump uses trade policy as a political negotiation tool. And the U.S. team has already approved a deal."
Upon receiving the sword of the ‘Thundercats’ – ‘Leono’ or ‘Sword of Destiny’ – as a gift, Milei joked, "This will go to Sturzenegger to help him cut the second phase of the chainsaw." Concluding his interview, Milei imparted a message of hope and freedom to the Argentine people, "As General San Martín once said, we should be free, for that is all that matters. If we become free, as planned, we will become the richest country in the world."