Is it Time to End Central Banking?

27 Nov

Is it Time to End Central Banking?

All Eyes are on Argentina!

It’s an upset!  Javier Milei’s landslide win in Argentina has toppled – at least for now – the country’s inflationary Peronista left-wing rule.  

“Freedom goes forward!  Hail freedom, dammit!” shouted Milei.

Milei will be sworn in as president in December.  He has promised to end central banking and the cronyism that has characterized Argentina.  The free-market champion is said to have won the admiration of both Donald Trump and the leader of Great Britain’s Brexit movement Nigel Farage.  

Economic commentator Michael Shedlock wrote, “Congratulations Argentina for electing the world’s first libertarian president.”  

Reuters summed up the new Argentine president’s economic agenda like this:

Milei is pledging economic shock therapy. His plans include shutting the central bank, ditching the peso, and slashing spending, potentially painful reforms that resonated with voters angry at the economic malaise.

Milei’s challenges are enormous. He will have to deal with the empty coffers of the government and central bank, a creaking $44 billion debt program with the International Monetary Fund, inflation nearing 150% and a dizzying array of capital controls.

Milei’s win shakes up Argentina’s political landscape and economic roadmap, and could impact trade in grains, lithium and hydrocarbons. Milei has criticized China and Brazil, saying he won’t deal with “communists,” and favors stronger U.S. ties.

The presidential term is four years, which gives Milei time to return Argentina to the prosperity that it enjoyed a century ago.  In 1913 it was richer than Germany and France.  Military rule and socialism killed the goose that laid the golden egg after World War I.  

Writing in the Wall Street Journal, John Fund cited a remark by a worker there who said, “Imagine someone born 25 years ago in Argentina. For your entire life, you have seen nothing but misery and little chance to get ahead unless you emigrate. We simply want to be a normal country again.”   

Milei is nothing if not dramatic.  He brandished a chainsaw about as he promised to eliminate useless government ministries.  No doubt his fiery and outspoken style was indispensable in his electoral victory.  But now he will face all the forces of political cronyism and leftism arrayed against him, not just the entrenched financial interests who have profited from the inflationary central banking regime, but the useful idiots of the left in the media and education.  

Grab your popcorn!  The show is about to begin!