Conversely, what are the three changes that Milei & Co. have put in place / want to put in place that you think will have / are having the most impact for the long-term benefit of the Argentine economy as whole?
1) Balancing the budget has had the following results:
a) reduced inflation
b) reduce country risk which is a quantifiable value of external support for the country which has allowed for:
i) public both federal and provincial and municipal debt offerings on international market at lower rates
ii) private debt offerings at lower rates externally
c) increasing likelihood of foreign company investment in large scale projects (This allow is a benefit of them passing RIGI as a law)
d) force the population to realize true costs for delivering services by removing most the subsidies (a government that cannot afford shouldn't be subsidizing everything for everyone)
2) The benefits of 1) had allowed for the return of a domestic credit market. Mortgages were being reintroduced and other credit to smaller businesses and individuals. This stopped at the end of July when the political attacks started and risk took over the markets. The impact of an internal credit market cannot be understated to eventually facilitate cheaper operating costs.
3) Reducing administration, bureaucracy and making the government more efficient + opening the borders. This allowed companies to import what was required for them to function. Things not available in Argentina. If you needed John Deere, Caterpillar, or other OEM parts, either you were limited or unable to import and it could still take a long time for it to actually make its way through the process to be cleared. This had some benefits, but for some industries it just hurt productivity and introduced higher costs. These industries also directly benefit the state, so it really made no sense to hinder them but they did.
4) Passing the RIGI investment scheme as law rather than approving and making agreements for individual projects makes it stronger and more likely companies are willing to invest.
5) I think in general the opening of the economy and removal of protectionist policies is the way to go. People are suffering an affordability crisis and having taxes and tariffs to support industry just makes the population finance the few businessman owners and subsidize few jobs at the expense of their fellow citizens. They don't have that luxury right now. This is a part of the economy adjusting. People will likely need to relocate to where the new jobs are.
6) For many Argentinian he is providing hope that things will actually change and break from the cycle. I don't think this can be understated, and it might be something that many of us can't understand or appreciate as we haven't been subject to the impacts of historical governance.
7) For Argentinian professionals and others that have accumulated some wealth, the reduction in the personal asset taxes is something they are very happy about. You have already paid income tax on the money, and you pay IVA whenever you spend it. The Asset tax regardless of what level was charged to them, hey felt is not fair.
8) Not providing health care and education to non permanent residents. These are costs that the individuals should be paying for not the state and allows the state to both reduce expenses and increase spend on their citizenry, infrastructure or pay down/finance debt.
