Milei’s not doing anything difficult in the slightest

We disagree with this comment about the success Javier Milei is having in Argentina:

Economists say Milei has managed to pull off a feat nothing short of Herculean.

Worth recalling what one of those Herculean tasks was, cleaning out the Augean Stables. Which was done by diverting a river through them, of course.

Economically there’s nothing difficult about what Milei is doing. The state requires a thorough clean out and the solution is, to switch classical metaphors, to get all Carthaginian Solution on it. That chainsaw, simply fire large swathes of it. Stop it doing a large number of things. There is, of course, a dreadful lack of servitude these days into which the staff can be sent but plenty of land to be salted all the same.

There’s nothing either intellectually or economically difficult about this. Less state means cutting the state. And?

Ah, now it’s true there can be political difficulty about this. For, as Lord Woodhouselee pointed out:

A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.

It’s a collective action problem and a fairly simple one too. When enough people are enough fed up then the political ability to get all Augean on the State exists. But the economic problem is obvious and simple long before that. Both whether and how to clear the horsepuckey out is known, nothing Herculean about that in the slightest.

Tim Worstall