Heterodox economists with positions opposed to the government acknowledge that this time may be different from Martínez de Hoz's 'tablita', which collapsed in 1980, or the Convertibility plan, which ended in crisis at the end of 2001, because Argentina has an increasing Vaca Muerta and mining that add to the productivity of the countryside, resources that did not exist three or five decades ago, which, although they will reach maturity in 2030, the existence of that future flow, as a guarantee, facilitates the financial bridge until the dollar restriction is overcome.
And with that endorsement, suppose that 'the Messi of finance' Luis Caputo managed to eliminate the remaining exchange controls and reach the 2027 elections without the exchange rate turbulences of 2025 with a corrected dollar price, even below inflation. Even with an annual inflation in 2027 half of what is forecast for 2026 (15% instead of the current 30%). With GDP growth like this year, around 3%, accumulating three consecutive years of GDP growth, something that hasn't happened since 2009 to 2011. Will that bonanza be enough for Milei to be re-elected if those indicators occur with the richest 30% of society more prosperous and 70% equal or worse?
The cultural battle is summed up in making the majority of society believe yes or believe no regarding the possibility of materializing an aspiration and turning it into an enforceable right.
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That country scenario, with GDP growth and economic stability, but with a marked difference between social classes and a minimal or almost non-existent middle class, is similar to most South American countries, but Argentina has an egalitarian culture forged in more than a century of political tradition, partly due to the composition of its population, overwhelmingly made up of descendants of European immigrants, and per capita territorial resources much more abundant than our neighbors. Human capital and natural capital forged a society that made possible the existence of a majority middle class that differentiated us from the rest of the subcontinent.
Will a large part of what was the middle class accept, as a permanent destiny and not temporary due to the effect of a specific crisis, its systemic impoverishment? In the case of our neighbors, that tolerance for a very marked social difference did not require a process of taming and disciplining because the rise of a large mass of their population to the middle class never occurred.
Cristina Kirchner, trying to emulate Perón, without his talent or conditions of possibility, insisted on empowering Argentines who had not reached the middle class or had descended from it due to some of the previous crises, making them internalize the demand for social ascent, instilling aspiration.
In the opposite sense, the former president of the Banco Nación, Javier González Fraga, at the beginning of Mauricio Macri's presidency, generated controversy by declaring: “They made an average employee believe that he could buy cell phones and go abroad.”
The cultural battle is summed up there: making the majority of society believe yes or believe no regarding the possibility of materializing an aspiration and turning it into an enforceable right. “Not every need generates a right” if there is no way to finance it.
Milei with Sturzenegger propose our country as free of regulations for artificial intelligence when not only the Pope just criticized it in his first encyclical, but even Trump is advancing its regulation. They do it to provoke, as part of their cultural battle, to move the sayable, the Overton window, even if it is not practicable but does move the extreme point. Same with Sturzenegger when he proposes debating eliminating the existence of the driver's license, they are negotiators of an archaic Mediterranean bazaar, they ask for double to later agree on a higher midpoint.
Returning to the hypothesis of Luis Caputo's financial success, for that form of exchange rate and fiscal stability to be politically sustainable, a significant part of the population must accept as fair or at least unchangeable the social order that derives from that form of production and distribution of wealth; that is not a task for the Minister of Economy, but for the President.
The adjustment carried out by Luis Caputo since December 2023 was possible due to the previous campaign process of Milei installing the mantra “There is no money”. When there is more money, will society accept that improvements are distributed only to the highest deciles of the population? That is why Milei insists that his main task is the cultural battle.
One could argue that the spirit of Milei's economic direction was successfully demonstrated in Chile, generating a middle class that previously did not exist in our neighbor. But the plan could be applied, regardless of its beginning in a dictatorship because it later had democratic consensus, in a society that did not have a majority middle class and could improve from a position much lower than Argentina to reach a level comparable to current Argentina, and today it is stuck in the middle-income trap, which after reaching that position cannot achieve full development. Argentina, even having regressed, already has the social floor that Chile only reached in recent years; we do not face the same demand as on the other side of the Andes.
Yesterday, on Perfil's morning program, reflecting on the Pope's latest encyclical, Emilce Cuda, the first lay Argentine woman to receive a pontifical doctorate in moral theology and the first woman to hold an executive position in the Pontifical Commission for Latin America, a position she continues to exercise under Leo XIV, emphasized that if a person like Elon Musk accumulates a wealth of more than 800 billion dollars, greater than most countries in the world, something is wrong. It is obvious, the giant concentration that has been generated in the last two decades is an anomaly. Emilce Cuda says: “In the Old Testament, in times of crisis, of slavery of the people, they do not criticize the enslaver. They do not speak to the one who is enslaving, they speak to the people: ‘This is happening to you because you went to worship false gods. Wake up, organize yourselves’.”
One should not confuse the weakening of Peronism and the unions as a weakening of the egalitarian sentiment of Argentines, which is much older than Perón and largely transcends him, including the social democratic sector of the PRO, a good part of the radicalism, and the provincial parties. In fact, part of that egalitarian sentiment was in the election of Milei by many of his voters regardless of the misunderstanding between what Milei promised as a candidate and the consequences of his policy as president.
Continues tomorrow: Left-libertarianism that added voters to Milei
