Days before Argentina’s presidential election last November, Javier Milei was on the ropes. His opponent Sergio Massa, a seasoned operator from the ruling Peronist coalition, pummelled Milei in a televised debate about his lack of experience and picked holes in his radical manifesto. Milei seemed flustered and at times struggled for answers.
“The reading of many people, including me, was that Massa had won,” recalls Guillermo Francos, then a close Milei adviser. “But I got home and looked at what people’s views were on social media. Their perception was the complete opposite. They thought Massa represented the old Argentine politics, arrogant, proud and bullying while Javier was the opposite: an honest, sincere guy who was confronting him.”
Milei went on to win with 55.7 per cent of the vote in the run-off against Massa. Francos, now his interior minister, tells the story as evidence of the mop-haired former TV economist’s ability to rewrite the rules of politics by striking a chord with ordinary citizens — many of whom were desperate for an alternative to decades of economic failure at the hands of a “caste” of corrupt, self-serving politicians.
After almost three months in power, Milei is now betting more heavily than ever on his ability to rally popular support via social media.
Milei is trying to push through a radical, high-risk programme of austerity to heal Argentina’s stricken economy. A political outsider, he is facing stiff opposition from Congress, unions, social movements and protected industries.
In response, he has doubled down on confrontation, insulting anyone who opposes him and refusing to negotiate.
For the time being, Milei’s popularity is holding up — giving him some space to direct public disquiet towards the politicians and vested interests he blames for the country’s economic woes. But if that popular support falters, he will have little institutional backing for his controversial agenda. Some political observers are already wondering privately whether his presidency will last its full four-term term.
In an interview with the Financial Times at the Casa Rosada presidential palace, Milei insisted he was making rapid progress in implementing his agenda.
“They all said the fiscal adjustment I proposed was impossible, that with a lot of effort it could be done over four years at least,” Milei said, referring to his pledge to turn a large deficit into a surplus by five percentage points of gross domestic product. “I did it in one month.”
Few experts disagreed that Argentina needed deep change when Milei took over in December. Inflation was spiralling out of control, international reserves were negligible and the government was printing so much money to fund itself that the peso’s value had plunged 96 per cent in five years against the dollar.
Milei, a self-styled “anarcho-capitalist” who believes in maximum individual freedom, minimum government and unfettered capitalism, had promised in his campaign to take a chainsaw to the state. He was as good as his word: his initial measures halted new public works, froze budgets, almost halved the number of government ministries and devalued the peso by 54 per cent.
The drastic nature of the programme left the IMF, to whom Argentina owes $44bn, in the unusual position of having suggested slower cuts and additional social spending, people close to the talks say.
Milei only entered politics just over two years ago and his La Libertad Avanza party holds less than 15 per cent of seats in Argentina’s Congress. He quickly ran into trouble when he tried to pass ambitious legislation to overhaul the heavily regulated economy. The president tabled about 1,000 reforms aimed at deregulating the labour market, promoting competition and raising some taxes to balance the budget. About a third of the measures were contained in an emergency decree, which faces a wave of legal challenges on the grounds it may be unconstitutional. The remainder were in a huge “omnibus bill” intended to sweep away 40 years of regulation.
But Congress refused to pass the measures wholesale and when it started unpicking the omnibus bill in debates, the tax-raising measures were an early casualty. As lawmakers made further changes, Milei lost patience and on February 6 gave orders from Israel, where he was on an official visit, to withdraw the whole package.
“Our government programme was voted for by 56 per cent of Argentines and we are not willing to negotiate it with those who destroyed the country,” he warned on social media, posting a meme of a mock film poster with himself as the Terminator.
Milei used a speech on Friday night opening the new session of congress to offer Argentina’s 23 governors, who control blocs of national lawmakers, an opportunity to come together and agree a 10-point national pact to be signed in May. These included balanced budgets and public spending cut to 25 per cent of GDP.
But the proposal was made very much on his terms. “We are not going to negotiate change and we are going to keep the promise which we made to society, with or without the support of the political class,” he told the lawmakers. “Faced with obstacles, I don’t brake, I accelerate.”
Around half of the governors and Milei’s conservative lawmaker allies welcomed the idea, but centrists’ reaction was mixed and the Peronist opposition bloc, the largest in congress, hit back.
“For more than an hour, Milei did not suggest a single initiative which would help with the economic realities of the provinces,” the Peronists said in a statement. “This country is being run by a person who is more worried about the amount of likes and retweets on X than about reaching agreements to take the country forward.”
Eduardo Vischi, leader in the Senate of Unión Cívica Radical (UCR), a key centrist party Milei needs to win over to pass legislation, told the Financial Times that recent weeks had “made me doubt that [the president] ever had any intention of wanting to find agreements to bring forward laws”. He did welcome the pact proposal, saying “I’m putting my faith in it being genuine.”
Milei had previously taken aim at the governors, none of whom are from his party. He had blamed them for the demise of his big reform bill and retaliated by cutting off almost all their discretionary funding. He also ordered cuts to the share of national taxes being sent to provinces with big debts to the central government.
Faced with not being able to pay salaries, some of the governors rebelled. Ignacio Torres from the oil-rich Patagonian province of Chubut, threatened that “not a barrel more” of crude would flow from his territory unless the tax revenues were restored. Even though Torres’s party had backed Milei in the election, the president insulted him publicly, calling him a “child” and accusing him of not being able to read a contract.
Convinced that he wins from each confrontation with the “caste” of professional politicians, Milei is unrepentant. “I went and negotiated in good faith,” he says. “They took this as a sign of weakness . . . In the end the governors had financial problems, so who lost, us or the governors? It was the governors.”
But moderate politicians worry Milei will be unable to impose his vision for Argentina through conflict. “There is no chance of building anything without dialogue,” says Rolando Figueroa, governor of the province of Neuquén which is home to the country’s biggest oil and gas deposits. “The president is elected, but the governors are elected too.”
The bitter public spats have also alarmed Milei’s business allies, who want him to succeed but fear he is putting his whole reform programme in jeopardy by refusing to compromise.
Eduardo Costantini, a billionaire property developer, supports Milei’s plans but describes his handling of Congress as an “unforced error”.
“The legislative strategy he had clearly didn’t work,” he says. “He came away from this first round practically empty-handed.”
Nicolás Pino, head of agribusiness lobby La Sociedad Rural Argentina, says cutting spending without also delivering deep reforms of Argentina’s state in the legislature is “no solution”. He urges the president to “lower tensions” with Congress and try again. “He will find many people ready to help him.”
But Milei appears to think otherwise. People who deal with the government say the president is now more dependent than ever on a small inner circle of true believers and his army of social media followers, to whom he devotes more than two hours a day online. His closest advisers include his sister Karina, who used to sell specially decorated cakes on Instagram and is now the presidential chief of staff, and Santiago Caputo, a 38-year-old political consultant and social media guru whose father is a cousin of Luis Caputo, the former Wall Street trader now serving as finance minister.
Sergio Berensztein, a political consultant, says the main problem “is that the government doesn’t allow itself to be helped. It doesn’t listen and it’s very closed.”
Some question Milei’s economic results too. Eduardo Levy Yeyati, an economist and professor at Torcuato di Tella university in Buenos Aires, believes the much-vaunted fiscal surplus in January benefited from accounting tricks such as shuffling government payments around. “The surplus is unsustainable,” he says. “It can only be sustained if the government passes tax measures.”
Milei’s eccentric style and aggressive all-or-nothing approach to politics have sparked speculation about how long he can last running a turbulent country in the middle of a deep crisis. Some diplomats have already begun to speculate about whether his administration will implode prematurely and leave behind a mess for someone else to unscramble — perhaps the ambitious and more pragmatic vice-president Victoria Villarruel, said to be already manoeuvring behind the scenes.
Investors, in the meantime, are biding their time, waiting to see whether Milei can succeed in stabilising the economy and passing lasting reforms.
Some observers look at the president’s passion for libertarian ideology, economic textbooks and Jewish history and ask whether there is a messianic streak in Milei where he might relish a dramatic departure from office.
Milei himself notes that his greatest hero, Moses, wandered in the wilderness with the Jewish people for 40 years. He enjoys playing the role of the academic, discussing game theory and musing about how to “torpedo Gramsci” by attacking what he calls socialism in the media, culture and education.
In his first months, Milei was able to count on an opposition in disarray, stunned by his election victory and unsure of how to respond. But as time passes and the president makes more enemies, the risk of disparate political blocs coming together to oppose him is growing.
Cristina Fernández de Kirchner, a powerful former president and vice-president and icon of Argentina’s left, broke a long silence after the election to deliver a 33-page excoriation of the Milei government this month.
“All the measures adopted so far repeat policies already implemented in the past,” she wrote. “All of them failed miserably, provoking only poverty and pain.”
Unions have begun to organise, calling a general strike last month and a host of smaller protests. The governors are restive and centrist politicians have been repelled by Milei’s confrontational style.
Carlos Pagni, one of Argentina’s leading political commentators, believes Milei needs to wake up to the threat that a broad ad hoc alliance of disaffected lawmakers could pose.
“No government project can be sustained by public opinion alone,” he says. “The question now is who moves most quickly to put together a bloc for a legislative programme — Milei or the opposition?”
But the president insists that his battles with Congress and the governors have delighted his supporters. He insists he can turn Argentina’s economy around without the support of lawmakers, attract private investment by lifting exchange controls later this year, and win a much more sympathetic Congress in midterm elections towards the end of next year.
“You can grow a lot even without doing reforms,” he says. “If that allows us to get to 2025 with a much stronger economy in terms of activity, jobs, real wages and falling inflation, that will mean that we’ll have a Congress much more in tune with the ideas of change which we are proposing.”
Ultimately, Milei’s fate is likely to rest on public opinion. Pollsters say roughly half the country currently approves of the president, despite the drastic austerity programme. But for how long Argentines will put up with falling real wages, an economy entering recession and some of the world’s highest inflation remains to be seen.
In the Villa 31 slum in central Buenos Aires, clothes seller Eruen, 45, says he wanted a change but adds: “I didn’t expect one this extreme. I’m struggling to make it to the end of the month. But I have hope that things are getting better . . . the country was so screwed before that this doesn’t change overnight.”
Evelyn, 23, a butcher’s assistant, voted for Milei last year. “Before I liked him 10/10, now I’d say 7/10,” she says. “I think the measures he’s taking will start to have an effect . . . I’ll give him this year to see results. And maybe a bit of next year.”
“So far Milei’s support is broadly the same as when he won the election,” says Berenzstein, the consultant. “Going forward it depends on how fast inflation comes down. If he succeeds in getting it down to 4 to 5 per cent a month by mid-year and avoids currency appreciation, he will have a lot of political capital.”
Prices rose by 20.6 per cent a month in January alone. While inflation is expected to slow to about 15 per cent a month in February, that would still equate to an annual rate of 314 per cent and wages are lagging far behind.
Jorge Day, a researcher at the IERAL think-tank, calculates that state workers lost roughly 16 per cent of their purchasing power in just two months to the end of January. Pensioners have also fared badly, with payments not increased fully to compensate for inflation.
Milei acknowledges the economic pain, but points out that this is what a majority of Argentines voted for and dismisses the spectre of mass protests. “People think they can hold out for a year,” he says. “At least that is what the polls say. In addition, expectations about the future are improving.” In his interview with the FT, he referred more than once to the possibility of winning a second term “if things go well”.
But many, including some of his supporters, question whether the president’s huge gamble can succeed. “They are taking big risks without a Plan B,” says Torcuato di Tella’s Levy. “They are burning their bridges with the opposition, including those who could help them. If the stabilisation fails or Milei loses support, the government may face paralysis in the midst of a crisis and the chance of a recovery may be lost.”
Or, as one ambassador in Buenos Aires put it: “He’s pouring petrol everywhere. At any moment it could explode.”
Data visualisation by Keith Fray
