Milei promises a “deep chainsaw” for the year of Argentina’s “reconstruction”

Buenos AiresJavier Milei has inaugurated the political year in Argentina with a 70-minute speech in the Chamber of Deputies, where he took stock of the first year of his administration and made a projection of what is to come for this 2025. Before a half-empty chamber - several Peronist and left-wing deputies have decided not to attend - "Argentina's inauguration": after a 2024 in which the "caste model" was "sufficiently" called, the political year that now begins will serve to "rebuild the foundations" of the country. To this end, the ultra-liberal president has promised to apply the "deep chainsaw", which –he says– "is not just a government program" but "a long-term" state policy.

In this regard, the Argentine president has congratulated himself on the surplus achieved and has said that fiscal balance must be made obligatory and the size of the state must continue to be reduced, with the goal that in 2027 public spending will reach a maximum of 25% of the gross domestic product (in 2023, the last year of Alberto Fernández's government). In this way, Milei assures, it will be possible to "banish inflation forever." Milei has also announced his intention to reduce the number of national taxes by 90% so that there are only six left, and in this sense generate a "dynamic" labor market that encourages formal work. According to data for 2024, more than 45% of work in Argentina is informal.

In terms of foreign policy, the ultra-liberal president has shown himself proud of the "ironclad positions" he has shown towards the world, which have transformed Argentina into an "unexpected protagonist" on a global scale: "The eyes of the world are on Argentina after a long time in which they are taking note of the task-deregulation portfolio of the United States," he said, before receiving applause from his supporters. Milei, who gifted Musk a chainsaw at the last CPAC summit, has pointed out that "the chainsaw today is a symbol of a change of era and the beginning of a new golden age for humanity."

With the desire to get closer to the United States and Donald Trump, one of its political referents, Milei has reiterated his intention to move forward with "the historic opportunity" of establishing a free trade agreement with Washington, even if that means leaving Mercosur - the commercial bloc made up of Argentina, Brazil, and Uruguay. Milei has always been against multilateral organizations such as Mercosur, which, in his opinion, would only have succeeded in "enriching the great Brazilian industrialists at the expense of impoverishing the Argentines."

When he explicitly addressed the deputies, it was to ask them for support in a new agreement that, he says, he is already negotiating with the International Monetary Fund (IMF). The objective of this loan would be, ultimately, to abandon the exchange restrictions that Argentina has with the foreign currency – the dollar – and move towards a "freer and more efficient" exchange scheme, in which, says Milei, investments would be more attractive and consequently there would be "less jobs and less", less inflation, greater growth.

In domestic politics, Milei has focused on the issue of insecurity, a concern that continues to weigh on Argentine society. This week a seven-year-old girl died in the province of Buenos Aires during a car theft by two teenagers, one of them 14, the age at which Milei proposes lowering the age of criminal responsibility in an "urgent" reform of the Penal Code: "Those who are sufficiently aware to commit adult crimes." Milei rejects the "legal wokism" that conceives criminals as victims of the system: "Being tolerant with criminals is punishing good people." In this sense, she has said that she will also toughen deportations for foreigners who commit crimes in Argentine territory.

Waiting for the legislative elections to gain power

Towards the end of the speech, which was met with applause and cheers, but also with some squabbling with an opposition MP, Milei again reached out to those present and invited them to "participate in the round table" that they have always "preached", which he argued is necessary for "national reconstruction"; but he immediately put on the brakes with his usual defensive tone: "If they want to decline it, frankly, it will not surprise us."

In October of this year, Argentina will hold legislative elections, that is, those that will determine the composition of the chambers, both of Deputies and the Senate. In these elections, there is a lot at stake for Milei, since obtaining a majority in the legislative power would mean governing more comfortably and without having to constantly resort to presidential decree, a resource that has earned him criticism for being anti-democratic or authoritarian.