Human Progress

Chelsea Follett: Joining me today is my colleague Marcos Falcone, who is a policy analyst focusing on Latin America at the Cato Institute center for Global Liberty and Prosperity. His research interests range from contemporary public policy in his home country of Argentina to the history, theory, and language of classical liberalism. He previously worked as a research fellow at Argentina’s Fandancion Libertad, as a professor in Buenos Aires for the lower house of the German Federal Parliament, and in the private sector, and he holds an MA from the University of Chicago. His columns appear frequently in Argentine and US Media, and he joins the podcast today to discuss the dramatic recent election win of Argentina’s President Milei, who has led his party to a landslide victory, and the implications for liberty and human progress in Argentina and the rest of Latin America. How are you today, Marcos?

Marcos Falcone: I’m doing great, Chelsea. Thank you so much for inviting me.

Chelsea Follett: Thank you for speaking with me. So, let’s start by setting the scene with a bit of a history lesson. Argentina has a long history that has not always, unfortunately, been a history of progress. Could you walk us through some of that background context?

Marcos Falcone: Yes, of course. So, sadly, Argentina is one of the very few countries in the world and perhaps the only one really, to have gone from being a developed country to a developing country. Right? So, for a podcast on human progress, that’s not very, that’s not great, but we’re trying to change that. So, we can talk about that later. But yeah. So Argentina, going into the last part of the 19th century and the early 20th century, was among the richest economies in the world. It ranked usually in the top 10 wealthiest countries in the world. And what proves that is immigration, right? So, Argentina was a very scarcely sparsely populated country that received millions of immigrants, mostly from Europe, from Southern Europe, but also from other parts of the world, like the Middle East, for example, even Asia. And it was only second to the US actually in terms of the net number of immigrants that any country in the Americas received. So, that speaks of strong economy. There was even a saying in French that was something like [foreign language] Argentine, to be rich as an Argentine, which tells you how the world was looking in Argentina, which had higher salaries than countries like Spain or Italy, salaries that were comparable to salaries in Germany, for example, or France.

Marcos Falcone: But of course, that all came to an end, right, because that is no longer the case. So, Argentina’s economy had been a very open one up to this point for the last part of the 19th century and the earliest part of the 20th century. This was a country that was very open, not just in terms of receiving immigrants, but in terms of trade. This was a country with low taxes, extremely low taxes, low public spending as well, very few regulations. But, of course, international ideological trends, so to speak, also affected Argentina. And the rise of nationalism, corporatism, and even fascism, we could say affected Argentina particularly, once General Juan Domingo Peron rose to power in the middle of the 20th century, in 1946, this is really where we see Argentina diverge from the rest of the world. And the main reason seems to have been that whereas the world started to open itself up to trade during those years, Argentina did the opposite. So, it had been a liberalizing country, but it turned into a very closed, very protectionist economy. And so Argentina missed out, really, of all the benefits of trade that increased dramatically after the end of the Second World War.

Marcos Falcone: And there was also, of course, since this became a closed economy, a lot of special interests developed, trade unions, crony capitalists, a whole system of people that depended on Argentina being a closed economy, which in turn made it worse and worse because all governments that try to change this, that try to liberalize Argentina’s economy, failed systematically because they couldn’t, for example, lower public spending because people were counting on that they. They couldn’t open borders because industries were counting on them being closed. They couldn’t deregulate labor relations because unions were counting on labor relations being heavily regulated. And so that’s how we started to get into a declining path that made Argentina a developing country. Right? An economy that is only in the middle tier of economies around the world. As I said, after Peron rose, well, he became really popular because there was a lot to give away, basically a lot of richness that his government basically squandered along with successive Peronist administrations. But these Peronist administrations don’t usually suffer the consequences that come afterwards. Right? Because by then people grow tire and vote them out. But then all intents to change course end up failing because the number of reforms that you need to do is extremely high, and the public’s tolerance for them is just not always there.

Marcos Falcone: And so this is a very shortened version of Argentina’s economic history that sort of brings us from one of the richest countries in the world, a very free and open society, to a very close society that closes itself to the world, and which, because of that, misses out on liberalizing trends and the benefits of progress that the world has seen.

Chelsea Follett: On a happier note, Argentina also does have a very long intellectual tradition of liberty or Classical liberal thought as well. Could you tell us about that?

Marcos Falcone: Yes, absolutely. And this is actually what made Argentina such a great example of classical liberalism by the end of the 19th century. So, the sort of architect of the Argentinian constitution was called Juan Bautista Alberdi. He was a lawyer, but like many people in the 19th century, he could do lots of things. So, he wrote on law and constitutions, but also on economics, on moral matters. And he followed very closely the example of the US Constitution because he believed that the US Constitution represented an example of what a constitution should look like, and particularly of a constitution that would allow a country, in this case Argentina, to grow by opening itself up to the world. So, this is what he had in mind, basically. And he is widely recognized as basically the architect of Argentina’s Constitution. So, this constitution went into effect in 1853. It has suffered changes, but really no major changes were implemented up to the mid 20th century. So for almost 100 years, Argentina retained this constitution, this very liberal, in the sense of classical liberal constitution, that was really beneficial to the country. And this created a culture, a political culture, where liberty stood at the forefront of Argentina, of Argentina’s politics.

Marcos Falcone: Because if you take a look at what the ruling elite was doing, was thinking, was saying back by the end of the 19th century, but also what the opposition were saying, you find classical liberalism in both sides of the equation, right? So you have a ruling elite that is pushing for open borders, that is pushing for foreign investment, that is pushing to deregulate for lower taxes, lower public spending. And then you also have an opposition that is pushing for classical liberal reforms, for example, clinging on to the gold standard. The socialists were very much against the creation of a central bank, for example, because they thought this was bad for workers. And they were right about that. The Socialists were also against protectionism. There were some pressures, you know, as industries started to grow. There’s always the case of special interests that start to reclaim some sort of protection and who want to be well protected by legislation. There was some push for that in Argentina by the ruling elites. But then the opposition, the Socialists mostly were saying, no, protectionism is bad because it will make things harder for the working class. It will make goods and services more expensive for workers.

Marcos Falcone: That’s not what we want. And so, you can see that the classical liberal sort of influence by Juan Bautist Alberti was really, really strong on these people, right? And this was, in my view, very good for the country, particularly during the. The early stages of Argentina’s development. Of course, after, well, fascism and communism became popular in the world, this classical liberal environment sort of faded, started to fade away up to the point that we had, for example, a Supreme Court that basically allowed for the military to seize power because it legitimized their decision in 1930. By then, a nationalist coup ensued. And from then on, it would be over 50 years for Argentina to finally go back to a fully democratic regime. Between 1930 and 1983, Argentina went back and forth between military leaders, including Juan Peron, who was a general, and civilian leaders. And it just didn’t seem to be able to have a fully functioning democracy, which tells you a lot about the state of liberties in the country. But Even during the 20th century, Argentina still had a very strong classical liberal tradition. And we saw, particularly by the end of the 20th century, many intellectuals in the classical liberal tradition.

Marcos Falcone: For example, Alberto Benegas Lynch, who is a Cato adjunct scholar, found, for example, a university called ESEADE, where classical liberal thought was basically spread. People like Martin Grouse, also an economist and also a Cato adjunct scholar We started to see more and more people spread classical liberal ideas. We saw the founding of different think tanks in the 80s and the 90s on the classical liberal tradition, like my previous employer, Fundacion Libertad, which you mentioned at the beginning of this episode. And we started to rebuild sort of this classical liberal culture that had been lost in Argentina for so long, in which, it seems to me, in the end, also fostered the rise, the eventual rise of Javier Milei. Because the now president of Argentina started out speaking at our forums, basically at classical liberal think tanks. I actually met him over 10 years ago. He wasn’t famous at all, but I knew who he was because he was in this environment. Right? But we can talk about him later. But the point is, Argentina had a very n initially strong tradition of classical liberalism, which it sort of lost for a while, but then came back alive. And that’s one of the reasons why I’m actually optimistic and why I think it makes sense to talk about Argentina on a Human Progress Podcast, because I think that we can progress in the future because of this revival of the classical liberal tradition.

Chelsea Follett: So let’s talk about that revival and let’s talk about Milei’s victory. Many people doubted that he would win. Actually, that was an unexpected outcome to many people, maybe less so to you and our colleague Ian Vasquez, who I know is on record predicting it. But walk us through what was going on going up to the election and the election itself, and why that outcome took so many people by surprise and how Milei did pull off a victory while promulgating classical liberal views.

Marcos Falcone: Yeah, so you could be referring to two outcomes, actually. So, I’ll talk about both, actually. Because Javier Milei won the presidency in 2023, when many people thought that was impossible. Right. Which is why politicians in other parties were actually thought that they were taking advantage of Milei’s presence because they thought that he was taking away votes from other parties, not their own. And so nobody really expected that he would win. Right. But we have to understand the recent context of Argentina to understand why Milei became a popular figure. In 2023, Argentina had an annual inflation of over 200%. These are numbers that are not typically seen in the world, or at least not in the 21st century. Argentina was on the verge of hyperinflation, I would say. We were running monthly inflation figures of over 10% before the 2023 presidential election. Right. And the country hadn’t grown in about a decade. So there had been stagnation, basically inflation, almost hyperinflation. Everyone who wanted to do business in Argentina knew that this was next to impossible because of how regulated the economy was. But there were also situations in daily life which were simply unbearable.

Marcos Falcone: For example, rent control. Rent control was so stringent in the context of high inflation that many people, many landlords decided not to have their places rent, and this caused prices to go up. And so if you were, say, a young professional in Buenos Aires, in the city of Buenos Aires in 2023, and you were looking for an apartment to move, you were facing a daunting task. I wrote a piece of actually on what this looked like, along with my colleague Ryan Bourne from the Cato Institute, that came out on Reason earlier this year. And we interviewed one person who told us that back in 2023, it was so expensive to find a place to live that it could even be cheaper to live in a hotel. He may those calculations himself. He’s a financial consultant, so he knows what he’s talking about. Right. So this is the context in which people turn to Javier Milei for different policies. Right. Argentina had been trying interventionist policies for a long time, and they were not yielding the results that people wanted. Right? Of course, we, as classical liberals understand why that is the case. We can explain why government fails whenever he tries to do something.

Marcos Falcone: But of course, this is not necessarily common knowledge for everyone. And so, Javier Milei comes along promising, wielding a chainsaw and saying, we need to cut spending, we need to slash public spending, we need to lower taxes, we need to deregulate, we need to open up the economy, we need to dollarize the economy. And all of this in a context of such chaos, but have also in the context of so many failed experiments, but also, but all of them status, of course. This is where Milei comes along and wins the presidency in 2023, right? But then after he wins the presidency, so many people say, “He’s not going to last because he’s a libertarian. A libertarian can’t last long into office. He will have to resign by a month if he tries to do what he says he’s going to do.” And well, we’re speaking in November 2025. That doesn’t seem to have been the case so far. Milei has been president for almost two years now and many of the radical reforms that he announced have not caused any sort of upheaval. For example, I think that the most important one is balancing the budget, right?

Marcos Falcone: Argentina of course had an inflation of over 200% in 2023 because it was running deficits and because of course, nobody trusted Argentina to pay its debt back. So, debt markets were closed. All the government could do was just print money out of thin air. And that’s what he did and that’s what Mile came to stop. And in just one month, just one month after taking office, he had balanced the budget, right? Everyone said this is impossible. I remember watching the presidential debates myself and seeing all of the other presidential candidates say, “No, you can’t do that. If you do that, the country is going to blow up.” That didn’t happen merely did it? And so far, almost two years into his presidency, Argentina still has a balanced budget, right? Which has stabilized things in Argentina in a way that nobody thought, not even the most optimistic person thought that it was possible. And this is of course great news because it is helping bring down inflation. Because the main root of the problem is just, is no longer there. Of course there’s inertia and of course there is certain policies that may still fuel some inflation for a little while, but the long term trend is very positive and not just in terms of inflation.

Marcos Falcone: Remember, Argentina was a very, and in some cases still is a very highly regulated economy, right? But rent control, the problem that I was just talking about that was so pervasive in 2023, just stopped only 10 days into office. Milei said this is gone and he had the authority to repeal the Rent control laws via decree. That’s what he did. The use of decrees is widespread among Argentine presidents. It may not be the ideal way of repealing a Congress law, but this was all that Milei could do, because when he took office, he only had about 15% of all Congress seats. So he was not just in the minority, in an extreme minority position. He repealed rent control within 10 days and replace that with nothing. So, basically he said, you know, landlords and people who need to rent, renters can just agree on the price that they think is best, the terms that are best, and that’s it. And so one year after that decision went into effect, what we saw was prices going down in real terms by about 30%. We saw the supply of apartments, for example, in the city of Buenos Aires, triple.

Marcos Falcone: And these are just common sense results, if you ask me or you. As classical liberals. We knew that this was going to happen. We knew that this was positive. And it’s strange that Argentina, of all places, is now set an example of rent control when rent control is so, has become so popular in the US and what we call the first World in general, right? We just had a mayor of New York City getting elected and promising to freeze rent and things like that. Argentina is proving that doing the opposite is actually what works. And so, we get to the 2025 midterm election, right? This was only a couple of weeks ago. There was some pessimism that maybe the Peronists were going to win. And this was based on the same assumption that people used back in 2023 to say, Milei won’t last. Many people, including political analysts, were saying, the depth of Milei’s changes is so profound that people will not stand his policies. They will try to vote against him or his candidates. This fueled a run against the Peso, against the national currency, and it.

Marcos Falcone: We didn’t know what was going to happen. But in the Milei won, he got over 40% of the vote, even though his name, his exact name, was not on the ballot, because this was only a midterm election, which is usually harder for incumbents, because even though their party is there, their names are not there. And Argentina is a pretty individualistic country in terms of personalities, and people wanted to vote for a specific person. So in this case, they had to rely on On Mile’s candidates and they still voted for them, right? Which is now bringing a new wave of optimism back to Argentina. Why is that? Well, of course, since Milei only had about 15% of all Congress seats. There were many reforms that he couldn’t do because he didn’t have the authority to do them. He was able to compromise and had for example, anonymous bill called, passed, sorry last year, which was called Lei Bases. With that law, the government received special powers to deregulate the economy, restructure state agencies. But of course there are many things that can’t be done without Congress approval. So, now Milei still doesn’t have a majority, but he’s now much closer to to forming one.

Marcos Falcone: So, he needs fewer alliances to pass the reforms that he wants to pass. And we can discuss some of them later. But these include, to the best of our knowledge, tax reform, labor reform, Social Security reform, and of course we would like, as classical liberals or libertarians, what we want to see is Argentina opening itself to the world. The MILE administration has done great progress in normalizing trade in the sense of making it less crazy because there were so many non tariff barriers to trade that it was almost impossible to import anything into Argentina. Those barriers are being lifted, but of course, when it comes to tariffs, you do need Congress. So, that’s another reform that we want to push. And of course, one of the reforms that we want to see Argentina adopt in the short term is dollarization too, right? Because as this last election proves, whenever there is uncertainty as to what’s going to happen with Argentina’s politics, people rush to buy dollars. And this basically stops all economic activity because people don’t want to make decisions, right? And what ends up happening is that the people who benefit are those with the dollars who are usually the richest ones, the ones who have access to foreign currency markets.

Marcos Falcone: Whereas it is the poorest who suffer the most because they have their national currency that is constantly losing value. That is a process that we believe we would expect to stop as the budget stays balanced and the root cause of inflation is eliminated. But of course, if there’s always going to be uncertainty as to what what’s going to happen when Milei is no longer in office, then one of the best ways to anchor all Milei reforms would be dollarization. But again, I think I’m jumping ahead here.

Chelsea Follett: We’ll definitely talk about some of those specific reforms. But one thing that’s interesting about reading about the Argentine election results, the midterm election results in the US is how it’s all characterized. I think most members of the press in the United States can tell that there is a big contrast between Milei and someone like Mamdani in New York who wants to freeze rent. But they often tend to lump together Milei with figures like US President Trump on the US, right. And while President Trump and the President Milei do seem to get along personally, they say very nice things about each other. They also seem to have very different policy agendas, especially in areas such as trade. Regarding tariffs, how would you characterize some of the differences between these two figures?

Marcos Falcone: Well, honestly, I think Milei and Trump differ in fundamental ways really about economic thinking. In particular, because Milei is a trained economist in free market tradition. He used to be more of a monetarist economist before finding out about the Austrian school of economics. The then he became a fan of, for example, Mary Rothbard, Ludwig von Mises. And so he knows that cooperation, trade is what makes us able to create prosperity, right? Create wealth. Whereas Trump believes that economics is a zero sum game and if you’re gaining something, then somebody else is losing. Right. And that’s the kind of thinking that he has applied to the US in opposite ways as in compared to the ways that Milei has governed so far. If you take a look at the at the last two years when Milei has governed in Argentina, you will see that all changes that have to do with trade are liberalizing changes. Right? So the Milei administration has been able to lower tariffs for many goods and services. Argentina still has a problem, which is that it is part of a trading block called MERCOSUR, which is a rather protectionist kind of block, which has relatively high tariffs.

Marcos Falcone: But Argentina used to have even higher tariffs than MERCOSUR. So, Milei has been able to lower those tariffs to MERCOSUR levels. And now he needs to either negotiate with MERCOSUR or just leave it. Like Chile did leave the Andean Pact in the, in the 1970s and 80s if he really wants the free as possible kind of trade, right? So Milei has lower tariffs. He has gotten rid of non-1tariff barriers which were very important in Argentina compared to other countries, even more so in some cases than actual tariffs. Whereas what you see in the case of the US since Trump got elected for the second time is the opposite, right? You have seen more tariffs, you have seen tariffs used as a means of negotiation. But even in those cases, it really does look like President Trump believes in tariffs because he has said the same things over and over for 40 years. He has been complaining about the Japanese since the 1980s. So he really does believe in tariffs. And that is just a fundamental difference in the way of thinking, which also applies to other areas. Right. It doesn’t seem like the current US Government is too concerned about the deficit because they, they really don’t seem to have a problem with debt rising still.

Marcos Falcone: It looks like Republicans are getting more and more similar to the Democrats in that regard. Whereas Milei again balanced the budget in just one month, which is just impressive. I haven’t seen any evidence of such a sudden balancing of the budget in a Democratic country that did not involve a default or hyperinflation in recent times. And this just shows how, just how different they are. Of course, Milei does need the help of people because Argentina is, was and still is in a very delicate situation. I understand why he would become friends with Trump, because if you take a look at the world, Milei really is the only libertarian president. So, if he were only going to be friends with libertarian presidents, then he’d be alone at the global stage. I believe that explains why he has become friends with people that are not necessarily libertarians, but on the right. And of course, the US is a very important country when it comes to Argentina and its national debt. Remember that Argentina is the largest debtor of the IMF, for example. Right. So we need the US to help with that. And I think this explains why they have grown closer together. Also because they oppose the left. As you said, it is easy to oppose these two figures to Zohran Mamdani, for example, Right? But yeah, that conceals differences that I think are fundamental between Milei and Trump.

Chelsea Follett: I agree with that. And I think also some of the confusion may come from their communication styles. Maybe they both have a sort of…

Marcos Falcone: The rhetoric.

Chelsea Follett: Brash. Yes. It’s a form of rhetoric which makes people see them as similar, despite these actually quite vast policy differences. But let’s talk about some of those policies. So, we’ve spoken a bit about trade liberalization and scrapping tariffs. What about tax reform and Social Security reform? I know those are also big issues in Argentina.

Marcos Falcone: Yeah. So, we don’t really know what’s going to happen after the new Congress takes office in December, but it seems like the priorities of the Milei administration will be to pass tax reform, Social Security reform, and labor reform. In terms of tax and labor reform, Argentina has sort of unique issues in that taxes are not just high, but also very complicated, really. And superimposing. Right. So over imposing. I mean, so you have taxes on taxes. And to give you an example, the last doing business report by the World bank which came out in 2020, said that if you were a business in Argentina and were to pay all of the taxes that you were legally required to pay, then you would pay 106% of your income, which makes absolutely no sense. That means it’s you, you’d be better off not doing any business at all. Right? And this was the worst result for any country. So you can imagine just how complicated, how complex the tax system is in Argentina, because obviously businesses don’t do that. They don’t pay 106% of their income because otherwise there would be no business. So the tax system is very complicated.

Marcos Falcone: It needs to change. The Milei administration could only do very limited changes up to this point because constitutionally decrees in Argentina cannot legislate over tax matters. So he needs Congress to do this. There has been some initial reform in terms of providing tax incentives for large investments, which were part of the omnibus bill that I was talking to you, that, that was passed last year in 2024. But more needs to be done to make the system less complex and less onerous. Right. In terms of labor reform, Argentina has a very high degree of informality in its labor market. And this is because it’s very expensive to hire employees legally. And it can be even more expensive to let them go. Right? Because litigation is very high. And businesses, particularly small and medium enterprises, are constantly trying to avoid litigation because they know, because of the way that the judiciary system is set up, they know that if they face a lawsuit by a former employee, they’re going to lose. And it doesn’t even matter if they’re right or wrong, they’re going to lose, and that can bring them to bankruptcy. Just one sentence by one court because of one employee.

Marcos Falcone: This needs to stop, the Milei administration knows this, which is why they’re going to push for labor reform. And then there’s Social Security reform. In that case, Argentina faces similar issues as other countries, which is that its population is aging. And we have the typical Ponzi scheme that promises, you know, that as long as, as the base keeps growing and growing, then there’s going to be no issue with the top of the pyramid. But of course, if the population pyramid is no longer a pyramid, then you have a problem. Right, because you’re having people pay taxes to support pensioners today, but there’s likely not going to be enough people in the future to pay for those who are paying taxes. Now, this is aggravated in Argentina’s case because of populist policies. Right. You were saying that Milei’s style, his rhetoric resembles Trump and it looks populist, but Milei’s policies are not populists. But we have had populist policies in Argentina that were Not Milei’s by means of which, for example, beginning in the 21st century, over a million, for example of of pensioners were integrated into the system without having made any payments to Social Security beforehand at all.

Marcos Falcone: And this of course puts a lot of stress into the system. You also have and you’ve had over the past two decades an increasing amount of fraud in terms of for example, disability payments. Right. So disability pensions in Argentina are equivalent to those in terms as a proportion are equivalent to the ones you would expect to see after a major war happening in a country. You just can’t have as many disabled people. It’s statistically impossible to have as many disabled people as Argentina seems to have because of the payments to the disabled that it issues. So, we know that there’s fraud. We see towns in Argentina in the most backward provinces where maybe 50% of all people are cashing in a disability payment each month. That makes no sense. We all know that’s wrong, that’s fraud. And those are the kind of things that, that the Milei administration will try to tackle with Social Security reform. So, it looks like those are the priorities of the Milei administration. What I would like to see, what we would like to see at the Cato Institute of course is those reforms, but also a farther, a more important trade liberalization, so more far reaching trade liberalization.

Marcos Falcone: And we would also like to see dollarization, as I was saying, because Argentina is a country that in due course will back eventually to a left wing or a Peronist administration because that’s just the way that things happen. We’re in a democracy, governments change. We haven’t really seen that Peronist, that the Peronist economic agenda is becoming more reasonable. It may be as crazy as it usually is. And so, we need to protect people and particularly the assets of the people in the event of a return of the Peronist. And I we believe that the best way to do this is dollarization, which is not only feasible, it’s not only doable, but also desirable so as to avoid a crisis in the future. Because what we just saw in the election, in the midterm election, this run against the peso and all of the pessimism and the uncertainty, this could have all been avoided by dollarizing. So, that’s the problem that we want to avoid in the future.

Chelsea Follett: Let’s talk a little bit more about dollarization because this is such an important policy issue in Argentina.

Marcos Falcone: Yes. So, Milei promised to dollarize the economy back in 2023. And of course in that context where you were very close to hyperinflation. This was a proposal that gathered a lot of attention, but nobody really thought that this was something that Milei was actually going to do because nobody expected Milei to win, right? And even if he won, it seemed like it was too difficult, like there were no dollars. The main argument against dollarization is that Argentina doesn’t have the reserves that it needs to dollarize its economy. Right? And of course now what’s happening is that as inflation has come down, the, the problem of inflation is still there because Argentina as we speak is running a year to year inflation of over 30% still, which is not 200, but it’s still really high and much higher than it should be and much higher than it is in other countries. The problem of inflation becomes sort of less salient as it gets better. And so, it seems as though maybe you don’t need to dollarize if you can just get things back into control without dollarization. But then we have this problem, right, that we just saw that whenever there’s a little bit of uncertainty as to what’s going to happen in Argentina, you have a run against the peso and you have people wondering what’s going to happen and you have many important actors halting all of their decisions to just because you have a national currency that is just not a currency that anyone can trust.

Marcos Falcone: Because what still happens, what has been happening over the course of decades in Argentina and still happens today is that as soon as you get your paycheck, you sort of calculate the amount of money that you’re going to spend that you need. And then with the rest of it you just go rush and buy dollars, right? And you don’t even invest those dollars. In many cases people just get the physical US dollar bills and they just keep it, keep them with themselves. And so, you lose in so many ways with that, right? Because there’s uncertainty, people don’t know what to do, the money is taken out of the financial system, there’s mistrust for your currency, all sorts of problems that you don’t need to happen. And this is important to state we don’t need to live like this. Argentines just don’t need to live like this. And we have seen examples of successful dollarization processes which have defended the citizens of the countries which have dollarized against populist governments. For example, Ecuador, right? So, Ecuador dollarized its economy 25 years ago in the 2000s. And after dollarizing, they did have a left wing administration led by Rafael Correa who rose to power in 2007 and left in 2017.

Marcos Falcone: So, he lasted two years. And many people thought this was a guy that could have been another Chavez. Right. Like in Venezuela, he really was left wing. He really wanted to turn Ecuador upside down and implement all sorts of interventionist policies. But there was one thing that was more popular than him during his entire tenure, the dollar. So, he didn’t undollarize or de-dollarize because he wouldn’t have been able to because the people were clinging onto the dollar. And even though he did a lot of damage to the Ecuadorian economy, which is why they’re not doing as well as they should do, dollarization still protected the value of their assets, the value of their currency. Of course, you do get the problems that the US has, but in comparison to the problems that Ecuador had created before dollarization when it was also running four digit inflation numbers, or the problems that Argentina had created for itself, those problems are minimal. So, dollarization is a policy that you can not only that, you can not just implement, that you want to implement in countries like Argentina with such level of political volatility because they will help stabilize the economy in a way that no other measure can.

Chelsea Follett: What do you think are some of the potential implications for the broader region? You’ve spoken now about a number of policies that will hopefully go into effect in Argentina, but do you think that this renaissance of classical liberal or libertarian or liberty oriented policy could this catch on throughout Latin America?

Marcos Falcone: Well, I think Argentina could become an example of libertarian policies that work that other countries in Latin America can imitate, which would be a very novel concept because Argentina has been declining for so long. But in recent years we have had different administrations in countries like Brazil, Chile, Colombia that have gone left wing right, and in many cases in more extreme ways than they used to in the past. And these were countries that were doing relatively well before the left rose to power and which are finding that of course interventionist policies don’t always and usually don’t work the way that they believe they work and the results are just not good. So, Argentina in that regional context today is relatively alone. There are of course no libertarian presidents in the entire world other than Milei. But even in Latin America, presidents that are not left wing tend to be more conservative or more nationalistic, which is not the case of Milei. So, I hope that Milei becomes sort of beacon that can illuminate other countries and make libertarian politicians in other countries rise to prominence.

Marcos Falcone: We are seeing that, for example, well, in the case of Chile, for example, even though Chile is going to the polls in November, and even though the most popular figure right now is literally a communist, you also have a libertarian candidate who could potentially go to the runoff against the communists and potentially win in Chile. And that could sort of undo a lot of the bad policies that Chile has engaged in in past years. Chile used to be the country which Latin American free marketeers would look to for success, for the effects of good reforms which range from a pension reform to trade liberalization. But that all has been endangered in recent years because of, well, the pro left wing ideological tendencies in Latin America. So, I hope that Milei, and particularly Milei’s policies, not just Milei necessarily, but his policies, his ideas spread across Latin America and also the world. Of course, we’re lucky that Milei is sort of eccentric because, because he brings attention to him. Right. And what we want is for people to find out that liberty works whenever you apply liberal principles to a policy, classical liberal principles, of course, those work, and Milei is an example of that in so many areas. And I hope that he becomes an example in more areas so that libertarian policies can thrive in the entire globe.

Chelsea Follett: And on that very progress oriented note, I think we should end. Thank you so much for speaking with me, Marcos. This has been fascinating.

Marcos Falcone: Thank you, Chelsea.