Milei remains successful

At the center of Milei's reforms is the consolidation of the state budget. To achieve this, Milei closed half of the ministries, eliminated 40,000 public service positions, cut subsidies, froze payments to the provinces, or only adjusted pensions partially to inflation. By massively reducing expenditures rather than increasing taxes, he managed to eliminate the previously high budget deficit.

Balanced budget is a prerequisite for ...

Balancing the budget was a prerequisite for reducing the high inflation that had paralyzed the economy and eroded the purchasing power of poorer segments of the population over the past decades. Without the high budget deficits, the state now no longer needs to be financed by printing money, which previously caused the central bank to fuel money supply growth and inflation.

... lower inflation and more stable peso

When the peso is more stable domestically, it is also more stable against foreign currencies such as the dollar. Price stability and currency stability are two sides of the same coin. This allowed the government to release the exchange rate previously set by the state without having to fear massive devaluation or an increase in inflation. Exporters no longer have to hand over their dollar revenues to the state at politically suppressed rates, which the state then allocated to select importers, leading to bureaucracy, corruption, and a shortage of imported goods. Balancing the budget ultimately enabled the liberalization of foreign trade, which is vital for the flourishing of companies.

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