Today marks two years since Javier Milei took office as president of Argentina. Since December 10, 2023, the first self-described libertarian to ever rise to power began to liberalize Argentina’s economy. Unsurprisingly for other libertarians, Milei’s policies have started to reverse the country’s long-standing decline.

As of September, the economy is growing at 5 percent on a yearly basis. Poverty, which exceeded 40 percent before Milei took office and peaked at 52.9 percent in the first half of 2024, is now down to 31.6 percent. Monthly inflation, which often surpassed 10 percent in the pre-Milei era and reached 25 percent in December 2023, now hovers around 2 percent. Both exports and imports are rising rapidly.

But how did these results come about? One of the first measures he took was to balance the budget immediately upon taking office. Since the deficit stood at 4.6 percent of the GDP in 2023, this policy was considered so radical that his opponents said it was impossible to carry out. Yet Argentina posted an impressive 0.3 percent surplus in 2024 and has maintained a balanced budget since then. This fiscal “anchor,” brought about by an astounding 30 percent in real spending cuts, has played the key role in ensuring that inflation comes down. However, fiscal consolidation has also left room for some tax cuts, the latest being a reduction in export taxes, which was announced yesterday.

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