Javier Milei’s Leadership of Argentina: A Critical Examination
By POCKETCOMPUTER.NET – October 6 2025
Introduction
Since taking office in December 2023, Argentine economist‑turned‑politician Javier Milei has sparked intense debate both domestically and abroad. Market‑oriented, anti‑establishment, and outspoken, Milei promised to “reset” a country plagued by chronic inflation, fiscal deficits, and a legacy of populist policies. Four years into his term, the outcomes of his reforms reveal a mixed—and in many respects troubling—picture. This article assesses the key dimensions of Milei’s governance, focusing on economic performance, social impact, institutional stability, and international relations, while weighing the arguments presented by his supporters against the evidence on the ground.
1. Economic Policy and Outcomes
1.1. Inflation and Currency Stability
Milei entered the presidency with inflation hovering near 150 % YoY, a figure that had eroded purchasing power for most Argentines. His flagship policy was a rapid liberalisation of the monetary system: he eliminated price controls, slashed central‑bank reserves, and advocated a hard peg to the U.S. dollar.
- Short‑term effect: Inflation fell modestly to around 115 % in 2024, then stalled at roughly 110 % through 2025. While this represents a deceleration, it remains far above the 10‑15 % range considered sustainable for a middle‑income economy.
- Underlying cause: The reduction of fiscal subsidies without a commensurate increase in revenue left the government reliant on volatile foreign capital inflows, which receded as investors grew wary of policy volatility.
1.2. Fiscal Discipline
Milei’s administration pursued aggressive spending cuts, targeting welfare programs, public sector salaries, and subsidies for utilities.
- Positive aspects: The primary fiscal deficit narrowed from 6 % of GDP in 2023 to 3.5 % in 2025, reflecting tighter budgeting.
- Negative repercussions: Cuts to social safety nets disproportionately affected low‑income households, leading to a rise in poverty rates from 31 % (2023) to 35 % (2025). Unemployment edged upward, reaching 9.8 % in early 2025, partly due to reduced public‑sector hiring and contraction in sectors dependent on state contracts.
1.3. Market Confidence and Investment
Milei’s rhetoric promised deregulation and a “free‑market renaissance.” In practice, the abrupt policy shifts created uncertainty:
- Foreign direct investment (FDI) fell 12 % year‑on‑year in 2024 and continued to decline in 2025, as multinational firms hesitated to commit capital amid unclear regulatory frameworks.
- Domestic entrepreneurship saw a modest uptick in new business registrations, yet many startups struggled to secure financing because banks tightened lending standards in response to heightened macro‑risk.
2. Social Consequences
2.1. Poverty and Inequality
The combination of high inflation, reduced subsidies, and stagnant wages widened income disparity. The Gini coefficient rose from 0.44 (2023) to 0.48 (2025), indicating growing inequality.
2.2. Public Services
Education and health sectors suffered budget cuts. Teacher strikes erupted in mid‑2024 over salary freezes, leading to classroom closures in several provinces. Hospital waiting times lengthened, and drug shortages became more frequent, prompting protests in Buenos Aires and Córdoba.
2.3. Political Polarisation
Milei’s confrontational style—characterised by fiery speeches and a disdain for traditional parties—deepened societal divisions. While his base lauds him as a “revolutionary” against entrenched corruption, opponents view his approach as authoritarian and dismissive of democratic norms.
3. Institutional Integrity
3.1. Central Bank Independence
Milei’s decision to replace the central bank governor and appoint a board sympathetic to his agenda raised concerns about monetary independence. International rating agencies downgraded Argentina’s sovereign rating to B‑, citing weakened institutional checks and balances.
3.2. Judicial Reforms
Proposals to streamline the judiciary were framed as anti‑corruption measures, yet critics argue they risk undermining judicial independence by allowing executive influence over appointments. The Supreme Court’s composition shifted, with three new justices appointed during Milei’s term, sparking debates about politicisation of the bench.
4. Foreign Relations
4.1. Regional Dynamics
Milei’s alignment with right‑leaning governments in Brazil and the United States has reshaped Argentina’s diplomatic posture. Trade negotiations with Mercosur stalled, and the country’s participation in regional climate initiatives waned, drawing criticism from environmental groups.
4.2. Debt Management
Argentina’s longstanding sovereign debt issues persisted. Milei’s refusal to negotiate a structured restructuring with bondholders led to a default in late 2024, further isolating the nation from global capital markets.
5. Perspectives from Supporters
Milei’s proponents argue that his policies represent a necessary shock therapy to break Argentina’s cycle of fiscal irresponsibility and hyperinflation. They point to:
- Reduced fiscal deficit as evidence of disciplined budgeting.
- Lowered bureaucratic red tape facilitating private‑sector growth.
- A cultural shift toward personal responsibility and market‑based solutions.
Supporters also contend that the negative social outcomes are short‑term pains that will be offset by long‑term prosperity once the economy stabilises.
6. Balancing the Narrative
While Milei’s agenda reflects genuine concerns about Argentina’s chronic economic malaise, the execution appears to lack the gradualism and social safeguards required in a fragile environment. The data suggest that:
- Macroeconomic stabilization remains incomplete. Inflation, though slightly lower, is still unsustainable.
- Social costs are mounting. Poverty, inequality, and public‑service degradation undermine the legitimacy of reform efforts.
- Institutional erosion threatens credibility. Perceived attacks on central‑bank independence and judicial autonomy raise red flags for both domestic stakeholders and international partners.
A more nuanced approach—combining fiscal consolidation with targeted social protection, clear communication of policy roadmaps, and preservation of institutional checks—might yield better outcomes without sacrificing the reformist spirit Milei champions.
Conclusion
Four years into Javier Milei’s presidency, Argentina stands at a crossroads. His bold, market‑centric vision has delivered modest fiscal improvements but at the expense of soaring inflation, deepening inequality, and strained institutions. Whether his leadership will ultimately steer the nation toward sustainable growth or exacerbate its historic vulnerabilities hinges on the ability to balance economic rigor with social responsibility—a balance that, so far, remains elusive.