Episode Transcript
[00:00:00] Speaker A: Great.
[00:00:01] Speaker B: Well, it is the top of the hour. I'm going to go ahead and get started while we wait for people to file in. Thank you so much for joining us today. I'm Scott Schiff with the Atlas Society. We have Lawrence on hosting duties. We're very pleased to have Atlas Society senior scholars Richard Salzman and Stephen Hicks discussing Javier Malay, his presidency and the implications South America. After their opening comments, we'll open it up to questions. So if you have a question, request to speak and we'll get to as many of you as possible.
I'm not sure which one of you wants to start. We've got Steven, our roving philosopher, on the ground in Argentina.
[00:00:47] Speaker C: Okay, why don't I start? We have an hour and a half, and when I was thinking through this topic, there's a lot of sub issues that are worth exploring.
So one agenda or one structure might be just to put a topic on the table, and then we all discuss that for ten minutes or so and then move on to the next topic.
[00:01:09] Speaker A: Some of the things are more philosophical.
[00:01:11] Speaker C: Some are more economic, and I know Richard will speak well to those. Some of them have to do with kind of leadership potential. And then, as Scott was suggesting, broader implications for Latin America and so on, rather than just put a whole bunch of things out there. What do you think about going through topic by topic?
[00:01:32] Speaker B: Sure, that sounds good to me.
[00:01:34] Speaker A: That sounds good, Steven.
[00:01:36] Speaker C: Okay.
[00:01:37] Speaker A: I think we might also want to appreciate that some of the people in the room may not know the broader story. So if we started broader, like who is he, how did he get to where he is, then we can get more detailed.
That can be brief, but maybe we can start with that.
[00:01:56] Speaker C: Let me say a few things.
I've met Javier Millet three times.
Each time it was when we were both speaking at events together.
We were both speaking at the same event.
I was speaking on philosophical topics. He was speaking on economic topics, twice in Argentina, once in Brazil.
So the first time I heard him, he was giving a straight up, this was about four or five years ago now, straight up economics lecture. And the most impressive thing to me was just how well he understood the economics. From my perspective, I don't have expertise in that area, but I know enough to be dangerous, so to speak, and all of the economic indicators, the way he was talking even then, about inflation issues, about money supply issues, about fiat currency, about the value of free markets, the destructiveness of tariffs, and it was all straight up free market economics, but at a very high level, sprinkled in with quotations from all of the people. I've considered heroes in the free market economics, and actually just good economics literature. So Friedrich Hayek, Ludwig von Mises, Milton Friedman, and so on. So, in my estimation, he was very good.
And then, of course, he is quite a thespian. He's got a lot of energy, a lot of passion, and he always adds a significant amount of theater to his presentation. So he made for a compelling presentation with good visuals, good charts and so on. And the other two times were a mixture, and they were more recent. He was starting to become more significant on politics, and again, he would be making very good points about the economics, but then also speaking directly to the issues of just the bad economics, the corrupt economics, and then the other forms of political corruption that are endemic in the argentinian political scene.
In both cases, sorry, both of the more recent cases, the talks were very well received, and I found myself enjoying them as well. But I also met him a little bit personally, where we would talk, and I got the impression that he was actually shy socially. Once he's on stage, it's like he becomes alive and plugged in. Outside of that, he strikes me as a little shy, perhaps a little bit socially awkward in one on one meetings or small group meetings, but nonetheless well mannered and very interesting to talk to. The other thing that was also impressive to me was that he is, aside from being good on the straight economics issues, he has a strong normative component to him. And this is the thing that brings in the philosophy as well. So the issues of self responsibility, the importance of personal production, the importance of character, not being a victim, not being a parasite, all of those themes. And that it's not just charts and data that we need to do as economists and then as political economists, but we have to people who are bad, who are corrupt, they are bad people, and there are, in fact, evil people in politics.
And he does have the courage to name names and so forth. And on the same side that a healthy culture, a healthy economy requires character, it requires virtue.
And he speaks to those elements of, especially argentinian culture, that hold the Argentinians back. So that was my first remark. Just that strikes me as very proficient on the economics and as a compelling speaker, obviously has some strong theatrical elements. I don't know how much of it is Javier Ballet comes out in his true personality when he is public speaking and how much of it is calculated political theater. But he does know how to hold a room and hold one's attention and get his messages across.
[00:06:45] Speaker A: Yeah, I would add to that, Steven in looking at his biography, well, here's one example of the theater that kind of illustrates the biography. He was known for holding aloft a chainsaw at his rallies, depicting the idea that he's going to slash and cut the budget. And people just loved it. I don't think he actually revved up the thing. Too dangerous. But many pictures of Javier lay holding up a chainsaw and we're going to slash government and promising out of the 21 agencies to get rid of half of them. But his first executive order a couple of days ago was exactly that. How much they're actually disbanded, not sure. But we can talk about how and whether he can govern to the agenda he has set.
[00:07:36] Speaker C: Yeah, there were 21 cabinet positions and agencies and that was reduced to nine.
[00:07:42] Speaker A: Right.
[00:07:43] Speaker C: Although some of them get folded in.
[00:07:45] Speaker A: Right. But his background is interesting because I have found if you compare him to, as he is being compared to other so called right wing leaders who have emerged in recent decade or so, Bolsonaro in Brazil or Trump in America, Oban in Hungary and elsewhere, he's a very learned guy. He's not only read a lot of books and read the right people, but he's published books. He was a professor, so he got a phd and he was a professor. Then he became a pundit, kind of very active. This is the more theatrical part, a pundit on political and economic shows and just plenty of meat, of course, to attack the existing administrations, by the way, both right and left, for mismanagement, for the hyperinflation, for the corruption. And as you know, Steven, the whole history down there is, you have to do have a half a populist aspect to what you're arguing. And sometimes that can be anti capitalist. So I have noticed that his stance is more anti communist, anti socialist, anti corruption. Notice all the antis, rather than an explicit defense of capitalism. Capitalism still has a bad name down there, but he will use the word liberalism. And down there, as in Europe, liberalism means more liberty. And I understand that much of his support, he won the election 55 to 44 on November 19. So that's considered a landslide. That a lot of his support was from young men. So he is a kindoclastic in the sense of the way you described, but not only in his views, but in his, and, but yes, one on ones, if you want to look at anyone, want to look at the interview before he got elected with Tucker Carlson, who went down to Buenos Aires, that's just a one on one in a studio. And he's very sedate, but also very measured and very interesting in that interview, and it's philosophical and political. I just want to give you a flavor of it. I highly recommend it. It's about a 30 minutes interview, but here's an example of the way he talks. He says to Tucker, argentine's embrace of socialist ideas began with an idea that seems attractive, but is actually terrifying, a terrifying way to operate an economic system. The idea that where there is a need, there's a right.
It's a real problem, because there can be infinite needs, but someone also always has to pay for those rights. Now he goes on, now that's the kind of thing where socialism is the political analysis. He knows the economy is being wrecked, but notice his sensitivity to the underlying kind of moral premises that underlie it. That's a very integrated, synthesized thinker, I think. I believe.
What do you think, Steven? Do you agree?
[00:10:50] Speaker C: Yeah, I think so, very much. And Coral's point I want to make is you're talking about his personal background as published author, as professor, PhD, and so forth.
There is, behind the scenes here in Argentina, the work of a generation to lay some of the groundwork for someone like Javier Malay to rise in North America. We are familiar with the concept of the long march through the institutions and what the left very successfully did starting in the 1960s, to start laying the groundwork for institutional capture over the course of the next generations. There has been some of that in Argentina, but fighting a much harder battle, because the cultural framework is significantly different in Latin America compared to North America. But the intellectual lineage is almost striking. Ludwig von Mises was invited to come down to Argentina and give some lectures. Hayek was invited down.
Milton Friedman, more famously, was invited to Chile to come and give some lectures, basically saying to Pinocchet, don't be an economic dictator.
And the Chicago school, as well as the austrian school, have had significant influence on a tiny and very active group of thinkers and doers in Argentina and other places in Latin America, especially in Argentina and southern Brazil, I should also mention in Chile, but on a smaller scale as well. And one of the things that can be traced is, after Mises made his visit to Buenos Aires and gave his talks, the Argentines got together and raised money to send three young Argentinians. In this point, these were all like 18 to 20 year old kids, up to the United States. Then they said, what we need to do is send them to the United States, to places like Hillsdale or Grove City College, places that actually have some austrian school thinkers and so forth. And they did go up to the United States. They got their college education in the United States, became kind of true believer, austrian economists and neoclassical in the Milton Friedman Chicago school style, and came back to Argentina and started think tanks, started activist organizations, focused on entrepreneurship, on liberty, on progress, on Ayn Rand in particular, and then working with publishers down here to get Rand's books translated into Spanish, get Friedman's books, Hayek's books, MRS's books, all published into Spanish. All of this is happening in the 1980s, and it starts to bear fruit through the 1990s, through the 19, or on into the 2000s. Until just in this past generation, there have been four, pretty sizable and a number of other smaller organizations that are devoted to various aspects of liberty. So Javier Malay then is mixed in because he's a younger guy now, but he's coming up and mixing with all of these people.
You might then say it's a libertarian march through the institutions that's having a spectacular success now.
[00:14:36] Speaker A: Yeah. I want to mention also the center for the Study of Liberty in Buenos Aires was set up as far back as 1957 and was the source of some of these ideas at least, being held alive during some very bad periods. Those who know argentine history, they almost pretty much copied the US constitution in 1863, way back in 1863, and for about 50 years until roughly World War one, but a little bit beyond that, the 50 or 60 year period they call the golden years. Enormous prosperity, enormous wealth. They were almost totally laissez fair. Didn't even have a central bank till 19, 35, 20 years after the Fed. And if you just go online now and look for pictures of photos of Buenos Aires in 1929, it is shocking how beautiful and opulent.
[00:15:35] Speaker C: Yeah, it's a spectacularly beautiful city in its historical core. Even so, once you get outside of that, unfortunately, it starts to become just another standard latin american city pretty quickly. But to speak to Richard's historical point, the influence of the british classical liberals, specifically the british classical liberals, in the early part of the 18 hundreds was huge.
And it wasn't just that the British, in addition to the Italians and the Spanish and so on, but especially the British, were bringing over commercial know how, technical know how, industrial revolution and its products and so on. But it was, yes, largely a less a fair regime in the latter part of the 18 hundreds.
Some striking factors. If you look at the year 1910, one of the parallels that is often pointed out down here is compared Buenos Aires with Chicago in 1910. And by almost every demographic measure, they are identical. Population is about identical, both approaching less than a million people, but growing rapidly. Similar mix of ethnic groups, Italians and Germans and people from a variety of places, both agricultural centers. So Chicago being where all of the crops from the Midwest flow into, to go onto the lake, boats eventually to make their way to the eastern markets. And then overseas, the same thing. Buenos Aires taking everything that comes in from the pompous, and then many of the mineral resources as well. And then it has this beautiful natural harbor. So the point is that they were almost equal in wealth and every single demographic measure, including broad cultural philosophy and so on. But then over the course of the next 90 years, what happened is, of course, Chicago continued to go up and became a spectacular first world city. And Argentina went into very slow decline.
And the slopes of Chicago going up and the slopes of Argentina going down are almost mirror images of each other. In 1910, this is before World War I, Argentina was in the top ten richest nations in the world.
Amazing human resources, natural resources, everything going for it. And then disaster struck after World War I. But we can come back to that point.
[00:18:24] Speaker A: Yeah, and even to this day. As you know, Steven, if you say, if you think down there, I'm a Peronist, Juan Peron was basically the autocrat, fascist leaning leader 1st 1946 to 1955 or so, but then came back in the 70s. People may not realize this, but this terrible period for Argentina losing its liberalism between the 30s up until not until 1983, that's only 40 years ago that Argentina got back some semblance of democracy. So they're still a mess to some degree, but at least they got out of the military dictatorship kind of autocracy of those years. People will remember the famous musical Evita. Evita Perrone was the second wife of Juan Peron. So the fact that people, leaders in Argentina to this day, still unabashedly call themselves Peronists or that there's referrals to Peronism is really quite interesting. So they're not necessarily ashamed of that past. Nobody in Italy is running around calling themselves Mussoliniists.
So that is kind of interesting. And that is also, we should know what Malay is kind of fighting against.
[00:19:43] Speaker C: Yeah, that's well said. I want to actually upgrade your phrase fascist leaning, because in the, when Peron came to power, he was just straight up fascist admired leaning. Yeah, that's right. Admired Mussolini. And when they rewrote the code, they borrowed and in some cases just directly copied the fascist constitution that Mussolini had put in place in Italy. So it was intended to be a fascist copy country. And even to this day, significant parts of that code are still on the book. So if you look at the labor code, for example, it's almost copied word for word from what was in place in Italy in the 1920s. Now partly the ideological story is important there, but also there is a certain amount of political captured by that, by that political party that's made it very hard for other political parties to get much traction. They've been able to institute barriers to entry, so to speak, politically. So there are other parties kicking around, but they can't get onto the stage very easily. The paronists have a political monopoly even if they've drifted from their pure fascist roots.
[00:21:21] Speaker A: Yeah, I think one of the reasons I refer to fascist leaning, if you look at what millet is doing today, or is it melee? How does it pronounce? Stephen, is it of the notice? One of the things he's proposing, one of the things he's trying to do, one of the things he campaigned on was privatization. And to the extent things are nationalized and they have been nationalized down there and he wants to privatize them, that leans on the more socialist direction, less fascist direction. So I don't know. I interpret as I look at their system over the post World War II period, it seems a mix of the two, that they are willing to nationalize things which the socialists would like, but they have these militaristic aspects to them and controlling business and what academia calls corporatism, the source of corruption that he's trying to fight. And it's also interesting that when he in interviews and writings describes the disease down there, the political disease down there, he almost never does say fascism, he always does say socialism. And yet he must know that it's really a mix of the two. But I don't want to get into semantics here, but the privatization plank of his program is really going against the socialist arguments, less so. Right.
[00:22:37] Speaker C: And I don't know if in Malay's conceptualization, if he has fascism as a subset of socialism or if he wants to put them on, categorize them differently.
Anyway, there is a kind of just delicious irony about how outside of Argentina, all of the people who are upset with Malays being elected to power, all the people who have been saying loudly for years that they are anti fascist are very upset that a fascist inspired regime got kicked out of power.
[00:23:22] Speaker A: That's very good.
If we're going to stay with philosophy a little more before we go into politics and economics, I'm curious, Steven, what you think.
I think the last time I checked, maybe 70 75% of Argentines are Catholic. It's very interesting that Malay has been critical of the pope. Now the pope is from Argentina. So Francis, so that's I think 2013 he ascended to that position and Malay has been unvarnished in his criticism of the pope. He calls him a leftist. He calls him an apologist for the Castros, an apologist for Madeiro and Venezuela.
I don't know, I guess they used to call it liberation theology. Stephen, down there, the unity of Marx and Jesus. I find it very interesting that he campaigned and is known for being critical of the pope, but because the pope leans left or say is sympathetic with environmentalism, Malay is a very strong critic of environmentalism, thinks it's Marxism hiding. Once the Soviets failed, he says they moved into the green critique. So I think it's a very subtle recognition that environmentalism is Marxism wrapped up. But the critique of the pope is very interesting and yet he wants to reverse the 2020 decriminalization of abortion down there. So Argentina only recently said abortion is okay and he's actually against abortion rights. Have you noticed?
[00:25:01] Speaker C: Yeah, I'll come back to that specific issue in a bit.
[00:25:05] Speaker A: Okay.
[00:25:06] Speaker C: Go back to your point about the philosophy, the catholicism versus the socialism and so forth. There's a very common pattern in Latin America. When I traveled around.
The intellectual culture is narrower than the intellectual culture in North America, the one that you're more familiar with. And when you think about how difficult it is for us in North America to get people who are left liberals and right conservatives to realize that not everything is a two way argument, that there are third possible political alternatives, that's an uphill battle for us in North America. It's much, much more difficult, almost impossible in much of Latin America. And I think that in part explains its oscillation politically between usually very left leaning. Often these are just warmed over 60s radicals on the left who were former just straight up Marxists, very strong socialists of a close fellow traveler version who now may have adopted some postmodern elements. And that's a huge intellectual cultural block all over Latin America, but especially in Argentina and Brazil, which are the most intellectual of the latin american nations. And the only strong opposition that people see to that approach is you mentioned the Catholicism. But the Catholicism typically means a kind of conservatism. It's not necessarily just a political conservatism, but a cultural conservatism. And that will include more respect for religion, a position on abortion issues, whether girls should go to school or whether they should strive to be more homemakers. But also the conservative element typically sees the left side as more anarchic, more revolutionary, more tending to violence. And so their answer to that is to say that we need to have order. And the place we get order is by forming a strong political alliance with the military. So typically, the religious, conservative, cultural, intellectual, political bloc is also working very closely with the military. And so the oscillation will then be that the leftists will rise up and do their violence and subterfuge, and sometimes they will get into power, and then there will be a swing to the other side. But the only other side that people see is the military. And so there will be a military pooch and a kind of military dictatorship that tries to take the nation back in a more religious, conservative direction. And almost nowhere in the last 80 years do you find what we would think of as classical liberals, much less libertarians.
When I started coming down here to lecture frequently, I would do the usual nerd thing of going to the bookstores. I would go to the philosophy section, since that's my home section. And the thing that would strike me is that you would find in the philosophy sections in the bookstores, all of the standard left wing authors, Karl Marx, Rousseau, all of the schools of neomarxism, Frankfurt school is represented. All of the postmoderns are there, 100% of all of the major authors, and all of the books are there. And then you will find a significant number of catholic conservative intellectuals from the 20th century. So they are all there. But you will not find a single book by John Locke, Adam Smith, John Stuart Mill, and certainly not in the Fosse section. Anyone like mine, Rand. So the classical liberal tradition and more broadly, the british enlightenment tradition is just not in the intellectual culture. It's not even taught in the universities. These are just kind of, if you're an educated person, of course, you've heard of John Locke, but you've never actually read him. So the culture is, in that sense, impoverished. So a lot of extraordinarily smart people among the intellectual culture, but only partially educated, and that plays out very strongly in the politics.
[00:29:45] Speaker A: Very interesting. I read a background piece on the influences in Argentina on this. And to the extent catholic, to the extent more influenced by french than british, because the British are protestant and the French are catholic. But the argument, Stephen, was that therefore Argentina got more Rousseau and less Locke. And we know what Rousseau leads to. Rousseau was much more inclined to lead to collectivism and socialism and other things where Locke would not.
It also interests me. I have seen this interests me, Stephen, because it's also a catholic connection that years ago, when I wrote for Forbes, I wrote a piece on holy scripture. It was called holy scripture and the welfare state, just the relationship between the ideas. And I found that the concept of social justice, social justice itself as a concept know plano aristotelian justice, which malay criticizes very distinctly and in depth, was originated by a jesuit in the 1840s, Luigi Taparelli. So there's a italian catholic origin based on Thomas Aquina by the way, who's otherwise a perfectly decent aristotelian, but a fellow named Luigi Taparelli, if you look it up, the Jesuit 1840s came up with the concept of social justice and his argument was that plain old doesn't entail enough mercy. But if you listen to Malay's critique of social justice, I think he gets it indirectly from Hayek. By the way, Hayek did the social justice. He called it social justice, the mirage, a fake thing. He says it's the opposite of justice. So that is also interesting because Malay, being catholic, being in a catholic country, maybe he has to be delicate about these things, but the very thing he's kind of fighting, he may realize that it has some catholic origins to it. It's not the Marxists who came up with social justice, it's the Catholics.
[00:31:52] Speaker C: Yeah, absolutely right.
So maybe we could start transitioning to either economics or politics. And one of the other topics I have to talk through and get some remarks on is what Malays priorities are likely to be.
So you mentioned the abortion issue and then of course there's always 40 or 50 issues on the table at a given time.
My strong sense is that the economy is going to be number one. It's not only that he speaks to his strengths there, but that is almost universally inside Argentina. The issue that everyone says people need to attend to.
Most of his energy will be directed toward those economic reforms. Is that your sense, Richard?
[00:32:49] Speaker A: I totally agree with that, Stephen, yes, and he campaigned on that. And the other way you notice this is as it gets closer to election time, which is November 19, he would deemphasize the other more extraneous what we consider to the more extraneous social issues. For example, he has a very kind of libertarian take on people should be able to buy and sell human organs, doesn't want people standing in line in the sense of organ translation. Now it's a very radical view. It's been in libertarian circles for a long time, but Argentinians kind of cringe at that. And the abortion issue, I think he wants to deregulate drug use as well. Those things he said early on, but it diminished his discussion of them as the election neared. And so if the three categories are economic, social, and then third would be foreign policy, which there is an element of that, definitely economic. And I think he knows, and I think he was elected on the grounds of knowing that unless he gets rid of the hyperinflation, nothing else is possible. So they have an inflation there now of 100 and 4150 percent a year. It's huge. They've had hyperinflations in the past.
They have had cases in the 1990s where they put an end to it by severely restricting what the central bank can do. But he is proposing that. He is proposing actually an end to the central bank. I'm not sure he's going to get that, but he's also proposing something. We don't have to get into the technics of it. Stephen, I just wanted to put it on the record. He is advocating something called dollarization. And it's very.
Because dollarization literally means stop issuing pesos locally, stop issuing the argentine currency, which is losing value by the minute, and adopt the dollar. Now that sounds odd to people. I mean, the US dollar, that sounds od to people. Until you realize that, and you may know this, Stephen, you may see it tangibly. Dollars do exchange on the streets of Buenos Aires and elsewhere, because that's the common practice.
[00:34:59] Speaker C: Nobody uses their foreign credit card when they're in the country unless they're stupid.
[00:35:06] Speaker A: Right?
[00:35:07] Speaker C: I know, and everybody gets the advice. Now, when I started coming to Argentina, my first speaking trip down here was in 2010. The official us dollar to peso exchange rate was 16 pesos to the dollar. But pretty much any busy street you would walk down, there would be guys saying, cambio, cambio, cambio.
The unofficial rate then was 35 pesos to the dollar.
[00:35:29] Speaker A: Right?
[00:35:30] Speaker C: So to the extent that the official rate, or overstating the value of the peso by more than 50% was a problem. But then every trip that came down after that, it had doubled more than us. And currently on the black market, you can get around 950 pesos per dollar, and that's over, what, ten or twelve years or so? The inflation is terrible. Nobody here uses or tries to get paid in pesos if they can get away with not getting paid in pesos. And if you have dollars, you can live like a king. And so the dollarization is almost a step toward what is de facto currency. Yes, I'm just making it jour.
[00:36:25] Speaker A: That's a really good distinction. And for those of you who don't know, there have been three or four cases down there. Not just down there, but in the rest of the world, in South America. Ecuador. Well, the earliest one, Panama, has used the dollar for many, many years, decades. Ecuador, El Salvador. So he's not pulling this out of his hat again. A version of this, as I said, was tried in the 1990s, and it totally eradicated hyperinflation overnight. And Argentina really did prosper in the 90s, unfortunately. We can talk later why they abandoned that. That was abandoned at the end of the century to great harm. But Milet at least can look to, if anyone has memories of that and say to people, we did do this in the 1990s, it's not impossible for us to fix the currency. So I think that helped him in the election, for him to say, listen, this hyperinflation is awful. It's wrecking your standard of living. It's making business calculations and investment impossible. I'm going to dollarize. It's a very radical view down there. It's a controversial view, because the minute you say dollar, they think of America. Like, why we be tied to America and any kind of anti americanism, any kind, know, the gringos, that kind of thing, that kind of bias and prejudice, they feel he has to fight that. He has to overcome that. But people really down there do love the dollar relative to the peso. It's unbelievable for Americans to believe this because they themselves are suffering under, say, a five or six or eight or 9% inflation. But.
[00:38:05] Speaker C: I'll give you one example. This is from just actually lunch today when we arrived in Buenos Aires. Our server is a guy somewhere in his sixty s, and he told us that he had been working his entire life, and a certain amount of his paycheck goes into the government scheme, pension scheme, which is being inflated away. And after 40 years of work, because of the ravages of inflation, his monthly pension is worth about $100 per month.
[00:38:41] Speaker A: Wow. Yeah.
[00:38:42] Speaker C: So that's just thievery by two generations of politicians. So I don't know how intelligent or well educated this guy is, but he knows exactly what the politicians have done to him.
[00:38:55] Speaker A: Yeah.
So that's number one on his agenda. My interpretation of this has been one. It's been done before. It's not completely the idea, never been tried before. If he does it, that would be spectacular. I think it would take upwards of six months to a year. I think the longer takes doing any of this, the worse it is, because they are just. The fangs are out. The opposition, including a foreign opposition, IMF. They owe IMF a lot of money, and the IMF doesn't want any part of Malay's project. So that's a thing dealing with as well. But I think if he stabilizes the currency really by substituting the dollar for the currency, that would be an enormous thing. And then he could do these other things. Now number two on his agenda is get rid of these government agencies, which he's begun to do. The question is whether that will reduce government spending. He says, now this is a huge number. I checked and found that argentine federal spending, government spending is something like 35% of GDP. That's about twice what it is in the US. It's huge. And he says he wants to cut it by 15 percentage points. That means he would bring it down from 35 of percent of GDP down to 20.
That is huge. I think it would be an enormously positive thing for the economy. But I have to say every economist, almost every economist in the world would say that that would be terrible because the keynesian view is that the more a government spends, the more it stimulates the economy. Well, here's Malay saying I want to reduce government spending from 35% of GDP to 21% of GDP. And that's going to be hard for him to do, by the way.
Well, I won't go to the politics, I'll just stick with the economics for now. The other one is privatization. There are in energy, in utilities, in rail and other things. There are government owned things that he's saying we should privatize this national airline and the airline as well. Right? There's some other things. But here the argument, standard argument just from Thatcher in Britain, it worked in the 80s. Listen, these things are a burden on government. They're badly run, they're sucking the budget dry. And if we convert them to private ownership, not only will they be more efficient and make money, they would actually turn around and start paying taxes to the government. So it would solve the budget deficit problem, which itself is the origin of the money problem. See, the sequencing is they spend too much money, they don't raise enough taxes, they have to borrow. They turn to the central bank, they ask the central bank to print money. I mean, this is the origin of the inflation problem. So if you back up just a few steps, you realize that part of his plan to fix the currency has to involve a return to some kind of fiscal integrity, which means trying to reduce budget deficit. And thankfully, as a free market economist not coming in and I'm going to narrow the budget deficit by raising taxes on the rich. Not doing that, he's saying, no, I'm going to drastically cut government spending. And he won the election with that, which is really quite amazing.
[00:42:19] Speaker C: Have you seen his proposals with respect to tariffs? Right now, one of the big problems in Argentina is import export. Export is easier. Import is very expensive. Things like personal electronics, iPhones or Samsung's or tvs typically are two to three times as much once you pay the import taxes down here.
[00:42:43] Speaker A: Yeah, it's long been known as it's an exporter of commodities like soybeans, and they're dominant in soybeans and an importer of capital equipment and technology. Yeah, I learned that he is much more of a free trader than is Trump, which is interesting. So from the standpoint of lining him up with the other right leaning leaders, he's very for free.
So the difficulty he'll have, though, is if he's going to dollarize Argentina, there's going to have to be a flow of dollars into Argentina. He can't just start printing dollars on his own. He has to find a way. He has to set up a situation where dollars want to go to Argentina because it trusts Argentina more, whereas there's been capital flight under the socialists and fascists. So that's a tricky thing for him because he wants free trade, but he wants to make sure ports still exceed imports. So that's more of a technical issue. We can leave that aside for now, but definitely to be classified as more of a free trader. I don't think he has, Stephen, the kind of issues that Orbon and others in Europe have regarding refugees, refugees are not.
I don't think this is true.
Fleeing into Buenos Aires, in a sense, where he'd be like, xenophobic or anything like that, that just hasn't come up.
[00:44:08] Speaker C: So that's not down here. That issue exists, but it's much smaller.
As bad as things are in Argentina and Brazil, they still, in Chile, they still are the great success cases compared to Bolivia, compared to Venezuela, obviously.
And there has been, when things are terrible in some of the other countries, an influx of people, and there have been some social frictions, but it's been relatively minor.
[00:44:42] Speaker A: Yeah, I think you mentioned others around mean, it'll become very interesting because Venezuela, we know, is heavily, heavily socialist and really in decadence.
And Brazil has waffled in between right leaning Bolsonara and back to Lulu, and Malay himself has been a big critic of Lulu. So you get like three huge countries down there with enormous natural resources, Argentina, Venezuela and Brazil. And they're all trying. Very different on the political spectrum, Stephen, very different political mean, I don't know how long Malay will last. We can talk about that later. But the fact that different experiments are going on just interests me as a. Yeah, yeah.
[00:45:34] Speaker C: You mentioned Lula in Brazil, who's now back in power after going to prison for.
Right. And there's been a history of that in Latin America, or all kinds of corruption. People go to prison, but then they just get cycled back into the system and into power fairly shortly after.
I know one of the issues on their minds, but I don't know how much of a priority is this issue of corruption. One of the huge differences between North America, Europe and Latin America is the degree of toleration of corruption. So we have corruption in North America, corruption in Europe and Canada, where I'm from.
[00:46:23] Speaker A: Right.
[00:46:23] Speaker C: And so forth. But in a way, we have baby corruption, and when corruption occurs, we are scandalized by it. Now, we all will say, oh, yeah, it's politics, and politics is corrupt and stuff, but we still are moralists about corruption. One of the things that is striking about Latin America is how normalized corruption is.
And there's almost as long as I've been coming down here, and at least this might be my limited travel circles, a sense that that's just the way it is. And so some scandal emerges, and there's not an outrage about it, and that this is intolerable. It's. Right. Well, what do you expect? And there's also large subcultures, a kind of sneaking admiration for the person who can pull off a con, including a political con, and get away with it.
So there is that part of the political culture. And one of my big questions in the case of Malay is, since he does speak the moral language quite frequently about personal responsibility and attacks corruption, how high a priority that will be in his administration. I mean, obviously, making sure that his own administration is squeaky clean, or at least squeaky wooden by argentinian standards, but also going those further steps of reeducating people to say, no, look, corruption is abnormal, it's wrong. We should not be tolerating, and you should not be tolerating it, however long he's in office for, by the time he leaves, that cultural attitude has shifted for the positive.
[00:48:16] Speaker A: That's really interesting, Stephen, the way that distinction you make between, what did you call it? Baby level infantile corruption. Yeah, I like that. Studies.
[00:48:26] Speaker C: I can remember just being in Canada, like, two years ago, and everybody in Canada was talking about some senators who'd padded their expense accounts.
You don't realize how good you have it until you realize the kind of scandals that occupy people. But a related point on this is that another good sign with respect to Malay is that another pathological part of latin american politics, including argentinian politics, has been the cycle of revenge. So your party is out of power, and because you're out of power you get persecuted in various ways. And what you do when you get in power is you get your revenge in various ways. And what I've seen so far is Malay is making a point of saying that he's not going to go after the previous generations of politicians, the ones who are still kicking around and make a point of putting them on trial and so forth.
What we need to do is focus on building the future, not vendetta, and trying to keep the nasty past history in everybody's consciousness. And I think that's a very healthy sign if he can stick to that.
[00:49:46] Speaker A: I've noticed the same thing, Stephen, and I endorse your interpretation of it entirely. It must take a certain amount of discipline for him to do that. I'll tell you something else I do notice in his approach to corruption, because he might be aware that studies have been done instead of just saying, well, someone's on the take and it's a cultural thing and we're this way and that way. We grease the skids and they don't. Studies have been done, then this wouldn't surprise this audience, but that exactly the extent to which government intervenes in the economy. And in other words, and this can be measured with the metrics of a mixed economy or not, the more corruption you get. And there are metrics on corruption. There's corruption indices put out by Transparency International, I think. And so I looked at Argentina and then there's a direct correlation between. And the causal arrow, of course, is the more government intervenes, the more it deflects and diverts wealth from one pocket to another. It's going to invite bribery, it's going to invite corruption. And I've noticed that Malay, although he doesn't emphasize this a lot, I think that's his view of it. I don't think his view of it is know as Argentines, I guess we're just corrupt. Let's try to be better people. Let's try to be better Catholics. I think he realizes that if he's able to restrain government intervention in the economy, that corruption thereby will diminish to some degree. So I just wanted to bring that to bear. It's kind of a different angle to this that might be explained why he's not going the revenge route.
Not to mention he's not really surrounded by a bunch of libertarians. I mean, he comes into this as a neophyte in the sense of having not had any government experience at all. So anyone he hires as cabinet ministers or helpers, anyone he deals with in the legislature, are going to be from the other parties that have demonstrated corruption already. So it's a delicate thing.
[00:51:51] Speaker C: Yeah, I think that's nicely said. I think I can open up a road for us to get back to the abortion issue in particular. So you mentioned that he is a neophyte.
And so one of the great challenges that he is going to face is suddenly he is the president. But he doesn't have the years in the trenches of knowing how the day to day administration of government goes practically. So either he's going to have to get up the learning curve very quickly or he's going to have to rely on people who have been in power. The people who have been in power, of course, are largely from the other parties.
And that has meant that already he has been forced into that might be too strong a word to form a coalition in order to maintain his power, even though he did get a huge mandate. Nonetheless, his party is just not big enough to be able to fill all the offices with any level of professionalism and competence. So this was apparent, though, even during the election campaign, where he's trying to build his coalition up in order to attract enough voting blocs.
That partly then meant was that he would form coalitions or agreements of varying degrees of strength with people who are not libertarian. The closest place we're going to get people who are not peronist or left socialist fascist types, people who are conservative leaning, sometimes more strongly conservative leaning. Now, on the abortion issue in particular, if we put that in the whole broader category of social issues, what do you think about things like gambling? What do you think about gay sex and gay marriage? What do you think about drugs, prostitution?
All of that Malay has consistently libertarian views and organ sales. You mentioned earlier on pretty much all of those things. So in one sense, abortion is a bit of an outlier on that. So it is a question in my mind because I've never talked with him about this issue in particular, whether the fact that he put that out publicly during the lead up to the election was politics or personal conviction.
So that's an open question to interview.
[00:54:27] Speaker A: There is a five minute segment in the interview with Tucker in October where this comes up, and you can see why Tucker would be interested in this. And he does seem to have a philosophical, his philosophic argument goes something like, it's a life. He actually refers to child in the womb, which is a contradiction, but he actually thinks it's murder. So I'm not sure that this is posing. So he has the pope critique, but then he feels like he has to offset the anti abortion. I think he fundamentally philosophically believes it's murder, so we could set that aside. I don't think he really realized that.
[00:55:07] Speaker C: May very well be right. And then the follow up question would then be, how high in the list of priorities would this be?
After economy, after reducing the bureaucracy, perhaps some foreign policy issues. I've got a couple of others to consider, particularly since he knows the country did go through a big battle over the abortion issue just a few years ago, and he knows that the country is largely divided. So he might also be thinking, as a politician, I don't want to alienate a huge portion of the vote that I just spent a lot of time getting.
[00:55:46] Speaker A: I think it's low on the list, and I think the organ sales thing as well. They took polls on that in Argentina. I think 10% of the people agreed with it. By the way, Steven, just to put metrics on what support he might or might not have, the numbers are in the House, which is the broader chamber. Down there. He has only 15% of the seats. He has 38 out of 257 in his party. In the Senate, which has only 72 seats, he's got eight. So the way to summarize this is that Malay's party, which is called, I think it's called liberty advances or liberty advancement. I don't know the translation, but it's got liberty in the name. At least. He's not a conservative. They have basically ten to 15% of the seats. Now in this parliamentary system, you need more than that to get your agenda passed. Well, there is a formidable center right group called Together for Change, and they were actually in power from 2015 to 2019. Mauricio McCree.
Mauricio McCree and his group did support Malay. So at least in the bigger house, if you add that group to Malay, they get something like 50%. It's not true in the Senate. So at some point, he's going to have to bring in peronists or however they're called. So we could talk about that. But just so people knew the numbers. I think it's very interesting, Steven, because even though from our side of the philosophy and political spectrum, we would cheer on any kind of pro liberty libertarian, it is true that libertarians have a long history of so distrusting the state that they don't participate in the state, they don't feel it's proper to be part of the process. And then the difficulty and paradox is, if you're elected, you have no bank, you have no team with credentials, with a history of governing. And it's kind of paradoxical, isn't it? You win this election, but then you're kind of stuck with, well, who is going to help me?
Who actually agrees with dilemma?
[00:58:02] Speaker C: Yes. So tomorrow I'm giving a talk here in Buenos Aires, and I'm going to be speaking to that issue in a slightly abstract and philosophical form. But on the list of priorities, after economy, bureaucracy reduction, education, I know is pretty high up there.
As much as we complain about how terrible our public education system is in the US and Canada and some other places, it's amazingly good compared to the argentinian one.
That would be hard for Americans to believe.
The amount of outspoken propaganda indoctrination in the textbooks, it's shameful. So there are a lot of overlapping issues here about privatizing education as a possibility. School vouchers is very high on the list of policy reforms that they are considering, bringing some competition then into the schools, empowering parents and getting them back in the loop and so forth. But if we combine this issue of education, which is always to be looking to the future, to the medium term and the future term, the kids who are now just starting school, what are they going to learn in the next ten or 15 years before they become the adults who are doing everything that adult Argentinians do, running the businesses, going into politics and so forth.
If their minds are not changed from the same old same old that Argentinians have been taught for generations, then Malay will be flash in the pan, and he knows it. So in one sense, the gridlock that you are talking about, and there are formidable forces that will be lined up to try to stop everything that he can do, plus his own challenges of overcoming the inexperience and the small team, to be able to get things done in the shorter term.
Perhaps his most important legacy could be whenever he leaves office, whether it's in four years or if he gets reelected and it's eight years, what can he do to change the educational culture of Argentina?
And here I'm partly hopeful because in a way, he is such a good communicator.
He lays out numbers. He says, this is the bad number, this is the good number. So he's very honest with people, and he has a way of talking to people in a way that not only gets them to listen, but makes a point in a very vivid fashion. So if you can do that effectively for the next four years, then at least people will be aware of a huge number of facts that they were not aware of before, and they will have better economic thinking, and they will be having the kinds of economic debates that will serve them well. And if that can go hand in hand with some sort of education reform of the schools, privatization, vouchers and so forth, then that might be the most important legacy from Malay.
[01:01:28] Speaker A: I like that. And beyond just the facts of laying out the facts of this is how markets work. I think deeper the more he in his arguments, the more he cites the great thinkers like Mises Hayek, Rand Buchanan, Nozak and Friedman as he's want to do. He does do that.
That alone, Steven, would elevate people would start saying, who is this mises guy? Who is this Hayek guy? Who is this Hayek guy?
I know his job is not to know, head tutor for the population, but the fact that he's very good about sprinkling his answers with citations of this kind, beyond just the fact, I think that alone might be very interesting. Now I have a question for you, Steven. You know the whole Chicago boys in Chile story.
Do you think it's possible, even legal? I don't know. You may know down locally, is it possible for him to overcome this dearth of argentinian libertarians in his cabinet and elsewhere by inviting down, I don't want to say down or over or upward, whatever, libertarian economists, advisors, ex cabinet officials from the rest of the world to descend upon, you know what I'm saying? From Cato, from Britain, from Britain, from all these Atlas foundation think tanks that have been established over the years, which I assume he's connected to, and you speak before these groups, is that possible that he could somehow, and is it allowed in Argentina that he could do that? Just bring in people from all over the world because he doesn't find them locally?
[01:03:23] Speaker C: Well, I know that at least informally that has happened, and it will happen increasingly now. So you're saying he mentions mises, and then 10,000 young people who said, I've never heard of this guy, go out and look up mises on Wikipedia or whatever, or the same thing with respect to rand.
But there is a well oiled mechanism internationally of politicians bringing in various sorts of expertise from other countries when they think it's desirable to do so. And I do know that some of the think tanks and activist organizations already here in Buenos Aires, there is Aynran Center, Latin America. They are here. They started in Buenos Aires, there is liberty and progress, and they are misian and hayekian and so on. So they are well positioned to capitalize and they are connected to people who are connected to people.
All of that is going to happen anyway. So whenever Malay mentions mises, then they'll be ready to say, and here on their YouTube channels or whatever their venues are, here's what you need to know about Mises. And the same thing for the rand groups.
[01:04:42] Speaker A: Yeah. And of course, those groups would have a high self interest in seeing this experiment work and last more than four years. It isn't just four years. I mean, there have been cases where radical like this don't even last out their term because the knives are out for this. So. But it would be in the self interest of these other groups. Right, Steven, to say we have a success story in Argentina. Look at this.
[01:05:14] Speaker C: Yeah, they're well aware of that. And they explicitly see themselves. We are in the cultural education business, and this is our moment.
[01:05:23] Speaker A: Great. Wow.
[01:05:26] Speaker B: I do want to at least invite people to ask questions. This is a great conversation.
Let me ask quickly on the flip side, what about the argument that Malay is now a representative for the liberty movement, whether we like it or not? And if he fails, it's now going to set back the liberty movement for a generation.
[01:05:51] Speaker A: I have a thought on that. Steven, go ahead.
Okay. I want to hear your views as well, Scott. I think the best way to handle this would be to put him in a broader context, as even the critics are doing in trying to compare and contrast him to others that our enemies would call right wing extremists or whatever they call them. So I think it's very interesting to start comparing and contrasting. Well, is this a south american movement? Is this a global movement? How does he relate to Bolsonara in Brazil? How does he relate to Trump in America? What are the arguments? How do they differ? How does he relate to Viktor Orban in Hungary? How does he relate to, is it Molinari and I forget her name in Italy, but she's a right leaning new prime minister in Italy. They all have varying emphasis. Right. If we wrapped it up in a package that said, there seems to be some kind of right movement, right wing, I hate to call it that movement, globally. And if we start distinguishing the healthy ones from the less healthy ones, we're able to distinguish our case more. So it's not just hinging on Malay, it's, wow, Malay is part of a broader pattern, and maybe the socialists and fascists are on their heels. And let's contrast and compare and see what the best arguments are and the best administrations are. That would be my reaction. We should broaden the discussion.
[01:07:23] Speaker C: Yeah, I think that's a useful thing to do and there'll be a lot of work to be done in all of those comparison contrasts.
To come back to Scott's question more specifically, I don't see that if Malay fails that there's any net loss here. I only see an upside because then whatever amount of cultural education he gets done, whatever amount of political actual reform he gets done, all of that is net plus. I think everybody who does politics is savvy enough to know that of course he's going to lose in the next election or the next two elections, because that's just how things always go, and that's just politics as usual. The thing I would worry more about is he is a volatile personality.
And in some ways it's not just theater.
It is a part of who he is. And I think there is some indication that he's going to become more dignified and more statesman like. But in the past ten years lead up to all of this, he can be, and has been quite crude.
In my estimation, quite badly crude in the language that he uses, his willingness to engage in ad hominem attacks on people and so forth.
There may be that there are character flaws, that when the pressure of office is on him, becomes too much for him. And if he has some sort of a character meltdown, then of course that will set up for at least some very bad public relations for libertarianism. If he is the poster child for libertarianism around the world. Yeah, they are people like crazy or crude people of bad character. So that to me again, is just an open question.
[01:09:47] Speaker A: Great answer. Really good. Yeah, great answer.
[01:09:49] Speaker B: Steven, let's go to Fountainhead Forum. Thanks for joining us.
[01:09:55] Speaker D: Hey, Scott, thanks for letting me know about this. I've had my 27 people on my podcast talking about melee.
He seems maybe like a version of Johnny Cash.
Maybe we just need more lead singers in our movement. But also some other things I wanted to bring up.
They lowered the voting age to 16. He went out and got the youth vote. Also, as another one of my guests pointed out, a lot of venezuelan immigrants were actually helping me lay because they said, we don't want another Venezuela.
Maybe I go over the top with this, but I've said this could be the most important election in the history of the world.
It really could be that big. And if nothing else, we need to learn something from. This is how to market ourselves. Milet made himself.
[01:10:51] Speaker A: Cool.
[01:10:52] Speaker D: And our movement has a lot of nerds. And how do we get more rock singers? How do we get more personalities like that, I think is the question we need to ask. And I'd love to hear Steven is there. I'd love to hear from you and of know. So thanks. Yeah, it's been a great talk.
[01:11:09] Speaker C: Okay.
Well, yeah, I think political theater is important, so he's clearly a master of it, or at least of a certain style of it. So to that extent, I'm fine with anybody who can hold an audience's attention when he's talking about economic matters and policy matters and make the points that need to be made clearly so the average person in the streets all over Argentina can understand it.
That's very good. So, yeah, we do need more rock stars, people, to make libertarianism sexy.
[01:11:52] Speaker A: Yeah. The other thing I noticed, Stephen, is apropos, say, comparing back to comparing and contrasting. Unlike Trump, who is prone to ad hominem and can be quite undisciplined on the stage or in open forum and not reading a speech, I don't see Malay quite that way. So I think the theatrics are chosen or well chosen. It's not like he's losing his mind in the middle of a debate. He's very pugnacious, but intellectually pugnacious. And I see a kind of moral certitude where you could see it on his face when he's, like, facing a socialist or even a pope.
It's like he really believes, these people are bad for me, these people are bad for human well being. These people, they know what socialism is and they're advocating anyway, and he gets angry. But he gets angry in a way that you and I might get angry. What is wrong with these people? I'm sick of these people. But there's some substance to it and there's some depth to it. I like. And the moral certitude is so crucial because we know that the brazenness of those on the left and those who are anti reason and anti capitalism, they're almost brazen about it, and we seem to lack that on the right. This kind of moral certitude that uniquely Ayn Rand gave because she gave this moral case for know, whereas the conservatives would be know, kind of apologetic be, I guess we should be for capitalism, but it is kind of selfish and doesn't really emphasize the family, and we know that hasn't worked. And he's unique in that regard.
I wonder what you think of that take.
[01:13:35] Speaker C: Yeah, I like that I just wanted to add to the moral certitude, the fact certitude, aside from who, who controls the moral high ground, which is so important in culture and politics as we know, we live in a rather skeptical, relativistic, postmodern age. And so to have someone who comes along and says this is a fact, it's real. And also to Argentinians, we cannot stick our heads like ostriches in the san of ostriches actually do this, but we cannot blind ourselves to reality anymore. We have to face the facts. It is going to be painful. This is what we are going to do. We to put numbers and charts and make certain commitments. So the moral certitude combined with the fact certitude are both very important.
[01:14:31] Speaker A: Yeah.
And not to double back to the point about the argument on corruption relevant here, he is very good at hammering home the necessity of equality before the law. In the Tucker interview, specifically, he's asked about this ministry for women, and the answer is brilliant because he basically says women have rights just like men do. We don't need a separate ministry for women. How come there's not a ministry for men? We need to have equality before the law. And he actually says, this is very profound. He gets this. He says when we redistribute wealth or demand that everyone be equal in result, we necessarily have to treat them unequally in the law to get there. And that's the source of our corruption. I mean, that is amazing. That is an amazing insight. And so the whole concept of objectivity, the rule of law, treat people the same way.
He has a certitude about that. Really, that helps the argument. But apropos the questioner, I think the questioner was kind of saying, when he said we, I think he kind of meant we as libertarians. And in many ways this is new stuff to libertarians and especially those who call themselves anarcho capitalists, because an anarcho really doesn't want any government. So they're stuck with the idea, well, now you're running the government. What are you going to do? And we know libertarians focused on politics do want to see political change occur. So this is a key moment. I mean, he mentioned this is an important moment. I'm not sure it's the most important election of the last 50 years, but it's important to the libertarian movement in the sense that they really do have to show that they can govern, that they don't assume every state is necessarily statist. The argentinian state right now is statist. But the job is to make it less so, to go in the right direction. And that isn't really a project that the libertarians have focused on. Their view has been less a fair or nothing, less a fair or bust. But you need to know how to go from point b back to point to actually execute the change. And that's the challenge here. That's what he's trying to do.
[01:16:46] Speaker B: Great point.
Well, let's go to BJ with the time we have left.
[01:16:53] Speaker C: Hey, everybody.
[01:16:54] Speaker E: Steven, good to talk to you again. I feel like I did this a couple of days ago.
[01:16:59] Speaker C: Hey, Mr. Dickter, good to see you. I hear you.
[01:17:03] Speaker E: Good to talk to you too. I'm very happy to hear you on spaces. This is absolutely fascinating. Hopefully you'll do more of it. Just a couple of the the difference in perspective on corruption in Latin America and North America. Well, a perfect example is when we had all our bank accounts frozen in Canada because of the trucker protest.
Everybody still, when I travel all over, doesn't matter if it's El Salvador or the United Kingdom, people are still shocked that that happened. Yet two months after, when the brazilian truckers had their bank accounts frozen in the exact same way. Their attitude is like, yeah, of course that's what the government would do. Why would we be surprised? And they just seem to be accepting.
But I wanted to ask you, in the ten years that you've been going there, what sort of change or shift in thinking from students on campus? Have you seen, have you seen a shift? And then the other two points, very quickly, Richard, I know a lot of, I'm very much in the bitcoin space, and I know a lot of traditional finance guys who are in bitcoin gold guys. And when Malay was elected, they were crying tears of joy. They were so excited. And the last point, Steven has a podcast called Open College. It's on YouTube and on Spotify and everywhere else, as well as the center for Entrepreneurial Studies YouTube channel. Please give it a listen.
[01:18:43] Speaker C: And we're going to be releasing season.
[01:18:44] Speaker E: Two in the new year. But anyways, what are your thoughts? Stephen?
[01:18:49] Speaker C: You asked specifically about the students, so I'm not sure. I've lost track of how many universities I've spoken to around Latin America, and I've not noticed any change.
I know that there is a growing students for liberty organization. So that north american organization founded originally by Alexander McCobin, I believe is doing well in Argentina, in Brazil, and a few other latin american countries, but I've not seen the impact with me personally when I've been dealing with students, what I've noticed is the students, they are left uniformly. They seem to be getting a pretty solid left. Postmodern education.
And one of the things I notice still shocks me each time is when I walk into many buildings where philosophy, economics, and so on are taught. There's portraits of Karl Marx, portraits, sometimes even of Lenin. In Argentina, of course, there's portraits of Che Guevara on the walls, and the faculty, administration, students all accept them. That is symbolic of the intellectual atmosphere there. There was one university in Brazil that had a plaque put up for Friedrich Hayek, and I saw that shortly after it had been unveiled, and that was, like, huge news. But my understanding was that within a month or so, it was entirely defaced and destroyed.
[01:20:31] Speaker E: Just to add to that, something that I noticed in all the years I was in Colombia is the public universities were like that, but the private universities, the one I went to, Yafib, was the polar opposite. So that's where you found your libertarian.
[01:20:54] Speaker C: Yeah, that's well said. I have less experience at the private universities. The ones I've gone to have been focusing on entrepreneurship studies, business studies, and engineering. And you're right, the attitude is very different. The culture is different in those ones.
[01:21:12] Speaker A: It's true that Malay is a big fan of crypto, especially bitcoin. So I understand the reaction there. To the extent it might be part of the solution to fixing hyperinflation, I don't know yet. But I think he would be the kind of guy who would make sure, and there is bitcoin used down there, that he would make sure that that has wide berth and that that isn't restricted in any way. It's not something the IMF would support, or even the Fed would support. But I can see why he, and another reason why he would get youth support. Youth. The youth in America, as well as down there, are much more likely to be pro bitcoin, say, than pro the gold standard. The gold standard to the youth today sounds old fashioned. Sounds like old fogey stuff. And so Malay doesn't mention, has mentioned the gold standard, but he mentions crypto much more. Stephen, I just wanted to put in a plug for Antonella Marty, who works for the Atlas Society. And I don't know how often you meet up with her down there, but she is at the Atlas Society, if you want to look her up, the director of society Atlas, and a senior fellow at the Atlas Society. But down there, she's also at the latin american policy fellow. She's a fellow consumer choice center. I'm not sure where the main work she does is, but she's around Latin America a very well, yes, yes.
[01:22:40] Speaker C: Wonder to come back to if there's time, Scott, to this question about whether this is the most important election or not.
That got me thinking. I think this is probably the most important election for libertarianism around the world because everybody is talking about Malay all around the world.
It's also striking that Argentina now in one way is perhaps one of the most happening places in the world. The pope is argentinian.
The soccer World cup champions were Argentina this past year and now Malay. So there's a huge amount of excitement and attention focused on what is going on here. And Argentina in terms of natural resources and human resources has so much potential. It'd be wonderful if the necessary reforms can be put in place for the foundation of a great recovery.
[01:23:42] Speaker B: You spoke to the important that naming names was a factor for him. Why do you think that was important? Just authenticity, being willing to call things out.
[01:23:55] Speaker C: Are you talking about the names of the intellectuals or names of the people who are corrupt and who are people that were corrupt?
Well, I think this does speak to his theme of personal responsibility.
Indirectly he is saying, I expect to be held responsible for what I say and I know I'm going to be under the magnifying glass and I'm going to try to live up to my standards and I hope that he can do so. But to get past this issue of, oh, well, just some politician did something or other, that's just the way it is to make it personalized and to say that politicians should be held to the same standards that everybody else is held to. Now Richard made mention of the point about equality before the law. And Malay does come back to that one frequently because it certainly is part of the political culture here that politicians are not held to the same standards that ordinary people are held to.
And another part of that, of course, is that there is a large amount of welfare state dependency down here and that all gets combined with a strong level of paternalism and people willing to go along with big daddy government or big mommy government when Christina Kirschner is in power.
So being able to say, look, you are an individual, you have your identity putting names to it for good and bad and putting my name to it also. I think that's an important political statement.
[01:25:43] Speaker A: Yeah, they've gotten to the point where the poverty rate down there is something like 40%, which is almost three to four times what it is in the US. The US I think is seven or 8%. I think Malay also is in a unique position to be able to say something like the following. My opponents now, on any issue, I want to do this with the currency and fix hyperinflation. And they start complaining and whining and so easy for him to say, wait a minute, you've been running things for a decade and we're in the gutter. Who are you to complain? Or we need to privatize, or we need to shrink the size of a government? If you think about it, anyone from the other parties criticizing him, they were the ones who brought Argentina to this position. I mean, he has argued that way. I'm not saying it's a new argument, but he needs to hold up that shield, so to speak, as he tries new things, that the ankle biters and the objectures and the critics are going to be the ones who brought Argentina to this position to begin with and needs to silence them a little bit for a while.
[01:26:48] Speaker C: That's well said.
[01:26:50] Speaker B: How much can these international organizations like the IMF thwart his agenda?
[01:26:56] Speaker C: Richard?
[01:26:57] Speaker A: Well, it is a problem, because, again, but he could say, listen, the prior administrations borrowed $45 billion from the IMF, and it's true that the IMF is anti capitalist, so they're going to not want him to fix the currency. They're against dollarization. They're against free trade. I mean, they're against almost everything he's doing, and yet he's beholden to them because he owes them money. I think in this case, since they've already defaulted on private debt, they've done that 20 years ago, and they've been doing it since. I think if he was brazen enough and bold enough, I would advise him to say to the IMF, don't press me. Don't push me. I'm going to do this.
I have a mandate to do this. And if you keep pushing me, I just won't pay you. I just will default and do it unapologetically. Not because I don't think countries should pay their debts, but we're not going to pay our debts to a group that's telling us to keep with the same old program, the same old program that's bankrupting Argentina and threw them into the hands of the IMF to begin with. Those kind of arguments I'm sure he can make, but he's going to get a lot of pressure from the international community to cowtow to the IMF.
[01:28:11] Speaker C: That's very interesting, Richard.
[01:28:15] Speaker A: They don't have a track record of free market stuff, Steven, but you mentioned paternalism. The IMF is very od because they almost want supplicants. They almost want needy borrowers that they can manipulate. I think Argentina owes more money to the IMF than any other country. It's at the top of the list. The IMF, of course, has run out of.
So anyway, yeah, I think it's great.
[01:28:45] Speaker B: That you're willing to back him, at least threatening default as a way of negotiating.
[01:28:54] Speaker A: Yeah. The other interesting dilemma for someone like Malay is by this time, and this is happening in the US more and more, we look at the first day a president has in the Oval Office and what is he doing? He's standing there sitting at the desk with a pile of executive orders, just signing executive orders all day. So rule by, not by Congress or judiciary, but by executive decree. It's very common down there now. It's very common in, you know, you say to someone like Malay, just find things you can do by executive order. Of course, it sounds unliberal. It sounds unlibertarian. It's autocratic. Right.
And so it's a philosophic puzzle. Maybe. But if the orders he's signing are liberating the country, are reducing regulations and getting rid of departments and literally putting the currency on a sound standard, you see the problem, Stephen? It sounds like it's pragmatism.
And a libertarian politician might cringe at doing this, but he has begun to do it. And I think it's because he knows that the consequentialism of it, if you want to call it that, the consequence of it will be a freer economy.
You see the dilemma.
[01:30:11] Speaker C: Well, yeah, I think if it's currently legal powers that the president has, he's entitled to do so. Right.
But along the way, you were saying it's in the direction of liberalization as deliberalization that is going to change the political culture such that easy executive orders become less frequent in the future. Hopefully, of course, one of the executive orders can be abolishing certain kinds of executive orders. Right.
[01:30:42] Speaker A: Yeah. Good point. Very well, gentlemen.
[01:30:45] Speaker B: This has been a great discussion. Maybe next year, as he's getting his policies underway, we can revisit the subject. But thank you all for joining us. It's not too late to make a year end contribution to the Atlas Society nonprofit advancing these slash donate. Thank you again to everyone who listened, spoke and to Richard and Stephen. Thanks a lot. It was a great discussion.
[01:31:17] Speaker A: Thank you.
[01:31:18] Speaker C: Thanks, Scott. Thanks, Richard. Great points.
[01:31:20] Speaker A: Great to hear you again. Thanks, Roy. As you can, Scott. Thanks.
