Argentina under Milei: The Failed Prophecies of the so-called Experts

For months, the so-called experts predicted apocalypse if Javier Milei came to power in Argentina: more poverty, hyperinflation, social chaos, and economic collapse. Today, with the election results on the table and the first major macroeconomic data consolidated, those predictions have not only failed, but have been proven wrong. What is happening in Argentina under Milei is not a theoretical experiment: it is a head-on collision between narrative and reality.

Long live freedom, damn it! The recent midterm elections in Argentina have shattered virtually all predictions and mark another radical turning point for the country’s politics, but above all for confidence in libertarian reform policies around the world.

Because, is there anything clearer than concrete results? Javier Milei’s party, “La Libertad Avanza”, won more than 40% of the vote in the midterm elections, a result that no polling company had predicted.

Even in the Peronist stronghold, the populous province of Buenos Aires, Milei won with 41.5% against 40.8% for the opposition, a historic breakthrough in a region that has been firmly in the hands of the left for decades.

The direct consequences are far-reaching politically: Milei’s party increased its seats in the Chamber of Deputies from 37 to 101 out of 257, and in the Senate from 6 to 20 out of 72. With this new strength, Milei has, for the first time since taking office in December 2023, the parliamentary power to push through his reform agenda without constant blockages. With 64 new deputies for LLA, the blocking minority of 86 seats is easily reached.

However, in recent years, his critics have spread a veritable avalanche of negative predictions about his plans and goals. Reason enough to look back on the most serious miscalculations, of course, not without a hint of satisfaction. And with the hope that this model, precisely because of these real empirical values, will also be well received in other countries.

So let’s look at the myths, fake news, and erroneous predictions, and talk about Milei’s actual results. And then, let’s look at what we can expect from him in the coming months.

Myth 1: Milei exacerbates the poverty crisis

In November 2023, over 100 renowned economists warned in an open letter that Milei’s planned cuts to the state budget would further increase poverty in the country and cause social chaos. The Guardian even called Milei’s election victory “a dark day for democracy” and predicted that the libertarian course of the “far-right” Milei would threaten to further exacerbate the country’s serious economic problems.

Milei’s opponents, from trade unions to the Catholic Church, echoed this view: austerity measures would hit the weakest in society hardest. Indeed, in the first half of the year, poverty rates soared to around 53% but have since been gradually recovering. The first months of Milei’s “shock therapy” were, of course, exploited by the media: soup kitchens and street scenes of impoverished families fueled the media narrative that Milei’s policies had exacerbated and would continue to exacerbate social precariousness on a massive and unprecedented scale.

However, almost two years later, the picture is completely different. New economic data refutes all the negative forecasts. The poverty rate, which affected more than half of the population when Milei took office, has fallen to just over a third (around 38%) according to government data. So, although Milei’s policy started with the “disadvantage” of previous rulers, it is lifting millions of Argentines out of poverty.

After the initial impact, the inflation rate has also fallen dramatically, from over 200% in 2023 to around 30% per year. A reduction of almost 15 percentage points in a year and a half. There is no better proof that miracle formulas are not needed, but simply to act logically and consistently.

If you compare the first half of 2024 with the first half of 2025 in the graph, the picture is quite clear. In 2024, 42.5% of households were poor, affecting 52.9% of the population. Among them, 13.6% were extremely poor households, often homeless, representing 18.1% of the population. A year later, we see the effect of real policy rather than political theater: poverty has fallen by around 40%, and homelessness by almost 60%. That’s more than ten million people whose daily lives are no longer characterized by hunger, cold, and lack of prospects. And all this without resorting to credit. The budget is balanced. And this is not a flash in the pan financed by loans.

It is remarkable that even these figures do not slow down some media outlets in the slightest. Instead of taking note of the facts, they now claim that the data has been manipulated. If reality does not fit the narrative, it is simply rewritten.

Myth 2: Argentina will enter a deep recession

It has been claimed that Milei’s plans, such as the abolition of the Central Bank and rigorous spending cuts, would have devastating consequences and lead to economic chaos. In the first quarter of 2024, Argentina’s gross domestic product did indeed contract by more than 5% compared to the previous year, and for the second quarter, analysts predicted a further decline of around 1.5%, which would be the fifth consecutive quarter of decline. The Reuters news agency reported in September 2024: “Recession deepens under President Milei’s strict austerity policy.”

The newspaper EL PAÍS reported, citing the International Monetary Fund (IMF), that Argentina remained in a severe recession at the end of 2024, even though inflation was declining. The IMF predicted a 3.5% decline in the economy for the whole of 2024. Milei’s strict spending cuts (i.e., the halting of state projects and mass layoffs in the civil service) caused temporary fluctuations in the national economy.

However, contrary to these pessimistic forecasts, a first change in trend became apparent at the end of 2024. Official figures showed that the economic decline was less severe than feared. Argentina’s GDP contracted only 1.8% for the whole of 2024, half of what had been initially forecast, which was around 3.5%.

In December 2024, economic performance even increased by 5.5% compared to the previous year. Milei presented the new figures in early 2025 as proof of the legitimacy of his harsh austerity policy, which he and many others describe as “the biggest fiscal adjustment in history.”

In light of these developments, Argentina’s economic outlook until the end of 2025 also improved significantly at the official level. International institutions revised their forecasts upward. Suddenly, the IMF now expects strong growth of around 5% for 2025, a rate surpassed in Latin America only by oil-rich Guyana. The World Bank is equally optimistic and now also suddenly forecasts GDP growth of 5% for that year.

Today we know that, under Milei’s leadership, the economy has recovered much faster than expected. Milei has proven many skeptics wrong, and he has done so with nothing but facts. The Argentine economy has been growing again since the end of 2024. The recession is OVER: the second quarter of 2025 already saw growth of 6.3%. That doesn’t sound like “the worst economic crisis in decades,” as was said in July 2024, does it?

Myth 3: Hyperinflation will occur and the peso will collapse completely

Both the Anglo-Saxon and German media painted an extremely bleak picture. The FAZ newspaper, for example, reported in February 2024 on “a country on the brink of the abyss,” with inflation above 250%. Milei’s new government was supposed to be barely able to control currency devaluation and that hyperinflation was looming. Milei himself acknowledged shortly after taking office that the situation was critical: “The outgoing government has led us down a path of hyperinflation,” he warned in his inaugural speech in December 2023. Without a major economic policy shock, according to Milei, annual inflation could skyrocket to 15,000%.

This scenario did not materialize thanks to the measures taken by the government, as we can see in the following evolution:

Core inflation in Argentina fell back below 2% per month in September 2025 and, at 1.9%, is even 0.1 percentage points below the August figure. This is the best value since 2018. In the service sector, price increases have also fallen to their lowest level in four years. The chart on the left shows the inflation bands by product group and, for the first time, all areas are below 3.5% per month. The downward trend is clear, stable, and, so far, uninterrupted.

Here, too, we see that the peak of the crisis occurred just around the time Milei took office. From then on, inflation literally plummeted. In just over a year and a half, year-on-year inflation has fallen back from its historic high to levels that Argentina was familiar with before the sharp increase. The trend is stable, not erratic. There has been no change in trend.

This is graphic proof that inflationary pressure has collapsed following Milei’s reforms. And that, in retrospect, the discourse on hyperinflation seems nothing more than propaganda from the supposed defenders of democracy.

So, almost two years later, Argentina is facing a situation that many experts, some of them self-proclaimed, did not expect. The predicted hyperinflation has not materialized. Instead of triple-digit inflation rates, under Milei’s leadership the country now enjoys what could almost be called price stability. By the end of 2024, inflation had already fallen dramatically. According to the INDEC, the annual rate was 117.8%, less than half that of 2023, when it reached 211.4%. A drop of 94 percentage points in one year, much stronger than most analysts had predicted.

In October 2024, the country experiences the lowest monthly inflation in three years. Prices are rising more slowly than critics expected. Milei’s stabilization policy is also having an effect here. The shock policy begins to take effect after monthly values have fallen significantly since the spring of 2024.

What else can we expect from Milei?

And now that we have reviewed the failed forecasts of the so-called experts, let’s see what Milei’s government could bring us in the near future.

Tax and labor market reform

A key part of Milei’s agenda is what has been considered political sacrilege in Argentina for decades: a tax system that can actually be understood. Milei does not want to reform the tax architecture, but to clean it up. Fewer taxes, fewer exceptions, less bureaucracy, and with that, the opportunity for work and entrepreneurship to no longer be treated as punishable acts. Even the famous payroll tax (“Impuesto País”) was buried without comment. At the same time, Milei is shaking up rigid labor legislation: more flexible hiring, easier dismissals, longer working hours, and reduced powers at the provincial level. Analysts see this as the end of decades of barriers to growth, which translates, in short, into less state and more economy.

Privatization and denationalization

The second major block is the dismantling of socialism in state-owned companies. State-owned companies that have been generating losses for years must go public or declare bankruptcy but not fall into the hands of taxpayers. Milei said this openly during the election campaign. Now, with a majority in Parliament, the transport, energy, and finance sectors are expected to be next. For us, as libertarians, it is clear: with the privatization of inefficient state giants, Argentina will finally be able to structurally enter the 21st century.

Reducing bureaucracy and deregulation

The core of Milei’s reforms is the radical reduction of Argentine bureaucracy. The new Ministry of Deregulation has achieved in months what previous governments had accumulated in decades of excuses: ten ministries dissolved, more than 53,000 civil servants eliminated, hundreds of authorities merged. And, above all, laws and regulations are eliminated at a dizzying pace. 1,246 regulations in one year, almost two per day. Energy, agriculture, real estate, health: unnecessary obstacles are being removed in all areas. This is the most drastic process of state reduction in generations. The “chainsaw” regulates what bureaucrats detest and entrepreneurs love, because they can finally breathe again.

Free trade and monetary reform

Milei is opening Argentina to the global market, rather than betting on the protectionist nostalgia of Mercosur. Import barriers are being reduced, quotas are being expanded, and a bilateral trade agreement with the United States is being negotiated. At the same time, Milei is standing firm on his most difficult project: opening up to the dollar and the option of closing the central bank. Argentines must be free to choose the currency in which they save and work, a freedom that their own government has denied them for decades. It is not yet clear exactly how and when the dollar reform will take place, but it will happen.

In short, Milei’s government has achieved what Argentina has not seen in decades: a balanced budget, declining inflation, and a pace of reform more typical of a start-up than a state. From a libertarian point of view, this is a long-awaited correction. A more agile state, less regulation, and more economic freedom are finally creating space for innovation and growth. Resistance from traditional interest groups will continue, but the latest midterm election results show that the majority of the population continues to support this course.

If Milei stays the course, the next steps are already clear: deeper tax cuts, large waves of privatization, and a serious opening to the dollar. Argentina could become, for the first time in many decades, the freest and most market-oriented country in Latin America. And that would not only be economic progress, but a political signal to the whole world: freedom works if you let it work.

If politics fails, then you must succeed

And even though we have all this in front of us, in black and white, some news media insists on sharing articles about how bad Milei’s economic model is. Of course, reality is uncomfortable when it doesn’t fit your own worldview.

In any case, the real question is: how much longer are you going to follow a leader who announces reforms to the hilt but never carries them out?

How many more lost years must be added before you realize that waiting is not a strategy? Vote with your feet, better today than tomorrow. Denationalize.me exists precisely for this reason: so that you don’t have to wait decades in Germany, France, Italy, the UK or whatever country you live for political miracles to fall from the sky.

If you no longer want to tie your freedom to the state’s misguided forecasts, power struggles, bureaucratic labyrinths, and penchant for tax-funded experiments, but want to take it into your own hands, you’ve come to the right place.

Since 2017, we have been showing the world how to build true freedom of action with the Theory of Flags, not at some point in the future, but now. If you want us to help you take the next step towards greater personal responsibility and freedom, hire our services or contact us.