From Argentina to America

(CLO) At the Argentine Ministry of Reform and State Transformation, two thick documents on regulations that need to be eliminated lie on the table, next to a small statue of President Javier Milei holding a chainsaw - a symbol of his policy of streamlining the state apparatus.

These drastic reforms not only shook up Argentina's economy but also attracted the attention of US President Donald Trump and billionaire Elon Musk, who are pushing a trend of shrinking the federal government in the US.

Under President Milei, Argentina has cut its ministries in half, downgraded agencies like Education , Culture and Labor, and reduced the number of public sector employees by 10% last year. A series of “fitness” tests are used to determine who will be fired. The pass rate for the tests was 96% as of December, allaying some concerns.

These measures have helped Argentina reduce its fiscal deficit and control triple-digit inflation, but have failed to fully address poverty, which remains high despite falling from more than 50% last year.

President Javier Milei holds a chainsaw - a symbol of Argentina's policy of streamlining the state apparatus. Photo: GI

Elon Musk and President Milei have met several times in recent months, with the billionaire praising Argentina's policies as a model for the US.

He shared a video of the discussion with Secretary of Deregulation Federico Sturzenegger, calling the measures “fantastic.” Meanwhile, the Trump administration, through the Department of Government Efficiency (DOGE), is also looking to cut the federal bureaucracy in a similar way.

Despite their similarities, the two countries’ contexts are very different. Argentina is struggling with an economic recession, depleted reserves and a large public debt, while the US maintains financial stability. Mr. Milei does not have solid support in Congress, forcing him to rely on conservative allies to push through reforms.

The Argentine government has eliminated a range of regulations aimed at encouraging competition, from rent controls to export taxes on agricultural products and electric vehicles. At the same time, Mr. Milei has cut funding for social programs but increased direct financial support for the poor to reduce the risk of protests.

But the policy has also met with opposition. Former Economy Minister Silvina Batakis argues that shrinking the government should not hurt the most vulnerable. "I am in favour of a balanced budget and an efficient state, but that cannot be achieved by taking away medicine from cancer patients or weakening the pension system," she said.

Despite the controversy, Mr. Milei still enjoys considerable support. According to a January Atlas Intel survey, 47% of respondents approved of his performance, up from 43% in July. The president claims that his policies have boosted market confidence and attracted investment, although much of Argentina’s recovery still depends on agricultural and energy exports.

In his office, Minister Sturzenegger points to two thick stacks of documents tied with blue and white ribbons – regulations he says need to be scrapped or revised. He is using the remaining time in the emergency decree to push through reforms, with a countdown clock in his office reminding him that there are only “161 days” left to complete the goal.

“Now is the time to put the chainsaws in,” he said. “We’ll go into each department and ask, ‘What do you do?’ If it’s not necessary, we’ll close it.”

Ngoc Anh (according to Reuters, ET, Newsweek)

Source: https://www.congluan.vn/chinh-sach-cai-cach-bo-may-nha-nuoc-tu-argentina-cho-den-my-post334220.html