While Germany’s debt spiral is accelerating ever faster, Argentine President Javier Milei is steering his country in the opposite direction. Germany’s statists will soon be left looking foolish once it becomes obvious that the German model has failed.
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Only contrast reveals one’s own mistakes. Javier Milei is the antithesis of Germany’s political class, and the comparison could hardly be starker. While Germany continues to expand the state, Argentina is slashing subsidies and radically reducing the size of its public bureaucracy. While Berlin piles up enormous amounts of public debt, Buenos Aires is posting a primary budget surplus. Friedrich Merz believes in the healing powers of state intervention, whereas Milei is deregulating markets and paving the way for an investment boom.
Argentina has achieved an economic turnaround while Germany continues its economic decay. Argentina’s economy is growing steadily, private-sector employment is expanding, and the poverty rate is falling rapidly.
At a time when Germany is doubling down on debt, the arms industry, and green state planning, Milei appears like a comet defying both political gravity and conventional doctrines of government.
The Argentine president’s latest initiative is the so-called “Grillete Fiscal” — literally, the “Fiscal Shackles.”
Behind the martial name lies what amounts to a fiscal revolution. Milei first unveiled the proposal in his characteristically entertaining style during a televised address to the Argentine people. The bill must still be approved by Congress, where his party, La Libertad Avanza, is expected to secure the support of allied parliamentary factions in both chambers.
Although Milei lacks a parliamentary majority of his own, his alliances have thus far proved remarkably resilient.
If enacted, the legislation would break with one of modern politics’ unwritten rules: the assumption that governments can always buy votes with higher spending, higher taxes, and ever more debt. The business of burdening future generations and taxpayers with politically manufactured credit expansion would, at least for the time being, come to an end.
Milei’s idea is straightforward: future Argentine governments should have their wings clipped before they are even able to take flight on another debt-financed spending spree.
The mechanism is equally straightforward. Should the federal budget remain in deficit for several consecutive months, Congress would be given a deadline to restore fiscal balance. Failure to do so would automatically trigger a U.S.-style government shutdown. Non-essential government activities would be suspended automatically — without further parliamentary debate or political horse-trading. The President, Vice President, cabinet ministers, state secretaries, and every member of both houses of Congress would receive not a single peso in salary until the budget is balanced once again.
Furthermore, all new spending would be frozen. No new contracts could be awarded, and no additional public employees could be hired. Even more striking, discretionary transfers from the federal government to Argentina’s provinces would also be suspended.
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For Germany’s statists, such a proposal is almost unthinkable. Rather than engaging with Milei’s ideas or his policies, they prefer to ignore him altogether. For Chancellor Friedrich Merz, Milei has become something of a red flag. On one occasion during a televised interview, Merz claimed that the Argentine president was ruining his country and trampling on its people.
A typical Merz response. The German chancellor views the world through a prism that distorts reality. He speaks like a genuine believer in the omnipotent state — a conviction that has never been shaken by a lifetime spent safely within the political establishment.
Then, every once in a while, someone breaks ranks within Germany’s left-wing consensus and says out loud what many of them truly think about Milei. He is supposedly “authoritarian,” they claim, and a threat to human rights. In April of this year, Germany’s Left Party even introduced a parliamentary motion describing Milei as “ultra-neoliberal.” Coming from one of Germany’s most statist political parties, such a label should be taken as a compliment. It says far more about the intellectual limitations of its authors than about Milei himself.
What is both striking and disturbing is how closely the German chancellor’s rhetoric has drifted toward the coarse vocabulary traditionally associated with the political left.
Yet even Javier Milei cannot truly satisfy Germany’s libertarians. Their intellectual figurehead, Hans-Hermann Hoppe, the former University of Nevada, Las Vegas professor and a student of Murray Rothbard, complained only months into Milei’s presidency that he had failed to deliver on his central campaign promise: abolishing the central bank.
The criticism exposes a fundamental weakness of many libertarians: they inhabit the theoretical world of textbook logic. Within that framework, it seems inconceivable that abolishing the central bank overnight could derail Milei’s entire presidency. It requires little imagination to picture the alternative — a financial collapse followed by the fall of the government, precisely the kind of scenario that would jeopardize Milei’s entire reform project.
But it is not Milei’s job to please everyone. In the end, every successful political leader disappoints almost every constituency. He hands out no favors and makes no empty promises. His uncompromising austerity program is detoxifying the state, restoring market economics, dismantling subsidies — and turning into losers all those who had long lived off the public purse without productive contribution, sustained by political patronage rather than genuine economic necessity.
If Milei stays the course and Argentina continues to regain stability, he is likely to go down in the nation’s history as a libertarian reformer who combined conviction with prudence. Germany’s statists — from Friedrich Merz and Lars Klingbeil to Ursula von der Leyen — would do well to prepare themselves. They may ignore him, ridicule him, or insult him, but reality has a habit of quietly making its way into people’s minds.
As Nietzsche wrote in Thus Spoke Zarathustra: “Thoughts that come on dove’s feet guide the world.” Sometimes, however, they arrive accompanied by the roar of a chainsaw.
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Image: Haim Zachs, Govt Press Office of Israel