The Argentine president has been accused of being far right, but they must be wrong because he professes libertarianism, and therefore the defense of property private, the defense of freedom of expression, of the press, of political freedom and of economic freedom. If this is the case, he cannot be an extremist of either the right or the left. When questioned on the topic he declares himself “ideologically libertarian and anarcho-capitalist, but since you have to have your feet on the ground in practice I am a minarchist”; that minarchy that aspires, that is, to have a society in which the state has a minimal role of interference in the lives of individuals. Javier Milei arrives at Davos with a scheduled flight because he says he wants to help cut costs, given the difficult economic situation in his country. Interviewed in flight on what he is preparing to say in his speech, he declares that he will say that market capitalism brings development and growth, while the countries gathered at the Forums they are caged in an agenda in which socialism is rampant, which historically has generated economic poverty and favored the flourishing of illiberal regimes.
And then he takes the floor and actually says it, and warns the West of the dangers it is facing. He addresses heads of state, politicians, academics and above all entrepreneurs by talking about the market economy and finally bringing the debate back to an event which is also called World Economic Forumon economic theories and practices and not exclusively on the prevalent themes expected in recent years, namely extreme weather events, misinformation and lack of trust.
You can more or less agree with him, but he should not be underestimated: read the full transcript and listen to his speech, without prejudice.
Milei’s full speech in Davos
Good evening, many thanks.
Today I’m here to tell you that the West is in danger. It is in danger because those who should defend Western values have been co-opted by a worldview that inevitably leads to socialism and, consequently, to poverty.
Unfortunately, in recent decades, driven by noble intentions of wanting help others and by other desires to belong to one privileged castethe major leaders of the Western world have abandoned the model of freedom for different versions of what we call collectivism. We are here to tell you that collectivist experiments are never the solution to the problems facing the citizens of the world, but rather are their cause. Believe me, no one can testify to these two issues better than us Argentines. When we adopted the model of freedom in 1860, in 35 years we became the leading world power. While when we embraced collectivism, over the last 100 years, we saw our citizens systematically impoverished until they dropped to 140th place in the world.
GDP per capita
But before we can have this discussion, it would be important to examine the data that supports why free market capitalism not only is it a possible system for ending poverty in the world, but it is the only system that may be morally desirable for doing so. If we consider the history of economic progress, we can see how from the year 0 to around 1800, the world’s GDP per capita remained practically constant throughout the reference period. If you look at a graph of the evolution of economic growth over the history of humanity, you will see a hockey stick-shaped graph, an exponential function that has remained constant throughout the reference period. Humanity’s GDP per capita has remained constant 90% of the time and began to grow exponentially starting in the 19th century. The only exception to this story of stasis occurred at the end of the 15th century with the discovery of America. But leaving aside this exception, for the entire period from the year 0 to 1800, the global GDP per capita has remained stagnant.
The GDP growth rate
Now, not only has capitalism generated an explosion of wealth since it was adopted as an economic system, but the growth rate has also increased throughout the period. For the entire period between the year 0 and 1800, the growth rate of GDP per capita it remained stable at around 0.02% per year, practically nothing. Starting from the 19th century, with the industrial revolution, however, the growth rate rose to 0.66%. At that rate, it would take 107 years to double GDP per capita. Observing the period between 1900 and 1950, the growth rate grows at 1.66% per year: it would no longer take 107 years, but only 66. In the period between 1950 and 2000, the growth rate is 2. 6% per annum. The trend, far from stopping, remains alive today. In the period between 2000 and 2023, the growth rate accelerated again to 3% per year, meaning we could double our global GDP per capita in just 23 years.
Only capitalism eliminates poverty
After the industrial revolution, the world’s GDP per capita multiplied more than 15 times, generating an explosion of wealth which lifted 90% of the world’s population out of poverty. We must never forget that in 1800 approximately 95% of the world’s population lived in extreme poverty, while this number dropped to 5% in 2020 before the pandemic. The conclusion is obvious. Far from being the cause of our problems, free market capitalism as an economic system it is the only tool we have to end hunger, poverty and destitution around the world. The empirical evidence is indisputable.
Therefore, since free market capitalism is superior in terms of production, left-wing doctrine attacked capitalism for its questions of morality, saying it is “unfair.” His detractors say that capitalism is bad because it is individualist and that collectivism is good because it is altruistic. And as a result they fight for social justice. But this concept, which has spread around the world in recent times, has been a constant in my country’s political discourse for over 80 years. The problem is that social justice is not only not fair, but it also does not contribute to general well-being. On the contrary, it is an intrinsically unjust idea, because it is violent. It’s unfair because the State is financed through taxes and taxes are collected in a coercive manner. Or can any of us say we pay taxes voluntarily?
More taxes, less freedom
To help the poor, stop attacking the rich
If there’s anything we should learn from the last few years, it’s that if we really want to help the poor, we have to stop attacking the rich and stop asking the State for more. We must stop accepting that there is an enlightened elite that wants to dictate to people what to do with their lives. We must stop allowing that the State tells us how to live and what are the best decisions for us.
The antidote to poverty is not social justice, but freedom. Free market capitalism is the only system that can end poverty, because it is the only system that allows for the generation of wealth. And wealth is the only way to end poverty. In this sense, capitalism is the solution to the problems facing humanity. But, if we focus on freedom, we can see that this is the key to understanding why capitalism is superior to socialism.
The solution is freedom
If we consider the triumph of the West in the world, we must rely on freedom as a key concept. Freedom of thought, freedom of expression, freedom of the press, freedom of religion, freedom of enterprise and freedom of property are pillars of Western success. Capitalism is the economic system that emerges naturally from a context of freedom. When people are free to make their own decisions and pursue their own interests, economic activities emerge that lead to growth and to prosperity. In contrast, socialism imposes a centralized vision of government, limiting individual freedoms and limiting innovation and creativity. When government decides what to produce, how to produce it, and how to distribute wealth, it creates inefficiencies and disincentives that ultimately lead to economic stagnation and decline.
Milei in Davos: appeal for freedom
The experience of various countries around the world shows that socialism does not work and leads to poverty. Capitalism, however, has proven to be the engine of innovation, economic growth and improved quality of life. We must defend and promote freedom as a fundamental principle and recognize that free-market capitalism is the economic system that best fits this vision. In summary, capitalism is the solution to the problems facing humanity because it is the only system that has proven to be capable of generating wealth and lifting people out of poverty. Freedom is the cornerstone on which the success of the West is based, and we must commit to defending and promoting it. In a world where threats to freedom are ever-present, we must be vigilant and ready to defend the values that made the West great. Thank you.
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