How is it that a poor country like Argentina can balance its budget, but we can’t even come within a country mile of that goal?

Maybe we can learn from Javier Milei, whose much-maligned chainsaw approach to balancing the budget really worked!

The Chain Saw Worked

Remember, it wasn’t long ago that Milei’s critics moaned that the cuts would decimate the poor. Nope. Inflation has fallen from 289% a year to 33%  and the poverty rate has dropped by almost half, from 53% in 2024 to 28% today.

Now Milei is proposing a reform package he calls the “fiscal shackle.”

His proposed fiscal rule would forbid Argentina from running a fiscal deficit for more than a few consecutive months. Congress would receive a warning and be given limited time to restore balance. Failure would trigger an automatic shutdown of all nonessential federal programs. As the Latin American Post summarizes:

“New spending would stop. Contracts would not be awarded. Hiring would freeze. Transfers to the provinces would be suspended. The president, cabinet ministers, secretaries and lawmakers would also lose their salaries.”