The far right president of Argentina, Javier Milei (Picture: Ilan Berkenwald)

Probably the most nauseating regular event of the year is the World Economic Forum (WEF), held at the skiing resort of Davos in Switzerland every January. 

It is an opportunity for the corporate rich and their hangers-on— academics, journalists, and the like—to swank and network. 

The tone of this year’s event, which took place last week, is summed up by the logo—“World Economic Forum: Committed to Improving the State of the World”. In other words, we can make money and be virtuous at the same time.

So the Financial Times’s Gillian Tett—who was once a great journalist but now spends too much time at corporate fests such as the WEF—tells us executives at Davos wanted to discuss Artificial Intelligence (AI) and sustainability. 

AI is being talked up as the new source of higher productivity and profitability. This is probably a pipedream.

Meanwhile, the transition to a net-zero economy to which everyone pays lip service depends on access to critical minerals such as lithium and nickel. 

Tett tells us that “a large delegation from Ukraine was in town, members of which were keen to point out that there are enormous reserves of the most critical minerals sitting in their country.” As it was 100 years ago, access to raw materials is becoming an important stake in inter-imperialist competition.

But all the virtue-signalling in Davos was undercut by what was probably the pivotal event last week, the speech by Javier Milei, the new president of Argentina. 

Milei calls himself an “anarcho-capitalist” and campaigned for the presidency brandishing a chainsaw to show what he would do to public spending.

He was reverentially introduced by WEF founder Klaus Schwab, who praised Milei for restoring “the rule of law” in Argentina. This is interesting since Victoria Villarruel, Milei’s vice-president, is busy trying to rehabilitate the military dictatorship that murdered up to 30,000 people between 1974 and 1983.

At Davos, Milei announced that “the Western world is in danger … because those who are supposed to have to defend the values of the West are co-opted by a vision of the world that inexorably leads to socialism and thereby to poverty.” Free market capitalism, the only historical source of economic progress, is being undermined by “collectivism”, by which Milei means state intervention in the market.

At one level, this is completely ludicrous. Oxfam greeted Davos with a report that since 2020 the five richest men in the world have doubled their fortunes. This doesn’t sound much like socialism. Nevertheless, as an Argentinian friend assured me, Milei isn’t any kind of fool. He put forward in Davos a coherent critique of mainstream economics from the standpoint of the libertarian right.

Drawing on the ideas of Friedrich von Hayek, for example, he argues that the market can do no wrong. “Market failures” —which are used to justify state intervention — “do not exist”.  Or rather, “the only context in which there can be market failure is if there is coercion” by the state.

The problem is that the present era of economic instability and stagnation began with the global financial crisis of 2007-9, which followed a period of radical deregulation —the withdrawal of the state.

Left to its own devices, the market is self-undermining. Nevertheless, Milei’s speech garnered some extravagant praise.  The Tory economic historian Niall Ferguson called it “a magnificent defence of individual liberty and the free market economy”. This reaction isn’t based on the belief that Milei’s policies are necessarily feasible. 

He’s already had to retreat from promises like replacing the Argentinian peso with the US dollar and “blowing up” the central bank.

It’s more that, for 20 years since the financial crash, the world economy has been limping along on state support and is increasingly vulnerable to “external” shocks such as the pandemic, climate chaos, and the wars in Ukraine and the Middle East. 

Milei says there’s a simple way out— smash the life support machine. This Utopian rhetoric —alongside proliferating attacks on the right to protest —appeals to those profiting from a system running up against the buffers.

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