In the mid-nineties my friend, Axel, and I went on a bike trip from Buenos Aires to Santiago, Chile. I had always wanted to travel to Argentina, and Axel was always up for adventure. Little did we know.
Argentina was distant, exotic, and historic, with Buenos Aires being the birthplace of the tango which echoed from the various restaurants and clubs in the city’s back streets. Outside the capital city are the pampas with its renown ranches and gauchos. Far to the west is the wine district near the city of Mendoza, with the Andes providing incredible vistas, hiking, fishing, and extensive mining opportunities. The country was known as one of the richest in the world in the late 1800s. Even the river Plate that forms its northern boundary is named for bountiful silver.
I scoured a map planning options for our trip, locating rail lines as well as secondary roads, and saw an extensive network of small towns that followed the main east-west highway corridor. Axel was coming from Calgary, while I was leaving Vancouver. We would meet at the airport in Buenos Aires, spend a few days there, then head out.
Downtown Buenos Aires was dusty and dirty, with the constant hum of a busy metropolis. The city, as with the renowned Casa Rosada (the Pink House, which is the President’s office), seemed like an elegant flower with its bloom fading. Moving into the outskirts saw a city with dusty roads, chaotic traffic and seemingly everyone fending for themselves. It was mayhem thriving in a frayed and loose infrastructure.
As we ventured through the outskirts of Buenos Aires, Axel and I were a foreign oddity. People were wary of strangers. Visitors didn’t go there, and no one was crazy enough to travel on bicycles loaded up with gear. When we pulled off the main road, people would go indoors. We would see people looking out from behind curtains. They called the police once, who showed up in a small pick-up truck with machine guns, telling us to move on. The people were nervous – but maybe it was just us.
As we left the sprawling city further behind the atmosphere changed. People were more approachable. We were welcomed by an architect and his family and invited to join a church dinner. The next day we toured the local high school, which was remarkable in that the kids were constantly shouting in class. A Canadian Rotary Exchange student told us it was impossible to learn anything. At night cars drove around briefly flicking on their headlights only when they approached an intersection – they were preserving the bulbs. The town was vibrant and full of life – if perpetually chaotic, and more than a bit terrifying.
We came across long-distant busses and it was intriguing to see hoses connected to the tires. It turned out that the bus driver could inflate the tire remotely in case they had a flat. There was little infrastructure outside the city which meant few places to stop for repairs. There was also the risk of being robbed, or hijacked.
The currency was the US dollar, and everything was expensive. If it was expensive for us, I could only imagine how the local population felt. And as we got farther from the big city the hardship that people endured became even more apparent.
arriving in Buenos Aires I was dismayed to learn that, despite my map’s intricate rail network, there were no trains. But in a remote village in the middle of nowhere we came across a train station. I asked someone what happened to the trains. He told me that at one point the government contracted the British to build a railroad, and so they laid track across half the country until the two countries had a falling out. Then the government brought in the Russians to finish the job. Well, the track gauge for British and Russian railroads is different, Russian trains run on narrower tracks. It seemed no one gave that much thought even as the Russians continued to roll out track across the country. Decades later there had never been any trains, and I stood at a railroad station in the baking sun, hours outside of Buenos Aires, half buried in sand, with chickens pecking in the shrubs that were reclaiming the land. It was symbolic of the overall travails of the country – a dysfunctional bureaucracy that spent with little mind to the final product.
On the brighter side, Argentinian agriculture seemingly thrived. We saw a lot of shiny new equipment and met prosperous ranchers. The city of Mendoza, nestled into the foothills of the Andes, resembled a thriving, if faded, European city with the flourishing surrounding vineyards. But across the country, the ravages of decades of mismanagement were apparent without having to look too far.
Enter Javier Milei, Argentina’s recently elected president. Milei rode a wave of popularity into power by promising to cut the administrative state and its accompanying cronyism. Since he has come to power he has been given many labels, and roundly criticized in global circles. As many western nations increase the size of the administrative state, Milei is taking Argentina in the opposite direction.
Milei was an economics professor for 20 years. As an economist he was fed up with living in a country with vast resources yet in a perpetual state of debt and decay. During his campaign he was incensed and vocal about his frustrations. Argentines agreed with him and gave him a landslide victory. Since coming to power his has slashed ministries, attacked the cronyism, balanced the budget, and is trying to rein in inflation – running at ~254% annually.
Milei has battle on his hands, as many of the administrative jobs he plans to cut are union jobs. He is up against decades of entrenched entitlement. His government opposition would like to see him fail, it would vindicate the status quo, and revert the country to its administrative torpor.
At a time when western governments are growing their administrative states, imposing ever more taxes on their people and printing more money, Milei is bucking the trend. Argentina’s maverick president espouses the view the governments do not create value, they destroy it, on the other hand it is businesses that create value.
I learned from my biking trips that there are necessities, and there is excess baggage. The necessities will ensure your success, the excess baggage will bleed you to failure. Milei is slashing decades bleeding. The world is watching.
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