Argentina asks to join NATO as Milei looks to enhance security, strengthen ties
Argentina’s controversial populist President Javier Milei wants his country to join the North Atlantic Treaty Organization. The move is an effort to enhance political and security cooperation. Milei’s government is looking to tighten relations with Western powers and attract investment in Argentina.
Argentina’s request came during talks on Thursday, April 18, in Brussels between NATO’s deputy secretary and the Argentine defense minister. The deputy defense secretary welcomed Argentina’s bid to become a global partner. He said that the cooperation could be mutually beneficial.
NATO only has 32 member countries but has relations with more than 40 non-member global partners. The partnership network enhances security outside of NATO territory. However, those 40 countries do not benefit from NATO’s core principle: “The commitment to collective defense.” Neither NATO nor Argentina would be obligated to militarily defend each other.
All 32 NATO members would still need to approve Argentina’s partnership. One holdup could be Argentina’s contentious relationship with Britain. Argentina’s strained relationship with key NATO ally Britain started during the Falklands War in 1982. Britain currently maintains control over the island.
The issue of sovereignty over the Falkland Islands poses a challenge for Milei. He is working to strike a balance between diplomacy and territorial claims as he seeks to boost trade with Britain.
If Argentina were to be accepted as a partner nation, it could use advanced technology, security systems and training offered by NATO.
In additions to joining NATO as a partner, Milei has adjusted his foreign policy to one of “almost unconditional support” for the United States. Milei is currently fighting to bring Argentina back to economic prominence and fix its national debt and overspending.
Why is Argentina’s economy so bad? Does Javier Milei have the answers?
People in Argentina are ready to take a chainsaw to their economy. On Dec. 10, President-elect Javier Milei will take office after his resounding electoral victory against the status quo candidate. Milei, a shaggy-haired, rockstar-esque, eccentric economist, fashions himself an anarcho-capitalist.
People call him Argentina’s Trump, but former President Donald Trump never destroyed the U.S. Central Bank. Milei has said he wants to blow up the country’s central bank, but that’s not all. He’s vowed to shutter entire government agencies and trash the Argentine peso, with hopes of making the U.S. dollar the national currency.
The chainsaw became emblematic of President-elect Javier Milei’s economic goals during his campaign. Source: Tomas Cuesta/Getty Images
“This is not a task for the lukewarm, not a task for the cowardly, and much less for the corrupt,” Milei said in his victory speech.
After years of calling those in Congress corrupt, Milei doesn’t have a ton of friends there, which will make it hard to pass his more extreme policies.
As the character portraying President Harry Truman said in the 1975 play, “Give ‘Em Hell, Harry,” “you want a friend in this life, get a dog.”
It’s advice Milei takes to heart. He cloned his beloved former dog, Conan, producing five genetic matches. He says the English mastiffs are his children and his political advisers.
“With me, the decline ends and we regain power. Long live freedom, damn it,” Milei said, using his catchphrase.
So why did Argentina’s voters overwhelmingly elect a man who is promising to blow up the economy? Argentina’s economy has been a disaster for decades.
“Did Argentina ever have a single crisis that put it down, you know, produce a great depression or lead everybody to leave the country? No, it’s been a series of many crises through the years,” economist Laurence Kotlikoff said.
Decades of disaster
A century ago, Argentina was one of the wealthiest countries in the world. It was rich in natural resources with fertile land. Economically, it was on parity with the United States.
“Argentina, in 1920, had 85% of our per capita GDP, they were almost as rich as we are,” Kotlikoff said. “Today, they have 14%. It’s all due to running these policies over a century. So this is a slow train wreck.”
It’s a train wreck many economists say started under Juan Domingo Perón, a three-time populist president first elected in 1946 who ruled on socialism with a side of fascism.
Perón drastically expanded social welfare programs, nationalized industries, monopolized foreign trade and pushed wages higher. As a result, growth in Argentina paled in comparison with countries it once competed with. The peso lost value and inflation took hold.
Though Perón was eventually overthrown in a military coup, “Peronism” persisted. Perón was even brought back from exile for a third term. And Peronist candidates have largely dominated the political landscape.
Milei’s opponent, Sergio Massa, was the Peronist candidate in the presidential race and minister of the economy. This time, voters resoundingly rejected those ideals.
The real inflation nation
Try shopping within a budget in Argentina where prices literally change by the day.
Inflation in the U.S. has dominated money conversations since the uptick began in 2021. While the U.S. peaked at around 9% this cycle, people in Argentina are looking at 143% in annual inflation in October, with the central bank predicting 185% by the end of the year. It’s among the highest inflation rates in the world.
Despite generous government subsidies, 40% of the population lives in poverty. Meanwhile, the value of Argentina’s currency continues to plunge.
Five years ago, 37 Argentine pesos could buy one U.S. dollar. Today, it takes more than 360 pesos to make the same exchange.
With no faith in their own currency, people in Argentina literally stash U.S. dollars under the mattress for safekeeping, knowing any pesos they hold will rapidly lose value. Many turn to the black market to buy elusive dollars, which in October went for nearly three times the listed exchange rate.
This is a country that boasts the second-largest economy in South America, behind Brazil. The World Bank sees it as a nation with significant opportunities. But the country has been out of balance for decades.
Argentina has defaulted on its debt nine times. The last three have happened since the year 2000. Who would lend money to a nation that can’t pay its debts? Argentina is by far the biggest debtor to the International Monetary Fund, with about $44 billion in outstanding debt.
“Countries like Argentina and Venezuela and a whole host of other countries, for in many cases very understandable reasons, take on debt that is denominated in currencies that are not their own,” economist Stephanie Kelton explained. “So they get loaded up with debt, they get IMF loans and the rest of it.
“Some countries just don’t have much of a choice. They don’t have domestic energy resources, they don’t have access to food and medicine and technologies, they’ve got to import these things.
“And to get those real resources they often have to acquire so-called hard currencies, they need the U.S. dollar or the euro or the pound. So they get indebted in currencies that they can’t issue.
“Then it’s no surprise when a country like Argentina that can do very well for a period of time because it’s a big exporter of things like soybeans, if soybean prices are very high and rising, well all of a sudden Argentina is doing very well.
“And then when commodity markets take a tumble and prices come crashing down, all of a sudden, you’re not earning the foreign exchange that you need to service debt that you’ve taken out in other people’s currencies. So you can get a debt crisis in a country like that.”
This year, with the drought, Argentina’s economy is expected to contract by 2.5%.
Argentina serves as a cautionary tale for other economies; a scary story told to say, “Don’t follow this path or you too might end up here.” As total U.S. debt flirts with $34 trillion, American economists are quick to compare the fundamentals.
“We’ve increased it so much that for example, our debt relative to our national income, to our GDP, is about 40% higher than it is in Argentina, a country that everybody knows is potentially in trouble,” said economist Kevin Hassett, a former senior adviser to Trump.
Will U.S. spending spiral the country to Argentina’s depths? Kelton said there’s one clear difference between Argentina and the U.S. or even Japan, which holds twice as much debt as the U.S. when compared to the size of their economies.
“Japan, the U.S., the UK, Australia, Canada, these governments are currency issuers,” Kelton said. “They’re not going to run out of their own currency. They never have to borrow it from anyone in order to be able to spend.”
One of Milei’s chief pledges, dollarizing Argentina’s economy, would mean letting another country drive its currency destiny. But doing so would eliminate a lifeline that has for decades fueled Argentina’s inflation: Printing pesos to cover the country’s overspending.
The U.S. has no control over whether a country adopts the dollar, and experts doubt Argentina could come up with enough dollars to transition. But the U.S. Treasury has warned countries in the past that dollarizing is not a substitute for sound fiscal policy.
Argentina, Brazil fans brawl with police before World Cup qualifier
Violence threatened to overshadow a historic World Cup qualifier as police clashed with unruly fans. The Brazil vs. Argentina match witnessed a 30-minute delay as police corralled fans at Rio de Janeiro’s Maracana stadium on Tuesday, Nov 21.
Fan altercations erupted during the playing of the national anthem, leading Brazilian police to intervene with batons in the away section.
AP Images
Captain Lionel Messi led Argentina off the pitch in an attempt to calm tensions in the stands. After more than 10 minutes, the players returned, and the match was allowed to start.
Nicolas Otamendi clinched a 1-0 victory for Argentina in the contentious World Cup qualifier at the sold-out Maracana Stadium in Brazil, attended by 69,000 fans. This marks Brazil’s third consecutive defeat and its first-ever home loss in a World Cup qualifier.
AP Images
“The truth is that this group continues to achieve historic things, once again,” Messi told reporters. “Obviously, at the beginning it was bad because we saw how they were beating people. You think about the family, the people who are there, who don’t know what’s going on and we are more concerned about that than playing a match. At that point the match was secondary. After that, winning this game like this I think is one of the most important wins that this group has achieved. It is something very nice to be able to win here in Brazil, after how strong they have been at home throughout their history.”
Col. Vagner Ferreira, the highest-ranking police officer in the stadium, blamed organizers for the lack of a barrier between home and visiting fans. He defended the actions of police.
“Every action demands a reaction,” Ferreira told TV channel SporTV. “There is a history of confrontation here. At first we spoke to them. Then, we had to use our batons. There was no lethal force involved, no rubber bullets, no tear gas. This was a very technical approach.”
AP Images
“Beyond the match… I don’t know which words to use, I don’t know which word because I don’t want to be rude but it’s very ugly to see that happen,” Argentina coach Lionel Scaloni said. “Whether it’s an Argentinian or a Brazilian, it’s very ugly and some (of our players) had family there, they didn’t know if they were there. To play a match in these conditions was difficult.”
Brazilian coach Fernando Diniz echoed his rival coach.
“It’s regrettable and we hope that the fans will be more understanding about coming to the stadium to cheer, that the public authorities will also take care of these situations, that they can act preventively so that scenes like the ones that happened today don’t happen,” Diniz said.
Trump-like Milei elected president of Argentina by biggest margin in 40 years
Javier Milei has been described an an outsider and a far-right populist, and as of Nov. 19, he is Argentina’s next president. The 53-year-old libertarian secured his victory with 56% of the vote, surpassing his left-wing challenger, Sergio Massa, who received 44%.
The Argentine president-elect secured the widest victory margin in 40 years.
Milei, a former TV personality often likened to former President Donald Trump, is set to face significant challenges in his new role. Argentina’s economy is buckling under triple-digit inflation, rising poverty, massive debt and job shortages.
To solve the country’s economic crisis, Milei plans to close down the central bank, ditch the peso in favor of the U.S. dollar and slash spending.
The hidden cost of US debt: Why younger generations should be outraged
The United States is so deep in debt, the interest payment alone is now costing more than $1 trillion a year, according to a Bloomberg analysis. Experts say the soaring debt is an alarm bell for the nation, but some economists have been ringing this bell for decades.
“I’m kind of outraged, morally outraged,” said Laurence “Larry” Kotlikoff, a bestselling author and professor of economics at Boston University.
Younger generations may also be outraged after hearing what Kotlikoff has to say. Kotlikoff is known in economic circles as a pioneer behind generational accounting, which examines the sustainability of fiscal policies, like Social Security, and the financial burden it places on different generations.
Kotlikoff also ran for president in 2012 and 2016 on the basis that existing politicians wouldn’t do what it takes to save the nation’s economic future.
The following interview has been edited for length and clarity.
Larry Kotlikoff: A lot of economists have used a model for the last 25 years, 30 years, that has this assumption that people actually care about their kids to the point where if they know their kids are going to be in trouble, they save for them. It’s not the case, our older people don’t give a damn. As a group, they don’t give a damn – and I could use stronger language – about you folks. It’s all take as you go. You give and we take.
Simone Del Rosario: There’s this profound moment from President Biden’s State of the Union address where he appears to get all of Congress to agree that they’re not going to touch Social Security or Medicare. And he says, ‘Let’s stand up for seniors.’ Now, I’m not advocating for pulling out the rug from under this entire group of people. But this protect-seniors-at-all-cost scenario that we live in, what is that going to cost the next generation?
Larry Kotlikoff: He’s said that, unfortunately, because maybe he wasn’t too aware of the facts. The reality is that we’re taking from the young, expropriating the young, and giving to the old through so many channels, not just Social Security.
We’re having tax cuts that are primarily aimed to help older people, because when the taxes are raised in the future, they’re not paying for themselves. We won’t be around, we’ll get to spend more, you guys will be around.
We’re changing the tax structure, just shifted more towards taxing younger people, who have labor income, and reducing the taxes on asset income, capital gains breaks and dividend tax breaks. We are expanding Medicare and Medicaid. Most of Medicaid, you know, which is health care for the elderly, 70% of those dollars go to the elderly, who are in nursing homes.
So through all the expansion of these programs and changes in them, we are expropriating younger people every way possible. Does this mean I don’t like older people? Some of my best friends are older. We obviously shouldn’t be pulling the rug out from under any poor older people and even lower-middle-class older people. But to not recognize that we have a massive imbalance, that we’re kind of Argentina in the making.
Argentina, in 1920, had 85% of our per-capita GDP, they were almost as rich as we are. Today, they have 14%. It’s all due to running these policies over a century. So this is a slow train wreck.
You asked the question, ‘When exactly will things hit the fan?’ Did Argentina ever have a single crisis that put it down, produced a great depression, or led everybody to leave the country? No, it’s been a series of many crises through the years. But it doesn’t mean there couldn’t be a default on U.S. debt or a default on Social Security, because we are really on a rapid pace over the cliff.
Simone Del Rosario: You said that you are outraged. Are you surprised that younger generations aren’t more outraged and more outspoken about this system, about how much we’re going to be left holding the bag?
Larry Kotlikoff: Well, I’m not all that surprised because nobody’s talking to them about this in these terms. Nobody’s saying that, compared to me and my generation, your generation is going to have 50% higher taxes.
We need some people that know what they’re talking about here and know the truth. But we have clowns like Trump, and President Biden is also taking Social Security off the table. So what’s all that about? Does he really understand what he’s doing here?
I think he would get more votes if he were educated about the problem and then he actually came out and said: ‘This has to be fixed.’ People would respect him. They’d say, ‘This guy is old enough to tell the truth.’ As opposed to, ‘This guy is old enough to know how the game is played.’ We don’t need to get to play the game again, the game we’re playing is suicide, economic suicide.
Simone Del Rosario: If politicians were to come forward, pragmatically, and say, ‘We need to come together and solve this problem. We are in a lot of debt and we can’t fund the promises that we made to the American people,’ they would get eviscerated, right?
Larry Kotlikoff: You have to appeal to what may not really exist, which is altruism. You have to say to older generations, look, I’m actually looking out for your kids, I want you to look out for your kids. I want you to vote for me, I want you to take a sacrifice.
We’re in this together. These are all our kids. And they’re going to be working together in teams. We want them to be able to survive, we want the country to survive. We have enough crazies out there trying to kill freedom, democracy, and we need to be strong. This is our future.
We were able to get people together when it was World War II, when we were attacked. Well, we’re being attacked by politicians, and so somebody needs to stand up and say, ‘The enemy is actually in the halls of Congress. They’re the ones who are putting our kids at risk. And vote with me, not with them.’
I don’t know, maybe that pitch won’t work. But it’s better to go down losing telling the truth than winning telling a lie and making your life an economic disaster.
Study reveals environment pays a high price for electric vehicles
As the U.S. moves toward its ambitious goal to electrify America’s vehicles, one study is adding some perspective on the real world costs it could have. Joint research by the University of California found that a full U.S. transition to EVs could require three times as much lithium than what’s produced right now for the entire global market.
The study claims this increased demand could lead to water shortages, the displacement of Indigenous communities, and the destruction of ecosystems beyond U.S. borders.
That’s because lithium, often dubbed as white gold, is the main component behind most modern electric batteries, and its demand is predicted to rise 40 times by 2040.
While this soft metal is abundant, 95% of its supply comes from just four countries: Australia, Chile, China and Argentina. It takes roughly 500,000 gallons of water to extract just one ton.
With three-fourths of Americans currently relying on cars to get from point A to point B, the U.S. would need a significant amount of lithium to meet its EV goals.
This study comes at a time when the Biden administration is investing historic funding for electric vehicles through bipartisan legislation where the efforts seem to be paying off. EV sales were up 65% last year, and over half of the nation’s car sales are predicted to be electric by 2030.
Morning rundown: Musk stepping down as Twitter CEO?; Texas migrant emergency
Elon Musk could to step down from his position as Twitter CEO; Texas is experiencing a migrant emergency; Messi’s triumphant World Cup good-bye. These stories and more highlight the morning rundown for Monday, Dec. 19, 2022.
Musk polls Twitter on ceo change
The Twitter-verse has spoken, voting for Elon Musk to remove himself as head of Twitter.
Out of 17 million votes, 57% said he should step down.
On Sunday evening, Musk said he’d abide by the results.
The poll comes after much controversy over Twitter policy, which Musk said from now on will be decided through polls. Starting with his position as CEO.
Final Jan. 6 Committee hearing today
The last House Jan. 6 Committee hearing is today. The members are expected to unveil their final report with any recommendations for criminal charges.
After a nearly 18-month investigation into what happened at the capitol on Jan. 6, 2021, the committee will formally adopt its findings.
Some sources say the committee will recommend criminal charges against former President Donald Trump to the U.S. Justice Department, charges that could include insurrection, obstruction, and conspiracy to defraud the government.
The hearing will begin at noon CST.
El Paso declares state of emergency
Something to watch for this week: Title 42 is expected to end in just two days.
The mayor of El Paso, Texas, has declared a state of emergency, as the historic influx of migrants has already overwhelmed resources before an expected surge.
The mayor declared a state of emergency on Saturday, saying the situation has grown unsafe. Migrants are sleeping on city streets in cold temperatures, while law enforcement is apprehending thousands of migrants daily.
The numbers are expected to double and potentially triple once Title 42 lifts on Wednesday.
Argentina wins FIFA world cup
And just like that, the FIFA World Cup has come to a close in dramatic fashion, with a shoot-out victory for Argentina over France.
Soccer fanatics are calling it the most thrilling end in the tournament’s history.
After a 3-3 draw, the game came down to penalty kicks.
Argentina won, hoisting the trophy, with soccer veteran Lionel Messi leading the way, earning a World Cup victory in the legend’s last dance before retirement.
Ronaldo, Messi among World Cup’s top-paid soccer stars but not No. 1
The best soccer players in the world make more than the top athlete in any other sport. Their salaries and endorsement deals eclipse the biggest names in basketball, American football or even boxing. Now, the best of the best are on display at the World Cup in Qatar. Here are the highest paid footballers in this week’s Five for Friday.
#5: Mohamed Salah
Liverpool’s Mohamed Salah makes $35 million solely for his efforts on the field, while his sponsorship and endorsement deals bring in an additional $18 million per year, according to Forbes. A total annual pot of $53 million seems warranted for a player who has won three Golden Boots as the top scorer in the English Premier League. Salah has an endorsement deal with Vodafone Egypt and even starred in an advertisement with Rick and Morty for Adidas. His national team, Egypt, didn’t qualify for the World Cup in Qatar, but at 30 years old, he still has time to make another run.
#4: Neymar
Neymar is like Cher or Madonna, an international icon that goes by a single name. The Brazilian superstar was part of a record $263 million transfer from Barcelona to Paris Saint-Germain in 2017. Neymar’s on-field compensation is $55 million and he makes another $32 million in endorsements, according to Forbes. He left a big contract with Nike to be the face of Puma in 2020. Now he’s hoping to lead Brazil to its sixth World Cup trophy, but that’s contingent on coming back from a nasty ankle injury he suffered during the group stage.
#3: Cristiano Ronaldo
Cristiano Ronaldo makes more in endorsements than any other footballer at $60 million per year, in addition to his $40 million salary, according to Forbes. He could be in line for the biggest payday in football if reports are true of his intent to sign a $207 million per year deal with Saudi Arabia’s Al Nassr FC. That will likely have to wait since his national team, Portugal, is still in the hunt for a World Cup title. Ronaldo has sponsorships with Nike and Clear Shampoo, to name a few. He even has an airport in his home country named after him, but it was a humorous bust honoring him that stole all of the attention. Don’t worry, they rectified the situation (sort of).
#2: Lionel Messi
Like the debate over Michael Jordan and LeBron James, soccer fans have been debating whether Ronaldo or Lionel Messi meet the criteria of greatest of all time, or GOAT. While that spat may never be resolved, Messi edges out Ronaldo in pay for now. The Argentine forward makes $65 million per year with Paris Saint-Germain and another $55 million off the pitch, according to Forbes. As Messi enters the twilight of his storied career, there are rumors he could return to Barcelona or even come stateside and join Inter Miami. He isn’t expected to make a decision until after Argentina’s World Cup run.
#1: Kylian Mbappé
At 23 years old, Kylian Mbappé is the youngest player on the list and the only one to already score a World Cup title. Mbappé shares the pitch with Messi and Neymar at PSG, collecting $110 million per year in salary with $18 million in endorsements, according to Forbes. Mbappé is also on the Nike roster, an ambassador for Dior and has been on the cover of EA Sports FIFA for the last three years. The French national team is hoping to win its second consecutive World Cup, which would surely add more to his bottom line.
