Milei: Long live freedom, dammit
Summing up, Javier Milie again criticises the failing Western system, saying it leads to unwelcome interventions such as subsidies and price controls, which hinder the free work of markets.
And in conclusion, he praises business people in the audience, and beyond, in a memorable crescendo, telling them:
Do not be intimidated, either by the political class or by parasites who live off the state.
Do not surrender to a political class that only wants to stay in power and retain its priviliges.
You are social benefactors. You’re heroes, You’re the creators of the most extraordinary period of prosperity we’ve ever seen.
If you make money it’s because you make a better product at a better price, Milei insists, declaring:
The state is not the solution, the state is the problem.
From today, Argentina is your “staunch , unconditional ally”, he pledges.
And in a memorable mike-drop, Milei declares:
Thank you very much, and long live freedom, dammit.
And with that, he’s off the stage. No opportunity for questions, alas (although where to begin?…..)
Updated at 10.37 EST
Having taken a mighty swing at western economic values, Javier Milei then turns to feminism.
He tells Davos that libertarianism states that we all have inalienable rights.
The “radical feminist agenda” has led to greater state intervention, Milei lectures WEF, citing ministries of women or international organisations dedicated to this agenda.
[Milei doesn’t explain, though, how this libertarian vision accounts for UK women effectively working two months for free due to the gender pay gap, for example]
Updated at 10.24 EST
Milei goes on to attack social justice, saying that it is not just – instead, it is intrinsically unfair because it is violent.
This violence, he says, is because taxes are collected coercively.
Thus the state is financed through coercion, Milei says. And by this logic, the higher the tax burden, the higher the coercion and the lower the freedom.
Milei adds that it isn’t a given that there is a pie of wealth to be carved up.
Updated at 10.18 EST
Turning to economic theory, Milei says that the market is not merely a graph showing supply and demand, but actually a market for social cooperation.
He argues that the dilemma faced by neoclassical economies is that they want to tackle problems in the market by stopping market failures.
But tackling market failures, perhaps through regulation or subsidies, you are opening up the way to socialism.
In Milei’s libertarian book, state intervention is harmful.
Updated at 10.17 EST
Socialism is always, everywhere, an impoverishering phenomonen everywhere it has been tried, Javier Milei insist.
It has also murdered 100 million people, he adds.
[this is a claim that communism was the leading ideological cause of death between 1900 and 2000, with 94m perishing in China, the Soviet Union, North Korea, Afghanistan, and Eastern Europe].
Updated at 10.13 EST
Milei goes on to attack collectivism, saying it binds the hands of entrepeneurs.
He rattles through a flurry of economic statistics, saying that between 0AD and 1800AD, global GDP per capita stagnated, apart from a pick-up after discovery of America.
GDP per capita only rose by 0.02% annually, he says, so almost no growth.
In the 19th century, in the industrial revolution, the compound annual growth rate was 0.66%, so would need over 100 years to double.
But this rate has picked up, so that in 2000-2023, the growth rate then accelerated to 3% per year, so can double in 23 years.
Updated at 10.04 EST
Argentina’s Milei: The western world is in danger
Next up, on a busy day in Davos, is Argentina’s new president, Javier Milei, who is giving a special address.
This could be interesting… Milei flew by commercial jet to the World Economic Forum in Davos yesterday, taking selfies with passengers on board and criticizing what he called the event’s “socialist agenda”.
Klaus Schwab introduces Milei, contratulating him on his victory in the presidential election. This is your first foreign trip since, he points out.
Schwab, who has a dab hand introducing world leaders, says Milei’s “more radical methods” have “introduced a new spirit to Argentina”.
Milei then takes the microphone.
And he warns that “the Western world is in danger”, declaring:
Those who are meant to defend the values of the west have been co-opted by a vision of the world that inexoriably leads to socialism, and therefore poverty.
The main leaders of Western countries have abandoned freedom, in favour of collectivism, Milei claims.
These are not the solution to the world’s problems, he says, but the root cause.
Free market capitalism is the only way to tackle poverty, and the only morally desirable solution, he argues.
Updated at 09.57 EST
UNDP chief: More countries in debt distress, and possible default
The prospect of lower interest rates is bringing no relief to heavily indebted problems of the world’s poor countries, according to Achim Steiner, administrator of the UN development Programme (UNDP).
Steiner said in an interview here in Davos that:
“More countries are finding themselves in the realms of debt distress and possible default.”
Last month the World Bank said rising borrowing costs had pushed annual debt repayments to a record $443.5bn in 2022 and Steiner said this was having a profound impact on the ability of poor countries to grow sustainably.
“Countries are being left to fend for themselves or face choices that are brutal” Steiner said, adding:
“They are not able to pursue the development strategies they want but instead are going for whatever growth they can get”.
“Debt repayments mean they don’t have the money to invest in the energy transition, educating their children, and building more resilience in health systems.”
Updated at 09.44 EST
David Cameron can’t escape his responsibility for Britain’s exit from the European Union at Davos today.
At the end of his session on supporting Ukraine, the foreign secretary is asked.
Q: You talked about the strength of the UK economy – doesn’t that show you were wrong to worry that Brexit would damage growth? Hasn’t Brexit been a big success?
Lord Cameron says the country made its choice in 2016 – now politicians must make it work.
He says Britain is demonstrating that it is perfectly capable of building a relationship where we are friends, neighbors and partners with the EU, and making it work.
He cites the response to Russia’s invasion of Ukraine as an example.
[On the growth point, the UK is currently on the brink of a technical recession, having contracted slightly in July-September].
Updated at 09.21 EST
Cameron: confident Rwanda bill will pass tonight
Q: Rwanda’s president Paul Kagame has said today [to the Guardian] there are limits for how long this can go on? Are you worried the deal could collapse?
David Cameron replies that he is confident the Rwanda bill will be passed tonight, when it has its third reading in the House of Commons.
[reminder: last night, two Conservative party deputy chairs resigned after defying Rishi Sunak and backing rightwing challenges to harden up his Rwanda deportation bill].
“We have signed this new treaty with Rwanda which puts beyond doubt that there are no dangers of asylum seekers being sent back to the country from which they came if they genuinely are asylum seekers…. I think that is important”.
And regarding the recent Supreme Court judgement against the scheme, Cameron says there is a huge pack of information abotu what Rwanda is like as a country. He says Rwanda now hosts schools that have relocated from Sudan, for example.
Of course we want to see this resolved; that’s what the bill, the treaty, the process is all about, Cameron declares.
Updated at 09.36 EST
Cameron denies Rwanda bill makes UK an embarrassment on world stage
David Cameron is then asked about the political row over Rishi Sunak’s Rwanda deportation bill.
Q: Is what’s happening over the Rwanda bill an embarrassment for the UK on the world stage, here in Davos?
Quite the contrary, Cameron insists.
He says the problem of illegal migration is one that every country has to deal with, particularly in the West.
And, Cameron claims, there are “two sorts of politicians” when it comes to this issue.
He says it’s “absolutely fine” to talk about dealing with backlogs of asylum seekers, to talk about smashing criminal gangs, to talk about collaboration with neighbours and partners, all things the UK is doing.
“But unless you’re prepared to do something that stops this trade in human beings, that means if you take a boat from one perfectly safe country, France, to another perfectly safe country, Britain, you won’t be able to stay in the country…. then you are a politician that has got nothing to say about solving this problem.”
He adds that the government’s approach is “quite unorthodox in some ways”, but out-of-the-box thinking is necessary to break the model of this “appalling people smuggling” that undermines the UK immigration system and also costs lives.
“We’ve seen this week, another four people drowning in the freezing cold water of the English channel on a January night. We’ve got to stop this.”
Cameron says there is a “growing understanding” about the need to take these novel steps, when he speaks to leaders from Italy, Austria and elsewhere.
Updated at 09.35 EST
Cameron: working very hard on using Russian assets for Ukrainian reconstruction
Lord Cameron has told delegates in Davos that there is a clear case for frozen Russian assets to be used to help pay for the reconstruction of Ukraine.
David Cameron is speaking on a panel discussion on the Ukraine war, as it moves towards its third year.
The UK foreign secretary points out that the countries backing Ukraine have a combined GDP 25 times larger than Russia.
We just need to make our support count, Cameron says.
And he argues that if you zoom out and look at the big picture, the Ukraine war has been a catastrophic disaster for Putin.
Russia has lost half the territory it captured early in the war, and has been sanctioned by a large swathe of the global economy.
Cameron also points to Ukraine’s progress in the Black Sea; with the Black Sea open, Ukraine is trading through its ports again.
Cameron says “Ukraine has done well, is doing well”, so the priority is to help Ukraine through this winter, and set up a system so that Ukraine can win in what will be a longer war.
Cameron is then asked about whether using Russian assets for Ukraine’s reconstruction would be legal.
He points out that the assets have already been frozen; the question is what we do next.
Legally, Cameron says there is growing support for the idea that these resources can be used in some way.
As a moral issue, he says Russia will have to pay reparations when the war is over, so why not use the assets now?
And the political angle, is that when Putin launched this illegal invasion, the world changed, and we need to change with it, Lord Cameron says.
We are now in a more uncertain world, so we need innovative thinking, Cameron says.
He adds that he is “certainly working very hard” on the issue, the rest of the G7 are too, and he’s confidence there will be progress.
Updated at 08.30 EST