The Country of Missed Opportunities – or Sudden Transformations?

As a national brand to inspire enterprise, Argentina could hardly have been better named. The Silverland – a faraway country of extraordinary riches and boundless potential, as limitless as the vast plains of the Pampas.

Undeniably, Argentina is a paradox. There is a saying that it is “the country of missed opportunities.” Yet this is only partly true. Viewed through a longer historical timeframe, Argentina reveals moments of astonishing and unexpected transformation – periods when new ideas, new generations, renewed sets of elites abruptly reshaped its trajectory. These turning points have always arrived with conflict, uncertainty, and confusion, but also with renewal.

Silverland 5.0

The first Argentina was born as a greenfield project on the Spanish imperial map. In 1776, King Carlos III created the Viceroyalty of the Río de la Plata, choosing Buenos Aires, then a small frontier fort, as its capital. It was a geopolitical invention, conceived to defend Spanish South America from Portuguese encroachment and to control the flow of silver from Potosí (in present-day Bolivia) to Europe.

The second Argentina was made in the era of wars of independence: campaigns to Chile and Peru, struggles against foreign powers, internal conflicts, blockades, and the young nation’s first default.

The third Argentina was the liberal Republic starting in the mid-nineteenth century, integrated into the system of global commerce, welcoming mass immigration, expanding its frontier, building infrastructure and achieving spectacular growth. The granary of the world, it became the regional power.

The fourth Argentina began in 1930 – the corporatist Republic epitomised by Perón – dominated by state intervention, import substitution, autarky, recurrent military coups, chronic deficits, inflation and defaults.

The fifth Argentina may have just begun.

The Political Backdrop

Before Milei, Argentine politics revolved around personalities and social bases rather than divisions around ideas.

Peronism – neither a party nor an ideology but a “movement” – has long functioned as a political power machine: pragmatic, adaptable, and often contradictory. Over the decades it shifted from corporatist nationalism to centre-right populism to left-leaning statism, maintaining its cult of charismatic leadership and a near-religious hold over its base. During the Kirchner era, it aligned with the “21st-Century Socialism” of Chávez, Castro, and Lula da Silva.

The traditional opposition, the Unión Cívica Radical (UCR), began as a nineteenth-century liberal-populist force but gradually drifted toward social democracy. Supported mainly by the urban middle class but shared equally interventionist and redistributive instincts, it differed more in forms and its social base than in policy substance.  As with Peronism, it favoured high public spending and protectionism and held a suspicion of markets.

In the mid-2000s, Mauricio Macri founded Pro, the first modern, pro-market centre-right party in decades. Yet PRO lacked national reach and was obliged to form an alliance with the social-democratic UCR to win the presidential race in 2015. United by the anti-Peronist feeling, at the end the alliance covered a bigger spectrum of ideas than Peronism itself. The alliance found it impossible to reach a consensus on decisive change. Macri’s administration failed to deliver, and majorities pivoted back to Peronism in 2019.

The “Cultural Battle” – A Generation Re-Educated

Milei’s La Libertad Avanza (LLA) shattered that pattern. A television economist turned political outsider, he built a cross-class, cross-regional movement, especially among younger voters disillusioned with the political class and years of stagnation.

Milei often describes his project as a “cultural battle” in defence of the “ideas of Liberty” based on moral principles rather than economic efficiency. The natural rights to Life, Property and Individual Freedom are the basis of prosperity and societal harmony. His political mission, therefore, extends beyond reforming institutions: it seeks first to ‘re-educate’ the society.

Since long before his election, Milei managed to persuade audiences through televised debates, university-style lectures, and an unfiltered presence on social media. His direct language, emotional and rich in images, resonates especially with young Argentines, who are now quoting Hayek and Rothbard as naturally as their parents once referenced Perón and Che Guevara.

Milei often describes his project as a “cultural battle” in defence of the “ideas of Liberty” based on moral principles rather than economic efficiency.

The Second-Generation Reforms

Argentina remains one of the world’s most closed economies – a net exporter of agricultural goods and importer of capital goods. Sustainable growth, however, requires greater openness to trade and investment.

For over a century, domestic business groups prospered under corporatism, protectionism, and political privilege rather than competition. Each timid attempt at liberalisation triggered a crisis. The State, industrial groups, unions, media, lawyers and other professions together form a dense web defending the status quo.

Milei’s “second-generation reforms” directly challenge this ecosystem. They seek to reduce labour, tax, financial, regulatory, and infrastructure costs, through a phased sequence:

1. Labour reform (addressing 50% informality and an unsustainable pension system).
2. Tax simplification and efficiency.
3. Deregulation and openness to international trade.

The discomfort experienced over the last months signals not failure but a system in the process of reset. The recent success in the ballots should help calm the nerves.

The New Congress

In 2023 Milei was elected President with 56% of the vote in the second round of voting.

During his first year – with only 15% of seats in the lower house and 8% in the Senate – Milei passed major reforms through negotiation with the softer opposition (centre-left non-Peronist). His second year proved harder: as mid-term elections approached, the opposition misread the social climate and instinctively got harder. Congress blocked new bills and pressed for higher social spending, threatening fiscal discipline.

On October 26^th La Libertad Avanza won the mid-term elections in a remarkable fashion, with 41% of the votes nationally and achieving first place in 15 out of 24 provinces. Peronism has been reduced to its minimum expression ever in both chambers, assuming it stays united. Just as importantly, it dramatically purged the Congress from most “middle ground” social-democratic elements and provincial parties.

The new Congress changes the arithmetic:

• LLA cemented its alliance with Pro and now holds 44% of the lower house, against 39% of the hard opposition (Peronism + hard Left)
• In the Senate, it will control about 24% of seats (35% with Pro and allies) while Peronists of every kind will fall to about 39%, their lowest share ever.

Peronism is now leaderless and fragmented; its main figures are discredited or facing legal trouble. The contradictions within Peronism will now be impossible to hide. It is hard to imagine how they can reinvent themselves and stay even loosely united.

Governing Without a Majority

Can Milei achieve reform without outright congressional majorities? It should be possible.

Roughly a third of Congress is filled by Peronist factions. Yet Peronism is divided and demoralized – its leading figures are polarizing or discredited. Roughly two thirds of Peronists will oppose Milei unconditionally. However, Peronism is a pragmatic movement, far left elements are alien to the more conservative strands from the interior provinces. Some may soften their stance, aligning with a pro-growth agenda that better serves their constituencies’ interests.

The other independent provincial parties and remnants of the UCR will be poised to provide the additional votes needed for Milei’s ambitious reforms. If something has been demonstrated in the recent elections, it is that opposing the government while seducing the centrist voter is impossible.

Why hasn’t this logic worked in the past? There are 3 differences with the Macri experiment:

1. In just two years, Milei has skilfully managed to re-ordain the political spectrum around a dialectic of ideas rather than forms, class or geographies. For the first time in 100 years, there is a clear Right with a consistent cohesion around a common vision. Against a project that promises to regain the past prosperity via clearly defined common sense policies, the Left are proponents of the mediocrity of the present, vociferating meaningless slogans. Voting with Peronism against any attempt of reform has been penalised in the ballots. Shifting towards a more constructive opposition might be the way to go if they want to have a chance of being re-elected in 2027.

• The energy boom is a reality and will soon become a second engine of growth on par with agriculture. For the first time, Argentina’s growth potential is diversified across multiple sectors and all provinces. Provincial governors stand to benefit from access to capital and the stable policies being proposed at the federal level. They, in turn, will put pressure on their own deputies and senators to support the reform agenda.

• By balancing the budget, Milei is not only fighting to reduce inflation, but he is also strengthening the Federal Government position vis a vis the provinces. Once the golden rule of zero deficit + zero new debt has been established, the political game of bargaining votes for funds has ended; or at least sets clear boundaries on the expectations of the political agents. This time the provinces will have to “pay with votes” now, to receive what can only be delivered in the future.

As in the mid-1850s, ideas matter – but to help align interests, nothing is better than business…  

Economic Drivers for the Decade Ahead

Unlike the 1990s – when reform lacked external engines – Argentina now has multiple potential growth drivers across a wide range of sectors, emerging simultaneously:

1. Farming & Agro-industry: improved terms of trade, lower taxes, better infrastructure and renewed productivity.
2. Oil & Gas: the Vaca Muerta shale basin (world’s #2) scaling up exports.
3. Mining: copper, lithium, uranium, silver, and rare earths remain underdeveloped; reform could unlock billions.
4. Clean Energy: world-class wind and solar potential, plus an advanced SMR nuclear programme (ACR-300 projected by 2030).
5. Information Technology: Latin America’s leading software hub (Mercado Libre, Globant); Patagonia is poised to host AI infrastructure – OpenAI recently announced a $25 billion USD data-centre project.
6. On-shoring Industry: cheap energy, skilled labour, and sea access favour relocating energy-intensive manufacturing.
7. Infrastructure: ports, roads, railways, and navigable rivers ready for rapid modernisation.
8. Housing: a deficit of four million homes – a vast potential engine for construction, jobs, and domestic demand.
9. Tourism: from glaciers to vibrant cities, deregulation and cheaper flights could make tourism a pillar of foreign-exchange earnings.
10. Entertainment & Sports: deregulation and digital infrastructure open opportunities in media, film and professional sports business.

“…dwelling on what lies in the rear-view mirror is no longer an option.”

What can go wrong?

Argentina’s greatest risk is also its most fascinating advantage. Why has the country so often drifted into isolation? The answer is simple: because it can afford to. Argentina can be remarkably self-sufficient for long periods of time. While most economies would collapse under such strain, Argentina does not. It can bleed almost to death – consuming its own capital – and only then does it feel compelled to change.

And because Argentines are passionate by nature, they fervently embrace ideas, right or wrong. Liberty is embraced with passion, reinterpreted differently each generation. The gaucho was a free lonely wanderer of the Pampas; the elites of Buenos Aires fought for independence from Spain and foreign powers; the interior provinces sought autonomy from Buenos Aires; Peron led Argentina to autarchy vociferating for freedom from foreign capital…

Milei redefines liberty once again: freedom from State oppression, echoing the nineteenth-century liberal tradition. It resonates with a generation weary of social decay and inaccessible privilege. Whether this tide endures will depend on whether institutions can anchor it.

The United States may now play the pivotal role once held by Great Britain in the nineteenth century. A conscious alliance built on shared values and mutual interests – trade integration, strategic cooperation, and capital flows – could provide the external anchor Argentina has lacked since the 1930s. Voluntary dollarisation, if achieved, could cement that bond. The sacred rule must remain: “not even one drop” of fiscal deficit.

Mulligan — A Second Chance

Is Argentina being offered a second chance? It may not be the country of missed opportunities after all. The path ahead remains uncertain and strewn with obstacles, yet dwelling on what lies in the rear-view mirror is no longer an option.

Whether President Milei’s libertarian experiment succeeds will depend not only on his ability to consolidate alliances, maintain fiscal discipline, and unleash long-suppressed productive forces, but – more decisively – on a generational change of mentality already taking root.

For the first time in generations, the conditions for a structural economic take-off appear within reach. If Argentina seizes this moment, the fifth Argentina – Silverland 5.0 – could mark not merely another cycle, but a durable road to prosperity, fulfilling at last the promise that has so often eluded it.