Full Javier Milei's Speech at CPAC (VIDEO + ENGLISH TRANSCRIPT)

Discover the powerful message delivered by Milei as he urges the audience to hold onto their freedoms and resist the advance of socialism in a spirited speech in the US.

Neoclassical Economics and Market Failures

Neoclassical economics often highlights market failures, providing ammunition for the rise of socialism and hindering economic growth. The conflict between neoclassical models and real-world scenarios results in labeling reality as a market failure.

Pareto Optimality and Market Failures

Pareto optimality, striving to not improve one without making another worse, is synonymous with market failures. These include non-convexities, externalities, and asymmetric information, paving the way for state intervention.

The Division of Labor and Social Cooperation

Adam Smith's doctrine of increased productivity through the division of labor and the vital role of free trade in fostering peace and prosperity, and its impact on socialism, are brought to light in this section.

Entrepreneurs: The Foundation of Prosperity

The significance of entrepreneurs in driving prosperity and the neoclassical dilemma within the theory of economic growth, backed by empirical evidence, takes a closer look in this segment.

Mathematical Structure, General Equilibrium, and Pareto Optimum Analysis

A deeper understanding of the mathematical underpinnings, general equilibrium, and its impact on economic growth are articulated, shedding light on its implications on the overall market dynamics.

Regulations, Corruption, and Argentina's Economic System

The flawed traditional analysis of monopoly regulation, the role of profits in driving economic growth, and the adverse effects of regulations and corruption on the Argentine economic system are meticulously examined.

Fighting Corruption and Socialism

Unveiling the perils of corruption and socialism in Argentina, this section delves into the threats they pose and the proposed measures to foster freedom and competitive market structures while eradicating corruption.

Value Creation and the Market as a Discovery Process

The concept of the market as a discovery process and the creation of value through production, justifying its appropriation by the discoverer, are elaborated upon, highlighting the productive and fair nature of the system.

Population Growth and Resource Scarcity

Dispelling the myth associating population growth with resource scarcity, this section emphasizes the need to focus on colonizing other planets rather than controlling population as a solution to resource scarcity.

Milei's Persuasive Speech on Defending Freedom

Milei's passionate speech advocating the defense of individual freedoms and resistance against the encroachment of socialism resonates as the spirit of his invigorating message is conveyed.

Conclusion:

Milei's compelling discourse in the US serves as a clarion call to safeguard individual freedoms, resist the lure of socialism, and embrace measures that foster economic growth and prosperity.

 TRANSCRIPT

"Long live freedom! [Applause] It seems that what was initially perceived as a neighborhood phenomenon has significantly expanded. First and foremost, I am deeply grateful for this invitation. Regarding today's conference and its impact, I previously spoke at Davos where I emphasized the danger the West faces due to the rise of socialist, statist ideas. Today, I will focus on the technical foundations that underpinned the political perspectives I shared at that conference. I will discuss how neoclassical economics and its view on market failures facilitate the progression of socialism, ultimately hindering economic growth and the fight against poverty.

The crux of this issue lies in a methodological conflict between theoretical models and real-world scenarios. Generally, when a model fails to align with reality, we adjust or discard the model. However, in the neoclassical framework, when there's a discrepancy, they tend to blame 'reality' for causing 'market failures.' This originates from studying the normative aspects of competitive equilibrium – existence, uniqueness, and stability. The problem arises with normative analysis through Pareto analysis. Pareto optimality suggests that improving someone's situation without worsening another's is a Pareto improvement. When these opportunities are exhausted, we reach a Pareto optimum, leading to the definition of 'market failures' – non-convexities, externalities, public goods, asymmetric information, and the Prisoners' Dilemma. All these definitions enable state intervention and the advancement of statist and socialist agendas.

To illustrate this, consider the transition from candles to light bulbs. If interventionists had their way, we'd still be using candles instead of enjoying modern lighting. This is how socialism can negatively impact our lives. We need to move beyond the Pareto optimum and embrace progress.

The market is a process of social cooperation where property rights are exchanged voluntarily. Since exchanges are voluntary, the concept of 'market failures' becomes irrelevant. The foundations of the market include private property and minimal state intervention. The price system, emerging from these exchanges, acts as an information transmitter and coordination mechanism.

Private property and free markets facilitate economic calculation, debunking the feasibility of socialism. Socialism lacks private property and market mechanisms, leading to inefficiency and distortion. Competition, not in the neoclassical sense of perfect competition, but as free entry and exit, is crucial.

Adam Smith's concept of the division of labor and social cooperation underlines the inefficiency of socialist ideas. Smith showed how specialized labor significantly boosts productivity. However, without demand, the division of labor can't be fully realized. Despite any personal differences, market participants must cooperate, promoting peace and undermining socialism.

Successful businessmen in a capitalist system benefit society by providing quality goods at better prices, creating jobs, and fostering progress. Entrepreneurs are the bedrock of prosperity.

Now, let's address the neoclassical dilemma within economic growth theory. Historical data shows that from the Christian era to 1800, GDP per capita was relatively constant. However, from 1800 onwards, it increased over 15 times, and the global population grew from 800 million to 10 billion. This period also saw a dramatic decrease in extreme poverty, from 99% to 5%. Neoclassical theory criticizes monopolies, yet this period of monopolistic structures brought immense well-being and poverty reduction. The neoclassical analysis is flawed because it oversimplifies and fails to consider future impacts and the entire economy.

Monopolies, according to neoclassical theory, produce less and charge more. However, monopolistic profits can spur consumption, production, and employment in other sectors. Saving these profits leads to investment and growth. Even if a monopolist hoards wealth, it reduces the money supply, lowering prices and benefiting the population.

Interventions in the name of social justice, unlimited democracy, and populism often harm the economy. Countries like Argentina, once among the world's richest, have fallen drastically due to excessive regulations and state interference.

Capitalism, contrary to accusations of hyper-individualism, is not only more productive but also fair. The market, as a discovery process, creates wealth during production. Those who discover or create new value rightfully own it.