The Elections in Argentina and Juan Bautista Alberdi

Translated by Gabriela Calderón de Burgos

Now is the time to work towards the reconstruction of our country. The executive power is backed by prestigious representatives from sympathetic political groups. These people, we hope, will be effective allies in Congress and work together with all of those who understand that a commitment to liberty is the principled foundation that will offer the best chances of success on a journey exceedingly difficult, full of threats and diverse and seemingly impenetrable obstacles.

Our country can experience a renaissance if we return to the concrete values that we should have never abandoned. Argentina can also be an example for the free world. For too many decades we have suffered under anti-​democratic currents in which property rights have not been respected, and where citizens feel persecuted, suffocated and crushed by an oversized state apparatus that is surrounded by megalomaniacs who conduct at their whim the lives and pockets of others. We can now return to democratic governance directed towards the protection of property rights and liberty.

Let us, then, now turn to the relevance of the famous author from Tucumán: Juan Bautista Alberdi, a figure who has inspired Javier Milei and others that want change in our country. While Alberdi’s ideas are of great relevance to us now, it perhaps doesn’t need saying that many do not see this since we have drifted so far from these values decades ago. There is an urgency to return to these values as they were indisputably the foundation upon which our country established itself as one of the nations with the highest moral and material progress from the Liberal Constitution of 1853 to the Second World War.

Following the military coups of 1930 and 1943, Argentina adopted statist practices that resulted in a prolonged decline leaving us in the desperate circumstances of the present day. President-​elect Milei understands that this statism is pervasive and destructive, and is woven into every aspect of our government. It is for this reason that he asserted that “there is no place for gradualism” in the coming reforms. With this phrase Milei has announced that the government will approach the fundamental issues that constitute the focus of the whole of the constitutional theory in our country. We have the hope that all politicians of good faith shall accompany him, leaving behind the entrenched and impoverishing collectivisms…and we also hope that the radicals will be inspired by the liberal principles of their extraordinary founder, Leandro N. Alem, and support Milei’s vision for liberty and prosperity.

We are going to cite just a few key ideas of Juan Bautista Alberdi, as they were outlined in two late nineteenth-​century works, namely, The Economic and Rent-​Seeking System of the Argentine Constitution (Sistema económico y rentístico de la Constitución Argentina) and Economic Studies (Estudios económicos). The ideas expressed in these two works provide the foundation for understanding the new government program.

This fundamental lesson explains the period between 1810 and 1853, which was rife with strongmen, racketeering, and banditry in the midst of failed attempts to establish a free society. The founding Constitution set the country on a new course by eradicating corruption and establishing the guiding principle of liberty among us. This turning point brought extraordinary progress which won the admiration of the world and attracted subsequent waves of migrants who came to these lands to “make America.” These were admirable advancements, only comparable to those of the United States, which were later rejected in favor of the barbarism of astronomical taxes, colossal debts, unstoppable inflation, labor regulations against working, and a blockade against international trade, all of which are typical of the most backwards banana republics in the world. We have been and we are still at present, colonized by our own governments.

Here we have the main thinker behind our Magna Carta (our founding constitution) pointing the finger at a central issue. Because goods do not grow on trees and there are not unlimited goods for everybody, it becomes essential to assign property rights to be able to place the always-​scarce resources in the hands of he who best tends to the needs of his neighbor. In doing so, traders that satisfy the requirements of others obtain profits and those that fail incur losses, as opposed to the pseudo-​entrepreneurs that thrive through alliance with political power and exploit their neighbors with privileges of different kinds. As has been shown, eliminating private property erases prices because these appear precisely as a consequence of the transactions involving property rights in a world of scarcity. This, in turn, eliminates the possibility of evaluating projects, accounting for gain or loss, or indeed, performing any economic calculus whatsoever. Before, I have used the following example to illustrate this impossibility: shall we build a road with concrete or with gold?

There are many ways to disrupt the free economy. Violations of property rights can be explicit, but they can also be violated through more obscure forms of state control, such as taxes or regulations. In this way, prices become blurred, and as they are the only indicators to know where to invest and where not to do so, capital is wasted. Remember, capital is the only cause of salaries and incomes in real terms. So, what follows is, without a doubt, poverty.

Here Alberdi addresses the absurdity of creating a central bank, especially when founded on a fiat money system. As the record shows, that institution can only proceed in one of three ways: to issue money, contract it or leave the money supply alone. This manipulation of the money supply and the price system leads us down the road we have already mentioned. Along these same lines, Alberdi also wrote: “The reform of a bank of the state is impossible. There is only one way to reform it: eliminate it.” This reveals that it is not possible to play at being a businessman, nor is it a function that can be simulated: either you are operating in the market with all its rigors and assuming risks with your own resources or you are doing it with the fruits of others’ labors. State banks only help those sectors preferred by the bureaucracy.

This declaration opposes legal positivism, which maintains that the law is that body of legal rules ratified by an authority. Natural law argues, to the contrary, that there are universal principles that inform our sense of justice. Just as the stones and roses have their attributes and features due to their nature, the human being also has universal qualities. These include individual rights, which come before the existence of the state apparatus and have a greater importance. The role of the state, in a free society, is the protection and guarantee of those rights. These observations are consistent with other arguments advanced by Alberdi: “The Constitution, by itself, creates nothing nor gives anything, she declares of man that, while equal under the law, some have been given greater ability than others creating in this manner the inequality of fortunes that are the product of capabilities, not of the law” (Sistema económico, p. 69).

In this sense, Alberdi offers a critique of the levelling nature of coercive redistributionism and offers instead an argument that the most efficient and productive are those who increase investment, which is what inexorably improves the social condition of the poor. Our author adds “The law could not have the power to make individuals equal in outcome, because it would have to violate liberty and property, and this process of giving to some and taking from others could not exist under the system of a Constitution that treats everyone equally as the essential foundations of the country’s laws” (Sistema económico, p. 69).

As a personal anecdote, I will share that I have this phrase inscribed in my home garden right next to a bronze likeness of Alberdi that a student gave to me. This idea captures the essence of the author of the Argentine Constitution. Alberdi is saying, in essence: do not interfere with the peaceful coordination and cooperation between individuals and avoid at all cost the megalomaniac and arrogant attitude of the authorities that administrate at whim the lives and pockets of others.

In the field of international commerce Alberdi reiterates that the state apparatus should not interfere with free movement and free trade. The state should not “make of customs a means of protection, nor much less of exclusion and prohibition without altering and contravening the stated spirit of the Constitution.” On this last point, he emphasizes that “protectionism” leaves the state extremely vulnerable. The calls for protective legislation (i.e. tariffs or similar regulation) are for rent-​seeking businessmen who – if they cannot compete due to a lack of resources – should associate themselves with other locals or foreigners instead of passing on the bill to inadvertent citizens. If nobody buys their goods or services it is because they are not viable. Alberdi adds, “The passport, invented by the despotism of the French Convention of 1793, is a means to scare the people and effectively converts the territory of a nation into a jail…from the passport to the customs duty there is but only one step. One is the custom for persons, the other is the passport for things” (Sistema económico, p.96). It goes without saying that the state should still be vigilant in controlling crime and delinquency, whether it comes from abroad or inside the national borders. National boundaries can be positive in that they decentralize power by dividing it among different countries, but when those national boundaries become methods of restricting trade and the free movement of persons, they become abusive.

This is a very brief overview of the values promoted by Juan Bautista Alberdi, who, as he tells us in his Autobiography, has been inspired by authors such as Adam Smith, Montesquieu, Jeremy Bentham, Benjamin Constant, Alexis de Tocqueville, Frederic Bastiat, Jean Baptiste Say, Story, and so many others, ideas that are summed up in the title of this renowned commencement speech at the School of Law on may 24^th, 1880: “The omnipotence of the State is the negation of individual liberty” (Spanish).

Finally, to those readers that wish to explore more deeply this excellent thinker I would add that his Obras Completas (Complete Works) are compiled in eight volumes and his Escritos póstumos (Posthumous Writings) in sixteen additional volumes, all of which amounts to about 15,000 pages in their original editions.

This article was originally published on Infobae (Argentina) on November 25, 2023, and republished on ElCato on November 27th.