The Impact of Shock Therapy on Argentina's Economy

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Argentina had severe inflation when Javier Malay took office, promising that things would worsen before improving through a strategy he called shock therapy. Malay immediately implemented austerity measures such as cutting government spending, laying off employees, and devaluing the peso. This led to a significant increase in inflation, reaching 250%, and pushed more than half of the population below the poverty line. The short-term impact of Malay's shock therapy was detrimental, causing widespread economic hardship.

US inflation feels bad until you look at Argentina’s, which is breaking 200 percent. Today, Explained’s Sean Rameswaram reports from Buenos Aires, where residents are divided over their new anarcho-capitalist President Javier Milei’s shock therapy.

This episode was reported by Sean Rameswaram, produced by Miles Bryan, edited by Matt Collette, fact-checked by Laura Bullard and Jesse Alejandro Cottrell, engineered by David Herman with help from Rob Byers, and hosted by Noel King.

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