Hatchet job

Argentina's newish president wants to take a hatchet to inflation. These axe swings will cut inflation, but they'll also kill people.

Javier Milei has been Argentina's president for 123 days. He's managed to cause quite a ruckus in that time with his slash and burn management style. But consumer prices are still rising at an incredible 276% per year, and according to the Catholic University of Argentina, 57% of Argentines are living in poverty. Mr Milei inherited an economy in dire straits. However, poverty is getting worse, and his austerity plan is in the name of controlling inflation. Sure, the plan will eventually bring consumer prices under control, but higher unemployment and increased poverty will be the price.

Mr Melei's pain approach will slowly bring inflation down because it'll reduce the deficit and the amount of money in the economy. To help, Argentina's central bank has started to cut interest rates. The bank's theory is that cutting rates will reduce interest payments on its bonds, reducing the amount of money in circulation. That seems unorthodox to mainstream economists, but it's a good start. Lower …