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Argentina's Milei: Ending the Debt State By Holding Politicians Personally Accountable For Fiscal Excess
Submitted by Thomas Kolbe
Only contrast reveals one's own mistakes. Javier Milei is the antithesis of Germany's political class, and the comparison could hardly be starker.
While Germany continues to expand the state, Argentina is slashing subsidies and radically reducing the size of its public bureaucracy. While Berlin piles up enormous amounts of public debt, Buenos Aires is posting a primary budget surplus. Friedrich Merz believes in the healing powers of state intervention, whereas Milei is deregulating markets and paving the way for an investment boom.
Argentina has achieved an economic turnaround while Germany continues its economic decay. Argentina's economy is growing steadily, private-sector employment is expanding, and the poverty rate is falling rapidly.
At a time when Germany is doubling down on debt, the arms industry, and green state planning, Milei appears like a comet defying both political gravity and conventional doctrines of government.
The Argentine president's latest initiative is the so-called "Grillete Fiscal"—literally, the "Fiscal Shackles."
Behind the martial name lies what amounts to a fiscal revolution. Milei first unveiled the proposal in his characteristically entertaining style during a televised address to the Argentine people. The bill must still be approved by Congress, where his party, La Libertad Avanza, is expected to secure the support of allied parliamentary factions in both chambers.
Although Milei lacks a parliamentary majority of his own, his alliances have thus far proved remarkably resilient.
If enacted, the legislation would break with one of modern politics' unwritten rules: the assumption that governments can always buy votes with higher spending, higher taxes, and ever more debt. The business of burdening future generations and taxpayers with politically manufactured credit expansion would, at least for the time being, come to an end.
Milei's idea is straightforward: future Argentine governments should have their wings clipped before they are even able to take flight on another debt-financed spending spree.
The mechanism is equally straightforward. Should the federal budget remain in deficit for several consecutive months, Congress would be given a deadline to restore fiscal balance. Failure to do so would automatically trigger a U.S.-style government shutdown. Non-essential government activities would be suspended automatically—without further parliamentary debate or political horse-trading. The President, Vice President, cabinet ministers, state secretaries, and every member of both houses of Congress would receive not a single peso in salary until the budget is balanced once again.
Furthermore, all new spending would be frozen. No new contracts could be awarded, and no additional public employees could be hired. Even more striking, discretionary transfers from the federal government to Argentina's provinces would also be suspended.
At the same time, the law deliberately protects the state's core responsibilities. Pension payments, healthcare services, unemployment benefits, as well as the salaries of police officers, members of the armed forces, and correctional staff would remain fully exempt from these austerity measures.
For Germany's statists, such a proposal is almost unthinkable. Rather than engaging with Milei's ideas or his policies, they prefer to ignore him altogether. For Chancellor Friedrich Merz, Milei has become something of a red flag. On one occasion during a televised interview, Merz claimed that the Argentine president was ruining his country and trampling on its people.
A typical Merz response. The German chancellor views the world through a prism that distorts reality. He speaks like a genuine believer in the omnipotent state—a conviction that has never been shaken by a lifetime spent safely within the political establishment.
Then, every once in a while, someone breaks ranks within Germany's left-wing consensus and says out loud what many of them truly think about Milei. He is supposedly "authoritarian," they claim, and a threat to human rights. In April of this year, Germany's Left Party even introduced a parliamentary motion describing Milei as "ultra-neoliberal." Coming from one of Germany's most statist political parties, such a label should be taken as a compliment. It says far more about the intellectual limitations of its authors than about Milei himself.
What is both striking and disturbing is how closely the German chancellor's rhetoric has drifted toward the coarse vocabulary traditionally associated with the political left.
Yet even Javier Milei cannot truly satisfy Germany's libertarians. Their intellectual figurehead, Hans-Hermann Hoppe, the former University of Nevada, Las Vegas professor and a student of Murray Rothbard, complained only months into Milei's presidency that he had failed to deliver on his central campaign promise: abolishing the central bank.
The criticism exposes a fundamental weakness of many libertarians: they inhabit the theoretical world of textbook logic. Within that framework, it seems inconceivable that abolishing the central bank overnight could derail Milei's entire presidency. It requires little imagination to picture the alternative—a financial collapse followed by the fall of the government, precisely the kind of scenario that would jeopardize Milei's entire reform project.
But it is not Milei's job to please everyone. In the end, every successful political leader disappoints almost every constituency. He hands out no favors and makes no empty promises. His uncompromising austerity program is detoxifying the state, restoring market economics, dismantling subsidies—and turning into losers all those who had long lived off the public purse without productive contribution, sustained by political patronage rather than genuine economic necessity.
If Milei stays the course and Argentina continues to regain stability, he is likely to go down in the nation's history as a libertarian reformer who combined conviction with prudence. Germany's statists—from Friedrich Merz and Lars Klingbeil to Ursula von der Leyen—would do well to prepare themselves. They may ignore him, ridicule him, or insult him, but reality has a habit of quietly making its way into people's minds.
As Nietzsche wrote in Thus Spoke Zarathustra: "Thoughts that come on dove's feet guide the world." Sometimes, however, they arrive accompanied by the roar of a chainsaw.
* * *
About the author Thomas Kolbe, a German graduate economist, has worked for over 25 years, he has worked as a journalist and media producer for clients from various industries and business associations. As a publicist, he focuses on economic processes and observes geopolitical events from the perspective of the capital markets. His publications follow a philosophy that focuses on the individual and their right to self-determination.
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Japan Looks To Palantir For Battlefield AI
Japan is preparing to introduce AI into the command-and-control systems of its Self-Defense Forces as part of a wider military modernization effort aimed at improving operational speed and interoperability with the United States, according to Nikkei.
Under the proposal, multiple U.S.-developed AI platforms would support commanders by processing battlefield data, assisting with tactical decisions, and coordinating operations across missions such as missile defense, counterstrikes, and drone deployments. The initiative is expected to be incorporated into revisions of Japan's national security strategy later this year as the government reshapes its defense posture over the next five years.
Among the technologies under consideration are Palantir's Maven Smart System, which analyzes intelligence and recommends targets and tactics, and Anduril's Lattice AI, which fuses information from sensors into a single operational picture while enabling autonomous coordination of drones and other assets in contested environments.
Nikkei reports that Japan currently lacks AI-enabled command systems, but officials see the technology as essential for keeping pace with increasingly data-intensive and fast-moving military operations. As cooperation with U.S. forces deepens, particularly following the launch of the Joint Operations Command in 2025, narrowing the gap in decision-making speed has become a growing priority.
At the same time, Tokyo is seeking to avoid long-term dependence on foreign technology. One proposal would place a Japanese-developed AI layer above the U.S. systems to determine which model is best suited for a given task. Sakana AI's Fugu, designed to orchestrate multiple AI models, has emerged as a leading option for this role and already works with Japan's Defense Ministry.
The government also plans to host the supporting data infrastructure within Japan to better protect sensitive military information. Even so, officials acknowledge that maintaining compatibility with U.S. AI platforms will be critical, creating a balance between rapidly adopting proven foreign technology and preserving the flexibility to transition to domestic AI capabilities in the future.
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OpenAI, Anthropic Models Created Fake Profiles, Tried To Trick Humans During Cyber Tests
Authored by Naveen Athrappully via The Epoch Times,
Artificial Intelligence (AI) models from Anthropic and OpenAI carried out unsanctioned actions targeting multiple people and organizations during a cyber evaluation, according to the UK AI Security Institute (AISI).
Illustration of Anthropic on June 18, 2026. Riccardo Milani/Hans Lucas via AFP via Getty ImagesAISI, which receives access to advanced AI models under voluntary agreements from major labs, put the agents through a fictional cybersecurity scenario to test capabilities.
The organization tested multiple AI models on two cyber challenges between July 25 and 28. In total, the challenges were run 122 times across several models, and in 19 cases, the AI models took "unsanctioned action on the live internet, including cases that targeted real people and organisations," AISI said in an Aug. 4 report.
Out of these, 17 were done by Anthropic's Mythos 5 model and two by OpenAI's GPT 5.6 Sol model.
"This is the first time AISI has seen deception of this severity that was targeted at a real person, unprompted, in the real world. It is uncertain to what extent the model recognised it was taking actions against real people," AISI stated in the report.
In the most serious incident, Mythos 5 tried to solve a cyber challenge by attacking GitHub, a cloud service that allows developers to store and manage code. The AI created a GitHub account and tried to get a malicious code approved by humans. Mythos 5 also created a second GitHub account, masquerading as another human user endorsing the malicious code. When a human reviewer caught the activity, the AI agent "falsely claimed to have made an honest mistake" and then repeatedly tried to reintroduce the malicious content by claiming the code was fixed.
Mythos 5 also sent multiple emails to two developers in an attempt to manipulate the recipients into running its malicious code.
According to AISI, the test runs of the various models did not result in any real-world harm. The organization said it was treating the AI actions as a "serious security incident" that requires further scrutiny.
AISI listed multiple factors that could have led to AI models acting in a concerning manner. The AIs were provided with internet access during the tests, which allowed them to carry out the unsanctioned actions.
AISI had also deliberately disabled the models' cyberclassifiers during tests. Cyberclassifiers are systems aimed at preventing misuse.
The AI models were also not explicitly told what they were prohibited from doing on the internet, AISI said, adding that clearer instructions may have prevented the unsanctioned actions.
In an Aug. 4 blog post, AISI said that since the behavior of AI models happened under specific conditions, it cannot say how likely such behavior will be in different contexts.
"What we can say is that the behaviour was possible, sustained, and new; that alone warrants attention," the organization said.
In an Aug. 4 post on X, Anthropic said that Mythos 5 and ChatGPT 5.6 Sol models attempted to complete their assignments in an environment where they were deliberately provided internet access and their normal safeguards were removed.
Due to the absence of specific restrictions on how the internet must be navigated and lack of safeguards, the models were tested under conditions that are "not representative of any of our production models," Anthropic said, adding that there was no evidence in these tests of an AI escaping from a secure environment.
According to the company, it was closely working with AISI to access more details on the incident while carrying out an internal investigation on the matter.
OpenAI said in an Aug. 4 statement that it appreciated AISI's partnership throughout the evaluation process, including the organization's work to identify, investigate, and share details about the activity of the GPT 5.6 Sol model in their tests.
"We look forward to continuing our collaboration together," the company said.
The Epoch Times reached out to Anthropic and OpenAI for comment but did not receive a response by publication time.
OpenAI was in the midst of another controversy last month after it admitted on July 28 that its models bypassed restrictions during an evaluation. In this case, the company was testing its models' capabilities in carrying out cyberattacks.
AI startup Hugging Face was impacted in the test. On July 16, the startup said it detected an intrusion into its data processing systems. It was only later that the startup learned that the intrusion was carried out by an OpenAI model.
HuggingFace then worked with OpenAI to contain the attack, the startup's CEO, Clement Delangue, said in a July 22 post on X, calling it "an attack unlike anything we've seen before."
"This is day one for cybersecurity in the age of agents & we're all learning that secrecy is not the answer & that all defenders (not just a few selected ones) everywhere need more powerful models without restrictions, especially open ones," Delangue said.
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