BUENOS AIRES – Argentina’s President Javier Milei took office Sunday with a dire warning to citizens to prepare for painful austerity measures as he tries to slash spending and curb triple-digit inflation, all with empty coffers.

The 53-year-old libertarian addressed thousands of supporters on the steps of Congress who waved flags and chanted “Freedom!” and “Chainsaw!” in reference to the power tool he carried around on the campaign trail to symbolize spending cuts.

“There is no money,” Milei said, vowing to end the “decades of overspending decadence” of his predecessors, who he said had left him “the worst legacy” of any previous administration.

Latin America’s third-largest economy is in ruins after decades of debt and financial mismanagement, the annual inflation rate is 140 percent and 40 percent of Argentines live in poverty.

Milei said his election was a turning point in history like “the fall of the Berlin Wall” and that the only solution for the economy was “shock treatment.”

“We know that the situation will worsen in the short term. But then we will see the fruits of our efforts.”

Milei – a self-described “anarcho-capitalist” – warned of spending cuts amounting to 5 percent of gross domestic product in a country where millions are on welfare and have become accustomed to high energy and transport subsidies.

“I AM THE LION”

During his swearing-in, he received the presidential sash and baton, the handle of which was personalized with the faces of his five dogs – cloned from the cells of a beloved, deceased mastiff

After his speech, Milei made his way to the presidential palace, Casa Rosada (Pink House), waved to supporters and was flanked by his sister Karina, his closest confidante, whom he has appointed secretary to the president.

Appearing on the balcony, he addressed the crowd again, singing “I am the lion” and chanting his slogan, “Long live freedom, damn it!”

Earlier, Milei spoke briefly with Ukrainian President Volodymyr Zelensky on the steps of the congress, and the two men embraced warmly.

The ceremony was also attended by Hungary’s nationalist Prime Minister Viktor Orban – the only EU leader to have close ties with Russia.

“The right is rising not only in Europe but all over the world,” Orban wrote on social media, sharing a picture of a meeting with his “good friend,” far-right Brazilian ex-President Jair Bolsonaro, also in the city was.

THE CHAINSAW

The Cabinet was the first victim of Milei’s symbolic chainsaw as he reduced the number of portfolios from 18 to nine and sworn in his new ministers.

Milei’s inauguration caps a meteoric rise for the former television panelist, who entered politics just two years ago.

His tirades against the “thieving” establishment fired up voters and drew comparisons to leaders like Bolsonaro and former US President Donald Trump.

With his deliberately tousled head of hair and rock star persona, he brandished a powered chainsaw at political rallies and vowed to “blow up” the central bank and replace the ailing peso with the U.S. dollar.

But with few members of his party in Congress, Milei has softened many of his positions since his election, allying with politicians he had previously insulted and adding some to his cabinet.

Economy Minister Luis Caputo and Security Minister Patricia Bullrich held their respective portfolios under former President Mauricio Macri (2015-2019), with whom Milei formed an alliance.

The discussion about closing the central bank and dollarization has now faded away.

‘STAGFLATION’

Among the questions that will be on Argentinians’ minds in the coming days is whether Milei will devalue the tightly controlled peso and ease currency controls that have spawned a variety of dollar exchange rates.

Economist Victor Beker of the University of Belgrano said the first “litmus test” for Milei will be whether he actually stops the money printing he so much derided by Argentina’s central bank, which finances much of the government’s spending.

Milei warned that it could take between 18 and 24 months for inflation in the country to be under control.

For 2023, the International Monetary Fund (IMF) forecasts a decline in Argentina’s GDP of 2.5 percent.

“Maybe it will take us many years to rebuild the country, but maybe this is the beginning of a new era for us,” said Javier Lobos, 41, a shopkeeper.