Crowds of citizens across the country on Wednesday 24 joined the strike against reforms aimed at deregulating the Argentine economy and reducing the size of the state and its levels of intervention pushed by the government of Argentina’s ultra-right-wing president Javier Milei.
In barely 45 days in office, Milei has lost several points of support in society and the conviction of many who still want or need to believe him has weakened. The government did not expect this adhesion to the trade union-popular call, appealed to intimidation and threats and only succeeded in motivating the demonstrators even more.
After the strike, which had a very strong resonance worldwide, the political mood of society changed and the hegemonic discourse that brought Milei to the Casa Rosada retreated, demonstrating that it is impossible to carry out such regressive structural changes without strong popular resistance and maintaining governability.
Without support, the government is forced to backtrack on the economic package it tried to put in the Omnibus Law. The Minister of Economy, Luis Caputo, announced the withdrawal of the proposals on withholding taxes, pensions, income tax, laundering and others, to try to unblock the negotiations in Congress. The bill maintains the delegation of legislative powers in the hands of the President, which means that, if the bill is approved, he could take these and other decisions by decree.
“If the delegated powers are approved, as they are in the bill, the president can change the entire socio-economic order without going through Congress. And that means that he can impose retirement formulas, withholding taxes and whatever else, by delegated decrees,” said constitutionalist Andrés Gil Domínguez.
The announcement by the Minister of Economy, Luis Caputo, on the removal of the fiscal chapter of the Omnibus Law, provoked immediate reactions from the opposition. “Caputo’s announcement: a step backwards that could still be a trap”, headlined Página12. There was a step backwards by the government, but the delegated powers, privatisations and the threat to the Sustainability Guarantee Fund remain, among other serious consequences of the Omnibus Law that is still in Congress.
But a large part of the adjustment has not yet been fully felt, but will only be devastating in February and March with the brutal increase in public transport, electricity and gas bills multiplied by eight, and eventually a new devaluation and the consequent transfer to prices. This mismatch between the utopian model of Milei, who received the backing of the ballot box, and the corporate models of Federico Sturzenegger and Luis Caputo, produces permanent turbulence.
But the verbose leader – who lacks any answer to concrete problems – appears strangely silent while Security Minister Patricia Bullrich seems to be competing for the government’s leading role. At first it appeared to be a competition with vice-president Victoria Villaruel, who endorsed and retweeted a Financial Times article that said that “the vice-president is ready for anything”, suggesting that she could replace Milei.
The president sensed some kind of plot and removed Villaruel from the two key ministries he had been promised: Security and Defence, and gave them to Bullrich. Competition with Villaruel seems to be a thing of the past and Bullrich is aiming for more and more prominence, while rumours are growing that it is not Milei but his sister, Karina, who is calling the shots.
Threats or extortion
In a cabinet meeting, the ultra-right-wing president Javier Milei made more threats against the provincial governors for their rejection of different points of his omnibus bill, on state downsizing and economic deregulation, the approval of which is uncertain. “I’m going to melt them all down,” he threatened.
The vice-governor of the southern province of Río Negro, Pedro Pesatti, said that “if the president threatens to leave the provinces without the fiscal resources that correspond to them, the provinces, like those in Patagonia, could leave the national government without oil, without gas and without hydroelectric energy”.
“But to reach that point would be to put Argentina on the brink of national dissolution or civil war, and that is what the president should consider before expressing himself with such levels of violence by using threats as a method,” Pesatti added.
Milei requested the resignation of Guillermo Ferraro from the Ministry of Infrastructure, the first resignation of a minister in his cabinet, accused of having leaked a phrase of the president against the governors.
The tricky thing about any negotiation is that legislators never know if what they negotiate will later be vetoed by Milei, and the biggest fear is that if he is granted the extraordinary powers he requested, it is unclear whether everything that was removed it from the text in those negotiations will not later be installed by executive decree.
In an interview with the Colombian Patricia Janiot on CNN en Español, Milei described the strike as something that “has nothing to do with legitimate demands” and once again raised the issue of dollarisation, while confessing that it is not possible to say when the economy will be reactivated. He returned to the Malvinas issue – a “geographical dispute” – and hoped to make progress towards “non-violent coexistence”.
“Anything on which you are willing to compromise?” asked Janiot. “Nothing. Freedom is not negotiable,” he replied. “I will not be allied with communists, I will not be allied with the Brics, my models are the West, Israel and the United States”. And he again denied the need for state mediation in foreign trade relations: “In the debate I said that people can negotiate with whoever they want, I am a liberal”.
An end to enthrallment
The rapture with the figure of the far-right anarcho-liberal Javier Milei seems to have come to an end, after the nonsense he uttered at the Davos Forum and the resounding answer from Argentines to his plans to alienate the country with the general strike and marches last Wednesday, in which more than 1.5 million people took part.
The first stage of his presidency lasted 45 days, during which he tried to impose the Decree of Necessity and Urgency and the so-called Omnibus Law, which evaporated when the real data of the support the President can expect for the minimum contents of his mega legislative proposal, pompously called “Law of Bases and Points of Departure for the Freedom of Argentines”, were revealed in Congress.
Parliamentary support for the law was never there; and it surely will not be. The bill needed hundreds of changes, cuts and revisions, but even today it is shipwrecked without a destination. The government’s opinion amounted to 55 signatures stamped on a blank piece of paper, without showing the no-end text. But 61% of those signatories opened the umbrella and said they did not endorse the proposal, and left their “dissent” in writing.
The homeland is not for sale
Wednesday’s strike was the expression of those who came out to defend their rights, in the face of the ultra-right-wing discourse that tries to turn even feelings into merchandise and has an implicit disdain for anything that sounds like the homeland. Argentines marched with the slogan “the homeland is not for sale”, which is also “I am not for sale”, making it clear that not everything is merchandise, which is Milei’s message.
It was not only a failure for the president, but also for the security minister, Patricia Bullrich, for her “security protocol”, which prevents the crowds from walking through the streets, and for her attempts to provoke the demonstrators.
And to make matters worse, the United Nations warned Patricia Bullrich that her anti-march protocol and the Security chapter of the Omnibus law are incompatible with international standards.
The strike march of Wednesday 24th was the popular answer to the policies that in just 45 days have impoverished the majority, curtailed fundamental freedoms, made rights such as housing and health prohibitive, triggered corruption, favoured a handful of tycoons and brought the country to the brink of a financial and social abyss.
These policies were materialised mainly in the ten measures of the Minister of Economy Luis Caputo, a presidential mega-decree and the sending of the Omnibus Law to Congress, which quickly had an impact on the fall in the acquisitive power of workers, with a 120% devaluation and the liberalisation of the prices of food, services and fuel.
Professor and economist Horacio Rovelli points out that the names of the Red Circle are the same, they are the ones who are mainly organised in the Argentine Business Association (AEA), whose vice-presidents are, among others, Paolo Rocca (Techint), Héctor Magnetto (Clarín), Alfredo Coto (COTO Supermarkets).
They are those of the Argentine Industrial Union (UIA), presided over by Daniel Funes de Rioja (representative of the civil-military dictatorship in the ILO), whose law firm drafted the chapter on labour legislation of the DNU; those of the Chamber of Exploration and Production of Hydrocarbons (CEPH), whose president is Carlos Ormachea (appointed by Techint, Vista and Pampa Energía).
And also those of the Argentine-North American Chamber of Commerce (Amcham), whose president is Facundo Gómez Minujín, CEO of JP Morgan in Argentina, Uruguay, Bolivia and Paraguay (a bank whose investors include the BlackRock fund, the main holder of private debt in our country).
Likewise, the Minister of Economy, Luis Caputo, launched a message threat to the provincial governors in the context of the debate on the omnibus law: he said that they are outlining “all the provincial items that will be cut immediately if any of the economic articles are rejected”.
Meanwhile, the Labour Court declared six articles of Milei’s DNU invalid. These are those that prevented the exercise of the right to strike and assembly. They also eliminated the ultra-activity of agreements.
The strike was strongly felt in the industry and left the trade union leaders debating how to continue, but also in the Government House. The massive mobilisation called by the trade union confederations greatly irritated the President, whose first reaction was to try to minimise the forcefulness of the measure.
The second was to warn that he would not negotiate the ferocious austerity programme. And the third, a concrete sign that he is willing to harden his intransigence: hours after the union protest, he dismissed the head of the Superintendence of Health Services, a key body for the union world because it regulates social and prepaid health insurance, Enrique Rodríguez Chiantore, replacing him with Gabriel Oriolo, former manager of a private medical company.
Federico Sturzenegger, an advisor on economic deregulation, is beginning to gain an increasingly prominent place in the cabinet, backed by a particular appreciation of the president and while the now all-powerful Minister of Economy, Luis Caputo, is already paying the political costs of the adjustment. The former goldenboy of JP Morgan has already told Milei that he will stay in the post for a few months, due to “family issues”.