The World Today for February 06, 2024

NEED TO KNOW

Growing Pains

ARGENTINA

Labor unions took to the streets a few weeks ago in Argentina to oppose recently elected President Javier Milei’s libertarian plans to adopt the US dollar as the country’s official currency while radically shrinking government spending.

It’s the president’s first big test despite only having been in office for 45 days.

Demonstrators during the strikes and again at protests, the latest last Wednesday, banged pots and pans together and carried images of Evita Peron, the wife of Argentine President Juan Peron, who dominated the country’s politics in the 20th Century and created the socialist, allegedly profligate style of government that Milei despises, CNN explained.

“Before we used to have asados (barbecues) every Sunday. Not now. Even rice is very expensive,” Elizabeth Gutierrez, a protesting nurse, told Al Jazeera. “Rents have shot up. You can’t live off your salary anymore – it’s not enough. The people are here to defend their nation.”

Such displeasure and anger is one reason Milei is now facing trouble pushing his agenda through the opposition-dominated Argentine Congress.

Inflation and skyrocketing living costs were battering Argentines before Milei took office in November. Consumer prices in the South American country rose nearly 95 percent in 2023, noted the BBC. But, as the New York Times reported, costs have continued to climb under Milei after he devalued its currency, the peso, in expectation of his new economic plan. Inflation is now running at 200 percent annually.

As the Buenos Aires Times wrote, after issuing a series of controversial decrees to undercut the public sector, Milei sponsored sprawling omnibus legislation that contained 660 changes to current regulations with the goal of liberalizing and dollarizing the Argentine economy.

However, even though the president enjoys the support of nearly 56 percent of voters, according to polls, lawmakers balked. The president then cut 150 articles in the text to move the bill out of the legislature’s committees. On Friday, the lower house of the legislature approved the bill. It’s likely to be amended further in the upper house, Al Jazeera wrote.

The courts, meanwhile, are yet another issue. Last week, a court struck down his plan to make it easier to fire workers as illegal, the Associated Press reported.

These delays have consequences. For example, chaos in the streets and price spikes led the International Monetary Fund to predict that Argentina’s economy will shrink over the next two years, according to Bloomberg.

Milei might lack the political savviness to push through his ambitions, warned World Politics Review. He might want to enact more measures, for example, to mitigate the pain that his policies are causing as he attempts to shepherd Argentina into a new economic model.

The president has called for payments to low-income Argentines to help them through this period, Reason magazine added. He is flying commercial to meet other international leaders, as he recently did on his way to speak at Davos. And he says he’s willing to compromise with lawmakers and work across the aisle.

He’s happy, say analysts, to do things differently: That includes inflicting pain on the elites and business owners who have benefited from preferential government treatment over the past few decades as ordinary Argentines have struggled to make ends meet.

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