Weakening the Shock

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An Argentine court this week suspended a series of labor law changes decreed by newly-elected President Javier Milei, reforms that are part of the “shock” therapy the libertarian leader seeks to implement to improve Argentina’s deep economic crisis, Agence France-Presse reported.

Last month, Milei issued an edict that would change or remove more than 350 economic regulations, prompting jurists to question their constitutionality.

The reforms would see an increase in the legal job probation period from three to eight months, cut pregnancy leave, and eliminate a law regulating rent. They also included the privatization of state enterprises and the termination of around 7,000 civil service contracts.

As a result, thousands of people protested against the changes, with the country’s national trade union federation, the General Confederation of Labor (CGT), challenging the decree in court on the grounds that it eliminated basic worker protections, such as the right to strike and parental leave.

On Wednesday, three judges of Argentina’s labor appeals chamber froze elements of Milei’s reforms, questioning the “necessity” and “urgency” of the changes. One of the judges, Alejandro Sudera, noted that some of the measures appeared to be “repressive or punitive in nature” and wondered how it would help the president to create jobs.

The decree follows Milei’s victory at the polls, in which he rode a wave of anger over the South American country’s decades of economic malaise marked by debt, a ballooning fiscal deficit and three-digit inflation.

Milei – a self-described “anarcho-capitalist” – said the goal of the decree was to “start along the path to rebuilding the country … and start to undo the huge number of regulations that have held back and prevented economic growth.”

Shortly after being sworn in, he ordered a devaluation of Argentina’s peso by more than 50 percent and announced large cuts in state subsidies for fuel and transport.

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