By posted on Workers World, January 26, 2024
I see this as a warning to us. [jb]
After decades of rapid inflation and economic crisis, Argentine voters last November elected economics professor Javier Milei as president. However, many consider Milei an Argentine variant of his pro-fascist Brazilian neighbor, former President João Bolsonaro, or even of Donald Trump. His taking office this January sets the stage for an intensified class struggle.
This isn’t the first time Argentine voters have elected someone who promised to revitalize the country’s economy by imposing sweeping market liberalization. Former President Carlos Menem spent the entirety of the 1990s doing just that, eventually facing a litany of corruption convictions, including for illegal arms trafficking and embezzlement.
It is, however, the first time they elected a far-right “libertarian” known now as Argentina’s “Chainsaw Man.” The nickname is derived from his promise to slash government spending by chopping federal agencies to ribbons. He even waved a chainsaw during campaign speeches.
The severity of his rhetoric and the viciousness of Milei’s plans are unique and would have been extreme even for the neoliberal wave of the 1990s. According to Argentinian political analyst and economist Claudio Katz, Milei’s battle strategy constitutes nothing less than “a war plan against the working class.” (katz.lahaine.org — for Katz’s Dec. 27 analysis in Spanish)
Working class responds
Milei’s honeymoon with the Argentine masses — if he had one — came to an abrupt end on Jan. 24. Argentina’s union movement called a general strike that day. Tens of thousands of workers took to the streets in Buenos Aires and each of Argentina’s major cities. Hundreds of thousands more participated in the strike, and thousands in many world capitals held solidarity actions.
The call to strike was made by the General Confederation of Labor (CGT), an umbrella organization larger than any other union or union federation in the country. At times, its leadership has represented the interest of the workers. At other times, its leaders have collaborated with neoliberal administrations and cut deals in the interests of the ruling class.
But, in this instance, the CGT has placed itself firmly on the side of the workers in its unwavering opposition to Milei and his disastrous so-called “reforms.”
Many in the opposition to Milei have condemned the strike, even though it was called with the hope of blocking Milei’s war on the workers. From the anti-Milei Peronist coalition to the smaller capitalists who are most threatened by Milei’s policies, the elites of Argentina have demanded the CGT cease striking. (Peronist refers to the political tendencies identified with late Argentine President Juan Peron.)
This is a textbook example of how contradicting interests within the bourgeoisie can temporarily come together. Even when they disagree, no portion of the ruling class sincerely wants to empower the people — and certainly not the working class.
Yes, large swaths of the capitalist class oppose Milei, while other portions fervently support him, but they are all in accord that a united working class expressing solidarity and exercising its strength is forbidden. Nevertheless, the will of the people cannot be held back forever. Even a united ruling class cannot easily impose its will on a united and combative working class.
Last 30 years in Argentina
In the 1990s the world bore witness to countless capitalist “shock therapies.” Argentina was far from unique in this regard. Since Menem, there have been several prominent Argentine capitalist politicians who have supported equally broad austerity measures and privatizations. But none have been so aggressive as Milei.
Milei’s plan includes the outright eradication of many public ministries, the reduction or elimination of government benefits, privatizing dozens of state-run sectors and rewriting or erasing literally hundreds of regulations. Milei intends to gut government regulations, ranging from environmental safeguards to labor protections.
What’s more, Milei intends to carry out much of his sweeping program in one year. There is no reason to assume that these “austerity” cuts will make the economy function. It is clear that they will impoverish the working class, eliminate public programs that assist the population and despoil the environment.
Milei admits that with his radical policy changes, things will get worse before they get better. While campaigning, he conceded that the already high rate of inflation would (temporarily) increase at an even faster rate. This prediction has already been borne out, with Argentina’s inflation currently at the highest it’s been in over 30 years.
Who is set to benefit, and who is likely to be harmed by Milei’s transformation of the country?
Milei targets workers
Certainly, the biggest losers will be Argentina’s working class, both active and retirees, who have already seen an effective reduction in benefits as a result of Milei’s program. What is sure to be a massive increase in poverty, combined with drastic cuts to social safety nets, is a recipe for disaster for the workers.
As for the upper classes? Time will tell, but large sections of Argentina’s bourgeoisie are likely to regret their enthusiastic support of Milei. And the portion of the bourgeoisie who were skeptical of Milei will just as likely feel vindicated, though this vindication won’t mean much to those who have lost their fortunes as a result of Milei’s reckless policies.
But Milei’s cabinet and advisers, a hodgepodge of businesspeople who for the first time have their hands on state power and access to the treasury, will no doubt make out like bandits. Unsurprisingly, Milei’s privatizations are hand-picked to benefit his friends and allies. According to Claudio Katz, Milei’s new proposals have specific earmarks for Starlink, Farmacity, Airbnb, Swiss Medical and many individual capitalists.
Lesser capitalists still hope to benefit from the economic shock. Business owners are hungry for the low wages they will get away with paying in Milei’s libertarian Argentina, as well as reduced overhead, since they will now have fewer regulations to follow. In the long run, there could be a collapse for most small businesses and even large, domestic industrial businesses.
Milei’s laissez-faire approach will open the door for cheap imports and a reduced ability for the Argentinian public — workers or middle class — to buy pricy consumer goods. Any Argentinian manufacturer that has up until now relied on selling goods to its own people will have to compete on the global export market or go out of business.
Agribusiness, however, may flourish under Milei, albeit at the expense of the Argentinian workers. Argentina is a country rich in fertile soil and natural resources. There is no good reason why a country with such an abundance of farmland should ever go hungry.
Laws have long been on the books to prevent rampant looting of Argentina’s resources for sale abroad to richer markets. Milei is working overtime to remove these restrictions.
This is good news for the owners of a mega-farm, but bad news for the average Argentinian.
The other loser, of course, is the natural environment. Argentina’s forests will suffer from these policies as much as its people.
Milei prepares to use the club
Don’t let it be said that Milei lacks all foresight. The writing is on the wall. Faced with reduced worker and housing protection, as well as an inability to afford basic food staples, workers are sure to protest, as Jan. 24 showed. The conditions for a full-scale uprising might even ripen.
Milei has prepared for this by enacting policies restricting freedom of speech and unlawfully punishing protest organizers, including with fines in the millions of dollars. Anticipating pushback from organized workers, Milei has decreed new restrictions limiting the ability to call for strikes.
As always, supporting the free market means more freedom for corporations to exploit, not freedom for the workers themselves.
Labor unions were already feeling the squeeze, with many labor leaders concerned not only about the status of organized labor in Argentina but about whether they can count on the continued existence of bourgeois democratic institutions.
Milei has limitations on how he can act. He has only limited influence over the legislature and the country’s judges at this time. That means the only way he can pass his programs is via a battering ram. In other words, by issuing executive decree after executive decree.
The General Secretary of Argentina’s Construction Union is on record as saying: “We do not question the president’s legitimacy … but we want a president who respects the division of powers, who understands that workers have the need to defend themselves individually and within the framework of justice when there is unconstitutionality.” (AP news, Dec. 27)
Milei’s sweeping “omnibus bill” and deregulating mega-decree have so far been approved by lower committees in Argentina’s legislature but have yet to make it through Congress. Still, provincial governments are resisting Milei’s policies in roundabout ways.
One of Milei’s orders has been the freezing of public sector salaries. Amidst an inflation that has reached over 200%, this is obviously unsustainable. The La Rioja province of Argentina recently authorized the printing of a local currency to supplement the pay of its public workers, allowing these workers to somewhat keep up with inflation. This local government action defies Milei’s goals to make Argentina’s economy entirely dependent upon the U.S. dollar. (Bloomberg, Jan. 19)
Milei lines up behind U.S. imperialism
Not everything Milei hopes to accomplish relates to the economy. Among Milei’s stated goals are a stronger alignment with the Western powers, especially the United States, and a rejection of BRICS (Brazil, Russia, India, China, South Africa grouping) as well as the China-led One Belt, One Road Initiative. If he’s expecting that the U.S. Treasury will bail him out if his experiment fails, he hasn’t studied how Washington treats its puppets who turn out to be useless.
Although the U.S. has often propped up far-right governments in Latin America as a bulwark against socialism, the U.S. giving significant aid to a failed state with Milei at its head seems a far-fetched scenario.
When it comes to endearing himself to the population, it is doubtful Milei’s tenure as president will earn him much goodwill. When a storm in Bahia Blanca killed 13 people, Milei’s condolences included the statement that he is “perfectly confident that you will be able to restore the situation in the best possible way, with the existing resources.”
In other words, “You will get no help from the federal government. You are on your own.” It seems this is Milei’s attitude towards the entire Argentinian population. As the country enters what may well be its toughest period since the Dirty War of the 1970s and the military dictatorship, the Argentinian working people can expect no help from their government.
*Featured Image: Hundreds of thousands of workers protest the new president in Argentina. Buenos Aires, Jan. 25, 2024