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Argentina after 100 days of a neo-liberal government

Jonathan FrĂĽhling

Javier Milei has now been in power in Argentina for around 100 days. He was sworn in as President of Argentina on 10 December in order to solve the economic crisis. His means of doing so are neoliberal measures that are unrivalled worldwide.

Attack with the chainsaw

Just a few days after taking office on 10 December, the new government came out with a Decree of Necessity and Urgency (DNU), which immediately abolished or amended around 350 laws. Milei aptly chose the chainsaw as the symbol of his attacks, announcing that he would cut down all the achievements of the labour movement.

Inflation explodes under Milei

Inflation has already risen massively in the three months he has been in office – by around 100% to 250% per year to be precise. One of the reasons for this was a 50% devaluation of the currency against the US dollar. Subsidies for public transport, gas, electricity and water were also cut. In addition, fixed prices for medicines and everyday products were cancelled. Corporations took advantage of this to immediately make them extremely expensive. Inflation also affects large companies, but of course far less than the majority of the population. After all, it is their prices that are rising, so they pass on a considerable proportion of the increased costs to buyers, especially for essential goods. The same happens when subsidies are removed.

The devaluation of the currency also favours the export of goods. The large landowners, whose products account for 60% of exports, are happy. Imports, on the other hand – especially vehicles, petroleum products, machinery and electronic devices – will become more expensive, further fuelling inflation.

Attack on democratic rights: the Bullrich Protocol

The Internal Security Minister, Patricia Bullrich, has already launched a fierce attack on the right to demonstrate. Demonstrations are no longer allowed to disrupt traffic, which effectively gives the state the power to harass small demonstrations and break up large ones. How are thousands or even hundreds of thousands of demonstrators supposed to march through the city on the pavements? The law has already been applied to small demonstrations. Mass random checks on public transport are also being authorised.

Reduction of state services

Immediately after taking office, both the Ministry of Culture and the Ministry of Women and Gender were dissolved. Tens of thousands of jobs were lost in the construction sector due to the cancellation of infrastructure projects. Many other ministries were also merged and reorganised, with thousands of civil servants being made redundant. The government is constantly reviewing thousands of contracts and will lay off more people in the future. The social sectors have also been particularly hard hit. For example, countless social workers who work with young people have already been fired. The state media organisation was hit in mid-March.

Taken together, the biggest budget cuts in the country’s history were decided by January, as the government proudly announced. Compared to January 2023, public investment was cut by 75%, social spending by 59%, transfers to the provinces by 53%, pensions by 32%, personnel spending by 18%, family allowances by 17% and spending on universities by 16%! The country is back in the black for the first time in February. In other words, money is being taken away from the population in order to shove it down the throats of international creditors.

The return of hunger

The number of people who are dependent on soup kitchens and food banks has increased dramatically in recent months. According to Aljazeera, 10 million people are taking up the offers of the approximately 38,000 local food banks. That is almost a quarter of the total population! This is a result of the poverty rate rising from 40% to 57% since Milei took office. It means that conditions are already similar to those during the 2001 – 2003 crisis, but that did not prevent the government from cancelling state aid for soup kitchens without further ado. Argentina is therefore heading straight for a hunger crisis.

Those providing aid are endeavouring to continue, but in some cases solidarity is eroding in the face of the crisis: private individuals and, above all, businesses that previously donated to the food banks, can simply no longer afford to do so. In fact, there have already been the first hunger protests in front of the newly created Ministry of Human Capital. The situation will become extremely acute in the coming months. Full-blown hunger riots are therefore a possibility very soon.

The government is weakening

Fortunately, at least the so-called “Omnibus Bill” was rejected by parliament. It contained all the laws that could not be pushed through by a DNU. To emphasise the severity of the attacks, a few points should be mentioned here: Funding of universities according to the number of graduates, closure of most state cultural organisations, de facto closure of most public libraries, release of indigenous forest reserves for mining activities, privatisation of all remaining 41 state-owned companies (including transport companies, water, electricity and gas suppliers), the right of government to determine pension level without reference to parliament. Of course, the government is now trying to push the laws through parliament individually and/or in a modified form.

Another weakening factor is the eternal dispute with Milei’s Vice President, Victoria Villarruel. From the outset, she has distanced herself from Milei’s uncompromising course and favoured negotiations with parliament. This was perhaps one of the reasons why he did not appoint her to a senior post (e.g. the Ministry of the Interior). The dispute recently escalated again when it became public that she had met with ex-President Mauricio Macri to discuss political alternatives to Milei’s approach. She also scheduled the DNU vote in the Senate, which Milei wanted to delay. This promptly led to a defeat for Milei, as the DNU was rejected in the Senate. Now, the vote in the lower house is due soon, where the majority conditions are more favourable for him.

Milei also lost further support when he cancelled state payments to the provinces. The provinces have therefore rebelled against him and threatened to stop gas and oil supplies to the north. On 1 March, the government announced that the provinces would receive their money if they supported its proposed legislation in Congress. Details are to be finalised by the end of May. However, the outcome of this move is by no means certain. Conversely, it also shows that the “opposition” elites and dissatisfied supporters of Milei can at best be expected to haggle over individual measures of his government policy in order to protect their special interests. Ultimately, however, Argentina’s ruling class is still behind the general attack on the working class. However, they want to secure their own sinecures and have a “say” in the measures.

And the labour movement?

On 24 January, a general strike took place in Argentina, bringing 1.5 – 2 million people onto the streets. It was the first since 2019 and a first demonstration of power by the trade unions. Afterwards, however, it was time to go home! Only the radical left took part in the protests outside parliament to vote on the “omnibus” law. The alliance of four Trotskyist groups called FIT-U stood out in particular. However, the maximum of 10,000 – 20,000 people who took part in the rallies over the two days was simply not enough. This probably also encouraged the police at the end of the second day, when only around 1,500 people were left in front of the parliament, to drive into the crowd on motorbikes and indiscriminately fire rubber bullets at the peaceful demonstrators, injuring many. This is probably just a foretaste of the repression that the government will unleash if the oppressed classes continue to fight back.

The Peronist organisations were conspicuous by their absence, despite such fierce attacks! The rejection of the “omnibus” law in the Senate now gives them another excuse not to take to the streets. No further strike days are planned until the end of March, and there is no action plan from the unions against the hunger crisis, inflation, redundancies and further tightening of the law.

Apparently, the leaders of the Peronist party are hoping that they will return to government after Milei anyway (with the advantage that the austerity policies pursued until then will not be their fault). They hope that by repealing some laws, they might even win back the trust of the masses. However, life has already changed drastically for the people. There can be no “business as usual” for those driven into poverty and misery!

It is clear that there can be no hope for populism in the form of the Peronists. It was Peronism that led the country into the crisis it is in today. The Peronist presidential candidate, Sergio Massa, also announced a strict austerity policy during the election campaign and the previous Peronist government under President Alberto Fernández, with Massa as economy minister, simply continued Macri’s austerity policy. Ultimately, they also serve the ruling classes, just in a slightly different way from Milei. For a long time, they have managed the corporatist inclusion and immobilisation of wage earners via the trade unions and the unemployed via the involvement of unemployment organisations in the distribution of aid funds.

In view of the historic economic crisis, however, the powder of populism has been shot. The concept of equalisation between the classes has run its course. Nevertheless, many still harbour illusions in the Peronist Partido Justicialista party or at least see it as the lesser evil. However, it is not enough to expect these illusions to be dispelled just through propaganda, exposure and denunciation; an active policy towards the Peronist-dominated trade unions and the party and voter base is also needed to build a united front against the attacks.

It is beginning to boil …

The effects of the shock therapy prescribed by Milei are already enormous. In the coming months they will intensify, especially if the government continues its attacks. This will certainly open up the possibility of major protests if there are organisations to lead the way. There is already resistance after the general strike on 24 January. Teachers in seven provinces went on strike on 26 February. There was another day of strike action on 4 March. This was in opposition to salary cuts for school teachers and a de facto 50% cut in the university budget. Railway and hospital workers in both public and private hospitals have also gone on strike. The working class is clearly beginning to seethe. This has finally prompted the trade union federation to “think” about a new general strike, so far without any concrete date or mobilisation plan. Just two months after he took office, Milei’s popularity ratings had fallen by 15 % to less than 50 %.

In Buenos Aires, neighbourhood assemblies have formed in some districts to provide neighbourhood support, discuss issues together and mobilise for demonstrations. These are the nuclei of real neighbourhood committees, which could organise the population in grassroots democratic structures, in addition to taking over aid services out of necessity.

Struggle for the trade unions

The trade union leadership is currently only organising limited actions by individual sectors or half-day general strikes. This showed a certain ability to mobilise in January and was therefore a step forward. But the strikes must not be allowed to degenerate into a ritual that allows people to vent their anger so that they can then return to their workbenches or offices. This is currently the tactic of the bureaucratic union leadership.

In reality, the limited and partial strikes can and should be used to gain experience and expand the movement. But that alone will not be enough to beat back the government’s attacks. For this, the power of the large trade unions is needed. Without their fighting power, there will be no success. The main question is therefore how they can be transformed back into instruments of the working class.

To this end, it is essential to raise the demand for an indefinite general strike, action conferences to prepare for it and a plan of struggle not only to the trade unions’ membership but also to its leadership. This is because the combination of events and organised pressure from the rank and file can force the tops to go further than they themselves want. It is necessary to mobilise the rank and file in the companies and unions around these demands and build up structures of struggle that are capable of action and action without the bureaucracy.

If the workers take the reins of action into their own hands in this way, they can force the reformist leadership, or parts of it, to act while, at the same time, building an organised, class-struggle opposition that stands up to the reformist leadership of the trade unions and is able to replace it.

It is important to actively participate in the existing struggles and to initiate others ourselves. What better way to do this than by building workplace action committees and local alliances in which left-wing organisations and parties, neighbourhood organisations, trade unions, etc. that are serious about taking up the struggle can participate? The goal must be a fighting unity of all class organisations that builds a permanent movement against the government. It is essential that such structures not only exist in the workplaces and at local level, but that they are centralised nationwide and can thus also take over the leadership of a general strike. The order of the day is a workers’ united front!

Socialism and general strike

To be victorious, we also need a socialist perspective that can offer a policy that goes beyond defence against the attacks. This would give people hope again and motivate them to fight. Fortunately, Argentina has a radical left in the form of the Trotskyist electoral platform FIT-U, which is stronger than in almost any other country. It receives around 3 per cent of the vote in elections and between half a million and a million votes. It therefore represents an important minority of the working class.

However, the FIT-U itself is so far only an electoral alliance of four Trotskyist organisations, not a party. It only exists as an effective unit in election campaigns and joint demonstrations (which could also be organised without the FIT-U). Militant workers and young people who vote for the FIT-U cannot join it. The FIT-U itself has no grassroots structures. Participation is only possible by joining one of its four member organisations, this has ultimately led to the stagnation of the FIT-U in the elections of recent years.

Above all, however, the FIT-U is currently failing to use the opportunities to address the core problem of the Argentine working class – its lack of a revolutionary party.

Such a party could and should take the ideological and organisational lead in the struggles so that the government can be overthrown. To do this, it must overcome the existing fragmentation and seek organisational unity. There is no doubt that the different parts of FIT-U are divided by important programmatic differences, but these must be addressed in the here and now. The best way to do this would be a broad and public discussion on a programme of action against the attacks, for the general strike and the establishment of a workers’ government based on councils and workers’ militias. Such a programme is essential, because a real general strike in Argentina will inevitably raise the question of power – and a revolutionary party must be able to give a clear answer to that question.

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