SUBSCRIBE TO OUR FREE NEWSLETTER
Daily news & progressive opinion—funded by the people, not the corporations—delivered straight to your inbox.
5
#000000
#FFFFFF
5
#000000
#FFFFFF
javier milei
The Bleak Fantasy of Milei’s Great Argentine Chainsaw Massacre
Despite the record of unremitting failures of neoliberal programs to deliver sustained growth over the last quarter of a century, there are still intellectual and political leaders like Milei who continue to embrace them.
Sep 24, 2024
At the heart of Buenos Aires lies the lovely Calle Florida. The experience of walking through this street that is exclusively dedicated to pedestrians was anything but lovely though, since in the one kilometer from one end to the other I was besieged—albeit politely–by some 200 men and women barking, “Cambio, cambio,” competing to give me the most pesos for my dollars.
It’s a seller’s market, with the “Benjamins”–$100 notes—especially valued. When I began my walk at one end of the street, I was offered 1,100 pesos to the dollar; by the time I reached the other end, the offer had climbed up to 1,400. The online price that morning was 963 pesos. I thought I had a good deal, but an Argentine friend later told me I could have done better.
The Argentine Disease
The daily depreciation of the peso relative to the dollar is a key indicator of inflation, which everyone says is the country’s prime economic problem. The conventional analysis is that the uncontrolled rise of prices stems from the government’s equally uncontrolled printing of pesos to cover its budget deficit. Thus, the peso has lost its function as a store of value, forcing people to resort to the black market for dollars. With the private sector hoarding dollars and international creditors hesitant to lend, owing to Argentina’s having defaulted on its $323 billion sovereign foreign debt in 2020, tourists have become a prime source of dollars for ordinary Argentines and small- and medium-sized enterprises.
The inflation rate for 2023 was over 211%. This was not in the order of the 3,000% annual inflation rate in 1989 and 1990, but as in that earlier period, inflation has resulted in the coming to power of regimes touting radical stabilization policies. In the 1990s, Carlos Menem, the populist Peronist turned neoliberal, famously imposed, among other stringent measures, the one-to-one peso-to-the-dollar exchange rate. The experiment led to chaos, with the country declaring itself unable to service its sovereign debt in 2001.
Last November came the turn of the self-described “anarcho-capitalist” Javier Milei, who has promised not only to make the dollar the medium of exchange in place of the debauched peso but to also lop off whole ministries of government and thousands of government jobs. His controversial but winning image during the November 2023 elections was his going around with a chainsaw to symbolize his determination to radically slim down government, which he regards as a “criminal operation.”
The question on everyone’s mind is, will Milei succeed where previous regimes failed?
Milei Wields His Chainsaw
Milei has been in office for less than a year, but he has taken his chainsaw to the government, as he promised. He chopped off half of the government ministries, devalued the peso by 50%, and slashed fuel subsidies. That was just the beginning. In the teeth of bitter opposition in Congress and in the streets, he got his “Bases Law” passed, which would allow him to roll back workers’ rights; provide tax incentives to foreign investors in extractive industries such as mining, forestry, and energy; reduce the tax burden on the rich; and provide him with the power to declare a one-year state of economic emergency with special powers to disband federal agencies and sell off about a dozen public companies. In order to get the Bases Law through Congress, Milei has postponed his plans to adopt the dollar as the national medium of exchange and “blow up” the Central Bank, as he puts it, deliberately invoking an image associated with Khmer Rouge’s destruction of the Central Bank of Cambodia when they came to power in the late 1970s.
As anticipated, the austerity measures are leading to the contraction of the economy, with the International Monetary Fund, which has signalled its approval of Milei’s policies, expecting a 2.8% decline in GDP in 2024. Still, according to some polls, his approval ratings are above 50%. “This shows that despite suffering in the short term, the people are willing to give the president the benefit of the doubt,” said the Argentine ambassador who gave me an unexpected 45-minute briefing when I claimed my courtesy visa to visit the country. Others, like radio personality Fernando Borroni, assert the president’s popularity ratings reflect not no much approval of him as rejection of the failed policies and personalities of the past.
Milei is perhaps the most colorful and controversial personality to come to power in Latin America in the last few years. Though he is nominally a member of a right-wing party, he has no organized political base but acquired national influence through wide exposure on television, where he poured his vitriol on ideological opponents, indeed, on anyone proposing any kind of government intervention in the economy. He is an unabashed animal lover, making sure to pay homage in his speeches to what he calls “mi hijitos de cuatro patas,” or my four-legged children. There is nothing wrong with that, but people look askance when he claims that he talks to his dead dog, Conan—named after the comics character “Conan, the Barbarian”—through a medium.
He has professional advisers, but the person who controls access to him and is said to be the power behind the throne is his younger sister, Karina Elizabeth Milei, who has been criticized for lacking any previous experience in government and having a background in business that consists mainly of selling cakes on Instagram. Still, she has elicited admiration for her micromanagement of her brother’s successful electoral campaign, prompting some to compare her to Evita Peron and Cristina Kirchner, the wife and successor of the late President Nestor Kirchner.
Mileinomics
Milei is personally quirky, and so, some say, is his economics. His intellectual hero is the radical libertarian economist Murray Rothbard. Reading an essay by Rothbard titled “Monopolies and Competition” was for Milei an experience akin to Paul’s conversion on the road of Damascus. “The article was 140 pages long,” Milei writes. “I went home to eat and began to read it. I could not stop reading, and after reading it for three hours, I said to myself, everything I had been teaching over the last 23, 24 years was wrong.” In addition to Rothbard, those in Milei’s pantheon of intellectual heroes are the paragons of neoliberal thinking, among them Friedrich Hayek, Leopold Van Mises, Milton Friedman, and Robert Lucas of the University of Chicago. (Milei has honored Lucas, Rothbard, and Friedman by naming his dogs, cloned with cells from the dead Conan, after them.)
It is not surprising that Milei condemns socialists, communists, Keynesians, and “neo-Keynesianos” like Paul Krugman. It is also not surprising that, like Friedrich Hayek, he considers the pursuit of social justice as a big mistake that is unjust and disruptive of the efficient working of the market and eventually leads to the “road to serfdom” by an all-powerful regulatory state.
What is unusual is that he includes a number of economists working in the neoclassical tradition in his sweeping condemnation of “bad influences.” Formerly an economics professor, he faults economic modelling promoted by the mathematization of economics for having led some analysts to the illusion that the market can lead to imperfect outcomes.
One fundamental tenet of neoclassical economics that elicits his ire is “Pareto Optimality,” which says that economic outcomes can be achieved that can make people better off without making anyone worse off. According to Milei, pursuit of Pareto Optimality by neoclassical economists has led them to the illusion that government action can improve market competition or make up for “market failure.”
Pareto Optimality, in his view, is the opening wedge that has led to the formulation and legitimation of other concepts such as imperfect competition, asymmetric information, public goods, and externalities—the solution or provision of which would require government intervention. The fundamental error of the economists who have generated these ideas is that they are so enamored with their models that “when their model does not reflect reality, they attribute the problem to the market instead of changing the premises of their model.”
Milei is, in fact, vulnerable to the same error he accuses neoclassical antagonists of committing: that when theory and reality diverge, it is reality that is the problem.
Interfering with the operation of the market always has dangerous consequences. Indeed, breaking up monopolies to bring about a state of perfect competition is erroneous, since monopolies, instead of being aberrations, are, in reality, positive. “In fact, within a framework of free exchange, if a producer is able to capture the whole market, they have done so by satisfying the needs of consumers by providing them with a better quality product…The existence of monopolies in a context if free entry and exit is a source of progress, and the constant obsession of politicians to control them will only end up damaging the individuals they are trying to help.” In short, the market can’t make a mistake, and trying to rectify its supposed errors will only lead to a worse outcome for everyone.
Another classical economist that Milei has placed in the company of Marx, Pareto, and Keynes as an ideological baddie is Malthus, who held that the law of diminishing returns would create a situation where rapid population growth would not be supported by economic growth, leading eventually to general impoverishment. Milei claims that Malthus’ law has been disproven by the tremendous economic growth since the 19th century owing to technological advances made possible by the market, and Malthus’ only use these days is to provide intellectual support for the pro-choice movement, whose advocacy of abortion and family planning he despises.
The Opposition
Not surprisingly, Milei’s hostility has been reciprocated by the women’s movement, which fears that their successful effort to legalize abortion in 2020 will be reversed by the president.
Another sector of society that feels threatened by the new government is the human rights movement. Milei is not so much the object of hostility of human rights advocates as his vice president, Victoria Villaruel, who has defended the so-called dirty war waged by the military dictatorship of General Jorge Videla in the late 1970s and early 1980s that took over 30,000 lives. Villaruel, whose father and uncle were members of the military during the dictatorship, has opposed the trials of those being prosecuted for crimes against humanity and has threatened to begin investigation and prosecution of members of the Montoneros and ERP (Armed Forces of the People) accused of “terrorist crimes.” At the rallies of the two groups representing the Madres de la Plaza de Mayo that take place every Thursday afternoon at the Plaza de Mayo, participants are warned that Milei might allow Villaruel to pursue her vendetta against the memory of the disappeared.
The strongest opposition to Milei is the Peronist movement, which was the base of the governments of Nestor Kirchner, Cristina Kirchner, and Alberto Fernandez that have ruled Argentina for most of the last 24 years. It continues to have the support of some 30% of the electorate. The problem is that neither Peronism nor the rest of the opposition has a counternarrative to Milei’s, admits Martin Guzman, former minister of the economy in the Peronist government of Alberto Fernandez and currently professor of economics at the School of International and Public Affairs (SIPA) at Columbia University.
Two obstacles lie in the way of the formulation of such a counternarrative. One is that while Peronism is a mass populist movement, its leaders have pursued conservative policies when in power, leading to the demoralization of the base. The second, and more significant obstacle, is that “the language and policies that animated Peronism’s working class base in the mid-20th century no longer connect with today’s young workers that are engaged in the gig economy perpetuated by savage capitalism,” according to Borroni, the radio journalist.
Milei and the Youth Vote
It bears noting that the strongest supporters of Milei are male voters in the 16-30 age group, 68% of whom said they would vote for Milei in a poll taken before the November 2023 elections. Argentines who have grown up in the last 30 years have done so in a country that has been constantly in crisis, besieged by inflation, recession, and poverty, which now engulfs an astounding 55% of the population, or 25 million people. To them, both the center-left governments of Kirchner and Fernandez and the center-right regime of Mauricio Macri were abject failures in turning the economy around, making them vulnerable to the inflammatory rhetoric of Milei during the 2023 elections.
Argentina is a proud country, but for many young Argentines, there is little these days to be proud of except perhaps Lionel Messi and the national soccer team (and even they have been tainted by a recent incident where some players were captured on video singing a racially offensive song regarding the African origins of many of those in the French national team that fought Argentina in the World Cup finals in 2022).
Destined to Fail?
Milei has promised to restore Argentina to its 19th-century status as one of the richest countries in the world. But it is difficult to see how Milei will get Argentines out of their economic conundrum and restore their morale as a country. His vision is that of an Argentina of the future purged by the fire and sword of radical austerity and shorn of the “political caste and army of parasites whose only objective is to perpetuate itself in power by sucking the blood of the private sector.” The measures he is taking, however, are likely to follow the well-trodden path of similar programs in the Global South and in Greece and Eastern Europe after the 2008 financial crisis, that is, continuing economic contraction or prolonged stagnation. What is remarkable is that despite the record of unremitting failures of neoliberal programs to deliver sustained growth over the last quarter of a century, there are still intellectual and political leaders like Milei who continue to embrace them. Milei is, in fact, vulnerable to the same error he accuses neoclassical antagonists of committing: that when theory and reality diverge, it is reality that is the problem.
At some point a program of vigorous government action to trigger growth, redistribute income, and reduce poverty may perhaps become attractive again and voters may turn on Milei’s counterrevolutionary economic project. “I have no doubt that Peronism will again come to power,” asserts Borroni. “Whether it will come to power as a a genuine popular movement or in the guise of a popular movement led by the right is the question.” But the bigger question is: will such a new and improved version of Peronism be able to finally lick Argentina’s poisonous galloping inflation while promoting growth and reducing inequality?
“Other countries have been able to control inflation. Why can’t we?” one Argentine I interviewed asked in frustration. That same question is on everyone’s lips, but for the moment, people seem to have suspended their skepticism and given the mercurial Milei some slack.
Keep ReadingShow Less
'Argentina Stopped': Unions Hold Second General Strike Over Milei Austerity
"It is a day of resistance and demand," said trade groups that organized the action "in defense of democracy, labor rights, and the living wage."
May 10, 2024
Argentina's primary trade union federation on Thursday held another nationwide general strike, the second called since President Javier Milei, a far-right economist, took office in December and began pursuing sweeping austerity and deregulation.
The South American nation's unions organized the strike "in defense of democracy, labor rights, and the living wage," according to a statement from the General Confederation of Labor (CGT), the Argentine Workers' Central Union (CTA), and the Autonomous CTA.
"It is a day of resistance and demand," the groups said, blasting the Milei government's "brutal" attacks on labor rights, social security, public health, education, science, and "our cultural identity." The policies of austerity, say opponents, have disproportionately impacted working people and retirees.
The labor groups called out the government for promoting "dangerous policies for the privatization of public enterprises" and pushing for "a phenomenal transfer of resources to the most concentrated and privileged sectors of the economy."
CGT celebrated the 24-hour strike's success on Friday, declaring that "Argentina stopped," and sharing photos of sparsely populated roads, transit hubs, and other public spaces.
As the
Buenos Aires Timesreported:
In the nation's capital, streets were mostly empty, with very little public transport. Many schools and banks closed their doors while most shops were shuttered. Garbage was left uncollected.
Rail and port terminals were closed, while the industrial action forced the cancellation of hundreds of flights, leaving airports semi-deserted. Some buses—from firms that did not take part in the strike—were running in the morning, although with few passengers. Cars were circulating, but traffic levels were similar to that seen on weekends.
The port of Rosario, which exports 80% of the nation's agro-industrial production, was all but paralysed in the midst of its busiest season.
A spokesperson for Milei, Manuel Adorni, claimed the nationwide action was "an attack on the pocket and against the will of the people" by those "who have curtailed the progress of Argentines over the last 25 years," the newspaper noted.
Meanwhile, union leaders stressed that the strike was the result of "a government that only benefits the rich at the expense of the people, gives away natural resources, and seeks to eliminate workers' rights," as CTA secretary general Hugo Yasky put it.
As the action wound down Thursday, Yasky described it as a "display of dignity of the Argentine people" that sent "a strong message" to Milei's government as well as the International Monetary Fund "that intends to govern us" and the country's senators.
Argentina's Senate is now debating an "omnibus" bill that contains some of Milei's neoliberal economic policies—including making privatization easier—after the package was approved last week by the Chamber of Deputies, the lower congressional body.
Rubén Sobrero, general secretary of the Railway Union, signaled that more strikes could come if lawmakers continue to advance the president's policies, tellingThe Associated Press that "if there is no response within these 24 hours, we'll do another 36."
From Europe to North America, trade groups around the world expressed solidarity with Thursday's strike.
"Milei's policies have not tackled the decadence of the elites that he decries, instead he has delivered daily misery for millions of working people. Plummeting living standards, contracting production, and the collapse of purchasing power means some people cannot even afford to eat," said International Trade Union Confederation general secretary Luc Triangle in a statement.
Triangle noted that "the government is targeting the rights of the most vulnerable sectors of the population and key trade union rights, such as collective bargaining, that support greater fairness and equality in society, while threatening those who protest with police repression and criminalization."
"In this context, the work of the trade unions in Argentina is extraordinary. They have emerged as the main opposition to the government's dystopian agenda, uniting resistance and building a coalition in defense of workers' rights and broader democratic principles," he added. "The demands of the trade unions in Argentina for social justice, democracy, and equality are the demands of working people across the world. Their fight is our fight and that is why the global trade union movement stands with them."
Keep ReadingShow Less
What Argentina’s Workers Can Teach the World About Resisting the Far Right
Organized labor can serve as an infrastructure for mobilization and a counterbalance to democratic backsliding.
Mar 31, 2024
This March, Argentina’s school year began with empty classrooms. The price of learning materials rose by 502% over the past year, leaving many children unprepared for the year to come. And the teachers? On strike after President Javier Milei announced deep cuts to their salaries.
There’s something much larger happening here: Workers rights are under attack in an already vastly unequal society. Labor income inequality has been on the decline in many Latin American countries like Chile, Colombia, and Mexico. In Argentina, it’s been on the rise.
Since the 1960s, Argentina has been in an unprecedented period of macroeconomic instability. Stagnating in the lead-up to, and during, the dictatorship years (1976-1983), the country’s economy has reeled from crisis upon crisis—punctuated with the occasional period of recovery and growth. As the decades wore on, public distrust and discontent produced a deep social divide. Argentines call this phenomenon la grieta (“the rift”).
During his successful presidential bid last year, Milei seized upon these conditions. TV personality and self-proclaimed anarcho-capitalist, the eccentric economist promised to correct Argentina’s path and make what he called the “political caste” pay for their mismanagement of the country. Wielding a chainsaw while he campaigned, Milei vowed to eliminate state ministries, abolish the central bank, roll back abortion rights, and dollarize the economy.
As one Argentine told a journalist, “The caste doesn’t take the train nor any form of public transit. We workers and students do.”
Now that he’s had a chance to implement his platform, working families—not an elite “political caste”—are footing the bill for his far-right economic project.
In the two months before Milei took office in December, inflation was running between 143 and 161%. In February, inflation soared to more than 254% and the poverty rate reached 57%—the highest in decades.
Argentina’s labor movement has quickly mobilized widespread and effective opposition to his policies. While strikes and protests continue, we can already begin to draw lessons on resisting the far-right’s rise worldwide.
Milei takes a chainsaw to workers rights
After taking office on December 10, 2023, Milei acted swiftly. Declaring, “There is no alternative to shock,” the president immediately devalued the peso by 50%, lifted price controls, and dissolved half of the country’s ministries.
Milei’s government then launched an offensive on workers’ rights. On December 14, the newly appointed minister of security announced a new protest protocol. Consolidating control of Argentina’s security forces and creating a registry for organizations suspected of “instigating,” the protocol allowed federal forces to use increased surveillance and violence.
Days later, Milei signed the “Decree of Necessity and Urgency 70/2023.” Dubbed the megadecreto (“mega-decree”) for its sweeping scope—cutting severance pay, weakening collective bargaining rights, deregulating the rental market, and otherwise undermining existing protections—the 366-article document is an unconstitutional abuse of executive powers.
Making matters worse, Milei cut public subsidies on utilities and transportation. Hypocrisy shone through his already vague definition of the “political caste.” As one Argentine told a journalist, “The caste doesn’t take the train nor any form of public transit. We workers and students do.”
Milei’s aggressive measures roused a prompt response from Argentine labor. In late December, the country’s largest unions announced plans for a January 24 general strike—the quickest to be organized under any president since Argentina’s return to democracy in 1983.
Millions Join the General Strike
Forty-five days after Milei took office, 1.5 million Argentines took to the streets. Workers from all sectors joined the strike: transit, aviation, government, banking, and sanitation, just to name a few.
“Not one step back,” one associated union declared on the day of the strike, “for the unity of the workers movement is essential in protecting the rights we’ve achieved.”
The protesters’ outrage centered on Milei’s Omnibus Bill. The proposed legislation contained sweeping changes to Argentina’s economic and political structure, including the privatization of state-owned companies and an unprecedented expansion of executive powers.
The bill would also codify Milei’s unpopular “mega-decree.”
At their best, unions provide checks on abuses of executive power and ensure that working people always have political representation—no matter who occupies the presidential palace.
“[Milei’s ‘mega-decree’] destroys individual rights of workers, collective rights, and seeks to eliminate the possibility of union action at a time in which we have great inequality in society” said Héctor Daer, the secretary general of the General Confederation of Labor. One of the world’s largest unions, the CGT represents roughly two-thirds of Argentina’s unionized workforce.
Shortly after the strike ended, the National Congress of Argentina rejected Milei’s Omnibus Bill. Initially approved by the Chamber of Deputies in a 144 to 109 vote, majority support faltered when it came time for an article-by-article review.
The first Omnibus Bill consisted of 664 articles. Now, two months later, they are struggling to push an amended 269-article version—with hefty concessions for the left.
Milei’s uncompromising approach played no small role in killing his first Omnibus Bill. But the general strike served a critical blow to his already weak coalition.
Aftermath in Argentina, implications abroad
Beyond their victories in the streets, Argentine labor has also made notable gains in the courts. Successfully challenging the legality of Milei’s “mega-decree,” the General Confederation of Labor blocked the roll-out of several critical anti-worker measures.
Following January’s general strike, February and March witnessed a patchwork of smaller strikes, placing continued pressure on the government. The most recent have come in the aviation, healthcare, and education sectors. The Argentine Workers’ Central Union (a federation with 1.2 million members) held a “national day of struggle” on March 12—and united with other groups to block 500 roads throughout the country on March 18. More strikes were planned for March 28.
On March 14, the Senate voted down the Decree of Necessity and Urgency. Though the “mega-decree” remains in force unless the lower house also opts to reject, the upper house vote represents another massive blow to Milei’s government.
This year will be a defining moment for democracy. Whether that’s for the better or for the worse, it’s up to us.
Instrumental in defeating Milei’s first Omnibus Bill—and otherwise slowing the pace of his anti-worker disaster project—Argentine labor’s recent victories offer an important reminder: Working-class people are a potent political force.
These victories also offer lessons in resisting the far-right’s rise worldwide: Organized labor can serve as an infrastructure for mobilization and a counterbalance to democratic backsliding. At their best, unions provide checks on abuses of executive power and ensure that working people always have political representation—no matter who occupies the presidential palace.
With nearly 30% of the workforce unionized, the labor movement is strong in Argentina. The United States hasn’t seen that degree of union density since the 1950s, though now the tide might be turning.
With 64 countries holding national elections in 2024, this year will be a watershed moment in world history. And with the far right on the rise, there’s never been a more critical time to mobilize in defense of dignity and democracy.
Here in the United States, there are over 85 million poor or low-income eligible voters. As Inequality.org’s co-editor Sarah Anderson writes, “If this bloc voted at the same rate as higher-income voters, they could sway elections in every state.”
The Poor People’s Campaign is working to mobilize this often ignored voting bloc. With 42 weeks of action, the campaign aims to propel working-class concerns to the center stage of U.S. politics and draw more infrequent voters into democratic engagement.
This year will be a defining moment for democracy. Whether that’s for the better or for the worse, it’s up to us. History will judge.
Keep ReadingShow Less
Most Popular