A nationwide shutdown puts Milei's tough approach to Argentina to the test

It's been six weeks since President Javier Milei took office in Argentina, and since then gas prices have doubled, inflation has soared and the value of the national currency has plummeted.

Such unrest, he had warned, was to be expected. Solving decades of economic problems would first require more pain, he said.

Yet many Argentinians plan to take to the streets on Wednesday to show that they have already had enough.

Argentina's largest unions are planning a nationwide strike — including workers in transportation, construction, health care, food, energy and banking — to protest Mr. Milei's planned reforms, arguing they will undermine protections of workers and the poor would weaken. More than 100,000 people are expected to demonstrate across the country.

Pablo Moyano, a labor leader, told reporters that Mr. Milei was “ridiculing Congress and workers.” Mr. Milei has shot back that the protest shows that “there are two Argentinas” – one stuck in the past and another that “puts us on the path to becoming a developed country.”

Yet more Argentinians appear to agree with Mr. Milei. Despite the economic chaos, Mr. Milei's valuation has remained high, or even risen along with prices. Recent surveys show that 58 percent of Argentinians support him, two percentage points higher than his share in November's presidential election.

In response, Mr. Milei, a libertarian economist and television pundit who ran for president with a brash political style, has tried to capitalize on his political honeymoon by overhauling much of Argentina as quickly as possible.

After cutting spending, firing civil servants and devaluing the currency, he has turned his attention to sweeping legislation that would impact the economy, elections, labor, public safety, the environment, the arts, science , health and even the way Argentinians divorce. . The omnibus bill would also consolidate more power in his hands.

That has led to the labor backlash. The unions have already won a preliminary injunction this month against some of Mr. Milei's attempts to change labor laws through a presidential decree, and now they want to show their power with massive demonstrations on Wednesday.

Labor uprisings have done that government campaigns to implement significant changes were derailed previously in Argentina, but Mr. Milei signals he will take a tougher stance against protests that become disruptive. He has proposed adjusting wages for government workers who participate in demonstrations and increasing penalties against people who block roads, potentially putting them in prison.

He also moved quickly. In his first days on the job, Mr. Milei made major cuts in federal spending, fired thousands of government officials and halved the number of federal ministries from 18 to nine. He also officially devalued the Argentine peso by more than 50 percent, bringing the government's exchange rate much closer to the market benchmark for the currency, but also causing prices to rise.

From November to December, prices rose 25.5 percent, compared to 12.8 percent a month earlier.

Annual inflation in Argentina now stands at 211 percent, putting the country of 46 million roughly on par with Lebanon for the highest inflation in the world. Argentine prices are rising faster than those in Venezuela, where years of economic collapse had led many Venezuelans to emigrate to Argentina. Now some are reconsidering.

“I see a lot of Venezuelans leaving the country,” said Andreina Di Giovanni, 35, a Venezuelan immigrant in Buenos Aires who owns a store selling Venezuelan food. “Some migrate elsewhere; Some go back to Venezuela.”

She said her business is struggling, with declining sales and rising costs, but she said it was too early to blame the new president.

Mr. Milei hopes that many Argentinians will be willing to give him a long leash to solve the country's long-standing economic problems, and for now some are going along with that.

Stella Body, 70, said she was technically retired but still works full-time as a beautician to afford the rising prices. To her, it was a worthy sacrifice for Mr. Milei's plan. “We won't see any positive results for at least a year,” she said. “Nothing can be solved in a month.”

Mr. Milei also has support from conservatives abroad. Last week he gave a speech at the World Economic Forum in Davos, Switzerland, arguing that unfettered capitalism is the only model for reducing poverty and that socialism, feminism and environmentalism threaten global progress by enforcing government regulation.

“You are heroes,” he told the audience in Davos. “You are the creators of the most extraordinary period of prosperity we have ever seen.”

The speech went viral and was promoted by several conservative and right-wing voices as a clear distillation of what was wrong with modern society.

“Good explanation of what makes countries more or less prosperous,” Elon Musk said when he shared a video of the speech. Later, the billionaire posted a doctored image of a man watching Mr. Milei's speech while having sex, a post that was viewed 113 million times.

A Brazilian politician later posted that she played the speech to her unborn baby in the womb, and Donald J. Trump weighed in on his Truth Social platform, proverb that Mr. Milei “MADE GREAT PROGRESS” in his effort to “MAKE ARGENTINA GREAT AGAIN!”

The International Monetary Fund, which still owes Argentina the vast majority of a $44 billion loan program, also praised Mr. Milei, saying he and his economic team took swift action to “rebuild reserves, correct relative price differences, the central bank's balance sheet and create a simpler, rules-based and market-oriented economy.”

Central to Mr. Milei's efforts to tackle the country's chronic financial problems is the omnibus bill he is trying to push through Argentina's Congress.

With more than 500 provisions, the legislation would reduce regulations, weaken unions, privatize most state-owned enterprises, abolish election primaries, increase export taxes and eliminate some environmental protections. The bill would also give Mr. Milei emergency powers for at least a year to implement his economic plans.

The drastic measures are necessary “to prevent the current crisis from becoming a social catastrophe of biblical proportions,” Mr Milei said in an address to the nation when announcing the legislation. Congress “will have to choose whether it wants to be part of the solution or remain part of the problem.”

Ricardo Gil Lavedra, a constitutional lawyer who has served as a congressman and justice minister of Argentina, said that Mr. Milei, without significant support from Congress, appears to be trying to move quickly while he has high approval ratings, knowing that rising prices will put him at risk. could give you a chance. short time to act.

But packing so many provisions into one bill and consolidating more power in the presidency is worrisome, he said.

“It is impossible for people to have an idea of ​​the enormous number of proposals that Milei has sent,” he said. “They cover dozens and dozens and dozens of laws, often on deep topics, so I think the population generally doesn't know what's being discussed.”

Still, the pushback against unions and Congress is a sign that democracy is working, Gil Lavedra said. “We must work with a new government that is in a very difficult situation and that has the support of a large number of Argentinians,” he said. “But at the same time, we must keep Argentina within the framework of a constitutional democracy.”

Daniel Politi contributed reporting from Buenos Aires.