Argentina: Union strike challenges Millei's economic reforms

For Argentina's unions, Wednesday, January 24, 2024, was a success. They managed to get hundreds of thousands of demonstrators across the country out onto the streets.

The power of the day's images got their point across. The mass event also served as an act of self-affirmation for the long-ruling Peronists — close allies of organized labor — after a bitter electoral defeat in November.

Even if they are unable to mobilize the entire nation, unions continue to be a powerful political force in Argentina.

Many went on strike but not everyone

"I was called on by my union — as well as the reality that we all face — to fight this government and defend our rights," demonstrator Victoria Santoro told DW. "Participation exceeded all my expectations."

The Peronist camp feels energized by the strikes after being in a state of shock since losing the election.   

Still, the new government saw its own little victories, too. Not everyone in the country was out on the streets. But it would be an exaggeration to call the strikes a failure like Minister of Security Patricia Bullrich tried to do.

The protests were directed at the austerity, deregulation and privatization plans outlined in the omnibus bill that Argentina's new President Javier Milei wants to push through Congress.

Criticism for President Milei

"Today unions represent a far greater majority of society. Their protest is justified, because the new — extremely neo-liberal, anti-state and anti-regulatory — administration is driving the country into a grave economic and social crisis," economist Ricardo Aronskind of the National University General Sarmiento told DW.

He believes that what is needed now is robust and diversified export policy in the industrial and agricultural sectors, both in terms of raw materials and refined products.

Export dynamism must be paired with improvements in domestic distribution in order to decrease poverty and marginalization, said economist Aronskind. "Dismantling macroeconomic inequities and fostering complex production structures requires a very active state." 

Praise for President Milei

"President Milei is facing a number of challenges," counters Agustin Etchebarne of the business-friendly, Buenos Aires-based think tank, Libertad y Progreso [Liberty & Progress].

Milei's emergency decree and omnibus bill could give Argentina significantly more economic freedom, said Etchebarne. But that is just the beginning, he claimed. "What's still missing is a solution to the very weighty problem of debt at the Central Bank of Argentina — to stabilizing the institution, to shrinking inflation, and to deciding whether to make the peso a floating or fixed-rate currency." 

Etchebarne expects noticeable improvements in the second half of the year.

That means that after just two months, the lines have been clearly drawn between the conservative-libertarian government of President Javier Milei and his opponents, but attitudes are not necessarily hardened. Right now, both sides are in Congress negotiating over the omnibus bill. The administration still believes a silent majority of Argentines is with them. The opposition believes it is slowly regaining its strength.

Is agreement possible in Argentina?

After displays of strength across the country, politicians will now have their say. There is much at stake for both sides and that could lead to compromise.

Then it will be in the hands of forces that Milei trusts with an almost blind faith: the markets. The administration hopes its reforms will allow these to blossom, ending Argentina's economic crisis.

Milei told his compatriots it would be a tough year. The general strike makes clear: If there's no light at the end of the tunnel soon, union marchers could be joined on the streets by even more people than have mobilized already.

This article was translated from German by Jon Shelton