Accompanied by the Minister of Economy, Luis Caputo, the president used the third national channel so far in his administration. The use of this tool indicates that it seeks to massively show some “achievement”, since the unrest in recent weeks has been on the rise. This could be seen in the support for the collective strike and in multiple demonstrations. The chosen day is not coincidental, this Tuesday a massive university march is expected throughout the country, against Milei’s budget adjustment and in defense of public education.

In a recorded message of just 15 minutes, he boasted of achieving a financial surplus in the first quarter (more income than expenses). He tried to minimize the cut in pensions that is equivalent to almost half of the surplus and did not take responsibility for the currency devaluation that triggered inflation. He wanted to present a contrast between “blender and chainsaw”, but the reality is that he is using both for his plan that is sinking the income of the vast majority.

In his speech he complained about not having the support of the political parties that had previous governments, in reference to Peronism and the radicals (UCR). An extortion towards the traditional parties to approve the delegation of powers included in the new Base Law, but starting from an extraordinary floor of governability for the level of adjustment in progress. So far, the parliamentary blocs of these parties have not made a call for the treatment of the DNU that is still in force.

The leaders of Unión por la Patria oscillate between silence, moderate criticism and cordial negotiations. Alberto Fernández is practically retired from politics, Sergio Massa is working for the vulture fund Greylock Capital and Cristina Kirchner was willing to approve a labor reform and validate partial privatizations of public companies. The UCR has just given him the votes to approve the finally fallen Omnibus Law and offers itself as editor of new projects for the government. The group of governors of both parties, together with those of the PRO, after making threatening statements, are granting Milei valuable time through a “truce” to continue with the cuts that affect workers, such as the elimination of FONID (fund teacher incentive).

This Tuesday, a massive educational march is expected throughout the country. However, there are sectors such as radicalism that call for mobilization but at the same time have presented a labor reform worse than that of the government. For decades they have held the highest positions in key universities such as the UBA and have favored the interference of companies by conditioning the autonomy of the study houses.

Trade and financial surplus at what cost?

The president confirmed that in March the financial surplus was $275 billion pesos and 0.2% of GDP in the first quarter, something that had not happened since 2008. He went so far as to describe this policy as a “feat of historic proportions.” , posing as the hero who “did not transfer the adjustment to the entire population, but only those who benefited from the impoverishing model of the past.” While it is true that both the PRO and Peronism made poverty grow, it is no less true that Milei made it take a new leap, leading to 3 million more people not being able to access the minimum to cover their needs.

The worsening of the social crisis is a direct and indirect consequence of the government’s adjustment. According to the latest report from the Congressional Budget Office (CPO), In the first three months of the year there was a drop in real terms in retirements and pensions, public salaries, subsidies for electricity and transportation, Empower Work, transfers to universities and provinces. The document detailed that the funds allocated to retirements and pensions fell 31.4% (real year-on-year) and energy subsidies 66.7% (real year-on-year), being among the main items that had the most impact on the reduction in expenses.

Retirees were one of the sectors hardest hit by this government. The report indicates that the salaries updated solely by the mobility formula (not reached by the bonuses) showed a real fall of 42% (real year-on-year) during the first quarter of 2024, while the loss of the minimum salaries with the bonus included was 27.8% (real year-on-year).

The Government also cut transfers to universities and provinces. In the first quarter of the year, the transfer item to universities plummeted by 33.2% in real terms. The report maintains that the funds for the payment of salaries and operating expenses of universities were below inflation. It is the origin of the mobilization in defense of public education this Tuesday.

Another tight sector is state workers. The Government left thousands of public employees on the streets. In addition, it liquefied salaries (as happened with the salaries of workers in the private and informal sector), thus the item of personnel spending registered a drop in real terms of 16.8% in the first three months of the year.

The scissors did not go through all the games. The debt interest item increased 7.3% in real terms in the first three months of the year in real terms. The Government honors the debt restructured by the former Minister of Economy, Martín Guzmán, inheritance of the Macrista mortgage with the International Monetary Fund.

Is inflation collapsing?

Milei pointed out the decrease in inflation in recent months as very auspicious and affirmed that it will continue that path. But far from “collapsing” as the president said, until now it has only returned to the levels prior to his inauguration, after having had a peak of more than 25%, and different specialists see it possible that the pace of price increases stagnates, oscillating around of 10%. Rate increases (electricity, gas, water, transportation), the lack of dollars and the inertial component will continue to be an obstacle to the government’s objective. Even if inflation declines, the damage done in recent months will not be reversed; The sharp drop in consumption reflects the consequences of increases in food, clothing and services.

The cost of the Total Basic Basket (CBT) prepared by Indec to measure the poverty line increased 304.4% between March 2023 and the same month of this year, being above inflation (287.9%). In the case of the cost of the Basic Food Basket (CBA), which measures the so-called “indigence line”, the increase was 308.2% in the same period. That is why the data from the consulting firm Scentia is not surprising, showing how sales in supermarkets and supermarkets have been falling since the beginning of the year as a result of the recession. In their report they detail that March turned out to be the most negative with a drop of 7.5%, almost doubling the drop in consumption that occurred in February.

There is no way to cover up the rejection of adjustment

While Milei and Caputo adjust the working class and the popular sectors, the government seeks to reward large businessmen and speculators with tax cuts and money laundering at a 0% rate. Millionaires linked to oil like Paolo Roca or to the trade and sale of food like Galperin and Perez Companc multiply their assets.

Milei tried to be optimistic by marking successes that are not successes and drawing figures as is his custom. Her speech was received with pot-banging in different neighborhoods and a massive mobilization is expected this Tuesday against her adjustment plan, as has rarely been seen a few months into a government.

The ruling party already had to back down with the Omnibus Law and the mega DNU was also rejected in the Senate. If the growing discontent with the government’s policy is transformed into a fighting plan to confront Milei’s adjustment measures, the situation may begin to reverse. It is necessary that the union centers, the CGT and the CTA, instead of negotiating with the Government, establish a series of measures to unite the demands of the workers and the large majority to defeat the looting in progress through mobilization and the general strike .


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