Rather than growing wealth, conservative economic policies have led to a lack of money in the country
The country has changed in the last eight months; it is different. Since Javier Milei took office on December 10, 2023, Argentinians have only heard austerity, devaluation, recession, layoffs, poverty, repression, privatizations and “zero deficit.”
The pre-existing problems have become noticeably worse, and many others have resurfaced. Today, Argentinians are still worried about inflation and even more so about the fear of losing employment.
So far this year, the official accumulated inflation rate is 87%, plus an additional 25.5% for December 2023. The first measure Milei’s administration implemented was to apply a 118% devaluation of the Argentine peso, resulting in a regressive income distribution favoring export sectors and harming workers.
Currently, poverty affects 55% of the population; 17% of people are living in extreme poverty, meaning they are unable to consume the minimum calories necessary to sustain their daily lives. The reality is even more severe: According to the Latin American Strategic Center for Geopolitics (CELAG), the poverty rate reaches 73.3% of the Argentine population. The official “income-based” measurement excludes those just above the poverty line by a dollar a month. 68% of Argentinians earn less than 284,000 Argentine pesos (USD 190). Argentina is now one of the two countries in South America with the lowest dollar-denominated wages.
According to UNICEF Argentina, “Hunger Has No Happy Ending: Every Day, One Million Children Go to Bed Without Dinner.”
Another 1.5 million children skip at least one meal a day, and 4.5 million adults do the same to prioritize their children. In summary, 70% of children live in poverty, and 30% live in extreme poverty.
Watch UNICEF Argentina’s advertisement about poverty here.
Meanwhile, the government has stopped distributing food to soup kitchens and food pantries.
In fact, the government had stored supplies from the previous administration in warehouses close to expiration with no intention of being distributed. There is an ongoing criminal case, and the court has ordered the Ministry of Human Capital to distribute food to the neediest.
The social reality is dire and is reflected in the most basic consumption patterns of Argentinians: the worst meat consumption rate in 110 years; dairy consumption plummeted by 17.3% in the year-on-year comparison during the first half of 2024, according to a report by the Institute for the Agroindustrial Development of Argentina. IIt is the lowest milk consumption year on record” in the country.
According to a study by the Department of Economic Sciences at Buenos Aires University, Argentina has the highest cost of living in the region and even compared to some European Union countries.
Milei’s slogan is “There is no money,” his policy is based on “zero deficit.” To achieve this, he stopped making mandatory transfers to various provinces (states), canceled public infrastructure projects, and drastically cut pensions, the main victims of the administration.
Although the IMF celebrates the adjustment, it warns about the lack of sustainability in the short and medium term. “The staff expects a 3.5% contraction of the economy for 2024.” On the other hand, the Economic Commission for Latin America and the Caribbean (ECLAC) worsened the forecast from a 3.1% to a 3.6% decline, the worst in the region, which will grow by an average of 1.8%.
The recession deepens daily: 200,317 formal workers have been laid off, which should be multiplied by two or three for informal workers. In the last eight months, 9,153 factories have closed. The data from the National Association of Entrepreneurs for Argentine Development is even more tragic: 10,000 small and medium-sized businesses shut their doors in the first half of the year, i.e., 50 per day.
The industrial sector operates at 54% of its potential. The figure is lower than the major crisis of 2002 and is at pandemic levels; this month saw a collapse of over 14 percentage points year-on-year. While big corporations applaud even the repugnant insults of the most disrespectful president in Argentina’s democratic history, Argentina is experiencing a true economic depression.
Discipline or Social Explosion
The big question is whether this global extreme-right experiment can be sustained over time. The initial answer is no. A project that excludes two-thirds of its population and another portion unable to achieve social mobility is unfeasible.
Although Milei has managed to achieve social discipline so far, thanks to the failed previous administration, repression, and persecution of opposition movements—there are political prisoners in his government.
Javier Milei’s ascent to the presidency is testament to the power of public opinion. As an outsider, his eccentric television appearances catapulted him into the public eye, and his significant presence on social media further solidified his position.
He emerged at a crucial juncture, the era of “anti-politics,” where image and persona trumped ideas. With the economic failures of Mauricio Macri’s right-wing administration and the last Peronist administration, most of the population was eager to “try something different: the chainsaw.”
People believed the economic cuts would be on politics, not the voters; they were wrong.
However, according to surveys, approximately 40% of the population supports him: This is the core group that voted for him (he received 56% in the runoff) and who hold “hope” that both the country and their situation will improve, even though they acknowledge that their current situation is worse than it was last year.
Argentina has a history of struggle and social protest. In fact, there have already been two national strikes and several massive marches against the government. However, it remains to be seen when an eventual social explosion might occur that would impose concrete limits on Milei and the PRO, the party of former president Mauricio Macri, which “co-governs” by providing top officials and voting for all laws in Congress.
In the meantime, the risk is that Milei might implement structural reforms that could have dire consequences, such as the dollarization of the economy, increased external debt, privatization of public enterprises, and the handing over of valuable national resources, which could significantly impact the future of Argentina.
The political opposition, centered on Argentina’s historic popular movement, Peronism, has the crucial responsibility to lead this process of resistance. They also have the task of urgently building a viable political alternative for the country, one that upholds social justice, economic independence, and political sovereignty.
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About the Author
Hernán Viudes is an independent journalist and a graduate from The Faculty of Social Sciences at the University of Buenos Aires. He lived in Argentina and enjoys music, culture and football.
Hernán can be reached at hernanviudes@gmail.com.
Milei is a Wall Street puppet of Jewish Central banksters and the farthest from right wing as possible. Look were the 4.5 billion of Argentina gold went.
I would bet the politicians and their cronies that brought on all this misery are sitting back drinking champagne waiting for the current govt. to fail so they can rush in and resume their plunder. Either way, the Argentines (short of a miracle) are screwed.
Money circulates. Where is the International Monetary Fund in all of this? Is it filling it’s pockets?