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OPINION AND ANALYSIS | 12-10-2024 06:04

Veto power! Milei’s ‘caste-like’ adaptations

Milei’s libertarians took on two of the most sensitive issues in Argentine politics – our grannies and public education – and successfully came out of the bout on top without sparking an uprising.

The administration run by self-proclaimed “anarcho-capitalist” Javier Milei has managed to secure an important legislative victory by upholding a veto that adjusted public university budgets by inflation. 

It’s the second congressional victory for Milei in just a few weeks, having recently overturned a bill passed by both chambers that would increase payments to retirees and pensioners, and in both cases it confirms that Milei and his political team have adapted and developed the “caste-like” characteristics necessary to orient the legislative branch in their desired direction. Thus, from a position of absolute political fragility – failing to count on a substantial number of legislators and without formal allies leading provincial governments – the Casa Rosada has managed to impose its will by way of veto, a supposedly toxic tool that comes with a heavy cost in terms of political capital. 

Furthermore, Milei’s libertarians took on two of the most sensitive issues in Argentine politics – our grannies and public education – and successfully came out of the bout on top without sparking an uprising that could challenge their governability.  This is not to say that the armour hasn’t been pierced – empirical evidence continues to demonstrate that Milei’s popularity, along with confidence in his administration, are decreasing in tandem with an economic crisis that is nothing short of dramatic. We are confronted with a consolidation of the Milei hegemony, which counts on the support of Mauricio Macri’s PRO party, while at the same time we experience an extreme rise in poverty that will leave its mark on the population and could threaten social stability.

“Don’t be confused,” an annoyed Miguel Ángel Pichetto told Lower House Speaker Martín Menem in this week’s congressional clash. “You believe you have won but you lost.” Pichetto, the epitome of the political “caste” for Milei, was admitting defeat before the libertarians had definitely secured the numbers to uphold presidential veto.  The septuagenarian railed against the government, accusing it of not having a plan beyond becoming “Damage, Inc,” with the only purpose of demolishing even the few public institutions that function relatively well in the country. Yet what annoyed the leader of the Hacemos coalition most was the lack of political construction of the Milei administration, with the Casa Rosada preferring to “consolidate a minority party” that would govern by blocking rather than building. Pichetto, one of the most conservative figures in Argentine politics, has emerged as a sort of rebel, a primus inter pares within the opposition that can hit them where it hurts, calling out his former colleagues in the PRO party for turning their backs on one of their key electorates, retirees, and La Libertad Avanza for doing the same with the youth.

Ultimately, the opposition was outsmarted by those in charge of political negotiations on behalf of Milei, who this time avoided descending into the mortal realm: Cabinet Chief Guillermo Francos, star political advisor Santiago Caputo, and Sister Karina’s own personal advisor Eduardo ‘Lule’ Menem. They learned the tricks of the trade during the protracted battle that was the ‘Ley de Bases’ battle and then put them to work to uphold the veto for retirement and pension increases. More of the same, as the Milei administration learns the tricks of the caste, securing votes, abstentions or absenteeism from members across the political spectrum, including pan-Peronists within the Union por la Patria coalition, supposedly led by Cristina Fernández de Kirchner. The Partido Justicialista, given the weaknesses of the flesh at the provincial level. Opposition factions, with ample majorities, tried to force the government’s hand by putting retirees and students at the centre of the political debate, but failed to extract political profit, be it by delivering an important legislative defeat for the government or by making them pay the costs. 

A major player in this alchemy of power was Macri, who once again lent the support of his legislators, promising that it would be the last time he’d collaborate 'for free. It remains to be seen whether the former president will finally manage to outmanoeuvre Milei, who seems to be taking him out for a walk in the park. Apparently, Macri was convinced by Santiago Caputo, whom he despises, to lend his party’s support despite failing to receive any concrete promises of concessions or official posts for his troop. It is said that Mauricio, of Calabrese descent, never forgets.

Not only has the Casa Rosada avoided a costly political defeat, it also seems to have overcome the spectre of a possible impeachment. While it remained a far-fetched idea, the rejection that Milei generates among his adversaries is such that there was talk of trying to put together a super-majority of two-thirds in the Chamber of Deputies to bring the accusation against the president to the Senate, which would have to rule following the same conditions. With a consolidated third composed of members of La Libertad Avanza, PRO, and various deserters, the anarcho-libertarian can breathe a sigh of relief. Yet Milei must be on his guard, as both of his vetoes were upheld by thin margins, while he maintains an open conflict with Vice-president Victoria Villaruel, who is constantly flattered by Peronists.

Meanwhile, Fernández de Kirchner has emerged as the leader of the opposition to Milei and the libertarian government (mainly through social media posts given her scant social appearances). Taking charge of the PJ, as she is expected to do soon, will give her a platform from which to mount the resistance, extending the era of vertical leadership with CFK at the apex. A tough cookie to swallow for Axel Kicillof, governor of Buenos Aires Province. Some Peronists close to Cristina speculate with a “herbivore” version of the former president, seeking a more centrist and dialogue-prone leadership, as they suggest she should lead the party ticket in next year’s midterms. Pursuing an impeachment, like the Peronists did with the Supreme Court during the Alberto Fernández presidency, could give them an interesting position from which to launch the campaign. But they need two-thirds.

At the end of the day, the game of political chess has society as its cannon fodder. With the mantra of the budget surplus, Milei and Economy Minister Luis ‘Toto’ Caputo have pursued an aggressive austerity plan that sparked a tough recession, by design.  While this has helped tame inflation, along with other restrictive elements of their economic policy, it has seriously diminished purchasing power and wounded the labour market. Poverty has skyrocketed. A lot of it had to do with structural issues and the recent largesse during the later term of the Fernández administration, with Sergio Massa as economy ninister-cum-presidential candidate and the infamous “plan platita” petty-money plan to boost consumption. But it is also a direct consequence of the current economic plan, which sought to stabilise macroeconomic variables in order to allow market forces to engineer a rebound. It’s not happening, particularly when it comes to the “micro-economy” of the majority of the population, as opposed to major sectors of the “macro economy” like energy, agriculture, and mining, which are booming. Instead of analysing how to improve public universities, the debate became polarised along the lines of whether one supports the government or is opposed. It would have been valuable for those in favour of the public university system to agree that it should be improved, and for the government to look for ways to adequately fund it rather than engaging in culture wars.

A win in Congress but there’s been substantial erosion in the President’s standing with society. He still holds major consideration in the eyes of the population, particularly among his voters, but many are beginning to lose hope as their personal situation fails to improve. In the not too distant past, an administration that had the tenacity to mess with retirees or public education would have been faced with violence in the streets – just ask Macri. Milei saw massive street protests but nothing out of the ordinary, yet the situation of a majority of the population is multiple times worse than in 2017. 

It is difficult to predict what will happen next, whether people will continue to tolerate Milei’s economic plan and the construction of a new and deeper “grieta” or rift line of polarisation. If there are no signs of improvement, patience will be tested sooner, rather than later.

Agustino Fontevecchia

Agustino Fontevecchia

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