In Argentina, President Milei's vast reform project sent back to committee

The opposition is exulting

In Argentina, President Milei's vast reform project sent back to committee

The opposition is exulting. The Argentine President, Javier Milei, suffered a first serious setback on Tuesday, February 6, in Parliament, where due to lack of support, his set of deregulatory reforms was sent back to committee.

“Our program was voted for by 56% of Argentines and we are not willing to negotiate it with those who destroyed the country,” denounced, on the social network or without the support of the political leaders who destroyed our country.”

Tuesday evening, when the Chamber of Deputies was preparing for very uncertain votes on the controversial theme of privatizations, the presidential party La Libertad Avanza (LLA) suddenly requested and obtained the adjournment of the session, de facto returning the text in committee. Interior Minister Guillermo Francos, who had been the linchpin of the negotiations to obtain an ad hoc majority - a challenge for Mr. Milei's LLA party, the third force in the hemicycle -, explained that he had noted "a lack of willingness of the blocs to support the reforms”. “There were voting commitments that were not respected in practice,” he denounced.

From Israel, where he arrived on Tuesday for a diplomatic tour that will also take him to the Vatican and Italy, President Milei denounced “the caste that got in the way of change.” “It will not be easy to change a system in which politicians have enriched themselves at the expense of Argentines,” he admitted.

A unraveled project

The deputies resumed on Tuesday the thorny examination, at times article by article, of Mr. Milei's ambitious so-called "Omnibus" law. Initially 660 reforming provisions also in the economy, commerce, culture, criminal law, culture... then, a project over the weeks narrowed down to around 300 articles.

However, the government initially recorded a victory on Tuesday, with deputies approving the principle of “delegated powers” ​​to the executive for one year, to legislate by decree in the name of “economic emergency”. Cracks had nevertheless appeared, with moderate opposition deputies, such as centrist Paula Oliveto, saying they feared "a weak democracy, which concentrates [powers] on a single person", referring to Mr. Milei, and "ends up leaving us all helpless.”

But the evening vote on the details of the law promised to be even more complicated: the moderate opposition, although ready to support the reforms, intended to demand modifications, such as on privatizations (between 30 and 40 companies targeted), or the distribution of resources between the State and the provinces of the country.

“The [provincial] governors did not keep their word,” said the leader of the LLA group Oscar Zago, suggesting that it is on the aspect concerning the financing of the provinces that the power was unable to ensure the guarantees of the vote of often independent governors, in a federal country with twenty-four provinces.

An “unprecedented ridicule”

The presidency has also pointed the finger at them and threatened them. “Unfortunately, the adjustment will have to be greater, it is the governors who will be concerned,” warned presidential spokesperson Manuel Adorni on LN television. “Each of the government's expenditures must be reviewed in order to comply with President Milei's instructions: zero deficit,” he insisted.

Mr. Milei repeatedly repeats that “there is no plan B” for austerity to restore Latin America’s third largest economy, structurally indebted and strangled by 211% inflation (in 2023). The IMF has predicted a 2.8% recession in 2024, driven by early austerity measures, including a 50% devaluation of the peso.

The opposition rejoiced at the parliamentary stunt “A political defeat of the government,” said Peronist deputy Leandro Santoro, asserting that it was “unprecedented ridicule” for those in power.

According to parliamentary procedure, sending a bill back to committee cancels the votes previously obtained. In this case the favorable vote last Friday on the “general principle” of the law, and that of Tuesday on the “delegated powers”. “That means they have to start everything from scratch,” said radical left MP and former presidential candidate Myriam Bregman.