“The worst is over,” he declared this Monday, after the large victory he obtained in the midterm elections. With the support of those gathered on Sunday, the ultra president of Argentina postponed the change of ministers that he planned to define this week to relaunch his Government and announced his decision to advance in a renewed Congress with structural reforms of the tax and labor regimes. “It is a historic consecration of our vision,” he celebrated an electoral result that, he admitted, surprised him. He even got excited about: “I’ll be two or six years older,” he said.
The far-right government had stumbled into the national legislative elections: politically weakened, besieged by allegations of corruption and with its economic plan in need of a multimillion-dollar bailout from the United States. The resounding vote of confidence that the polls granted him changed the scenario, literally, from one day to the next.
Milei’s victory also ratified his unconditional alliance with Donald Trump, who had made his help contingent on the electoral result. The US president congratulated his counterpart “on his overwhelming victory” and praised him: “He is doing an excellent job! The Argentine people justified our trust in him.” Milei thanked him for his support and defined him as “a great friend of the Argentine Republic.” The support of the Republican – embodied in 40,000 million dollars from a currency exchange and an eventual credit from the private sector – was crucial for the Ultra Government to face the financial volatility of recent weeks. This Monday, The peso appreciated against the dollar and the country’s bonds and stocks rose markedly.
The day after the legislative elections, Milei was exultant and convinced of deepening his objectives of deregulating the economy. At the same time, he insisted on presenting himself as more moderate and dialogue-oriented than until a few months ago, when he labeled his adversaries and also his allies as “rats” or “baboons.” Excluding Kirchnerist Peronism and the left, he reiterated his call for the opposition to seek agreements, an initiative demanded by the Trump Government to give sustainability to the far-right program.
“Just yesterday [por el domingo] We open the dialogue. I am willing to sit down with the governors,” the president remarked this Monday, in dialogue with channel A24. “I now need a political counterpart to advance with the reforms. We have already fulfilled 98% of our campaign promises. With this result I have to go look for the reforms that I am missing.”
In particular, Milei referred to what he called “second-generation reforms,” a modification of tax regimes and the labor market. “In terms of taxes, we have a plan to lower 20 taxes now, expand the tax base, so that, by lowering the rates, evasion makes no sense,” he summarized. The priority was assigned to “a labor modernization, which does not imply a loss of rights,” he assured. And he sent a message to the union centers: “The unions know that this does not work, that if they think of it as a business they are liquidated.” Without giving details about his projects, he suggested that with them “everyone will win because there will be more registered workers.” Today informal employment exceeds 40% in Argentina.
La Libertad Avanza has already presented a labor reform project in Congress and it is presumed that it will now promote many of the measures planned there. Mainly, it proposes offering incentives to small and medium-sized companies for hiring employees and making the regulations stipulated in the agreements agreed between unions and companies more flexible, on issues such as vacations, work hours and compensation payments.
Just as the electoral support led Milei to revive his proposals, it also put a brake on the renewal that he had announced for his Executive. It was a direct consequence of how unexpected, even for the Government, the results were. “Who thought we could win the province of Buenos Aires? We are going to take that into account for the changes,” he said.
The biggest surprise of the elections, the basis of Milei’s national triumph, was registered in the largest and most populated province of Argentina, where almost 38% of the country’s voting population resides. There, 50 days ago, La Libertad Avanza had lost by almost 14 points to Peronism, in the local elections. This Sunday, the far-right reversed the defeat in Buenos Aires and won with 42.45% of the votes compared to 40.91% for Fuerza Patria, the Peronist list.
“This reconfigures the political structure that I must put together to negotiate and approve the laws that I promised Argentines,” Milei said. “The cabinet is designed according to the alliances it has to seek. It will be built in light of the new Congress,” he said. What will not be modified, he assured, is what he calls “the iron triangle”, the structure that concentrates decision-making power around him and which is completed by his sister, Karina Milei, and his advisor Santiago Caputo. The clashes and tensions between the sectors that both represent have marked the future of the Government in its almost two years of administration.
Some casualties in the Executive have already been confirmed. Last week he resigned, questioned internally for failures in the negotiation with Trump. He has already been replaced by Pablo Quirno, former Secretary of Finance. The head of Justice, Mariano Cúneo Libarona, had also announced his resignation this Monday, but he had not yet formalized his departure. The Minister of Security, Patricia Bullrich, and her Defense counterpart, Luis Petri, as well as the presidential spokesperson, Manuel Adorni, were elected legislators and will leave their positions when they assume their seats, on December 10.
With its 40% of votes nationwide, La Libertad Avanza will reach, by adding allies, 107 seats in the Chamber of Deputies, out of a total of 257. That number will allow it to sustain presidential decrees and vetoes, and will leave it close to being able to approve laws by a simple majority. In the Senate, it will have 24 seats, a third of the body made up of 72 legislators.
For its part, with 31% of the votes it received in these elections, Peronism will retain 98 seats in the Deputies and a third of the Senate. It will see its firepower diminished in Congress, but it will continue to be the main opposition. The rest of the benches – provincial, left and center – will play the role of arbitrators in a polarized Parliament.
