Development Blog Post 4

Development Blog Post 4

            In this tumultuous year for the Argentine economy and political system, strikes stemming from the massive labor organization, CGT, are further exacerbating the political stress of the Macri government. Before I can justify the decisions of the CGT, I think it is important to clarify the problems they are claiming to be protesting, and what I believe the ultimate goals of the strike are.

            Macri’s policies mark a shift back to the neoliberal practices of the 80’s and 90’s in Argentina. These policies generally entail three concepts, privatization of previously government owned enterprises, deregulation of the economy and/or austerity measures, and liberalization of the economy through reduction of trade barriers. Macri has most infamously committed to austerity measures, cutting state education and medical budgets by approximately thirty percent. This, while certainly aligned with his political ideology, stems from another of his controversial policies; the largest ever loan from the IMF being given to the Macri administration. Loans from the IMF come with strings attached, call structural adjustment programs that call for drastic austerity measures to reduce the federal deficit. These policies have been extremely controversial in a country in which much of the population has condemned the IMF as the hand of the devil. This is not an unreasonable conclusion considering the IMF’s generally poor track record with the countries receiving “assistance” actually faring worse than those who do not. Regarding privatization, Macri has yet to commit to any privatizations, but his speech has certainly alluded to the possibility of its occurrence. Following the state-owned Aerolíneas strike, Macri’s comments about the “unfairness” of tax-payer money going to a company that only 4% of the population can take advantage off certainly allude to his support for the concept of privatization. Though, the terrible reputation of the Menem era privatizations will likely inhibit repetitions of these policies. Third, Macri has been a powerful proponent of liberalizing Argentina’s position within the global economy. He has vigorously fought for the adoption of a free trade area within MERCOSUR and has only been halted by the legislature that his party lacks power in. So, all in all, Macri’s economic policy fits squarely into the neoliberal box. On top of all of Macri’s efforts to govern an economically tumultuous nation are massive inflation rates, reducing investor confidence and eviscerating the savings of millions of Argentines. However, are the strikes instigate by the CGT actually going to fix such problems?

            The CGT has called for a series of general strikes in areas ranging from transportation to education in protest of Macri’s neoliberal agenda. In my opinion, these strikes are only going to worsen the situation in Argentina. They will both decrease productivity and significantly reduce investor confidence, driving capital out of Argentina and into more investor friendly nations, like Chile. However, I believe that the CGT is fully aware that their actions will only serve to worsen Argentina’s economic state, in fact this is likely their precise motivation. If the nation’s economy worsens under Macri’s regime, it will significantly reduce his likelihood of reelection and increase the strength of the Fernandez-Kirchener ballot. Kirchenerism is an ideology of Peronist origins that is significantly friendlier to the labor movement. Under the Kircheners, Argentina saw significant strength given to the labor movement, advanced social welfare programs, and significant protection of Argentinean industry from the global market, all of which are extremely friendly policies to the CGT. So, while I can’t say I think the strikes are going to do anything to help the Argentinean economy in the short term, I can say that it is an extremely intelligent move on the part of the CGT and will likely lead to the achievement of their goals. On this study abroad, I have been thinking a lot about the role of politics. I used to believe it was more about having a sound and ethical ideology that stands true in every circumstance, however now I see more and more that it is a means to an end. Politics are not about always being in the right, because this is impossible. Politics are about maximizing the good you do and minimizing your negative impact. The CGT believe that Kirchenerism will help achieve their goals, so ultimately, they are striking to worsen the economy, and Macri’s political appearance. As a barely informed outsider, it is extremely difficult to say whether or not this will yield better results than if they chose not to strike, but I can agree that it will have the desired effect.