Argentina: General Strike Looms for Macri With Economy Sputtering and Poverty Rising

Photo: Ricardo Mazalan / Associated Press

BUENOS AIRES, Argentina – The General Confederation of Labor of the Republic of Argentina (CGT), the largest and most historically important labor union in the country, has announced plans for a 24-hour general strike to place pressure on President Mauricio Macri as poverty levels continue to rise and the economy struggles nearly a year into his presidency.

Although the CGT has not announced a definitive date yet, several other strikes have taken place this week, including those of the unions in the education and health care sectors, in a move that some political commentators in Argentina said was intended to push the CGT to finally announce a nationwide strike.

The Union of Argentine Educators (UDA) and the Confederation of Education Workers (CTERA), two of the largest teachers’ unions in the country, went on strike this week.

According to the UDA’s national leader, Sergio Romero, the “rate of educators that joined in the exceeded 90 percent at the nationwide level.” The demonstration was a “clear message against the Macri government’s cutting of education budgets and the freeze in salaries of education workers in the face of a full-on economic crisis,” said Romero.

The two major unions, joined by several other smaller labor organizations, led two separate marches in Buenos Aires while they were striking and shut down several major city streets. One mass of participants gathered in front of the Ministry of Education while the other amassed in front of Congress.

“It cannot be that this government is giving all sorts of tax breaks and financial loopholes for the wealthiest and most powerful companies and sectors of Argentina while the workers suffer from salary reductions as part of a plan of harsh economic austerity and massive rate hikes in vital services,” said Roberto Baradel, the head of the Unified Education Workers of Buenos Aires (SUTEBA). Baradel suggested that there would be another strike in October if nothing changes.

For now, the national CGT has agreed after a meeting with several of Macri’s ministers on a 10-day “grace period” in which they will not call for a general strike.

The CGT triumvirate of leaders stated their demands for a one-time bonus to offset the recent sharp loss in purchasing power, an exclusion on salary taxes for bonus earnings and a reworking of the salary raise scale to match inflation.

Macri’s administration, represented by Labor Minister Jorge Triaca, Economy Minister Alfonso Prat-Gay, Interior Minister Rogelio Frigerio and Production and Planning Minister Francisco Cabrera, asked for the 10-day period at the end of which they will give their response.

The short delay is testing the newfound unity of the CGT as the labor union, like a political party, has its internal factions.

Typically, on one side lies the ‘oficialista’ sector that generally backs the incumbent leader, at least initially. In opposition to the ‘officialist’ union were typically one or two other large unions that would hold protests and/or strikes separate from the officialist fraction due to their disagreements.

For example, during the government of Cristina Fernández de Kirchner (2007-2015), Macri’s predecessor, the officialists backed the national government. Meanwhile, the dissident CGT Azul y Blanco and the CGT Azopardo unions were both in opposition to the former government.

Earlier this year, however, the sectors reached a tentative agreement to unify once again under the triumvirate leadership of Carlos Acuña (valet and parking workers), Héctor Daer (health sector workers) and Juan Carlos Schmid (dredging workers).

“We are going to go ahead and grant the government their request for a 10-day period,” Acuña said after the meeting with the government ministers. “However, if there are no responses,” he added, “there will be a strike because this is a social urgency and many are suffering at the moment.”

The economic trouble and the suffering mentioned by the labor leaders stems from several actions that Macri’s government has taken since he assumed the presidency in early December of 2015.

Macri has removed the subsidies instituted by his predecessor and went a step further by adding higher taxes on vital services like public transport fares, electricity and water. The costs of these services increased between 200 percent and 700 percent and Macri has warned of even higher prices.

Several weeks ago, Macri’s government sought to raise the price of gas by 1,000 percent in the middle of a severe cold snap in the austral winter but a series of protests against this measure has been halted temporarily by a federal court.

The wealthy businessman-turned-politico born to an Italian billionaire construction tycoon who arrived in Argentina in 1949 has also removed currency regulation (which has led to a 30 percent depreciation in the Argentine Peso), laid off over 150,000 public workers (and warned of more layoffs) and agreed to pay the New York-based vulture funds that have refused to accept restructured loan payments.

Tensions were so high that last month in the coastal city of Mar del Plata, Macri and a group of political allies were insulted and had rocks thrown at them and their convoy as they left a public event. Minutes earlier, Macri was forced to end the event less than five minutes after it began when whistles, jeers and chants drowned out his speech.

Macri caused further anger this week when several recordings showed the truth behind his “spontaneous bus ride,” a publicity stunt that attempted to show the billionaire businessman riding a suburban Buenos Aires bus like “one of the commoners.”

The videos, however, showed that Macri was actually dropped off in an air field by a private helicopter and then driven in a diplomatic vehicle to the nearby road where he then walked onto the out-of-service bus that was actually filled with colleagues and supporters, not everyday bus passengers. After several photos were taken, Macri deboarded the bus, which was followed by armed guards and rolled along a dirt road and not on its usual route, after just several minutes.

Statistics released this week paint an even bleaker picture for Macri and his economic measures and make the case for national strikes that are being urged by some sectors of the CGT even stronger.

An oft-repeated slogan of Macri’s has been to reach “zero-level poverty,” the description of his plans for economic growth and security in Argentina.

Statistics, however, would prove him wrong as all economic indicators (including GDP growth, inflation and unemployment) have worsened significantly since he assumed power in December of 2015.

In August, the respected Observatory on Social Debt at the Pontifical Catholic University of Argentina outlined last week that 1.4 million Argentines have slipped under the poverty level since Macri took office.

This week, Macri’s government released statistics of its own through Indec, the state statistics agency. According to Indec, 32 percent of Argentines fall into the “poor category” at the present time. In addition, Indec also reported a 3.4 percent drop in the GDP from April to March brought about by a drop in consumption (1.2 percent), exports (1.9 percent) and foreign investment (4.9 percent), along with drops in many other categories.

The statistics concerning the latter pair, exports and foreign investment, are particularly painful for Macri as he has touted how “open” his government is to the world economy compared to his predecessor’s; he has lifted export taxes that previously kept domestic prices lower and held several “investment fairs” where hundreds of businesspeople from around the world were invited to find out about opportunities in the local market.

The only positive areas in Indec’s statistics were rises in the electricity, gas and water (4.1 percent) sector due to Macri’s massive rate increases and restaurants and hotels (3.1 percent), an increase due to a small spike in tourists from neighboring nations taking advantage of the steep fall of the Argentine Peso.

Macri has repeatedly said that the measures he has taken would be painful initially, but the situation would improve. He said foreign investment should start flowing in, inflation and unemployment would go down and salaries would rise by April. Then, he said that these positive developments would happen in June and then July, and now, his government has said that the situation will improve in 2017.

Inflation, considered one of the scourges of the Fernández de Kirchner administration and a sensitive subject in Argentina, was designated by Macri as one of his primary targets for reform with an eye on lowering the rate.

However, his measures have done the opposite yet again as Indec explained that inflation rose by 3.1 percent from April to August. At the beginning of that period, the Central Bank of Argentina said that inflation in April had reached its highest month-to-month increase (6.7 percent from March to April) since 2002 when the country was in the midst of a full blown economic meltdown.

Thus, when added to the other months of 2016, this meant that inflation has risen by 19.4 percent from January to May. In comparison, during the same period in 2015 under Fernández de Kirchner, the figure was 8.0 percent.

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