Anti-Milei sentiment growing among Argentina’s elites
There’s a growing feeling among certain groups of elites that the Milei administration will fail at some point in the near future.
There’s a growing feeling among certain groups of elites that the Javier Milei administration will fail at some point in the near future. These small but influential groups of people span from businessmen to politicians, journalists to economists and other key opinion leaders. They believe the Casa Rosada will face an explosive cocktail at some point of its own making that will put it out of commission.
The failure of the libertarian political project won’t necessarily be expressed in the form of a government collapse, but it remains a possibility, according to this segment of the ‘círculo rojo' group of decision-makers who are coming around to the idea. But it will necessarily be tied to a loss of popular support for the President and his measures, sparking a typical “rats escaping a sinking ship” phenomenon (to use an evil metaphor in line with today’s public discourse), as circumstantial allies withdraw votes and support. If this thesis is correct, ultimately, Milei will find himself alone, surrounded by his sister, Presidential Chief-of-Staff Karina, and his four dogs (or is it five, now that the Conan clone has been publicly shown?) and maybe some of his diehard acolytes.
It is difficult to differentiate how much of this vision is wishful thinking from these groups or a real attempt at analysis, but it’s worth noting all of them have either been opposed to the Milei project from the start or wounded by it at some point along the way. Hate and aggression beget feelings of vengeance.
The arguments behind this theory are both political and economic. On the latter front, the policy model pursued by Milei and Economy Minister Luis ‘Toto’ Caputo seems to have contained the problems on the macroeconomic front, but it suffers from multiple inconsistencies that could seriously backfire. The tandem composed by a strong peso and a weak US dollar generates an artificial sensation of wealth by inflating income in dollar terms, while helping keep a lid on peso inflation via pass-through effects. This is hugely beneficial for the upper classes who love to travel abroad or for those looking to purchase a car or house, both of which are dollarised assets in Argentina. But it’s severely detrimental for exporters and domestic consumers. Costs in Argentina have skyrocketed and are therefore eating into the current account surplus, putting further pressure on the chronic lack of hard currency in the Central Bank’s coffers.
At the same time, a large and growing portion of society is excluded from the rebound in economic activity, specifically those with formal and informal wages that aren’t at the extremes. While the very rich are protected by their savings and the very poor have seen the level of social welfare outmatch inflation, the rest of society has seen the purchasing power of their earnings seriously dwindle. Small- and medium-sized companies have closed their shutters across the nation and it is difficult to envision how this economic model will create quality jobs, particularly given its anti-industrial bent and focus on extractivism. While measurements of poverty have increased statistically, self-perceived “economic stress” – which refers to a feeling of insufficient income to cover necessities – has increased, as head of the Social Debt Observatory at the UCA Catholic University Agustín Salvia explained on Modo Fontevecchia this week.
The deterioration of the family finances of a large portion of society could still increase this level of dissatisfaction, at some point eroding Milei’s solid opinion poll figures. As every local election held this year has shown, record low turnouts indicate people are tuning out of politics. Milei’s 2023 bombshell electoral victory saw him beat out the two major coalitions that had dominated the political scene for the past two decades. In part, he was capitalising on this pent-up anger against the political class that he cleverly called “the caste.”
The biggest damage was inflicted against former president Mauricio Macri’s Juntos por el Cambio coalition, which was expected to win the election. It blew up into multiple pieces, the largest of which Milei is trying to pick up, particularly the centrist and far-right elements more closely associated with PRO. Indeed, the libertarian coalition, La Libertad Avanza, took the top spot in the legislative elections in Buenos Aires City, where Jorge Macri is currently the mayor. They’ve also absorbed former PRO presidential candidate and party chair Patricia Bullrich and her ex-running-mate, Luis Petri of the Unión Cívica Radical. Despite a meagre showing in Congress, Milei has managed to pass legislation or block it by counting with the support of diverse groups, but mainly PRO. He has also humiliated Macri, who lent his support initially and is now about to be engulfed by LLA. Certain groups of centrist Peronists and Radicals have also lent their support, as well as deputies and senators who respond to provincial governors. All of these people have been berated, insulted and attacked by the president and his henchmen.
Across the aisle, the pan-Peronist Unión por la Patria coalition has managed to remain united legislatively, but is deeply fragmented at the political level. With Cristina Fernández de Kirchner under house arrest yet still trying to dispute power with Governor Axel Kicillof, the Peronists of the Buenos Aires metropolitan region are unable to come up with a proper strategy in order to propose the potential LLA-PRO coalition that could deliver them a tough match-up in October’s national elections. There’s another level of rift when provincial interests are brought to the table, with some Peronist governors even lending their support to Milei’s measures. This diverse political structure has been grouped into the category of Kirchnerites by the government, which chooses to antagonise directly with Fernández de Kirchner in their attempt to win the “us against them” vote. They are consistently blamed as those most responsible for Argentina’s decadence and associated with corruption, inefficiency, being directly responsible for the people’s suffering.
The speculation within the political plane is that an anti-Milei front could be put together to effectively channel the level of distrust, anger and disillusionment caused by the government’s constant aggression and provocation against its opponents. This could happen throughout the political spectrum, whether it’s Kicillof or some “moderate” Peronist that manages to coalesce a significant portion of non-Kirchnerites, Macri or someone on his behalf attempting to dispute the centre-right vote or something like the former Juntos por el Cambio coalition including UCR radicals and conservative Peronists. Even a novel coalition including representatives of the right and the left, as occurred in Brazil with Jair Bolsonaro, who was opposed by Luiz Inácio Lula da Silva and his former centre-right opponents.
At the social level, the number of people being left out by Milei’s model could galvanise the bases, who looking for representation to find another outsider who represents the opposite to Milei, a la Gabriel Boric in Chile who led a student revolution. That was Carlos Burgueño’s take in his weekly column in Perfil, and is supposedly the scenario expected by Fernández de Kirchner. This scenario would include some level of social unrest, even though it wouldn’t seem likely that things would escalate as in the 2001 implosion. A centrist from a more established political lineage associated in some way to a broad coalition could also mobilise voters looking for a response to the President’s distaste for democracy and civic responsibility. Close to Macri they continue to push for an open break with Milei to lead an opposition from the right. The former president continues to claim he is not interested in running for office again, but it could also be a young and upcoming figure that isn’t even being tracked by opinion polls.
All of these scenarios are being analysed by myriad socio-political actors trying to anticipate what comes after Milei. They assume the economic model will run out of steam and that the political model will be carved out from the inside by the libertarians themselves. At the same time, Milei could surprise them, managing through a pragmatic approach to adjust his economic model in a way as to dissipate internal tensions, while maintaining a political centrality that allows him to win the upcoming midterm elections and re-election in 2027. Time will tell.
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