Libertarian victories as Milei keeps quiet

With the Javier Milei administration beginning to effectively throw around its recently attained legislative weight, Argentina is deepening the trench lines of the latest iteration of ‘la grieta,’ the country’s unique brand of political polarisation. 

While this shouldn’t be taken as a novelty, it does begin to reveal the new relative distribution of power that will mark the anarcho-capitalist libertarian experiment’s final two years in office. While those on either side of the labour reform debate attempt to justify their arguments based on the merits or vices of the bill, at the end of the day it becomes clear that essentially the totality of the socio-political ecosystem has chosen sides around the central element of that universe: President Milei. Interestingly, this is occurring at a moment in which the wild-haired economist appears once again at a zenith of power, with no real adversaries of weight, and while he spends his time far from the domestic oratory spotlight, posting on social media and jetting off abroad to partake in yet another event alongside US President Donald Trump. 

Milei’s already faced the edge after breaking with every potential ally and pushing his economic model past its limit, only to be bailed out economically by the United States and later politically by the electorate that gave him a second chance. The stakes for his plan of political hegemony couldn’t be higher.

For the time being, it seems as if Milei has effectively eclipsed the former two epicentres of the political ecosystem: Cristina Fernández de Kirchner and Mauricio Macri. The former has progressively seen her centrality wane, a situation exacerbated by her home imprisonment under house arrest after being found guilty of corruption. Buenos Aires Province Governor Axel Kicillof is attempting to take control of the more combative wing of the Partido Justicialista (the main Peronist party known as the PJ), while Argentina’s provincial governors are playing their own game. Sergio Massa, the leader of the Frente Renovador – who was the pan-Peronist front’s last presidential candidate – is nowhere to be found. 

Some speak about Peronism trying to find their woen outsider, with evangelical pastor Dante Gebel’s name being banded around – see the splurge of typical street paintings announcing his name in and around Buenos Aires – though no-one really knows who’s backing him (the suspicion, it seems, is always Massa). At the end of the day, the once feared Peronists seem unable to come up with a palatable response to Milei, even in the face of a deep recession, a consistent loss of purchasing power, and rising joblessness.

Across the aisle, so to speak, Macri has been humiliated by President Milei and Presidential Chief-of-Staff Karina Milei, who have effectively absorbed PRO’s legislative muscle. Not only that, both members of the presidential ticket presented by the coalition led by Macri in 2023 – Patricia Bullrich and Luis Petri – have become central to the libertarian power structure, not to mention the key ministerial positions held by PRO alumni Luis ‘Toto’ Caputo and Federico Sturzenegger. While there have been some complaints from Macri’s allies, led by national deputy Cristian Ritondo (particularly around the possibility of allowing salary payments through fintech platforms), PRO has essentially lent its full support to everything La Libertad Avanza has thrown its way. The rumour is that they’re looking for their own outsider, with some suggesting that MercadoLibre founder Marcos Galperín is their prime target. That could explain the emphasis behind the importance of breaking the banks’ monopoly on wages, though it’s nothing more than rumours at this point.

The political momentum that the Milei administration has gained has allowed it to begin to secure the passage of bills through Congress, starting with the 2026 Budget (the first “bill of bills” approved in three years), the labour reform push and a bill lowering the age of criminal accountability from 16 to 14. All this has happened after the surprise and solid victory in last year’s midterms, which came after the government was initially spooked by Kicillof’s strong showing in Buenos Aires Province’s local elections. Not to mention a bailout from the United States, together with a ‘back to basics’ campaigning approach for Milei that saw him perform a rock concert and personally lead the communications strategy. 

But since then, the President has remained relatively quiet, limiting his media appearances, watering down the aggressiveness of his rhetoric on social media, while spending a good amount of time overseas, generally with Trump. The political squad has taken the lead, with Sister Karina, supposedly in charge alongside Cabinet Chief Manuel Adorni. Yet it feels as if the individuals who have really taken the reins are the more traditional politicians, the historical members of “the caste” so hated by Milei – recently minted Senator Bullrich and Interior Minister Diego ‘Ginger’ Santilli, another former PRO figure. Not long after the President proclaimed the death of Niccolo Machiavelli and the art of politics, his team is managing a series of important political triumphs that give him breathing room and credibility, both domestically and abroad – particularly with the International Monetary Fund.

Rushing a labour reform bill through Congress has its problems, such as failing to catch certain “mistakes,” such as the contentious “Article 44” referring to medical paid leave, which was ultimately dropped. The debate in the lower house Chamber of Deputies also saw many potential circumstantial allies raising controversial points and questioning whether their colleagues in the Senate had even read the text. The untimely closure of 80-year-old domestic tyre manufacturer Fate also coincided with the legislative process, putting Milei and Caputo’s economic plan under further scrutiny. In response, the CGT umbrella union grouping took the opportunity to organise a national strike that was fairly substantial, while bouts of violence in the plaza outside Congress raise the spectre of social tension in the face of the sustained closure of companies and job losses.

While the actual content of the bill matters, it won’t serve as a definitive solution to Argentina’s historical problem of economic decrepitude. Neither will macroeconomic growth that excludes a vast majority of the population from improving their lot. The President must push forth with his agenda of structural reforms, including tax and pension projects that will undoubtedly spark heated debate and more social tension. 

Yet this recent passing of a series of bills shows a new push for pragmatic negotiation in order to attain political consensus, which was one of the major issues of the first two years in office. If those negotiations could begin to lay the groundwork for the construction of political majorities to support a series of major national issues that can transcend the immediate political demand for polarisation over everything, then there could be a chance at taking advantage of the opportunity.

Yet, mired as we are in our new version of ‘la grieta,’ a polarisation that forms part of the government’s political and electoral strategy, it feels like the political ecosystem is far from finding common ground to get the country up and running. And that Milei, whenever the time is right, will start talking again.