NO FUDGE IT WITH BUDGET
In an unprecedented presentation by a president rather than the Economy minister, President Javier Milei did not so much present the 2025 Budget to a half-empty Congress on Sunday evening as the budgets of all time which should always be balanced whatever the economic cycle – if revenues exceed expectations, taxes must be cut and if they fell in a recession, state spending would have to take a further hit but spending must always be based on the available revenue rather than coming first with the funding subsequently sought. Any parliamentary law triggering deficit would be vetoed, he vowed. His 43-minute conceptual speech was almost bereft of numbers but one which did carry impact was informing provincial governors that they would have to cut their spending by US$60 billion. This triggered strident protests from virtually all governors and Cabinet Chief Guillermo Francos tried to reassure them that not all these cuts would have to be made next year. Parallel to Milei’s speech a budget bill was presented with plenty of numbers including forecasts of five percent growth and 18.3 percent inflation for next year – the primary fiscal surplus is to be 1.3 percent of Gross Domestic Product.
RADICAL ‘HEROES’ SANCTIONED
On Tuesday night President Javier Milei hosted a barbecue in Olivos presidential residence to reward 87 “heroes” – the deputies who had frustrated a two-thirds Congress majority to override the presidential veto of the opposition pension bill – but at least four of them had already been punished the previous day. On Monday the Radical National Convention suspended prior to expulsion four of the five Radical deputies who had voted to salvage the presidential veto of what was originally a Radical bill. Milei was less fortunate with his decree to pad the reserve funds of SIDE intelligence agency by over 100 billion pesos – nixed by a 49-11 Senate vote just before last weekend.
FLIGHTS AN ‘ESSENTIAL SERVICE’
Last Monday the government officially declared aviation an “essential service” via decrees 825 and 831 published in the Official Gazette, a decision which had already been announced before last weekend while airport unions were carrying out a 24-hour strike. The unions responded by rejecting the legitimacy of the measure as infringing the constitutional right to strike and appealed to the courts, also anticipating that their conflict with Aerolíneas Argentinas in particular and the government in general “would aggravate.” The decrees, signed by President Javier Milei, Cabinet chief Guillermo Francos and ministers Sandra Pettovello (Human Capital) and Luis Caputo (Economy), refer to the “grave consequences of interrupting the essential public service of civil aviation” and oblige “minimum services to be maintained during the conflict,” for which 48 hours’ notice must be given. The decrees define mínimum service as “in no case inferior to 50 percent of normal activity.” Strikes disguised as union assemblies returned to the airports last Thursday. Also on Thursday presidential spokesman Manuel Adorni announced that the government had commenced conversations with prívate Latin American airlines to take over Aerolíneas Argentinas “if the extortions continue.”
MILEI WANTED BY CARACAS
Venezuelan prosecutor Tarek William Saab on Wednesday announced that arrest warrants would be issued against President Javier Milei, presidential chief-of-staff Karina Milei and Security Minister Patricia Bullrich for the seizure of a Venezuelan Emtrasur aircraft in mid-2022 when the preceding Frente de Todos administration was in power. The announcement came the day after Argentine prosecutors Carlos Stornelli and José Agüero Iturbe called for the arrests of Venezuelan President Nicolás Maduro and his right-hand man Diosdado Cabello on accusations of tortures, abductions and illegal executions in Venezuela. Not surprisingly, the Argentine government repudiated Saab’s arrest warrants in a communiqué.
SLUMP CONTINUES
Gross domestic product fell 3.4 percent in the first half of the year, the INDEC national tatistics bureau reported last Wednesday, representing a continuing steep recession but also some recovery since the economy plunged 5.2 percent in the first quarter. There are now various positive indicators but some remain sharply negative (such as car production, 16.7 percent down in June). The following day INDEC announced 7.6 percent unemployment for the second quarter of the year, almost identical to the 7.6 percent of the first quarter.
CITY FUNDING AGREED
City Mayor Jorge Macri and national Economy Ministry officials last Tuesday arrived at an agreement finally to honour the 2022 Supreme Court ruling awarding the Federal Capital 2.95 percent of federal revenue-sharing funds (slashed to 1.4 percent in September, 2020) via the 1.4 percent remitted daily and the remaining 1.55 percent weekly. The agreement was reached at a Supreme Court hearing.
RECORD NATIONAL DEBT
The national debt closed August at a record US$455.935 billion, US$6.318 billion more than the previous month and US$62.666 billion over the past year, the Finance Secretary’s office reported last Wednesday. The Javier Milei administration inherited a national debt of US$368.225 billion last December but this did not include either Central Bank debt or export arrears, omitted by the Alberto Fernández presidency. Index-linked (CER) bonds account for US$123.633 billion and the International Monetary Fund (IMF) US$41.88 billion of this debt, which is approximately three-quarters of Gross Domestic Product.All in all it was far from a vintage Gallardo Libertadores evening.
ALBERTO: PLOT SICKENS
An audio file of ex-president Alberto Fernández insulting his former partner Fabiola Yáñez almost non-stop in Olivos presidential residence was leaked to the press in midweek, thus adding verbal abuse at least to the photographic and other evidence in the gender violence case lodged by the former first lady. Limited space in a family newspaper plus the difficulties of translating some Argentine lunfardo slang expressions work against conveying the insults here but the ex-president was quoted as saying that Argentine films are “all shit,” among other things. The defence lawyers of Alberto Fernández hit back by releasing photos of Fabiola Yáñez consuming alcohol in a bid to present her as something of a lush while a column of Kirchnerite journalist Horacio Verbitsky insinuated that her falls were not the result of violence but “her excessive consumption of alcohol.” Verbitsky further claimed that the Cognitive Neurological Institute founded by eminent scientist and Radical deputy Facundo Manes had diagnosed her as a bipolar personality.
PLURALISTIC POPE
Pope Francis, 87, just back from his Pacific tour, was even-handed in his attention last Monday, granting separate audiences to a CGT committee and Human Capital Minister Sandra Pettovello with Argentina’s socio-economic situation the common agenda of both meetings. The CGT committee, headed by secretaries-general Héctor Daer and Pablo Moyano, expressed concern about the Javier Milei government’s labour reforms and about its policies in general with the Pope “exhorting us to defend social justice,“ as well as expressing concern about the young vulnerable to drug-trafficking, according to Daer. Pope Francis also expressed a desire to visit his native land without giving any date. Pettovello presented the pontiff with a detailed report on the social welfare, labour and education areas under her portfolio, centring on poverty, in a one-hour afternoon meeting. She also broached a papal visit to Argentina without obtaining a concrete date.
SIDE REPORTING
Appearing before the Bicameral Intelligence Committee in Congress in midweek, SIDE intelligence chief Sergio Neiffert assured parliamentarians that he had not used the 100 billion pesos granted his agency by a decree nixed by Congress earlier this month (with a 49-11 vote in the Senate). During the three-hour sesión Neiffert further admitted that he had yet to put together an intelligence plan. The new SIDE chief further underlined that he was not the choice of star spin doctor Santiago Caputo but of President Javier Milei himself, further describing his mission as a more “professional” agency, not internal snooping.
OFF-PITCH PROBLEMS
Gonzalo Montiel, the Sevilla right back who netted the penalty clinching the 2022 World Cup for Argentina in Qatar, was subjected to psychological tests last Tuesday in a sexual abuse case lodged against him. The plaintiff accuses Montiel of having drugged and raped her at a New Year party (which coincides with his birthday) at his family home to welcome in 2020 – family friend Alexis Acosta faces similar charges. Montiel made no statements to the press.
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