New President Javier Milei had the votes. He has the plan. But can he really overcome the internal power structures of the rotting Argentine state in order to cut it, clean it, and reinvigorate it?
As he kicks off his most meaningful administration, a combination of oversized union power with a meddling judiciary has suspended a package of labor reforms.
The three-judge court will rule on a legal challenge brought by the main union group, the General Labor Confederation (CGT), which argued that ‘the changes affected workers’ rights.’
“The ruling by the National Chamber of Labor Appeals temporarily blocks enforcement of the labor regulations in Milei’s so-called ‘mega-decree’, which includes more than 300 measures aimed at deregulating the South American country’s economy.
Labor elements of the decree include the repeal and modification of laws related to employment contracts, terms for dismissal, severance payments, and more.”
The powerful socialist CGT union has – as you would expect – opposed those measures, and is planning a nationwide strike set to kick off at the end of the month.
The roadblocks ahead for Milei in his work to rescue the economy will be numerous.
He battles the wreckage wrought by the leftist Peronists with triple-digit inflation, a lack of central bank reserves, and increasing poverty.
“The judges behind the decision said the new labor measures were being temporarily suspended until the court can make a final ruling on whether they are allowable under Argentine law without congressional approval.
The CGT on Wednesday celebrated the ruling, saying it ‘halts (Milei’s) regressive and anti-worker labor reform’.”
The Milei administration will appeal the suspension.
The decree may also face difficulties in Congress if a motion to repeal it passes both the lower house and the Senate.
Milei’s party does not hold a majority in either house.
“Congress is currently in a special session called by Milei through the end of the month in an attempt to pass a sweeping omnibus bill, which critics have dubbed unconstitutional.”
Associated Press reported:
“Milei’s decree announced in December established several changes in labor rules, including increasing job probation from three to eight months, reducing severance compensation and allowing the possibility of dismissal for workers taking part of blockades during some protests.
Alejandro Sudera, one of the three judges, said the administration went beyond its authority to decree labor changes, which first needed to discussed and approved by Congress.
[…] [Milei] says he wants to transform Argentina’s economy and reduce the size of the state to address rising poverty and annual inflation expected to reach 200% by the end of the year.”