Argentina: Milei’s brutal economic shock plan sparks rebellion in Misiones

What began with teachers’ protests over pay rises has expanded into a week-long police riot and a grassroots rebellion of teachers, health, energy and other state workers in the province of Misiones, in the far northeast of the country, 1,000 km from the capital Buenos Aires.

Misiones’ teachers, among the lowest paid in the country, had been protesting for almost a month, demanding a 100 percent pay rise. Since Milei's arrival in power, they quantify that the purchasing power of their salaries has halved.

It is not just about wages. A local journalist describes the situation thus: “schools that have no toilets or fans, have stopped serving breakfast [for needy students] or paying caretakers”. There has been a total collapse of the education system as a direct result of inflation and the Milei government’s brutal budget cuts.

On Thursday 16 May a large group of struggling teachers broke into the provincial legislature building. In the early hours of Friday 17 May, some 600 police officers surrounded the Comando Radioeléctrico, the police command centre in the provincial capital Posadas, with burning tyres, and set up an encampment. The protest was made up of retired police officers, off-duty active police officers and their families. The policemen also demanded the same raise as the teachers, 100 percent.

The protest encampment, which grew to about 1,000 people, continued throughout the weekend, despite threats from the national government of sanctions and of sending in the gendarmerie against the mutinied policemen.

The response of the Ministry of Security, in the hands of Patricia Bullrich, was to form a ‘Crisis Committee’ made up of the National Gendarmerie, Prefecture, Argentine Federal Police, Airport Security Police and the Federal Penitentiary Service. “The uprising of the police is inadmissible, something completely and utterly outside the law,” Bullrich said.

Milei Image public domainThere has been a total collapse of the education system as a direct result of inflation and the Milei government’s brutal budget cuts / Image: public domain

The police responded by forming a joint ‘People’s Crisis Committee’ with the teachers. When federal forces encountered the mutinied police, they were quickly forced to retreat for fear of provoking a bloody armed confrontation. Ramón Amarilla, a spokesman for the rebellious Misiones police, said that “in Misiones there is a dictatorship disguised as democracy”.

On Tuesday, an unprecedented situation arose. The teachers rejected the agreement reached by their union leaderships affiliated to the CTA for a wage increase of 30 percent, which they consider totally insufficient. In response, they decided to block Route 12 at the Garupá Bridge. It was there that they received a phone call from the representative of the police officers in struggle to join their camp. The teachers submitted it to an assembly and decided to move 20 kilometres to the Comando Radioeléctrico and set up their camp about three blocks from that of the police. There were, of course, recriminations, as the teachers complained about all the occasions when the police had repressed them.

After some discussions there were common chants of “unidad de los trabajadores, y al que no le gusta, se jode, se jode” (“unity of the workers, and if you don't like it, piss off, piss off”)! Logically, we cannot trust those who only months ago repressed the workers, but the police riot reveals the rottenness of the state, the corruption and above all the deep economic crisis that pushes the state workers as a whole to struggle.

The brutal adjustment imposed on the shoulders of the working class, and in particular onto public sector employees, has ended up breaking, even if only temporarily, the very apparatus of the state, in this case the repressive forces. It is an insurrectionary symptom.

“These people are workers like us and we all have the same problems,” declared the representative of the mutinous police officers, Ramón Amarilla. “I heard a teacher say that we clashed with them many times. I apologise to them on behalf of the authorities who send us to do things that we shouldn’t do. They make us fight poor against poor.”

On Wednesday 23 May, and then subsequently on Thursday 23, Friday 24, it was the turn of the health workers, also organised from below and leaping over their union leaders, who joined the struggle by taking over the provincial facilities of their Ministry. The unions, both CTA and CGT, had signed a ridiculous wage increase of 28 percent, which the workers could not accept. Other health workers joined the teachers; and police protest, setting up their own encampment.

On Thursday 24 May, a group of hundreds of yerbateros (yerba mate producers) who came to the capital to protest against Milei’s measures to liberalise the entry of imported products and eliminate the minimum prices set by the INYM (National Institute of Yerba Mate), joined the protest.

On the same day, thousands of workers in struggle marched to the provincial legislature building and were harshly repressed by the police forces defending the building.

The social explosion in Misiones, which threatens to spread to other regions, is the direct result of the ultra-liberal shock measures that Milei has been implementing since he came to power just six months ago. In particular, it is a response to the cut in transfers to the provinces, including the National Fund for Teacher Incentives (FONID), the brutal fiscal adjustment, the liberalisation of all aspects of the economy, the mass sacking of public employees, the liberalisation of tariffs for services such as water, electricity, the cuts in pensions, etc.

These measures have had dire economic consequences that have been borne by the working class and the poorest sectors of society. The chainsaw that Milei promised has not cut the political caste as he said, but the working majority. Inflation remains at 280 percent a year, the peso has suffered a massive devaluation (15 percent in the last week alone), hundreds of thousands of workers have lost their jobs in the public and private sector, the poverty rate has risen from 47 percent to 55 percent of the population, and economic activity has collapsed. The average wage of formal sector workers is now below the poverty level.

The Central Bank (BCRA) announced that in the first quarter of the year alone, around 275,000 ‘salary accounts’ were closed, a figure that represents between 2 percent and 3 percent of the total number of bank accounts used to credit wages, revealing that in only 3 months, 275,000 workers were dismissed.

In March, the Monthly Estimator of Economic Activity (EMAE) recorded a year-on-year fall of 8.4 percent, and the figures for construction (-29.9 percent) and manufacturing (-19.6 percent) are even worse. Installed capacity utilisation in the industrial sector was only 53.4 percent in March, a fall of 13.9 percentage points compared to the same month last year.

The impact of the brutal recession is being felt in heavy industry. The Acindar Arcelormittal steel plants, with 3,000 workers, were closed for a month, due to the abrupt drop in sales of 35-40 percent, affected by the impact of the recession and high inflation, in addition to the domino effect of the paralysis of construction and public works.

There is also a lockout at the General Motors Alvear plant, which employs 1,100 workers, where production has been stopped because of the floods in Brazil. Toyota is going to lay off 400 workers, and Renault has announced another 270 layoffs.

The Banco Provincia Consumer Index, which tracks household consumption on credit and debit cards, recorded a 35 percent drop in April compared to the previous year. In the poor, working-class southern part of the Buenos Aires conurbation, the figure was 43 percent.

While the IMF and international economic commentators applaud Milei for achieving a primary fiscal surplus, the working class and working people who foot the bill are not prepared to sit idly by.

A social outburst was inevitable, and it has now started in Misiones, but it could easily spread throughout the country, where workers are in similar, or worse, conditions. In the neighbouring province of Corrientes, police officers have also come out to demand a pay rise.

In barely six months, we have already seen two 24-hour general strikes called (reluctantly) by the union bureaucracy, and a massive mobilisation in defence of the public university with the participation of almost a million in Buenos Aires alone.

However, what we are witnessing in the last week in Misiones goes beyond that. Union leaderships have been overwhelmed by the self-organised rank and file, while repression is unable to control the police riot.

There are other symptoms. In Catamarca, in the north-east of the country, 140 women workers from the Textilcom factory have occupied the company’s premises to prevent its closure, under the slogan, “the machines are ours”. The factory occupations that we saw after the Argentinean ‘argentinazo’ in 2001 are back.

More importantly, the heavy battalions of the working class – the steelworkers – have rejected a wage increase below inflation that their union UOM had proposed in a referendum.

There are signs that the struggle is spreading to Rosario, Mendoza, and Buenos Aires.

Pressure from below is opening cracks at the top. Milei’s plans have been defeated in the Senate; the ‘Basic Pact’ that he wanted to sign with the regional governors by 25 May as a way of giving lasting legitimacy to his programme is floundering; and the traditional right wing of Macri and the PRO, a key component of Milei’s ruling majority, is beginning to distance itself from the ultra-liberal president.

These divisions also reflect the interests of some sectors of the national bourgeoisie that have been hit by Milei’s policies.

The bourgeoisie is openly arguing that the economy is in a severe depression, aggravated by the opening up to imports which means a hard blow to medium and small industries and businesses. This is without mentioning the Regime of Incentives for Large Investments (RIGI), a package of tax and exchange benefits for foreign investment that allows foreign industries to invest and transfer their profits to their parent companies, without charging them any taxes or royalties. This is the policy dictated directly under the tutelage of US Ambassador Marc Stanley, and the US business chamber, AmCham.

Milei seems unwilling to back down, drunk on the success of the European far right’s mass rally in Madrid, which cheered him on. At a certain point, a section of the Argentinian ruling class may come to the conclusion that the arsonist must be removed from the Casa Rosada for fear that the fire will take them all down with it.

In these conditions, a national plan of struggle including an active general strike, with mass mobilisations, would put the government on the ropes and could prepare the conditions for its downfall.

The trade union bureaucracy of the CGT and the CTAs are only prepared to call for as little as they can get away with, in order to release pressure. The general strike of 9 May was a passive one, without any mobilisation. It is necessary for the working class itself and its rank and file representatives to take the lead, on the basis of democratic, self-organised struggle committees coordinated in each sector, in each province, and at the national level.

In the face of the acute crisis facing Argentina, what is on the order of the day is a national insurrection, for the whole country to rise up like Misiones, and for the working people to take the reins of the country.

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