Argentina senate throws roadblock in front of Javier Milei’s government austerity plans

Argentina’s Senate has given the green light to an increase in pension spending, potentially derailing President Javier Milei’s budget-balancing efforts.

Argentina President Javier Milei

As per a Financial Times report Thursday, the Senate cast a 61-8 vote in favor of a new formula for pension calculations, taking into account the country’s triple-digit inflation. This development poses a challenge for Milei, a staunch pro-Bitcoin libertarian, who has committed to eradicating Argentina’s persistent fiscal deficit and reigning in inflation.

Despite Milei’s promise to veto the bill, the overwhelming support it received in both legislative chambers indicates that a two-thirds majority needed to override the veto is likely.

Milei, a free-market proponent, secured victory in the November elections after promising large cuts in public spending to address Argentina’s fiscal deficit and increasing inflation.

His government achieved the first budget surplus in over 12 years, after being in office for just nine weeks. The good work continued as Argentina recorded six straight months of fiscal surplus, according to a Reuters report.

Milei’s libertarian stance is also reflected in his support for Bitcoin, the world’s largest cryptocurrency, being one of the very few heads of state to openly support the asset.

The Argentinian president has expressed his support for the free competition of currencies, including Bitcoin. He has praised the scarcity-driven growth model of the apex cryptocurrency and dubbed it a way to return monetary power to people.

However, the Argentine President has also faced flak over his austerity measures with his critics saying that millions in the country are paying the price as public sector jobs face the ax.

Energy and transport subsidies have also been slashed. However, Milei has said that the burden was largely shouldered by what he described as the political corporation, according to a BBC report.
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Credit: BBC