The government is moving forward quickly together with the IMF technicians, intent to put it to vote in Congress. These new commitments legitimize a swindle and the fine print is beginning to be known. What are the implications? How far does the adjustment go? How will the quarterly controls be? Let us see the answers to these questions, which drive the need to redouble the campaign against the agreement and against the whole adjustment plan. That is what we have been working on from the Left Front Unity (FITU) and the MST.
By Sergio García
“There are not going to be any more increases in social plans” affirmed the Minister of Social Development Juan Zabaleta. With these clear and obedient words he evidenced that the adjustment requested by the Fund is already underway prior to the signing of the agreement. In a country with more than 40% poverty rate, incessant inflation and no decent work plan, stopping social assistance is harsh and will be confronted in the streets by unemployed people organizations and those independent of the government.
But this reality check, which throws overboard all the official speeches that said “there will be no adjustment”, was only the tip of a skein of thread that meter by meter is laying bare the governing narrative. Zabaleta’s announcement had not yet ceased to be news and the draft text of the new agreement had already begun to leak.
Journalist Sebastián Premici pointed out this Monday aspects of the fine print and affirmed: “Everything will be subject to permanent consultation with the organization. Even if the trade balance figures were better, the Executive Power is committed to use that balance to reduce the deficit. What is written in the draft speaks of a co-government”. From then on, different media, journalists, studies of our site Periodismo de Izquierda and others, were revealing more in depth where we are going with this agreement. Let us analyze the most sensitive points of “Argentina, Memorandum of economic and financial policy.
Preliminary draft”. We could even mention the most surrenderist and anti-sovereign points, typical of the Macrist school of thought that gave rise to this last scam of $44 billion dollars. With different adjustment variables, the text opens the doors to future changes in structural and very sensitive issues for the economy of our country. Let’s see.
Our pensions as targets
“We will carry out a study describing options and recommendations to strengthen the equity and long-term sustainability of our pension system. Special attention will be paid to the evaluation of special regimes, and to mechanisms that favor the voluntary extension of people’s working life”. This is what it states about the delicate situation of the Argentine pension system.
The paragraph in question caused such a commotion that Alberto Fernández had to say at an event on the coast that it is not planned to change the regime for workers but for judges and diplomats, who quickly raised their voices in defense of their privileges. But beyond the hurried and forced presidential words, the truth is that the text enables the evaluation and modification of the special regimes in general, not only that of judges. And even worse, it enables the debate on extending the retirement age, a historical demand of the IMF. The government says it could be optional, according to an existing law voted under Macrism. With a miserable $30,000 minimum retirement, having to work after the age of 65 is not optional, but mandatory to survive. One way or another, an adjustment to retirees and a fundamental, i.e. structural, debate on when and how to be able to retire are coming.
Spending rationalization
With this new euphemism, the text announces another important adjustment: to the provinces and to the salaries of the entire state administration, which in many cases already has depressed salaries and precarious working conditions. In this regard, it is proposed: “to limit discretionary transfers to the provinces and state-owned companies and to manage the public sector wage bill to ensure that it grows consistently with the improvement of the activity”. The meaning is predictable; if the numbers are not enough, it is likely that the variant of “rationalization of spending” will be to adjust via wage freezes, reductions, direct layoffs and release those resources for “priority use”, obviously from the IMF. The famous “improvement of activity” is a disguised labor reform. In the case of the provinces it also, indirectly, enables adjustments. For if the allocations are reduced, in a country where many social services are provincialized, the governors will use this fact as an argument for their own internal cuts.
With a tariff cut at the door
“We will develop, with the support of technical assistance from the World Bank and the IMF, a medium-term plan to steadily and gradually reduce energy subsidies and improve the efficiency of the sector, anchored in our objective of cost recovery”, says the draft text, with a clear horizon of adjustment in regards to essential services and the current millionaire subsidies to the concessionary companies. We all know that the business sector, which has earned fortunes in recent years, is asking for a sharp increase in tariffs if subsidies are to be reduced. To start with, the government was talking about increasing the tariffs of only the wealthiest sectors, but a study indicates that the increases will have to reach more than 65%: it will include the middle sectors and important sectors of working families. In short: the IMF will achieve its objective that the State should stop subsidizing and use the money for payments to the Fund, and the big businessmen will continue to gain through significant rate increases.
Two more examples
“In labor matters, the agreement highlights that the double indemnity for dismissal without just cause, which is already being gradually reduced, will be completely eliminated at the end of June 2022”, explained journalist Alejandro Bercovich in a tweet that added data to the debate, after studying the text in question.
To this attack on workers’ rights is added a blow to popular sectors and the media. According to the same journalist, the fine print proposes that the Central Bank should also “‘gradually make the minimum limits of deposit rates and the maximum limits of lending rates of banks more flexible’. In other words, to free again (as Macri did) the interest on refinancing with credit cards and other loans”.
Extractivism with no limits
“The regulation to encourage investment and exports in strategic sectors, including the knowledge economy, hydrocarbons, mining, agribusiness”. In other words, more agribusiness, fracking, mega-mining and environmental destruction. As it could not be otherwise, the circulating draft text gives a strong impulse to extractive, destructive, plundering and polluting policies in our country. After the defeat of the government’s mega-mining plan in Chubut at the hands of an enormous popular mobilization and in the face of the repudiation of the installation of offshore explorations in the Argentine sea, now the government and the IMF intend to continue along the same path and more thoroughly, in the search for dollars to guarantee the payments.
Administered
The text also does not establish forecasts of great growth but of scarce numbers for the next years, between 2 and 4%, throwing overboard the discourse that the agreement first allows growth, since there will be a moderate or slight growth in the best of cases. And there is something of great importance: together with the economic goals set, the political decision to have the IMF reviewing and auditing the progress of the economic plan on a quarterly basis, and a government obliged to consult and decide with them every time something new happens or the numbers do not indicate, but reaffirms, what was foreseen.
Everything will always be under the administration of the Fund and its objectives, aspects may be modified only under its orbit: “recalibrate policies to ensure the fulfillment of economic and social objectives in consultation with the IMF staff”. This is how clear is the coming co-government and the sovereignty that is leaving.
Critical voices, and what else?
In the face of a text that sets alarm bells ringing, critical voices are heard. Even the pro-government and kirchnerist Fernanda Vallejos tweeted: “The pre-agreement with the IMF includes a series of budgetary adjustments camouflaged under the concept of rationalization of spending”. She joins other voices coming from the Front of All, whose initial voice was that of Máximo Kirchner resigning as head of his block of deputies, and to a greater or lesser extent, from organizations allied to Peronism and part of the government, such as Unidad Popular, Patria Grande or the PCR, among others.
However, in the midst of the news that give more details about the depth of the coming adjustment, today none of these sectors proposes to go out to confront this agreement or to break with the government that will apply it if it is voted. If they were coherent they should do so. But now they are only debating between abstaining, voting against, and without ruling out that some critics may even vote for it. Regardless of what they vote for in the end, as a whole they do not intend to hinder the president. They have not lifted a finger to stop the agreement. Including Cristina Fernandez de Kirchner, who with her lasting silence has been facilitating the negotiation to proceed, although she avoids appearing publicly supporting it. It is the policy of preserving itself as the center, not of preserving the interest of the popular majorities that will pay the price of the new agreement and the new indebtedness to “honor” the previous swindle.
The path of the Workers Left Front Unity
They say that the great political events put everyone in their place, and allow us to see in depth the competing projects. This is happening today. There is a tacit agreement between the IMF, the presidential wing of the government, the trade union bureaucracy, the big media and corporations and the right wing opposition, to advance in the agreement no matter what.
There is a sector that claims to be critical, a more progressive or center-left wing of the government, which today shows all its limitations by letting the agreement pass and makes it evident that it prioritizes its attachment to the State apparatus, to be ordered by wanting to administer the same unjust and unequal system, but with some changes. This sector today shows its political impotence, having to see how the president they themselves digitized moves forward together with the IMF. At least so far, they let him move forward.
And there is a third political voice, a clear and powerful one that has won the streets in opposition to the agreement, to the payment of this swindle and for the political and economic rupture with the IMF. We are the left organized in the FITU, which emerges as the promoter and articulator of a great unitary space of struggle, together with hundreds of social, union, piqueteros, human rights, environmental, gender and political organizations.
We are the ones who have been confronting the adjustment, we take this debate to every workplace and study place and to every popular neighborhood. We are the ones who call on the unions that say they oppose calling for a national strike the day this agreement is discussed in Congress. We have a clear, independent, anti-capitalist and socialist political project that does not admit interference from the Fund. As the referent of the MST in the FITU Cele Fierro said: “There is another way out: to confront the IMF in the streets and cut off usury in order to use those funds to solve the structural problems of the country. For that reason, from the Left Front we are going to promote strong mobilizations to the Congress on the day it is dealt with and many other actions during these weeks”. To this campaign, to these actions, and to this left political project, we want to invite the workers and young people who voted for the Front of All to throw out Macri and who do not want the IMF to join us. Our struggle is underway, it is collective and needs thousands and thousands of us. We are going to face the vote in Congress and if it is voted, another stage will begin against its implementation and against the whole adjustment plan. There is a lot to do, there is a lot to fight for. And there is a lot of political space to make the FITU bigger, for the political and social struggles to come.
We will shut the country down the day it is discussed
The agreement with the Fund is a scandal. The whole fine print is not yet known, but with the draft memorandum that has been circulating since Monday 21st, there are more than enough reasons to worry. This agreement of adjustment and surrender will be a calamity for the workers: less salary, more precariousness and the threat against conquests that we achieved with years of struggle. The fine print that has begun to appear is terrifying:
. Wage increases tied to productivity. Wage ceiling, with a guarantee that it will be below inflation.
. State employees’ salaries tied to GDP. Even in the context of stagflation (recession + inflation) this will imply a reduction in salaries. And more precariousness. Forget about the permanent staff.
. Modification of the pension system. Evaluation of the “sustainability of the regime”, which is why it is open to adjustment modifications. For now what comes to light is about the special regimes, but more regressive reforms are outlined.
. Increase in the retirement age. This may imply an increase in the number of years of contributions, in the minimum retirement age, or both.
. Elimination of transfers to the provinces. In order to sustain state employment in the provinces, it is deregulated, leaving the poorest provinces weaker. Less salary, less work, more precariousness.
. Removal of subsidies in transportation and services. Increase of tariffs and therefore higher inflation.
. Labor reform in chapters. The Toyota model, with more exploitation, longer working hours and less leave, is an example of the liquidation of all progressive features in the agreements.
In this situation, the role of the CGT, which has been an active part of the ruling front, has been directly sepoy, supporting the agreement with the IMF. Shameful. They have to break the truce with the government and initiate a plan of struggle to defeat the adjustment, starting by calling a strike the day the agreement is dealt with in Congress.
The CTAs, which have been holding a scandalous truce, have to define themselves. There is anger in the rank and file unions but the leaders remain in some lukewarm critical statements, maintaining their support to the government and passivity. Yasky first supported it, now he says that they are going to consult. They have to take to the streets and call for a stoppage. Even more so taking into account that the state workers will be the most directly affected and they are the biggest mass of affiliates that these central organizations have.
Let us stop and surround the Congress on the day it will be dealt with.
We must fight against this surrender, which will only bring us more hardship and adjustment. From the Plenary of Combative Unionism we will have a meeting this week to promote the mobilization, joining the space No to the IMF that has been articulating the FIT Unity with more than one hundred organizations and filled the Plaza de Mayo twice. On that day we have to organize a big day of permanence and mobilization and raise a strong demand to the central unions that they stop on that same day.
We have to prepare it from below, with assemblies in the workplaces, voting to stop and mobilize from each sector to converge in a huge concentration as we did in 2017 against the Macrist pension reform. We were able to do so before and we can also defeat this agreement now. Let’s get down to work.
César Latorre y Guillermo Pacagnini
National Classist Anti-bureaucratic Alternative (ANCLA)