Argentina’s libertarian president passed his first major bill through Congress. And did Peru’s right secretly vote a left-winger into the presidency?
ARGENTINA
Javier Milei passes his first big reform through Congress
Argentina’s libertarian president, Javier Milei, celebrated yesterday after passing his first big congressional reform since winning last year’s midterm elections: a controversial redrawing of labor regulations, which sparked a nationwide strike from the country’s main unions.
The bill had already passed the Senate last week and yesterday was approved by the lower chamber by a 135-115 majority. It will, however, require a second vote in the upper chamber after the government accepted one change to the original text during committee discussions.
👉 Why it matters. Proponents argue that the reform will modernize Argentina’s labor legislation, creating a more flexible labor market that incentivizes hirings and formal worker registrations, which currently stand at all-time lows. Critics, however, say that fundamental workers’ rights will be affected, including their most basic collective bargaining rights, due to new provisions that are highly restrictive of strikes.
Among the most notable points of the reform are cuts to severance payments, the formula for which will be redrawn to exclude tips, bonuses and holidays from calculations, while also imposing caps on those earning salaries three times higher than the industry average. A new mandatory rainy-day fund to finance severance payments will also be created, using part of the firms’ contributions to Argentina’s social security system.
While maximum weekly work hours will not increase, employers will be allowed to reshuffle them, reaching work days of up to 12 hours as long as they are compensated with extra rest later in the week. This, in turn, will reduce the much-coveted overtime payments.
The total amount of holidays will not change, but employees will no longer be able to take all their rest days consecutively, and may be forced to split them into smaller 7-day installments — a major nuisance for those planning long trips or simply looking for some extended rest.
The right to protest will also be limited, as the new law expands the list of “essential services” that must always operate at 75% or more of their normal levels — even during strikes. The list only included health care, electricity and gas, potable water, and air traffic control as essential, but will now add telecommunications, commercial flights, ports, customs, immigration control and non-university education.
A new broad-reaching category of “substantially important services” will also be created, banning strikes above 50% in some of the largest business sectors, including transportation, heavy industry, food, construction, airports, mining, refrigeration, postal services, agriculture, banks, hotels, restaurants, e-commerce and more. Security forces will remain fully barred from striking.
After a week of controversy and criticism from allies, the government did make one concession from its original text, removing an article that authorized firms to pay less than full salaries when employees took medical leave due to accidents suffered or illnesses contracted outside of the workplace. Speaker Patricia Bullrich admitted that they made a “mistake” by failing to differentiate between severe illnesses such as cancer and a sports injury incurred while playing football during a day off.
PERU
Did Fujimori secretly vote left-winger Balcázar into office?
Peru’s José Jeri gave new meaning to the term “interim president,” managing to last just four months in the role. He was ousted by the country’s unicameral assembly earlier this week by 75 votes to 24, with three abstentions. His replacement, left-winger José María Balcázar, became Peru’s ninth president in less than a decade, extending a political crisis that has not yet rocked the country’s relatively steady economy.
Jeri was accused of holding unregistered meetings with Chinese businessman Zhihua Yang, potentially hiding a conflict of interest with foreign lobbyists. But his image was tainted beyond that incident, including a long list of sexual misconduct allegations, the last of which was the hiring of multiple young women after late-night visits to the government palace.
Jerí had himself replaced another interim president late in October, when the same assembly unanimously voted to remove the unpopular Dina Boluarte, a former progressive who made a deal with the political right to survive in office after her former ally, Pedro Castillo, went to jail for trying to shut down Congress by decree in 2022.
👉 Why it matters. Besides adding to Peru’s institutional chaos, the latest turn at the country’s presidential merry-go-round will be central to the upcoming April 12 election, as Balcázar will be thrown into the spotlight as the latest representative of a repudiated political caste, and few will want to be openly associated with him.
Balcázar comes from the ranks of the Peru Libre party, which brought the discredited Castillo and Boluarte to power and is led by the controversial Vladimir Cerrón, a self-proclaimed Marxist-Leninist who remains a fugitive despite being recently absolved from one of his charges by Peru’s Supreme Court.
Before reaching the presidency, Balcázar was known for being one of the few legislators who opposed a nationwide ban on underage marriages, which raised the legal age of unions from 14 to 18, as well as for a series of corruption allegations.
This marks Balcázar as a rarity for modern urban audiences, who see him as far-left on some issues and far-right on others — although his views are not entirely alien to Peru Libre’s rural voting base.
The two main leaders of Peru’s right wing were split on Jeri’s ousting. While presidential frontrunner Rafael López Aliaga backed the decision, the leader of the congressional right, Keiko Fujimori, made a last-minute attempt to protect him:
“Changing a president just 57 days before the election with no conclusive proof will create more uncertainty … We reject the denigrating way in which women were described. Calling women prostitutes simply for attending a meeting or party reflects an aggressive and discriminatory mindset that Peru must not normalize,” Fujimori argued, in a calculated dig against López Aliaga, who struggles for support among female voters.
López Aliaga’s team replied with another strong accusation: that Fujimori’s lawmakers secretly voted for the left-winger Balcázar in the anonymous assembly election, in order to blame his rise on López Aliaga and launch a convenient presidential campaign talking point.
Such a seemingly implausible scheme would not be unprecedented, as Fujimori and Peru Libre have made multiple congressional deals before, despite being ideological polar opposites. Although with the fragmented nature of Peru’s current congress, a definite answer about who put Balcázar’s name in the assembly’s secret ballot box might never be known for sure.
QUESTION OF THE WEEK
While South America became used to right-wing dictatorships in the 1970s, Peru bucked the trend with a left-wing military government. Who led it?
- Abimael Guzmán
- Alan García
- Juan Velasco Alvarado
- Manuel Oldría
QUICK CATCH-UP
🇪🇺 Javier Milei’s labor reform is not the only highly consequential bill making its way through Argentina’s Congress, as the country is also set to approve the EU-Mercosur trade agreement, the content of which is just a Senate floor vote away from being cleared.
🤝 The US Trade Representative said last week that it has “substantially concluded” negotiations for a trade agreement with Ecuador. Experts say Ecuador could receive relief on agricultural exports (such as bananas, cocoa and coffee) in exchange for modernizing its trade procedures to make it easier and cheaper for US companies to export there.
📢 As President Rodrigo Paz reached 100 days in office, Bolivia’s former three-time indigenous President Evo Morales made a public reappearance after nearly two months in hiding. Morales, who is a fugitive from justice due to a statutory rape investigation, took part in a rally in Cochabamba ahead of regional elections.
💬 Expanding on the covert meetings we reported last week, US Secretary of State Marco Rubio has held talks with Raúl Castro’s 41-year-old grandson of the same name. According to Axios, Castro represents “younger, business-minded Cubans for whom revolutionary communism has failed — and who see value in rapprochement with the US.”
🚢 Although many of the battleships deployed in the Caribbean earlier this year have departed for the Middle East, US military authorities reported a new round of bombing against three alleged drug boats in international waters close to Latin America this week, two of them in the Eastern Pacific and another near Venezuela, killing 11.