Omnibus Legislation in Argentina
Neo-Liberal Destruction of Argentina
Demonstration in Buenos Aires, January 24,
2024 against omnibus bill.
Argentina's new Law for the Bases and Starting Points for Argentinians' Freedom is an omnibus bill known as the Bases Law. Introduced by the government of Javier Milei, it aims to restructure the state as part of its "shock therapy." The legislation grants the President special powers to privatize state-owned companies, eliminate a pension moratorium, create a new investment incentive scheme and introduce anti-worker labour reforms.
Milei, who describes himself as an "anarcho-capitalist" was elected in November 2023 after running on a platform to deal with Argentina's high debt and deficit, soaring inflation and rising poverty by slashing spending on public programs and services and "putting everything into private hands that can be."[1]
The Bases Law was passed in the Chamber of Deputies on April 30. On June 12, after the government was forced to negotiate with senators who could otherwise have sunk its bill, a modified form of the legislation was passed in the Senate by one vote. The country's Vice President cast the tie-breaking vote.
The bill was amended to remove from the list of state-owned companies slated for privatization: the national airline, Aerolineas Argentinas; the national radio and television networks; and the national postal service, Correo Argentino. Modifications were also made to certain income tax provisions.
The amended bill must now return to the lower chamber to be ratified, rejected in favour of the bill originally passed there, or approved with some, but not all of the modifications introduced in the Senate. Under Argentina's constitution the possibility of a presidential veto also exists in the event Milei does not accept the end result of the process in the Congress. It can be overridden by a two-thirds majority in both chambers of Congress.
From the time the bill was introduced through to the present, Argentinian workers, students, retirees and others have been in the streets demanding the withdrawal of the anti-social legislation. In keeping with his declared intentions, Milei has used the repressive forces of the state to attack them, subjecting them to arbitrary detentions and harsh treatment while detained, and accusing them of sedition and of being "terrorists."
Demonstration in Buenos Aires against attacks on public
post-secondary education, April 23, 2024
The following are some of the provisions of the Bases Law approved by the Chamber of Deputies and how they will affect the people:
- The retirement age for women is increased from 60 to 65 years. A moratorium on the ability to pay off contributions for years missed to be able to qualify for retirement with a state pension is cancelled. It is estimated that nine out of 10 women and seven out of 10 men will not be able to retire at 65.
- The Social Monotributo tax regime will disappear, leaving 600,000 people more vulnerable.[2]
- Workers who had been exempt or paid low income tax will be taxed at up to 35 per cent of their income.
- The wealth tax paid by the rich is reduced from 2.25 per cent to 0.25 per cent, and this measure is extended until 2038, depriving future governments of resources.
- Informal employment is encouraged; people working in companies with less than five employees cease to be considered employees.
- Companies have their fines cancelled and criminal charges for having undeclared workers are annulled.
- A worker can be dismissed for any reason (for example, union activity) and the courts cannot force the company to reinstate them.
- Pregnant women must work up until 10 days before their date of delivery.
- Oil companies will have control over the hydrocarbons they extract and will be able to commercialize them freely without the state intervening or setting prices. Argentinians will pay international prices for fuel despite the fact that Argentina is the producer. This could cause supply problems, without the state being able to intervene.
- Extraordinary powers are granted to the president: he can disappear or merge public agencies, increase at his discretion the cost of services and transportation, defund public health, education and more.
- The new Incentive Regime for Large Investments (RIGI) will grant extensive tax and exchange benefits to big multinational companies but not to small and medium-size enterprises.
- The new tax and exchange rate regime allows these investors to import machinery and inputs, which will destroy the national metalworking industry.
- Conditions for extractivism are promoted, for removing natural resources with minimal processing.
- These measures are extended for 30 years, with future governments unable to undo them.
- The Federal Administration of Public Income allows the laundering of up to $100,000 without the need to repatriate that money, pay any penalties or give any explanation regarding its origin. In other words, tax evaders are rewarded and the laundering of assets of criminal origin is enabled.
- Arbitrary detention is legalized in order to repress protests, just like during the military dictatorship.
In addition to these measures, fourteen state-owned companies can be privatized by the president and the lots where they operate can be auctioned off. Some of these include:
- AySa, the company that processes drinking water for millions of Argentinians. It was recovered from private hands by the state in 2006, when it was determined that the water distributed to homes contained fecal matter.
- Aerolíneas Argentinas, a company operating with a surplus, which connects 21 cities all over the country. The last time it was privatized, the company was hollowed out and went from having thirty aircraft to one.
- National radio and television; and
- Argentine railroads.
This article was published in
Volume 54
Number 5 - June 2024
Article Link:
https://cpcml.ca/Tmlm2024/Articles/M5400517.HTM
Website: www.cpcml.ca Email: editor@cpcml.ca