On Thursday morning the Lower House approved the 2019 draft Budget bill, including austerity measures demanded by the International Monetary Fund (IMF). But discussion over the controversial piece of legislation and what it entails was overshadowed by a series of angry encounters a day earlier – both inside and outside Congress.
An interrupted debate of more than 17 hours eventually ended in passage by a 138- 103 vote, sending the draft bill on to the Senate. The unpopular initiative includes both tax hikes and public spending cuts amounting to some 400 billion pesos to achieve its stated aim of eliminating the fiscal deficit next year.
The budget is widely seen as the price of a massive IMF stand-by agreement concluded in two parts since June. Yesterday, just two days after the chaos, the institution’s board of directors approved the second September 24 accord with a new total of US$ 56.3 billion.
Violent protesters clashed with police wielding tear gas outside Congress on Wednesday. There were 27 arrests and four foreigners now face deportation, with temperatures seemingly no calmer.
“No to the IMF budget. Don’t cut our future!” shouted demonstrators outside Congress while, inside the chamber, tempers ran high as lawmakers jostled and traded insults.
The technical contents of the budget focus on eliminating the fiscal deficit (which was 3.9 percent of gross domestic product last year) rather than ending chronic stagflation, on which front it is pessimistic – inflation of 42.7 percent and negative growth of minus2.6 percent are forecast as this year’s final figures (with 23 percent and minus 0.5 percent the respective figures for next year).
Amendments to ease passage included the exemption of rural properties from the revamped personal assets tax, a compensation fund of 6.5 billion pesos to console municipal governments for the removal of urban public transport subsidies; withdrawal of an article which would have allowed the Executive to restructure public debt (estimated to reach 87 percent of GDP next year) and a measure that would have blocked welfare recipients from working and making social security payments.
The marathon session to approve the 2019 budget, included some of the tensest moments inside Congress in years.
Faced with a governing coalition assured of both quorum and the numbers to pass the budget, the opposition rapidly converted the violent incidents already unfolding outside Congress from the start of the debate into their main argument, insisting that police “repression” made debate impossible.
When various Kirchnerite deputies including Victory Front caucus chief Agustín Rossi approached Lower House Speaker Emilio Monzó to press this point, the confrontation peaked as deputies Daniel Filmus (Victory Front) and Leopoldo Moreau (Civic Unity) jostled with PRO caucus leader Nicolás Massot after Moreau linked the latter’s family to the 1976-83 military dictatorship. The session was briefly adjourned.
But there were other arguments and strategies in the lengthy debate. Victoria Donda (Red por Argentina) showed up with a life-size mock-up of IMF Managing Director Christine Lagarde wearing the Argentine presidential sash.
Apart from the Peronist deputies from some inland provinces throwing their crucial support behind the budget, the opposition of all stripes was critical when parliamentary debate took its normal course.
“In Argentina, austerity programmes always end up in a crisis. Why do they think the Titanic is not going to sink this time?” Rossi said after the vote.
Former economy minister Axel Kicillof (Victory Front) called the Mauricio Macri administration an “absolute failure” which could no longer blame the inheritance from Kirchnerism after three years of “making everything worse.”
Criticism also reached government ranks even if Salta’s Alfredo Olmedo was the only proMacri lawmaker to vote against an “austerity” budget. Martín Lousteau (heading Evolution) said: “Although it seems a grotesque budget to us, we will accompany it.”
Mario Negri (Radical-Córdoba), the head of the Cambiemos (Let’s Change) ruling coalition caucus, took a loftier view: “We are in a crisis and the government must take responsibility. Social problems and the recession oblige us to pass the law. To have no budget would be a defeat for the country.”
Most attention, however, was drawn by the clashes. Protesters clashed with police officers outside the national Congress as tensions rose.
A small group of militants, many of whom had their faces covered, set rubbish-bins alight, before knocking down security fences and throwing stones and rocks at protesters.
Police officers in riot gear responded by firing tear gas and rubber bullets at the demonstrators as tensions rose. Later water cannons were used to disperse youths.
The Plaza del Congreso was ultimately cleared, after peaceful demonstrators from social movements, unions and political groupings withdrew from the area. Meanwhile, peaceful protesters – made up of social movements, unions and other political opposition groupings – shut down Avenida 9 de Julio as they marched from the capital’s famous avenue to Congress. Unions and social groups called for huge demonstrations in rejection of the government’s proposals.
The arrest of four foreign nationals during the protests prompted calls for deportation and changes to migration laws0 Two Venezuelans, a Paraguayan and a Turkish national were arrested on Wednesday as unionised workers, left-wing groups and citizens protested.
“I hope the four foreigners (...) are ready at the Immigration Department for their departure from the country,” Peronist majority leader in the Senate, Miguel Angel Pichetto, said. “A serious country would act that way.”
Interior Minister Rogelio Frigerio and Security Minister Patricia Bullrich also joined the calls. “It’s not on for them to come to Argentina, where they are received openly but decide to participate in violent activities,” Bullrich said.