Javier Milei and his ‘chainsaw’ austerity win big

Argentine President Javier Miley led his party to a landslide victory in Sunday’s midterm elections, having marked the first two years of his presidency with radical spending cuts and free-market reforms.

His party, La Libertad Avanza, won nearly 41% of the vote, winning 13 of the 24 seats in the Senate and 64 of the 127 seats in the House of Representatives that were contested.

Its gains will make it easier for the president to move forward with his program to reduce government spending and liberalize the economy.

Before the vote, Miley ally Donald Trump I explained The United States’ recently announced $40 billion lifeline to Argentina will depend on Miley maintaining political momentum.

Miley’s supporters welcomed this, although their critics accused Donald Trump of foreign interference in the Argentine elections.

Referring to his North American ally, Miley told cheering supporters: “We must consolidate the path of reform we have embarked on to change Argentine history once and for all… to make Argentina great again.”

Before this election, his party had only seven seats in the Senate and 37 seats in the House of Representatives.

This meant that his program of spending cuts and reforms faced various political obstacles.

Opposition lawmakers overturned his veto of bills aimed at increasing funding for public universities, people with disabilities and children’s health care.

After Sunday’s result, hundreds of his supporters gathered chanting outside a hotel in Buenos Aires where he was watching the result.

“Miley didn’t get 15% of congressmen in his favour,” said young voter Dionisio. “Now, with more representatives and senators, he will be able to change the country in one year.”

“Previous governments destroyed our county,” said another voter, Ezequiel.

“Now, thank God, freedom has triumphed. We want our daughter to grow up in this beautiful country. What happened in recent years is unfortunate.”

These elections were the first national test of President Miley’s popularity since he took office in 2023, pledging to reduce government spending by wielding his metaphorical “saw.” He waved a real one during his campaign rallies.

Since then, he has cut education, pensions, health, infrastructure and subsidies budgets, and laid off tens of thousands of public sector workers.

Supporters, including Trump, praise him for curbing inflation — which reached triple digits annually before he took office — reducing the deficit, and restoring investor confidence.

However, his critics say the price has been job losses, deindustrialization, the collapse of public services, a decline in people’s purchasing power, and a looming recession.

Juliana, who works with children with disabilities in Tucuman province, is concerned that the law to increase funding for people with disabilities — which Miley vetoed, before it was repealed — could be “at risk” while strengthening the president’s position in Congress.

She added: “Our salaries are low, and they remain the same, while other things are increasing. We still do not see any change.”

Veronica, a retired police officer, is affected by Miley’s pension cuts.

“You see a lot of poverty,” she said. “It is very difficult: for pensioners, for people with children with disabilities, for young people. There is a lot of unemployment. Many factories have closed.”

Miley has also succeeded in keeping inflation low by propping up the peso, making it overvalued and depleting reserves before paying off $20 billion in debt next year.

This has raised concerns that Argentina may be heading towards an economic crisis.

This, coupled with the poor election result in Buenos Aires province in September, spooked financial markets that Miley’s cost-cutting agenda may not be politically sustainable.

These factors prompted the United States to intervene to help. It has now offered Argentina a potential $40 billion lifeline through a combination of a currency swap, buying pesos, and arranging private investment.

Trump threatened, saying: “If he wins, we will stay with him. If he does not win, we will leave.”

Prior to this election, doubts had grown over Miley’s political future due to some voters’ fatigue with his austerity programme, as well as a series of corruption scandals that had rocked his party.

Voter turnout was 67.9%, the lowest in national elections in decades, representing widespread apathy toward politicians of all stripes.

Some voters reluctantly supported him.

“Miley has two years and he has to try to do everything he can,” said Dardo, a business owner in Buenos Aires. “I think we are on the right track, but the middle and working classes are suffering a lot.”

He is skeptical that US support will help, saying “we will have to pay for it at some point.”

Others, like political science student Thiago, said they understood the need for fiscal balance but questioned Miley’s methods.

“There is a lack of investment in hospitals, infrastructure and people with disabilities,” he said. “There is a certain false hope.”

However, this election result shows that many Argentines are still unwilling to return to the Peronist model that Miley blames for decades of economic mismanagement.

“The Argentines have shown that they do not want to return to the failed model, the inflation model… the model of a useless state,” he declared.

Financial markets are expected to rebound after the win: a sign that Miley’s political survival, for now, has also helped keep his economic experiment alive – and propped up in the US.

His new term gives him the ability to implement more radical changes before the next presidential election in 2027, when his name will be on the ballot again.

The question now is whether ordinary voters are starting to feel better, or whether the pain of some cuts is testing people’s patience again.

For now, a large percentage of voters appear willing – once again – to give him time.