Under President Milei, worst economic crisis in decades tests Argentina’s ingenuity – LocalNews8.com

Associated Press

BUENOS AIRES, Argentina (AP) — In the massive anti-government protests that have paralyzed downtown Buenos Aires in recent months, some Argentines saw a traffic headache. Others saw a reaction to President Javier Milei’s brutal austerity measures.

Alejandra, a street vendor, noticed that people had nowhere to urinate.

Plazas offered no privacy, and cafes demanded expensive purchases to use the toilet. With little more than a tent and a bucket, Alejandra started a small business that has grown alongside the angry protests and skyrocketing inflation in Argentina. She asks what people are willing to pay.

“I haven’t had a job for a year, it’s my only income now,” said Alejandra, who declined to give her last name for fear of reprisals from neighbors. Every four or five customers, she puts on gloves and empties her bucket into the trash.

The political elite’s inability to resolve Argentina’s decades-long crisis explains the wave of popular anger that brought the irascible Javier Milei, a self-declared “anarcho-capitalist,” to the presidency.

But it also explains the rise of a unique society that runs on perseverance, ingenuity and opportunism – perhaps more so than ever, as Argentina faces its worst economic crisis since the catastrophic default on its foreign debt in 2001.

“It is the famous resilience of Argentines,” said Gustavo González, a sociologist at the University of Buenos Aires. “It is the result of more than three generations struggling with adverse circumstances, great uncertainty and abrupt changes.”

The Liberal leader warned that the situation would get worse before it got better.

To reverse decades of reckless spending that made Argentina notorious for defaulting on its debt, Milei scrapped hundreds of price controls. He slashed subsidies for electricity, fuel and transportation, sending prices soaring in a country that already had one of the world’s highest inflation rates.

He laid off more than 70,000 public-sector workers, cut pensions by 30% and froze infrastructure projects, plunging the country deeper into recession. Supermarket sales fell 10% last month. The International Monetary Fund cut its growth forecast for Argentina for 2024, predicting a 3.5% contraction.

Poverty now affects a staggering 57% of Argentina’s 47 million people, and annual inflation is over 270%, levels not seen in generations.

“Argentina is at a turning point,” Milei said in his Independence Day speech on July 9. “Turning points in the history of a nation are not moments of peace and tranquility, but moments of difficulty and conflict.”

Wealthy Argentines have responded by stashing stacks of $100 bills in safes and turning to cryptocurrencies to avoid their country’s chronically depreciating pesos.

Middle-class families — whose energy bills skyrocketed 155 percent last month — have stripped back comforts they once took for granted: No more eating out. No more traveling. No more private school. Public hospitals say they are overwhelmed.

In a country where barbecued beef, or asado, is not only a national dish but also a social ritual, meat consumption has fallen to its lowest level ever, the Rosario Board of Trade said.

The crisis hits the poor hardest.

“They can’t hedge,” said Eduardo Levy Yeyati, an economist at Torcuato Di Tella University in Buenos Aires. “They can’t save, they can’t travel. They’re stuck here and they’re the ones who are most affected by inflation and the fiscal adjustment.”

In the past five months, the official unemployment rate has risen by two percentage points to 7.7%. According to experts, this figure seems much lower than it actually is, because Argentina’s underground economy accounts for about half of its gross domestic product.

Rising unemployment and poverty have forced even more Argentines into the informal labor market. “Those who can’t find a job have to invent one themselves,” said Eduardo Donza, a poverty researcher at the Catholic University of Argentina.

For 34-year-old Armando Fernández, a broom has become a survival tool.

Last month, Fernández walked hundreds of miles south from his impoverished hometown in Santa Fe province in search of work in Buenos Aires. Now he sweeps the capital’s sidewalks for all the pesos shopkeepers throw his way.

As Milei attacks state anti-poverty programs with his chainsaw, the poorest Argentines no longer have the coping mechanisms they once had.

“Politicians talk a lot but do nothing,” Fernández said, as he wolfed down chicken stew provided by Solidarity Network, a charity born out of Argentina’s successive crises. “I survive thanks to these soup kitchens, these people who offer me a little food.”

Seven days a week, at nightfall, hundreds of people line up for free meals in the square in the center of the capital, outside the presidential palace. Solidarity Network has transformed this square into an open-air dining hall.

“We are helping more and more people every night,” says 31-year-old volunteer Pilar Cristiansen. “There are more and more people who cannot afford to buy food.”

Recently, the line included homeless people like Fernández, but also newcomers: a chef whose work had dried up, a bank employee who had recently been laid off, an electrician whose salary had lost most of its value.

Argentina’s downward spiral has long been visible in the southern suburbs surrounding Buenos Aires. Streets are unpaved. Sewage pipes don’t reach. The walls of Noelia López’s house are covered in random chunks of concrete.

From an attic lined with clotheslines, López and her 21-year-old son Patricio run the only laundry in their urban slum. At dawn, their floor vibrates with the rumble of washing machines as they sort coats and quilts for a dozen neighbors a day.

What started as a spontaneous boost in income during the pandemic has grown into their livelihood.

“There is nothing better than being able to recognize that this country is exactly like that,” López said of Argentina’s volatility. “Now we have to keep going.”

Maybel Delvalle grew up in Buenos Aires as the daughter of Paraguayan immigrants and was determined that her own children would be spared the same fate.

Soon she was a single mother with two hungry toddlers and realized she couldn’t pay her bills selling empanadas.

Today, the 25-year-old is a successful content creator on the platform OnlyFans, where she sells sexual fantasies to subscribers around the world and promotes her bootstraps story to legions of like-minded women. Her $6,000 monthly income would be unthinkable for an Argentinian doctor, lawyer or professor.

The work wasn’t easy. Few people had heard of the platform in 2020 when Delvalle stumbled upon it. She had to teach herself how to stay anonymous and safe while posting explicit content, convert her dollar income into pesos at a favorable exchange rate, and speak enough English to act as a “virtual friend” to subscribers in the U.S.

When she got her windfall, she became the top OnlyFans teacher in Argentina. Delvalle struggles to keep up with the demand for her lessons. “It’s been amazing,” she said of the past seven months since Milei took over.

About 5,000 female students, 4,000 of whom are from Argentina, have enrolled in her training courses, trying to find a way out of the growing poverty in their country.

“There’s no miracle that’s going to get us through this,” she said. “You have to rely on yourself more than anyone else.”

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Associated Press editor Natacha Pisarenko contributed to this report.