(Bloomberg) — President Javier Milei’s austerity campaign in Argentina faced renewed opposition Wednesday in a nationwide march against budget cuts to higher education.
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Public university employees and students took to the streets to protest Miley’s upcoming vote on a bill to raise wages to compensate for inflation, which was approved in the House in August and the Senate last month.
Organized by labor unions, it is the second major protest to threaten higher education caused by libertarian aggressive spending cuts. Argentina’s public university system is almost a point of pride in a disaster-prone nation.
The first demonstration in April grew into one of the largest of Milei’s nearly 10-month tenure, spanning many years and political parties. After that march, the government compensated the universities for operating costs but failed to take into account salaries, which constitute a large part of the expenditure.
In an effort to stop the unrest this time, the protesters were told to clear the streets at seven o’clock at night. The government has indicated that it will raise salaries by 6.8% for public universities that have been rejected, according to a statement from the Ministry of Labour.
University salaries have lost about 24% in real terms from November 2023, according to Nicolas Lavagnino, who heads a research center based at Universidad de San Martin and Universidad de La Plata. As a share of gross domestic product, spending on higher education fell to its lowest level since 2005, according to Empiria, a consulting firm based in Buenos Aires.
Milei took office on December 10 and immediately devalued the currency by nearly 55%, opening the door to monthly inflation of more than 25% that has since fallen to around 4%. Although wages have been rising slightly in real terms, they have not yet been able to offset the initial spike.
The bill would raise university salaries to match inflation by 2024 and adjust them for inflation going forward, equal to about 0.14% of GDP, according to a congressional budget study.
The debate about university funding mirrors the debate that began this year about pensions and social security. Both houses of Congress approved bills to compensate for inflation and Miley immediately threatened to veto the measures because they would throw off the budget balance. The president’s vote on pensions was strengthened when lawmakers failed to muster a two-thirds majority to repeal it, something his government hopes to repeat this time.
“This has something in common with public security negotiations,” said Luis Picat, a national congressman from the province of Cordoba who voted against the budget extension. “Congress cannot intervene in the budget without saying where it will find the resources to spend the extra money.”
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