Argentine president Javier Milei has just passed a reform bill and a twin fiscal package through the Senate, which include policy prescriptions that would cut pensions and water down labor rights. The move has drawn fierce opposition in the country, with violent clashes raging between protesters and riot police outside the National Congress in Buenos Aires as the bill made its way through the chambers. 

Despite the rocks and Molotov cocktails thrown, Milei achieved a symbolic win — albeit one with many prescriptions negotiated away. Foreign policy analysts were initially bearish on Milei’s capacity to get along and pass legislation, with a Senate replete with dissent. 

Now a handful of state-owned firms, including Argentina’s nuclear power company, are now on the chopping table. An item in the law creates an incentive scheme that gives investors tax breaks for the next thirty years. Another measure lowering the income tax threshold for thousands of workers failed to pass. Yet others, like one delegating the executive powers in energy, pensions and security survived the legislative process. Similarly, structural changes in paid leave for public workers, as well as amnesty for those with undeclared assets, made it through.

From overseas, some saw Milei’s drastic proposed cuts as impossible, in part because of his demeanor, but mostly because of the hold Argentina’s left still has over its institutions. Yet the messy-haired economist, whatever you make of his policies, has proven to be quite an apt strategist. 

Only 15 percent of deputies and 10 percent of senators (all first-timers) are from Milei’s La Libertad Avanza Party. The left-wing coalition party, Unión por la Patria, on the other hand, controls over 45 percent of the senate (only a third of senate seats are up for play in each election cycle). Of 664 items originally presented, only 200 ended in the final law following a thirteen-hour debate in the senate. The bill passed only because Victoria Villaroel, Milei’s vice president, broke the tie. 

Minutes after its passage, the president’s office described the law as “a triumph of the Argentine people and the first step towards the recovery of our greatness.” The key phrase there is “first step.” Milei had to surrender privatizing Argentina’s public airline and its radio and television corporation to pass this law. He also gave up retirement cuts. 

But juxtapose this with the history of economic policy in Argentina, and free marketeers have the right to claim a tremendous win. If cuts make any sense, they do so in a country that saw a 211 percent inflation rate last year, Argentina’s highest in thirty-two years, and currently the highest in the world. How Argentinians will take these policies is another question. Most of them don’t read economics whitepapers — but all of them go to the supermarket.