Recent Argentine history shows how the middle class forged in the heat of workers generated upward social mobility and was the driving force of the country through consumption and the generation of added value. But That Argentine emblem begins to fade with the presidency of Javier Milei and an adjustment that means that many Argentines cannot meet the income thresholds to remain middle class.
Since the inauguration of President Javier Milei in December to February, accumulated inflation exceeded 70%. In 12 months, it is close to 280% after years of price increases that deepened in the last years of Alberto Fernández’s mandate. which results in a continuous collapse of purchasing power and therefore consumption.
The gradual deterioration of purchasing power led to the fact that, according to the Government’s own statistics, the average formal salary will not reach the poverty line in January 2024, since it cannot cover the value of a basic basket.
INDEC itself pointed out that a basic basket reached $596,823 in the first month of the year, which represents the total expenses that a family of four must make to cover all the needs considered elementary over the course of a month. In comparison, the Average Taxable Remuneration of Stable Workers (RIPTE), measured by the government Ministry of Labor, was established at $555,269, more than $41,000 below the value of the basic basket.
Consequently, since the assumption of Milei Salaries lost a fifth of their purchasing power (18%), in their worst decline in 21 years, according to the RIPTE index.
This is why poverty measured by income reaches almost six out of every 10 Argentines, since according to the February report from the Social Observatory of the Catholic University (UCA), 57.4% of Argentines were below the poverty line. poverty in January 2024.
It is true that the decline of the Argentine middle class, an example of upward social mobility in Latin America, precedes Milei. Ezequiel Adamovskya historian specialized in the subject, explains to the AFP agency that the Argentine middle class has been shrinking for 50 years until losing the foundations that once made the country prosperous.
But the situation has worsened since Milei cut subsidies on transportation, fuel and utility rates, and eliminated regulations that placed limits on rental contracts and private healthcare prices. This was added to the inflationary blow caused by a 50% devaluation a few days after taking power.
Source: Ambito