ASSESSMENTS

In Brazil and Argentina, Politics Picks Up Where the Left Left Off

Oct 5, 2017 | 19:48 GMT

President Mauricio Macri so far has avoided taking labor reforms to the legislature because his coalition lacks the congressional representation it would need to pass the controversial measures. To avoid the complications of the legislative process, Macri's administration is taking his reforms straight to the labor unions.

Argentine President Mauricio Macri lacks the legislative support he needs to pass controversial labor reforms. But bypassing Congress comes with its own risks.

(JUAN MABROMATA/AFP/Getty Images)

Highlights

The Argentine government will opt to negotiate directly with unions, rather than going through the legislature, to try to implement controversial labor reforms that would benefit private firms.
By avoiding the legislative process, however, President Mauricio Macri will leave his reforms susceptible to reversal under the next administration.
A leftist victory in Argentina's upcoming election, slated for 2019, would give the country's Peronist movement greater power to pass legislation than Brazil's Workers' Party would gain should former President Luiz Inacio Lula da Silva win the next Brazilian vote in October 2018.

Time is running out for Argentina's current administration to revise the country's business regulations. President Mauricio Macri so far has avoided taking labor reforms to the legislature because his coalition lacks the support it would need to pass the measures. Changing Argentina's labor laws through legislation would be a contentious proposition that would invite protest from the country's powerful unions. So soon before the next federal elections in 2019, moreover, leftist lawmakers likely would be unwilling to compromise on the proposed reforms. To avoid the complications and controversy of the legislative process, Macri's administration is taking his reforms straight to the labor unions. The president used the same strategy to negotiate changes to the oil and natural gas sector, working with unions in Neuquen province to address specific portions of their contracts and reduce labor costs for energy firms. Now, he's hoping for a repeat of that success elsewhere in...

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