Politics Economy Country 2025-12-15T10:24:09+00:00

Milei's Government Faces Critical Week for Labor Reform and Budget Approval

President Milei's government navigates a critical week to test its political consensus, facing significant hurdles in passing the labor reform and the 2026 budget amid internal power struggles and opposition resistance.


Milei's Government Faces Critical Week for Labor Reform and Budget Approval

The government of President Javier Milei is starting a week that will test the political legitimacy he earned at the polls on October 26th. This period will reveal the level of consensus achieved within the power structure designed by the Secretary-General of the Presidency, Karina Milei, and the Menemists.

Following a landslide victory in the legislative elections, the victors in the internal Executive power struggle (the 'karinismo') have focused on reshuffling pieces and reorganizing an administration that had broken ties with the so-called 'dialogueist' governors, several of whom were Peronists.

With Santiago Caputo having fewer tools at his disposal, the internal power dynamics at Balcarce 50 have never been as clear as they are now during Milei's two years in office. Over the last month and a half, the Minister of the Interior, Diego Santilli, has toured the provinces and received provincial leaders at the Casa Rosada.

The main challenge remains the labor reform. Patricia Bullrich faces two major hurdles: she would need to get senators to work during the holiday period, which would require her to perform miracles, and she must block requests for speakers in committees, a common legislative tactic used by the opposition to delay proceedings.

On Tuesday, a meeting of the Parliamentary Labor Committee will be held, with Vice President and Senate President Victoria Villarruel, who has a diminished public profile and is seeking a political agenda, in attendance to coordinate the discussion with other blocs. While the situation for the ruling coalition is difficult, it is not impossible.

In the Chamber of Deputies, La Libertad Avanza (LLA) intends to take the bill to the floor for a vote on Wednesday or Thursday to grant it preliminary approval and send it to the Senate. In the Senate, however, the prospects for the Casa Rosada with the labor reform are less encouraging.