‘You’re either poor or rich’: the Argentinians struggling under Milei’s chainsaw austerity | Argentina

Francisco Jiménez spends at least eight hours a day, seven days a week, riding through the streets of Buenos Aires as a delivery app rider, yet he still struggles to make ends meet.

Next month, the 32-year-old will have to leave his rented house on the outskirts of Argentina’s capital and move with his wife and three children into his mother-in-law’s flat because he can no longer afford the rent.

“The economy is complicated, my life is complicated because, well, I have three children – they’re growing up, so they eat twice as much … and things keep getting more expensive”, said Jiménez.

Even so, in last Sunday’s midterm elections, which renewed about half of Argentina’s congress, he voted for president Javier Milei’s party, La Libertad Avanza (LLA).

After a campaign in which the US president, Donald Trump, announced a $40bn bailout for the country and made continued aid conditional on the victory of his Argentinian counterpart, LLA defeated the Peronist opposition by a wide margin.

“We’re not doing very well at the moment,” admitted Jiménez.

The days leading up to the vote were widely described as the lowest point of Milei’s nearly two years in power, marked by an economic downturn and corruption allegations. Even the president himself admitted to being surprised by the sweeping result.

Jiménez argues that Milei needs more time. He said that, despite the setbacks, he voted for the president’s party because the opposition had “been in power too long and done too much harm”.

Argentinians such as Jiménez, who are struggling to make ends meet, are now the majority.

After taking office in December 2023, Milei, an economist and former TV pundit, launched a deep “chainsaw” austerity plan, cutting federal spending, freezing wages and pensions, halting public works and slashing subsidies.

To meet his zero-deficit target, he also introduced a “shock therapy” approach to the peso, initially devaluing it by almost 55%.

On one hand, the libertarian managed to bring inflation down from more than 211% in 2023 to 32% annually by September 2025 – still high by global standards, but a level Argentinians had not seen in years.

On the other hand, average incomes have fallen sharply, dragging down purchasing power, while household debt has risen and the poverty rate climbed above 50% before recently easing to 31.6%.

Nicolás Pedrosa, a 40-year-old mobile phone shop owner in Buenos Aires, voted for Milei in the 2023 presidential election. “Today, I deeply regret it … I wanted change, but it was too drastic,” he said.

“The middle class no longer exists; you’re either poor or rich,” said Pedrosa, adding that customer traffic in his shop practically disappears by the 15th of the month as many people’s salaries have run out by then.

Four months ago, in an attempt to diversify and boost sales, he started selling perfumes and incense alongside the usual phone cases and chargers. “You have to be an all-rounder to survive these days,” he said.

After the initial devaluation of the peso, one of Milei’s main measures to curb inflation was burning through reserves to buy dollars and prop up the currency’s value – which, according to many analysts, has left the peso artificially strong.

To keep buying dollars, the president turned in April to a $20bn loan from the International Monetary Fund – $14bn of which has already been disbursed – and recently to a $40bn bailout from the US.

The president has also lifted restrictions and lowered tariffs on imports, a move that is driving domestic industry into a “great depression”, according to Luciano Galfione, the president of Fundación Pro Tejer, which represents the textile sector.

Textile manufacturers faced two problems, he said: as “the purchasing power of society has fallen dramatically”, people are buying fewer clothes, and those who can still afford them often opt for imported products, which, with the “cheap” dollar, have become more affordable.

Even one of Argentina’s greatest passions is being affected. Domestic wine sales – which account for about 70% of production – fell by 17.1% in August, according to a report by the Center for Argentine Political Economy (CEPA). With the stronger peso, Argentine wine has also become more expensive abroad, and export volumes between January and August were down 8.4% from the same period last year.

“We’re not against imports; what we don’t agree with is having to compete under such absolute inequality,” said Galfione, who estimates the textile sector alone has lost 300 companies and 12,000 jobs since Milei took office.

Across all sectors, between 205,000 and 250,000 formal jobs – those subject to labour laws – have been lost in Argentina over the same period, mostly in construction and manufacturing, and about 18,000 businesses have closed.

“When formal jobs are lost, people have to find some way to earn an income to survive. And what usually happens is that informality increases,” said Roxana Maurizio, a professor of labour economics at the University of Buenos Aires, adding that informal workers now account for 43.2% of the labour force and that half of them don’t earn enough to get by.

Despite most socioeconomic indicators showing no improvement in living standards, the “cheap” dollar, somewhat contained inflation, rejection of the opposition and fears of losing the US bailout were widely seen as key factors behind Milei’s victory.

As a result, the president’s party went from a modest presence to the largest bloc when combined with the seats of the centre-right PRO, the party of former president Mauricio Macri, which has already allied itself with Milei.

The bloc still falls short of the minimum majority needed to pass reforms, and the president already has three in mind – labour, tax and pensions – meaning Milei will have to seek further alliances.

“He can’t fix the economy overnight when it’s been a mess for years,” said Jiménez. “I know people who are unhappy who voted for him [in 2023] and thought we were going to become a world power in a year, but he never said that.”