AltAusterity Digest #51 June 7-14, 2018

The IMF has stepped in to bail out the Argentinian economy with a $50bn loan agreement. As part of the deal the Argentinian government has agreed to reduce the fiscal deficit, with a fiscal surplus of 0.5% of GDP being reached by 2020. The loan’s interest rates will range from 1.96% to 4.96% depending on how much the government uses. The deal will also require a strengthening of autonomy for Argentina’s central bank with the intended goal of curbing runaway inflation.

Egyptian President Abdel-Fattah el-Sissi has defended recent austerity measures against public outrage. The Egyptian government has recently raised the price of electricity and tap water as part of a reform package linked to a three-year, $12-million loan from the IMF. El-Sissi announced on Tuesday that the government spends about $18.6 billion a year on subsidies for fuel, food and electricity, and that the cutbacks on these subsidies would be necessary to improve the economy. In response to criticism over social media, el-Sissi’s government has arrested several activists and bloggers. The crackdown on dissent has been in place since el-Sissi’s coup overthrew the freely elected former President Mohamed Morsi.

In a piece for Jacobin, Catarina Príncipe examines Portugal’s actual record of fighting austerity measures. Príncipe claims that while the Socialist-led government is left-of-center, it is not necessarily an “anti-austerity administration.” Portugal has been treated as “the good student,” which followed the rules laid out by the Troika in the early stages, and despite popular mobilizations against austerity, never organized a mass anti-austerity, left-wing political party. Despite Portugal having deficits above the limits imposed by the Fiscal Compact in 2016, the European Commission decided not to apply sanctions on Portugal (or Spain) in order to maintain political stability. However, while the Socialist Party (PS) may not be avowedly anti-austerity, their coalition partners – including the Left Bloc and a coalition between the Communist Party and the Greens – have been able to force the agenda to the left.

According to sources from within the newly elected Ontario Progressive Conservative government of Doug Ford, a top priority will be ending a four-month strike by 3,000 York University workers with back-to-work legislation. Should the strike be resolved before July, Ford’s next priority will be to reduce gas prices by 10-cents-per-litre. This will supposedly be accomplished by cutting provincial taxes on gas and by scrapping Ontario’s cap-and-trade program. The Conservatives promised to find “spending efficiencies” in other areas leading to reductions in spending of 4%, though he has promised that not one job would be cut.

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