Exactly addressing my question.
Why are they raising wages?
It is offsetting and defeating the intended goal. (if that is what they are trying to do)
Fix the wages factor, people have less to spend, kill inflation. (all other inflationary factors remain the same)
I do not see depressed Argentine wages. Wages today, in US$ equivalent, are higher than yesterday.
This is a great observation. If wages keep rising, then how can inflation come under control?
We must differentiate between the CAUSE of inflation and the EFFECT of inflation. The cause of inflation in Argentina, put simply, is economic mismanagement by incompetent socialist politicians. Cristina wanted to buy votes with money the Argentine government didn't have. So she cranked up the printing press and created more pesos. She then spent those pesos on government subsidies, federal hiring, corrupt infrastructure projects, etc... This flooded the domestic economy with pesos. Each peso is worth less, so the price of goods and services rises - it takes more pesos to buy the same kilo of asado.
Economic actors must react to rising prices. As each business and worker sees its costs rising, it takes counteractive measures. For a worker, the easiest counteractive measure is to demand a wage increase. In a heavily unionized economy, wage increases are easier to procure. Employers raise wages, but they pass that increase in cost on to their consumers. And the chain reaction tears through the economy, as each economic actor does the same thing - raises prices to counteract inflation's increase in costs.
I think what you are saying is that this cycle is a crazy merry go round of insanity. Yep - that is an accurate observation.
To your point, government could implement a wage freeze. Some uber-radical governments have tried this. It doesn't go over well and usually there are hugely violent revolts in the street. Any politician that freezes wages on the worker will never, ever be reelected. To freeze wages is to place the onus on the common man/woman/family. It is much easier, and politically acceptable, to gather executives in a room and enforce a price freeze, ala precios cuidados in Argentina.
In addition, governments cannot stop inflation - they can only slow it down. So if a government freezes wages in a 55% inflation economy, the average family will hit the poverty level very quickly.
But back to my original point - a wage freeze would address only an EFFECT of inflation. It would not address a CAUSE.