ARGENTINA: Workers occupy factories as crisis continues

December 4, 2002
Issue 

BY FEDERICO FUENTES

On November 14, Argentina gained the status of a financial delinquent when it defaulted on its repayments to the World Bank. While in Washington, Argentina's economy minister Roberto Lavagna delivered the news that Argentina would only pay US$77 million of the interest due to the bank, not the full $805 million that was required. This follows the US$141 billion default on its debt to the private sector last December.

The Argentine government claimed that they would not be able to repay the World Bank until a deal was made with International Monetary Fund. It had been frantically trying to seal an IMF deal before the November 14 deadline, but talks broke down over IMF worries that the Argentine government would not be able to keep its promises.

Last month, senior IMF sources had told Reuters it was unlikely to sign a deal with the current Argentine government because of its inability to secure government backing for its agenda.

Argentina's president Eduardo Duhalde said his economic team would persist in efforts to cobble together an IMF agreement. As a sign of his commitment, on November 20 he issued a decree that increased the price of water, power and other basic services by more than 10%, by-passing legally required public hearings. However, the IMF has asked for 30% price increases before it is prepared to refinance loans owed to it and other multilateral agencies. Duhalde has also announced that the government would lower sales taxes, a move the IMF has vocally opposed.

The price rises will be a blow to a population that is already suffering from the impact of a recession that has lasted four years. Half the population now lives below the poverty line and 34% of the work force is unemployed or underemployed.

A positive working-class response to the crisis is the increasing number of factory occupations. In a little more than a year, workers have seized control of more than 100 closed or bankrupt factories.

Christian Castillo, a sociology professor at the University of Buenos Aires, told the November 8 Sydney Morning Herald that "the idea that a capitalist is needed to organise production is being demystified. If things improve economically, this movement may perhaps fade away. But the idea of workers' control is out there".

The SMH described how the process unfolded at one factory: "For nearly a year, the workers at the Grissinopoli bread stick factory saw their weekly salary steadily decline from 150 pesos to 100 and then to 40. Finally, on June 3, with the firm headed for bankruptcy, the workers demanded recompense. The plant manager offered 10 pesos to each of the 14 employees and asked them to leave the factory. They didn't budge.

"'He closed the shutters, and we stayed inside', said Norma Pintos, 49, who has worked at the factory ... for 11 years... But what began as a last-ditch effort to save their jobs, or at the very least to receive some back wages, turned into a dogged effort to gain control of the factory. The workers began taking turns guarding the factory 24 hours a day, surviving by asking for spare change at the public university and selling empanadas, chorizos and home-made bread on the street.

"Four months later, the city legislature expropriated the factory and handed it over to the workers. In October, Grissinopoli began producing bread sticks again."

In recent months in the province of Buenos Aires, authorities have expropriated 17 factories in similar circumstances, as well as three in the capital. While it has mainly been factories that have been occupied, the movement has spread to a supermarket, a medical clinic, a Patagonian mine and a Buenos Aires shipyard. The workers have been able to win government approval of their actions due to the strong public support they have received.

Provincial and city legislators are drafting bills that would create a government agency to assist in the formation of co-operatives and facilitate the expropriation of bankrupt companies to hand them to workers, reported the SMH.

In most cases, the co-operatives' income is equally distributed among its members, based on the week's profits; decisions are made by direct vote of members in regular assemblies.

From Green Left Weekly, December 4, 2002.
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