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ELITE STALEMATE AND WORKERS’ CONTROL:
Applying the Experiences of Nicaragua and Cuba to Argentina

Sean Herlihy
Texas Southern University, U.S.A.

ABSTRACT:

In Nicaragua , Cuba , and Argentina working people won more workers’ control when opposing elites deadlocked. Fieldwork in these countries involved 160 interviews, and 54 worksite observations over a period of 22 over months between 1990 and 2005. Workers’ control movements offer self-sufficient, popular, internally democratic challenges to neo-liberal privatization. They exploit spaces between bureaucratic and capitalist elites to win concessions from leftist and democratic governments. During the Triumph of Nicaraguan Revolution, a gap in authority between fleeing Somocista and incoming Sandinista administrators left workers and peasants to carry on production by themselves for several months. Sandinista leaders, although sympathetic to worker participation, wanted to centralize agriculture, but peasants and Contras pressured them to distribute land to individuals and cooperatives. With the fall of the Sandinistas, country people again used the hiatus between governments – this time outgoing Sandinista and incoming pro-capitalist Chamorro administrations - to occupy land. Chamorro’s government tried to privatize industries to capitalists, but, workers took over some of the privatized enterprises themselves. In Cuba , crises after the Soviet collapse produced conflicting tendencies within the state apparatus. When state farms left lands uncultivated, rural people took them over, both by wheedling and by force. The government relinquished titles to 50,000 individuals and established cooperatives with more workers control. In Argentina eighteen years of neoliberal restructuring collapsed in 2001. Peronist legislators, and union leaders, paralyzed the Radical Party presidency of Fernando De la Rúa. The economic collapse, enterprise failures, and deadlocked elites provided an opening for a popular uprising and 10,000 workers taking over or “recuperated” almost 200 enterprises. Capitalists and bureaucrats are usually stronger than working people, but workers have opportunities to win more control of production when conflicting elites balance each other, with the weaker party usually being working peoples’ best ally.

Introduction: Elite Stalemate Model

The revolutionaries, communists, and capitalists all stumbled, and despite, or rather because of this, workers won more power in the workplace. Deadlocked elites in Nicaragua , and Cuba , in the 1990s and Argentina in 2001 allowed working people to gain significant measures of workers control. This article presents a strategic explanation of observations in Cuba , and Nicaragua over some 22 months of dissertation fieldwork in the 1990s and two weeks of fieldwork in Argentina in 2005. Its model helps to explain other self-management movements such as, the factory committees of the Russian Revolution, land invasions in Zimbabwe , and even a briefly democratic cigarette factory in US occupied Iraq . The Sandinista theoreticians Orlando Nuñez and Juan Morales argue that worker and peasant impetus to directly control the means of production explains turning points in the Nicaraguan revolution René Mendoza and Arturo Grigsby, who are critical of the Sandinistas, advocate private land ownership, yet they also see the peasants' longing for direct control of their farms as driving events. In Argentina , writers such as Pablo Heller, Esteban Magnani, Julián Rebón, and the Lavaca collective have analyzed the significance of the recuperated enterprises movement. This article argues that workers and peasants took advantage of deadlocked elites to win greater control of production in all three countries.

This model has four explanatory advantages over state-oriented versions of Marxism and over mainstream democratization and privatization theories. First, it challenges the idea of the state as relatively exclusive strategic vantage point. Second, it assigns more agency to the popular classes as maneuvering between capitalist and statist forces, sometimes taking advantage of them and at other times trapped between them. Third, it embraces a popular, rather than middle class, construction of civil society in contrast with most democratization theories. Fourth, these movements offer a strategy to resist globalization in a post-Soviet world.

This model explains three movements of working people taking control of production in Nicaragua , a fourth in Cuba , and a fifth in Argentina , based on the accounts of journalists, scholars and representatives of three clusters of social forces. In Nicaragua these are: 1. capitalists, large land owners and their government allies, 2. The Sandinista party and state officials, and 3. working people. In Cuba these are: 1. high officials, economists, and social theorists advocating cooperativization within the socialist framework. 2. Communist Party officials and enterprise administrators, who have been skeptical about cooperativization and marketization. and3.working people. In Argentina the interviews were mainly with recuperated enterprise workers and leaders, but the main forces would be the Peronists, the Radicals, and the workers. The number of production centers researched – fifty four - is not large in absolute terms, and the observations are subjective, and fieldwork is heavily weighted to the first two country cases, yet the sample considers eight significant variables: 1. The three different countries; 2. Types of production including: industrial, service, retail or agricultural, 3. Proximity to the capital; 4. Regions of the country; 5. Urbanness, and remoteness; 6. Form of ownership; 7. Whether successful; and 8. Pro- or anti-regime.

Although most people at the Center for Global Justice conference are probably familiar with the idea of workers’ control, it does not show up often in conventional political science, or in the United States political discourse, and, in any case it is used to mean different things. In this paper the term is used broadly to signify working people gaining more influence in their workplaces. Greater influence can be a subtle “weapon of the weak” such as doing ones own projects on company time, or it can be dramatic and powerful – a peasant land invasion or a revolution. It can be informal – such as a work slow-down to effect management policy – or formally recognized as worker participation was in the Sandinista constitution. It can be individual – a peasant taking her own plot of land, or collective – a labor union taking over a factory. In this sense almost all workers are striving almost all the time for workers’ control. Understanding the politics of work can not afford to ignore the subtle, informal issues, and forms of contention. Workers control is never completely absent, nor completely secured. In all three of the cases considered here, workers did struggle for, and achieve extraordinary, although not unlimited forms of workers’ control.

1. Hiatus between Somoza and the Sandinistas

Sandinistas and their peasant supporters seized property from the state and alleged Somocistas, which became the Area of People's Properties or APP. In 1980 the APP amounted to 21 percent of agriculture, 25 percent of manufacturing, 30 percent of construction, 95 percent of mining and 25 percent of services Accompanying the official government seizures at the time of the triumph, peasants and workers, sometimes actively expropriated the Somocistas and other times they maintained enterprises when owners and managers had fled. At the beginning of the revolution workers often took over agricultural and industrial enterprises to prevent decapitalization, theft, and deterioration during the hiatus between capitalist and socialist management. The FSLN needed time to take power, and take stock before it could actually send managers to take charge of appropriated property. Many of the enterprises where I conducted interviews and observations had their own short self-management experiences at this time.

The Sandinistas organized most of the appropriated land into large state farms under the Ministry of Agricultural Production and Agrarian Reform (Ministerio de Desarrollo Agropecuario e Instituto de Reforma Agraria - MIDINRA). Jaime Wheelock, the former chief of MIDINRA, told me in an interview that in the months just before and after the revolution people invaded the land and “imposed their own models” of land possession or did so “without models.” MIDINRA’s research agency led by Wheelock’s chief theoretician, Orlando Nuñez, published Participatory Democracy in Nicaragua , which says that during the guerrilla campaigns against Somoza “the people and popular organizations confiscated some of the agricultural properties where the dictatorship had lost military control, and a type of insurrectional self-management control began which received . . . support from the guerrilla columns.” It says “worker management normally consisted of a general assembly” with participation from all workers, the guerrilla fighters, and some of the area’s land owners, making decisions by “consensus.” The pamphlet says that this kind of “worker control continued for several months after the triumph.” Wheelock says “the revolution broke structures and created space,” yet unfortunately, with people “stealing machines, we were in a situation of anarchy.”

The pamphlet describes Sandinista disillusionment and elimination of direct workers’ control, “Advancing institutionalization put an end to these self-management experiences,” so that “more centralized exercise of power in the hands of only one person produced a strong confrontation” between workers and technicians in the State Productive Units. The agricultural workers “were afraid of loosing the control over the property which they felt was theirs by right.” The Sandinista Farmworkers’ Union supported Assemblies for Economic Reactivation in 1980 to try to reconcile administrators and workers. However, they often would explode into “stormy discussions” and “accusations that the directors were anti-worker”. The commentaries of Wheelock and this pamphlet show that direct, radical, forms of workers’ control unsettled Sandinista authorities. The authorities blame the workers and make strained, and apparently embarrassed, apologies for implementing more hierarchical state controlled management in 1980.

Wheelock tells me, “the program of the Sandinista Front originally did not plan to have state enterprises” for the land. Yet he says that Sandinistas along with the peasants took over “the most advanced land in Nicaragua” - that is the most modern, industrialized, large scale farms that had profitably grown cotton, tobacco and coffee, but peasants only wanted to use the land to raise basic grains for subsistence “self-consumption.” He says this eroded the economic value of production, so that when he took over the Agrarian Reform his job was to restore the country to the level of productivity of 1978. He says that at that time everyone thought that productive agriculture demanded large scale operations with expert management, whether by capitalists or socialists. He says there were no “peasantists” then, neither Sandinistas favoring small cooperatives, nor anti-Sandinistas favoring small to middle sized private farms.

Wheelock confirms that when the ancien regime had collapsed and before the new one was established, peasants seized land both on their own and with Sandinista acquiescence. The Agrarian Reform, did expropriate wealthy Somoza supporters and political opponents, and did give many peasants and workers more direct influence in the workplace and more access to the land, while setting up large state enterprises in agriculture and in industry. Wheelock says that in 1981, “in response to the problem of the peasant,” they began giving out land on an individual basis. At first they gave individual lots to squatters who invaded the land, which suggests that the initiative for individual seizure of the land was from the peasants. Wheelock says “there was resistance of a sector of peasants to join cooperatives, especially during the war by peasants in the montaña” - the rougher, more isolated, and underdeveloped areas.

For urban, industrial workers, as well, the Sandinista guerrilla movement, out of power, had advocated participation in management, and when it came to power it initially tried certain experiments with worker participation, although not full workers’ control, in most state enterprises. In addition to the agrarian self-management, Participatory Democracy in Nicaragua depicts a variety of experiments with industrial worker participation in the early 1980s. Extensive interviews for this dissertation were conducted at El Caracol, a cereal beverage plant in Managua , in which, as with many other firms, workers prevented the old owners from decapitalizing and took over management functions when they fled. Later the government brought the firms under the centralized management of the APP. The pamphlet says again, that often the new managers took over authority that workers had claimed for themselves. The state’s industrial, umbrella, agency, the Corporación Industrial del Pueblo, (People’s Industrial Corporation, COIP), set up Assemblies for Economic Reactivation in the enterprises to replace, ad hoc worker participation mechanisms. These often met worker resistance where trade unions already "had developed significant influence in the enterprises." These Assemblies were often the scene of intense labor-management conflict so that government managers thought, "The lack of managerial preparedness of the working class was amply demonstrated." The government then introduced Consultative Councils a year after setting up the Assemblies which were smaller and gave the workers only minority representation. In this period the government emphasized labor discipline and banned strikes.

In 1993 I met with officials and members of the cooperatively owned El Caracol, who described the three moments of worker assertion of control over the enterprise before, during, and after the Sandinistas were in power. Susi Rivas, a union secretary of women's concerns, says the old owners, the Campos , were "Somocistas" who cooperated with Somoza’s police to repress union organizing efforts. She says that after the triumph on July 19, 1979 , the Campos stopped production for two months. The workers got rid of the sindicato blanco, or company union, and formed a real one. The Campos said they wanted to lay off 36 people, but when the workers refused to accept this, they resumed production anyway. Magelda Campos even received a four million córdoba loan from the Sandinista government. César Aragán, (who later became a cooperative manager) says that the workers discovered that the Campos were decapitalizing and, after the Campos left at five p.m. one evening, the workers seized the factory. Workers say that the government did not, however, send a manager for two months, so leaders of the union took the initiative running the firm for that period, while asking the government to nationalize it. The workers say the union leaders ran the plant reasonably competently for two months. Through this process they built a willingness to struggle, another nodule of socialist civil society, and confidence that workers could manage themselves.

The enterprise became both a conquest and a burden for the workers. In 1980 they worked 75,000 hours of volunteer labor, over several months only for food and without salary to pay off the Campos ’ four million córdoba debt. Yet the former union chief Martínez notes that in1980-1986 state appointed managers "did not want the workers to participate in management of the enterprise." They were "from the bourgeois class," he says, and although they would listen to the workers they would still impose their own policies. Ironically, the so-called “voluntary” labor imposed by what they considered oppressive managers greatly enhanced their sense of ownership of El Caracol and their identification with the Frente.

Despite the general shift toward less democratic managerial methods as the Sandinistas consolidated power and tried to activate the economy, workers continued to have real influence and unions disregarded the ban on strikes. At El Caracol, as elsewhere, the union had effective power to remove enterprise directors even though COIP-appointed directors were to have authority in firm level decisions. The union and the assemblies of workers had considerable clout although the elected union leaders appear to have made most of the initiatives.

2. Contra resistance and peasant pressure on Sandinistas to distribute land

Even Wheelock and most sympathetic observers admit that during the Contra War the Contras themselves, as well as Sandinista peasants pressured the government to give out land on an individual basis. Wheelock says the Sandinistas lacked “a social base in the countryside,” leaving an opening for the Contras or as they are also called, the “Resistance.” He describes the higher Contra leadership as professionals, members of Somoza’s National Guard, and some politicians; the mid-level as “rich and middle peasants;” and the greatest part of actual fighters as “peasants with land.” Wheelock mentions cultural/ideological motivations - that the peasants did not understand the revolution and fears that the Sandinista Front was undermining the family. However, he says that the landowning peasants and “all property owners small and large thought the Agrarian Reform was a threat” and objected to being required to sell their produce at below-market value to the state, and to the rationing of scarce industrial products. Wheelock also says that in 1987 with wartime food shortages, people were petitioning the Agrarian Reform to cultivate idle land, and “were sewing small plots in a disorganized way,” so it permitted them to take possession of the land on a provisional basis.

Pro-Sandinista analysts at the Nica School in Esteli write that the Resistance struck a chord with rich and poor peasants by calling for individual property rights, and playing into their fears of expropriation. The analysts say many state farm workers lobbied to obtain the land directly, and that Sandinista delays and inflexibility in cooperativization alienated the peasants who longed for their own private plots and preferred to decide for themselves whether to form coops. They say that the failure of the Agrarian Reform up until 1985, to meet peasant expectations gave an opening to the Contras, but afterward, the FSLN gave out land on an individual and cooperative basis, to woo these peasants back. Cristóbal Kay agrees that the Contras took advantage of peasant resentment about the collectivism of the Agrarian Reform. However, he says peasants were able to pressure the government to reduce state control and to hand out more land on a cooperative or individual basis. The Agrarian Reform increased the expropriated land it gave to peasants individually from 8 per cent from 1981 to 1984 up to 24 per cent from 1985 to 1988. Kay says that the National Union of Agriculturalists and Ranchers (UNAG), which became the Sandinistas’ mass peasant organization, became more autonomous and pushed the government to distribute half of the state land to workers and landless country people, mostly on an individual basis.

The Sandinistas also enlisted pro-revolutionary peasants in the fight against the Contras by setting up cooperative farms as armed outposts in contested areas. Cooperative farmers became grateful defenders of the revolution, but they paid a high price - pro-Sandinista sources say the Contras killed some 7,000 of them and destroyed 150 coops. The armed coop system drafted people to fight, but allowed them to return to farming when necessary, thus emulating informal structures of the Resistance, and giving peasants greater control over the means of production.

3. Post-Sandinista hiatus between powers

When the Sandinistas lost the 1990 election, there was another hiatus between governments, this time between the outgoing Sandinistas and the incoming United Nicaraguan Opposition (UNO) of Violeta Chamorro. Repeating what happened during the Triumph, workers and peasants took over land and enterprises, pressuring the UNO for property reform. The critical, but pro-revolutionary journal, Envío says that while almost 1.5 million acres, or 32 percent of Nicaragua ’s agricultural land was redistributed under the FSLN, an additional twelve per cent was redistributed under the UNO. People on both sides of the Contra War took over 176,000 acres under Chamorro without waiting for legal sanctions.

Edgardo Garcia, President of the Sandinista ATC the Farmworkers’ Association explains his position on country people seizing land in the post-Sandinista period in an interview in Envío. Before that time, “the state represented social property. But if . . . the state is dividing up its properties, that revolutionary utopia assigned to the state becomes our responsibility. . . . So under the current circumstances, the ideal is workers’ property.” This shows that the Sandinistas still prefer state control, but, after their fall from state power, by turning over former state farms to workers of the ATC, peasants of UNAG, urban workers, and cooperative members, they could preserve some of their own institutional power, broader popular class power, and the revolutionary project.

Garcia describes the mixed significance of remobilized ex-contras (whom Nicaraguans call “re-contras”) emulating Sandinista land seizures, sometimes redistributing downward, and other times, just taking land from other poor people. The re-contras, “occupied some 36 [private] farms in Jinotega, totaling about 34,000 acres. During the war, the owners of those farms encouraged those people to join the counterrevolution, promising them land when they won. But now they’re sending them to fight” with workers and peasants. He says the re-contras were able to take over about 100 Sandinista cooperatives, but not the former Sandinista State farms. The coops were smaller, more egalitarian, and less bureaucratic. The large, state farms with unionized, wage-earning, workers allowed less room for dissent, but they seem to have been better organized for military defense. García insists that his workers never conceded anything to the re-contras by force. I met a well-to-do pro-Contra land owner and his guest, a Contra commander who say that the government should provide land to the former Contra fighters, not to anyone else. Another re-contra commander in Nuevo Guinea tells me he wants state land, which would be taken from mostly poor families - who had had property foreclosed. Re-contras appropriated Sandinista principles of land redistribution, but they were not simply agrarian reformers who happened to prefer land on an individual, rather than cooperative basis.

Re-contras were interviewed who joined exclusively with other re-contras to take over land, and others who joined together with Sandinistas. The demobilized Sandinistas who had returned to guerrilla warfare, were called the “re-compas” or rearmed comrades. I met a combined group of eight re-contras and re-compas, whom the Nicaraguans bemusedly call “revueltos” meaning scrambled, as in scrambled eggs, who had set up a squatter cooperative. These re-vueltos had joined together to seize some land near Nueva Guinea in the post-Sandinista transition period, and had engaged in firefights against former landowners and a Nicaraguan Army unit that had come to evict them. Sitting in wooden chairs on the dirt floor in a room of the coop, with sunlight sifting through the rough wooden wall panels, the female head of the coop tries to lead the responses although the others make frequent, interruptions. One animated fellow says, “You know, it’s funny, we have disarmed, there are no arms here. But whenever we need arms we have them.” Most of them think owning land is more important for democracy than voting for the government, with the only dissenter - a political organizer - saying they are equally important. Most say a coop meeting would be more important to attend than an election to national office. Solidarity mixes with open, joking disagreement, among these former enemies, who had taken advantage of the weakness of the state in the remote area.

Before they lost the 1990 election, the Sandinistas oversaw a rather centralized state economy, and a largely top-down, union movement. However, when the FSLN believed it had defeated most of the Contra forces, it felt freer to cut social spending to slow down rampant inflation, while the unions also felt freer to strike against the cuts. As García indicated, the Sandinistas found in 1990 that their centralized apparatus would be at the disposal of their enemies. To prevent this, the FSLN accelerated redistribution of land to its popular base, so that after giving out 5.1 million acres of land over ten years, it suddenly gave out 1.3 million in only three months. Privatizations are always corrupt, privileging government insiders. The “piñatas” of the FSLN, and subsequent UNO, and Alemán regimes were no exceptions.

The in-coming and out-going governments appeared to be the main players in the change of power. The UNO alliance of 14 anti-Sandinista parties mainly represented the propertied elites, coming into office intent on privatizing state enterprises, laying-off thousands of workers, and cutting social services. Yet it was willing to negotiate. The main concern of the Sandinistas was to protect themselves against reprisals by the new regime and the Contras, so much of the agreement focused on the Sandinista army. In March 1990 the UNO negotiated with both the FSLN and the pro-Sandinista trade unions for a Transition Protocal. It accepted the FSLN’s main demand - that Humberto Ortega remain chief of the armed forces in exchange for FSLN cooperation on policies including the economic austerity measures.

The Sandinistas told the unions to ask the UNO for 10% of the privatizing state industries, but the unions demanded more and won 25 per cent.Mario Malespin, President of the Telecommunication workers union, tells me in an interview that he was in a meeting where Jaime Wheelock suggested that the unions demand 10% of privatizing state enterprises. In fact the unions demanded as much as they could get, settled for 25% in a national agreement, and, as result of case by case negotiations won about one third, at the time. Sandinista unions carried out general strikes against the austerity plan in April and June-July 1990. The UNO joined tripartite concertación negotiations including itself, the business sector, and the unions. Edgardo Garcia, agreed, in an interview with the author in 1997, that the FSLN had to moderate its demands and tactics to appeal to voters, while the workers and peasants had to use more confrontational tactics to defend redistributed property. The union movement, then, while essentially Sandinista, became a negotiating actor in its own right, representing working people more directly than the FSLN Party and state.

On August 16, 1990 President Chamorro tested the water by announcing the return of sixteen enterprises including the El Caracol plant to the previous owners. Evenor Hernandez, the Sandinista director, called together the firm's union officials who mobilized its supporters. On September 26, 1990 , the ex-owner, Magelda Campos, arrived to demand return of the plant. Marta Prado, a secretary says the workers turned out in force for an assembly where they expressed their rage against the ex-owner. The directors of the union made a motion for the workers to become "owners of the enterprise," which the assembly approved before electing a new management team. The unions at the other fifteen firms took over their work sites in similar actions. On October 1, 1990 , thousands of workers joined a "Day of Civic Resistance," to protest the austerity plan, reportedly with over five thousand workers from the recuperated factories. At several of the firms, including El Caracol, the ex-owners cut utilities, froze bank accounts, stopped wage payments, and blocked delivery of supplies

Although the concertación, established three formal negotiators: business, government, and unions, a better explanation of the social forces would be the propertied elite and its government representatives on the one side with the organizations of the workers seeking control along with the former bureaucratic elite - the Sandinistas - on the other. In October the bargainers signed another concertación agreement which established labor peace, wage increases and severance pay for government employees, and privatization in favor of the workers. The strikes and the government reaction showed that although working people respected the FSLN, many were willing to go beyond it, and that they saw the popular organizations as legitimate vehicles of their own interests. Moreover, the unions and the pro-land reform peasantry still had the power to stop governmental and economic activity, even though the Sandinistas were out of power. Another ten months of unions and owners trading legal measures, physical force, and shady financial maneuvers led to a second concertation in August 1991 in which the government agreed to sell at least twenty-five percent of the stock of privatized firms to the workers. The workers would receive credit on concessionary terms to buy the stock which they were to pay back over six to twelve of years.

The Campos family hoped to reclaim the El Caracol, plant and as well as a discotheque the Sandinistas had seized, called Lobo Jack. Workers in both firms negotiated with the Campos and the Chamorro regime to obtain legal ownership of a portion of the enterprises. Ultimately, the union agreed to buy El Caracol, in entirety, from the government, which would, in turn buy it from the former owners. The Campos would retain possession of the discotheque, which was worth at least twice as much as the plant, but the union reckoned that it would be better to possess all of one enterprise than a one third minority share of two enterprises. In other negotiations, where capitalists did obtain majority shares, they often squeezed out the worker minority share holders. Lobo Jack workers received an agreement for a substantial pay increase over a few years, no lay-offs, and sharing ownership of El Caracol with El Caracol workers.

Gilberto Cuadra, President of the High Council of Private Enterprise (COSEP) the main anti-Sandinista instrument of business in Nicaragua , explains how he sees class forces operating in the privatization struggle. During the revolutionary period, he says, “workers and peasants” became convinced that they held “power,” so that they abandoned “the work ethic.” They also became convinced “that the owners, who were – and still are called bourgeoisie, got rich by pillaging, robbing or exploiting, and that this wealth is really the property of the workers who had produced it.” He disparages, but recognizes, the strong class consciousness of Nicaraguan working people, saying they have become “a political and not a labor force. . . . I have friends who’ve even gotten the papers that say they’re owners of the property, that there was never a reason for it to have been taken” by the Sandinistas, but the workers would not return it. They say the “factory is ours; we kept it alive; we volunteered on Saturdays and Sundays to keep it running.” Cuadra directly disparages the workers, not just the Sandinistas, and is unusually explicit in seeing three collective political agents 1. the workers and peasants together, 2. the Sandinistas, and 3. property owners like himself. In his schema the workers as an agent, did not control production under the Sandinistas, are misguidedly intent on taking it over, and are hostile to the bourgeoisie.

On a national level, in October 1990 the union movement was united enough to pressure the UNO to agree in principle to privatization to the workers. The government would take "into account the rights acquired by the workers, such as the right to participate in the ownership” of the privatized enterprises without specifying either an ownership percentage or mechanism. Then in August 1991, phase II of the agreement guaranteed the workers 25 per cent of the value of privatizing industries. At first it the unions won a good deal more than 25 per cent. A report of the Central Sandinista de los Trabajadores (Sandinista Central of Workers – CST) summarizes worker ownership in the privatization of 34 firms in 1993 as follows: 100 per cent in 10 enterprises 40-65 per cent in 6 enterprises, 11-39 per cent in 15 enterprises, 0 per cent in 1 enterprise, and 2 enterprises as closing However, the long run success of worker managed enterprises, which go beyond the scope of this article, although significant, were less spectacular. Spalding cites CORNAP – Corporaciones Nacionales del Sector Público – National Corporations of the Public Sector – with figures on privatized companies. Between 1990 and 1993 CORNAP had 351 rural and urban enterprises, of which 51 were liquidated, 114 remained in the hands of the state and 237 were privatized. Envío reported that in 1993 there were 137 privatized enterprises, in which the workers owned between 25 per cent and 100 per cent. It says that by 1997 50 of these remained in business. Some of those no longer listed would be businesses that failed, some that were bought out, and others that were cooperative farms divided up among the members.

The stalemate between capitalist and socialist elites was the main determinant giving workers the chance to control production. Elite stalemate is more a particular relation of social forces than of economic conditions, institutional arrangements, or political culture, although these had influence as well. Capitalists had more wealth, control of the state bureaucracy, and superpower support than the socialists, but the socialists had more control of the police, the army, and unofficial armed forces, and some residual influence within the bureaucracy. The Sandinista agrarian reform weakened the big land holders and strengthened much of the peasantry. The FSLN established strong, representative organizations of workers, peasants, youth, and women. Although the Sandinistas genuinely empowered working people, stalemate between socialists and capitalists gave workers more opportunity to control production than would have been the case if either capitalists or Sandinistas had had more complete power.

4. Shaken elites in Cuba

In Cuba the bureaucracy faced a collapse of self-confidence and popular support in 1991-1993. The Cuban elite did not confront an internal capitalist class as the Sandinistas did, but an external one, principally from US corporate and government interests, and from wealthy, influential, Cuban refugees. Cuba ’s principle strategic allies that had provided protection, trade, membership in an international community, and triumphal confidence, had crumbled. With the fall of the Soviet system, Cuba ’s exports declined 70% and imports 75% from 1989 to 1993. The GDP dropped by more than one third. Although Washington ’s hostility to Castroist Cuba has been long standing, it tried to take advantage of the island’s economic crisis, and the expectation that the government could soon collapse. In 1992 presidential candidate Bill Clinton, tried to win over the Cuban American vote, by chiding President George H. W. Bush for not signing the Cuban Democracy Act and missing a chance to “put the hammer down on Fidel Castro.” Bush then made up for this, by signing the Act and in 1994, President Clinton signed the Helms Burton Act, further tightening sanctions. At the Cuban government’s weakest moment, it made concessions, giving peasants and workers more control over production, cooperativizing state farms, allowing farmers’ markets, and setting up small “cooperative” businesses. As Laura Enriquez states, “ Cuba 's agricultural transformation is being carried out by a socialist regime whose objective is to fortify its economy and government in the face of serious threats to its existence”.

The official state farms, and later the cooperatives, lacked sufficient resources to cultivate all the land available to them, so in October 1991 Fidel Castro gave a speech at the Communist Party Congress saying that the food crisis would be the highest priority, and there should be not one inch of idle land in Cuba while it lasted. Rural working people took this as a green light to occupy and farm the uncultivated land. Apparently most people obtained unofficial nods from local administrators, but, Cuban scholar Niurka Perez tells me personally that some peasants informally started cultivating idle land without seeking permission, and Perez along with Diana Deere and Ernel Gonzales wrote that some peasants had actually seized land leading managers to lend, or authorize peasants to cultivate, parcels of the state farms from the beginning of 1992. There were food riots in Havana as well. It seems, then, that there was agency from above and from below. This unacknowledged squatter movement went on for two years until the government gave notice, on September 15, 1993 that it would form the new farm cooperatives (Basic Units of Cooperative Production, UBPC) and establish regular channels for individual citizens – mainly retired - to cultivate unused land. A Ministry of Agriculture administrator said that MINAGRI received about 5,000 formal requests to cultivate little plots of land within a month after the September 1993 laws were passed. As of April 1998 45,804 people managed to get parcels of land from government amounting to 10,943 hectares or about 27,000 acres.

I encountered three men just off the road from the Bay of Pigs to Santa Clara , on the Southern side of the island between Torriente and Playa Larga at a Jardin Botanica - Botanical Garden -that cultivates exotic, but useful flora and fauna. Wearing yellow straw hats and rubber boots, their ages appeared to run from almost forty to about sixty. One had a machete and two had heavy, three-speed, Chinese, bicycles. One said they had received permission from a local official to farm the land but, “We are precarios.” That is, they are squatters on the land or using it at sufferance of the official. The field was grassy, but invaded by marabú - a rough, thorny, bush, so difficult to remove that the financially strapped government could not be bothered with it.

Cubans in the 1990s set up “conucos” - little gardens on land not legally their own to raise vegetables or a few chickens where the responsible officials would not notice or care. The word conuco derives from the indigenous Arawak or Taino language and from colonial times when slaves would cultivate small individual plots of land during unsupervised moments. In the 1990s, the government established a formal policy to set up areas of “autoconsumo” - self-consumption - on all farms and coops and in any cultivatable spaces within urban areas, even including the front lawn of the Ministry of Agriculture. One dissident cooperative farmer within Cuba , claims that officials complain that workers spend half of their time on their conucos so that they are the main obstacle to productivity in the cooperatives. The precarios such as those in the Botanical Garden applied a kind of influence, sometimes forceful and other times very gentle.

Social forces were most determining in the shift toward more workers’ control, but institutional, economic, and cultural/political forces had impact as well. Working people had exerted pressure on the system since the 1970s, although not in an organized, and often, perhaps, not even in a conscious way, by withholding labor. When the lack of worker motivation led to the failure of the 1970 sugar cane harvest, Fidel Castro began to encourage revitalization of the trade unions and certain forms of worker participation. In the early 1990s the economic crisis, the food riots in Havana , the country people’s land hunger, and the regime’s doubts about its own survival, all gave these working people the opportunity to acquire direct control of the means of production. The sense of elite weakness, and the opportunity this gave to country people, were the major impulsions for the regime to offer land and for people to take it. The decisions of key persons in governing institutions, especially Castro’s greenlight and the policy of cooperativization, were also critical. The economic crisis was the proximate cause for country folk to take the land and city dwellers to riot. The political culture was important as well, with Cuban ideology favoring workers, and the poor. Government officials were acculturated to believe their role was to help working people, so they were not prepared to repress vast numbers of them to maintain control.

In Cuba , although the conflict between the Cuban elite as a whole and international capital was important, the conflict within the bureaucratic elite affected workers’ control even more. Arturo Villar describes elite conflict underway in Cuba as an “internal war. The battlefield is the economy. . . . And the combatants are foreign investors, bureaucrats and managers of state-operated enterprises.” Villar favors management methods in the joint ventures including ability to “fire workers at will.” Cuban workers have been free to goof off, and worker decision-making bodies have formally blocked management sanctions and, informally, driven out unwanted managers. Villar thinks that some bureaucrats see capitalism as “the wave of the future,” while others “constantly place stumbling blocks in the way.” A state economic planner says “Resurrection of capitalism in Cuba is inevitable, . . . we are simply looking for ways to do it while keeping the social costs down.” He says the Cuban managers support Fidel Castro “circling the wagons while we learn the tricks of the trade to face the Yankee invasion and the soldiers from Miami,” which indicates that even though the managerial elite in Cuba may hope to become more market oriented, it remains at odds with the Miami Cuban business elite. He says “Among the managerial class, it seems only hard-line revolutionaries and incompetents are against foreign investment” An ex-vice minister says “We are fighting our own war here. . . . the managers [struggle] with the help of the foreign investors.” So Villar and his sources clearly believe, from a counterrevolutionary perspective, that there was a serious conflict, apparently between more entrepreneurial managers and investors, on the one hand and those politically committed to socialism on the other.

Enterprise managers (such as the one I interviewed at Cubana de Acero) see certain regulations as constraining productivity, so they hope a more market oriented system would eliminate these constraints. In the late 1990’s Cuba began the “perfecionamiento empresarial” program to introduce more independent capitalist-style management. Phillip Peters, a conservative Reagan-Bush State Department official, quotes Lázaro González, a Cuban manager, who says his authority at a rubber enterprise had been, “very limited practically all our problems were resolved at higher levels, . . . . I couldn’t structure my payroll or designate who works with me.” In Cuba as in the former Soviet system, managers who hoped to do well became the pro-capitalist lobby within the bureaucracy. The managers might consider being careful what they wish for, however. In transitions of most of the former Soviet bloc and in Nicaragua , new constraints emerged, and the central planning mechanisms collapsed before market mechanisms could replace them, so although speculators profited, most real producers did not. In Cuba and China the complete collapse did not take place as the government never released its grip on the economy and the agricultural administrators never released control over the new cooperative units

I talked with Cuban metallurgical workers and managers who perceive managers as representing the enterprise and its workers in negotiating with the government ministries. Executives seeking allies for enterprise autonomy looked naturally to their employees, offering greater participation – although not real workers’ control. Gonzalez, the rubber executive, describes drafting a proposal to the ministry for greater enterprise autonomy and managerial authority. He says, “Without the participation of workers in each step the process doesn’t work.” The managers would offer rosy business forecasts telling their workers if you let us be more independent of the government, to have more freedom to make enterprise decisions, to seek investors, lenders etc., we will all make more money and we will give you more power in the factory. Peters writes that González says, “he was concerned about worker support for the process. . . . [and he] moved quickly to heed worker concerns about conditions and benefits.” Peters describes a construction materials plant CEO, Alejandro Gutiérrez who stated that “his first step was to eliminate fear of layoffs,” telling workers that if any jobs were eliminated, the Foreign Trade Ministry would have positions for them. The firm did increase worker remuneration, but had 15% fewer personnel, suggesting that layoffs may well have occurred. Peters quotes an unidentified observer of the perfeccionamiento empresarial who claims, “This is the first time workers’ opinions are truly being taken into account.” However, even though managers may seek worker support in the short run, their desire for the power to “fire workers at will” would reduce workplace democracy in long run.

The Cuban government made a similar case to win support for the new UBPC cooperatives. The workers do not seem to have bought the pitch or received the touted benefits in the sugar cane coops, but the idea seems to have gotten some ‘traction’ in the food coops, as evidenced by the fact that cane has continued to lose money, while food coops have improved, so that they are nearly breaking even. So in both the enterprises and the cooperatives, pro-market managers offered what might be considered a short term democratization of the workplace in order to win over the workers.

Haroldo Dilla, a Cuban former Communist party member, and critical supporter of the Revolution from the left, offers his own analysis of the elite divisions in the Cuban marketization process. He describes a “technocratic-entrepreneurial bloc” with access to global markets that emerged in Cuba along with the arrival of some 260 international investors and 800 foreign firms. He says this “techno-managerial sector” of “probably no more than a few thousand” began to appear just prior to the 1991 CCP Congress. “For several months, Cuba experienced the most democratic public debate in its history.” He says, however, that the “techno-managerial elite’s” goal is not empowerment of the people, but a “sugar-coated Chinese model”, that is economic marketization, plus political authoritarianism. He notes that when the Spanish Melia investors established their first hotel in Cuba in this period, they tried, unsuccessfully, to prevent the union from operating. Concerned that the entrepreneurial elite may foreshadow a “Cuban thermidor” or a “tropical mafia,” Dilla proposes an alliance between the “popular classes” and “the political elite that emerged from the revolution” to check this technocratic-entrepreneurial tendency. He advocates, among other things, a “renewal of popular forces,” more efficient “participatory municipal institutions,” and “decentralized, pluralist, local democratic planning (Dilla, 2000).”

5. Recuperated enterprises in Argentina: Collapse, deadlock, and explosion.

In Argentina the conditions that allowed workers to establish what they call “recuperated enterprises” where seize their workplaces and establish forms of workers’ control shared certain key features with Nicaragua and Cuba : 1. Economic collapse including failure of management, and massive job losses, 2. Division of elites, and 3. Governments willing to negotiate with the workers. There had been economic crises in Argentina for decades, but this was a sharp, extreme economic collapse over a short period of time after a period of rising expectations. This economic collapse severely damaged the living standards of the great majority of Argentines, from middle class to the very poor. Management failed at the enterprise level, which was similar to Nicaragua , and especially to Cuba . At the beginning of the Sandinista period in Nicaragua , when Somoza era owners and managers deserted their farms and enterprises, and at the close of the Sandinista period, neither the Sandinista managers, nor the incoming UNO managers had full control of the enterprises. Even more dramatically, in Cuba when the Soviet Union dissolved, the resources disappeared that were needed to make production plans work, so these plans, from the national to enterprise levels, had to be jettisoned. The failure of the economies at the macro-level and management at the enterprise level, also produced the massive loss of jobs. This was more true of Nicaragua than of Cuba . In both Nicaragua and Argentina workers overwhelmingly reported that the most important reason for taking over the enterprises is that they are trying to save their jobs. The strongest parallel is between the unions demanding more than the Sandinista leadership demanded, by taking over enterprises in Nicaragua and the workers, generally without, or in opposition to, the unions, taking over factories in Argentina . 2. As in both Nicaragua and Cuba there was a division of elites in Argentina . In both Nicaragua and Argentina , the division of elites was especially sharp. In both countries the party controlling the executive was paralyzed by the actions of the major opposition party, by legislative obstruction, and general strikes. 3. In all three countries the governments were willing to bargain with rebellious popular forces. Taking over control of the means of production in all cases involved squatting or occupation of the workplaces, and negotiation with the government over legal possession. Neither strategy is possible in the face of either authoritarian regimes of the right or left that are willing and able to use terror or massive repression. When workers took over factories in Chile under Allende, they could push, shove, and bargain. When Pinochet and the military intervened this became impossible. When the Kulaks resisted collectivization in the Soviet Union , Stalin used mass terror and starvation to break their revolt. Nicaragua , under the Sandinistas and Chamorro administrations held elections, and allowed the operation of oppositions. Cuba, although a single party dictatorship saw itself as benevolent and committed to the well-being of working people, so it was not going to engage in mass terror to repress rioters or squatters.

Introduction:

For eighteen years, since the return to democracy in Argentina in 1983, the major Argentine political parties – The Radicals and the Peronists - implemented the orthodox neoliberal policies dictated by the “Washington Consensus” and International Monetary Fund. This was to be expected of the Radicals, but out of character for the Peronists. Peronist President Carlos Menem reversed expectations by privatizing state industries, cutting social services, making concessions to international investors, and keeping US dollars in reserve to support the Argentine peso on one to one parity with the dollar. Dollar convertibility did succeed in stopping quadruple digit inflation, and privatization brought a short term cash influx from selling off the national patrimony, accompanied by the usual corruption. Well healed buyers, gladly bribe moderately paid government officials to obtain hundreds of millions of dollars worth of industrial capital at bargain basement prices. International capitalists were impressed by the pro-business policies and poured loans and speculative investments into the country. Economic productivity improved for several years, but foreign debt as a portion of the gross domestic product increased from 29 percent in 1993 to 41 percent in 1998. The infusion of capital created a bubble, driving economic growth and borrowing even further, until the bubble was burst by falling international demand for grain, which Argentina exports, and a faltering economy of neighboring Brazil . Alarmed international investors cashed in their pesos for dollars until the financial system collapsed. The government restricted ordinary account holders from withdrawing money from the banks, as big investors exported capital legally and illegally. Argentina defaulted on most of 141 billion dollars of government debt and gave up dollar convertibility allowing the value of the peso to drop 29 percent. Throughout the country thousands of businesses collapsed, and 20 percent of the labor force were thrown out of work.

The economic collapse led to the December 20, 2001 uprising of the middle class, students, workers, and the unemployed – the “Argentinazo”. People in the Argentine neighborhoods set up assemblies where they established informal mini-governments. Parallel to and incorporated in this movement, workers in bankrupt or abandoned enterprises took advantage of the upheaval to take over their workplaces. The unemployed workers, (“piqueteros”, picketers) who had blocked highways to the major cities for years, demanding jobs, income and social services, seized the streets, as well during the uprising.

One of the puzzling questions about the rebellion is about “the dog that didn’t bark” – the government and the military. De la Rua did send the Federal Police to clear protesters out of downtown “by any means necessary” with mounted attacks on the demonstrators, including unarmed Mothers of the Plaza de Mayo, leading to thirty deaths, and wounding some 2000. Yet the military did not attempt a coup and authorities did not use all out terror to smash the protest. There are two main reasons for the government response that was much more restrained than the Dirty War repression. First, the military really had been discredited, humiliated, and tamed after military defeat in the Falklands War, eighteen years of democracy, accumulating exposure, and official repudiation of the crimes of the dirty war. The military had been reduced in size, the high level rulers of the dictatorship had retired, some had been tried, and some were being considered for extradition to face international human rights charges. During the late 2001, early 2002 uprisings, many people expressed fear of the military intervening. After all, the Chief of Staff of the Army , General Ricardo Brinzoni was accused of participating in the killing of some twenty-two dissidents, when he was a lower ranked officer during the Dirty War, and expressed ambivalence about investigating the atrocities of that period. Yet Brinzoni repeatedly denied rumours that the military might intervene or carry out a coup during the 2001/2002 protests.

Second, the elites were divided and deadlocked, nearly as sharply as they had been in Nicaragua , and much more so than in Cuba . Going into the crisis period at the end of 2001 the executive branch of the Argentine federal government was under President Fernando de la Rua of the Alianza Party. The two uneasy factions of the Alianza Party repeatedly edged closer to a rupture during the year leading up to the Argentinazo. One section, the Radical Civic Union, has been historically centrist, been more free-market, less corporatist, and less pro-labor, but more committed to formal democratic procedures. The other faction of Alianza is the Front for a Country in Solidarity - on the center-left. The legislature was dominated by the majority Peronist – Justicialist Party – that historically has been protectionist, corporatist, fused with hierarchically controlled Peronist labor unions, less committed to formal democracy, and frequently disposed to collaboration with military dictatorships. The Peronists, who had controlled both houses of Congress since October, refused to ratify the austerity budget that chief executive De la Rua negotiated with the International Monetary Fund. The Peronists used their domination of the legislature, as well as their hegemony in the labor unions, and some business associations to make it impossible for Alianza to govern. The Peronist resistance was partly partisan, and reflecting the interests of wealthy elites that benefited from protectionism, and corporatist largess, and occasional compromises with the military dictatorship. But the Peronist party also has more genuine connection to the workers, the piqueteros and to it’s the estranged members of the Peronist left wing who have engaged in guerrilla war and other popular struggles since the 1960s. Therefore the Peronist resistance, beyond partisanship or support from rival elites, also, reflected real pressure from poor, working, and middle class people, who saw their jobs, incomes, businesses, and life savings disappearing. The divided government reflected the shift of middle class attitudes from acceptance of the restructuring policies of the economic elites, to outrage that those elites appeared to have betrayed them. The Peronists obstructed the Alianza government to return to power, to ally with the popular movement, and to avoid taking the blame for catastrophic results of their own ten years of neoliberal economic restructuring under Carlos Menem.

Yet the mainstream Peronist politicians were deeply split as well. Partly this was about personal and self-serving factional rivalries, but it also reflected the division between Peronists led, on the right, by Carlos Menem and Ricardo Lopez Murphy who drove through the neoliberal program, and on the center-left, by Eduardo Duhalde and Nestor Kirchner who voiced opposition to neoliberalism, accommodation with the former military dictators, and the corrupt, authoritarian practices of the Menem administration. The popular uprising and the Peronist obstruction destroyed De la Rua’s capacity to govern, but the divisions among the Peronist politicians made it impossible for three successive Peronists heads of state to hold power for more than a few days, until Duhalde took office on New Year’s Day 2002. The first was Rodriguez Saa, but he quickly lost support of key Peronist governors and had to step down after only a week in office. He was followed by Ramon Puerta and Eduardo Camano, until the legislature, in an act of dubious constitutionality, installed Duhalde until elections were held a little over a year later. When presidential qualifying elections were held, Nestor Kichner won a place in the final round with only 22 percent in a widely divided field, finishing second to Menem, with 24 percent. Kirchner was so clearly the favorite among the remainder of the voters, that Menem withdrew from the run-off election, conceding the presidency to Kirchner.

The elite conflicts had direct impact on the capacity of the state to repress the popular uprising. First, the humiliation, gradual reigning in, reduction, and change of command of the military, kept it out of the conflict as an independent political force. Second, although De la Rua did declare a state of siege and send the Federal Police to repress protesters, he simply lacked the authority to make the police carry though on the task. He was undermined by scandal, by factions in his own party, and by opposition control of the legislature. He could not assure his lieutenants that they would not be prosecuted for human rights abuses, and indeed he and his security officials were later so-charged. He could not count on the loyalty of his administration, or his political constituency. Also, de la Rua and the Radicals, to their credit, lacked the political will to follow through on the massive scale of terror that would have been necessary to repress the popular movement. The shining moment of historical glory for the Radicals, despite their economic failures, and corruption charges, was when their President Raul Alfonsín ended the Dirty War dictatorship in 1983. The Radicals might be willing to kill 30 people, but they would not destroy their whole reason for being to return Argentina to a new regime of state terror. The Radicals, although willing to play rough, were willing to play the game. This and the elite divisions that gave the opening to the popular rebellion also gave the opening to certain working people to take control of certain means of production.

There were historic precedents for cooperatives and workers’ control in the Argentine labor movement. Laws providing a framework for the principle of cooperative enterprises had been on the books for decades, but during the period since the end of the dictatorship, cooperatives were mostly a subterfuge for employer created labor units that lacked the legal or union protections of wage workers. Employers used these for what Argentines call tercerizacion handing over jobs to third parties. The workers’ movement had its own experiences to draw on. Railroad workers had struggled to influence workplace rules from 1930, supported Peron’s nationalization of the rails in 1948, and continued to struggle against Peronist and military regime efforts to intensify work discipline through the 1960s. There were several experiences of workers taking over enterprises in the 1990s that provided immediate models for the twenty-first century. In 1996 workers occupied the facilities of Yaguan, a cold-storage business. In 1998 workers assumed control over the IMPA metallurgical and plastics factory under a self-managed, egalitarian system. In 2000 workers took over the GIP metallurgical plant in Buenas Aires, agreeing to pay for the business and establish a cooperative, and workers took over the Zanón ceramics plant in Nequén on the Western side of the country. In September 2001 the workers at the Zanello tractor factory established a company in which 33 percent belonged to the workers, 33 percent to the investors and marketers, 33 percent to the high level engineers and 1 percent to the town where is was located. Zanello has been upheld as a model for the side of the movement that wants to save worker jobs with as little challenge to the capitalist system as possible. December 2001, the mostly female workers of the Brukman clothing manufacturer took over the workshop the day before the popular rebellion took off. According to Brukman worker Celia Martinez, her co-workers started out trying to get back wages, but the massive streets protests, as well as members of the far-left groups, such as the Trotskyist Partido Socialista de las Trabajadores, and Partido Obrero, encouraged them to demand more. The idea of workers’ control has enjoyed renewed circulation in Trotskyist, New Left, and other anti-authoritarian left circle since the 1960s. These ideas gained currency at Zanón and other enterprises, so it would be hard to exclude this anti-authoritarian left influence on this choice of tactics. Others sources of that workers point to are the Mondragon cooperative enterprises established in Spain in the 1950s and the recent Brazilian Landless Workers Movement.

How, then, did 10,000 workers take advantage of this opportunity to self-manage nearly 200 enterprises in Argentina ? The mechanics of the enterprise seizures follow a general pattern with two main variations. First the old owners or managers abandon the firm, file for bankruptcy, start to decapitalize the firm, or are face lawsuits by their lenders. An average of about one thousand enterprises failed a year from 1999 to 2003. In the Brukman factory, and several other cases studied, the former owners owed months of back wages, so the protests often began with workers demanding all or part of what was owed to them. In Brukman, the managers could not provide the back wages, so the workers, asked for a small part of what was due them, in order to pay for transportation home. The managers agreed to do this, and left saying they would go get the cash. Meanwhile some of the workers simply stayed inside the factory waiting for their employers to return. When they did not return the Brukman workers started working on their own, filling existing orders, scavenging materials, and little by little soliciting new orders and new customers. At Brukman the managers never returned with the back wages. Some of the enterprises had been owned by the state and later were privatized. Many had received subsidies or loans from the government, creating less clear independence of the firms, from social ownership and responsibility to the society that had protected or supported them.

One of the tactical points of contention within the movement that reflects broader ideological differences is over how to take over the factories. On one side are the activists such as Pablo Levin head of strategic planning for the Zanón ceramics works who seized the plant and have not tried to become cooperative, but private. owners of it. Rather, they have called for the government to take over the plant, while leaving the workers in charge under a system of workers’ control. This was the position of various far left groups that convened the Encuentro Nacional de Fábrica Ocupadas y en Lucha (National Conference of Occupied Factories in Struggle – ENFOIL) The less militant, but still leftist position is that of Eduardo Eduardo Murúa, who came from the left Peronist guerrilla movement, the Monteneros, and the lawyer, Lenny Kravitz. They lead the Movimiento Nacional de Empresas Recuperadas (MNER, the National Movement of Recuperated Enterprises) that adopted the militant slogan of the Brazilian Landless Workers Movement, “To Occupy, to resist, to produce.” The MNER maintains a perspective of representing recuperated enterprises as part of the working class struggle, not just as would-be small businesses. As such they strive to ally the recuperated enterprises with the trade unions, the piqueteros, and other social movements. Murúa says that the physical occupation of the plants has been necessary to win favorable decisions from judges and from state legislatures to let the workers maintain possession. The MNER has supported election of favorable legislators, and has cooperated with politicians of the left, including Kirchner.

The most rightward end of the recuperated enterprise political continuum is Attorney Luis Caro who leads the Movimiento Nacional de Fábricas Recuperadas por los Trabajadores (MNFRT – National Movement of Factories Recuperated by the Workers). There are about 80 enterprises in the MNFRT and analysts differ as to whether Murúa’s or Caró’ organization is the largest. Caro’s politics are Peronist, close to Carlos Menem, anti-socialist, and pro-market and a few years ago he joined the electoral slate of right wing military putchist Colonel Aldo Rico. Caro’s tactics for the recuperated factories are consistent with his pro-capitalist politics, but they also prove to be effective in the specific legal context of Argentina . He opposes workers explicitly seizing company property, which, he says gives the ex-owners the legal opportunity to petition the courts to send the police to evict the workers. Rather, he prefers to use actions that could be covered under the legally guaranteed right to strike, such as camping out at the front gate of the plants to prevent decapitalization, sale of the enterprise, or introduction of scabs. When workers occupy a plant, even if they are physically doing the same thing as Zanón or MNER workers who unapologetically seize the facilities, he defends it as a sit-down strike – not a property seizure. Thus, he uses the right to strike as a shield. The goal of the MNFRT workers is to become private owners of the factories, through the legal vehicle of a cooperative.

The right to strike is not the only peculiarity of Argentine law that the workers use to negotiate, sometimes to their own advantage. The IMF had pressed the government to pass Article 187 of the bankruptcy law, which was meant to make it easier for large, multinational firms to consolidate industries, supposedly making them more competitive. One point of the law allows judges discretion to hand bankrupt enterprises over to worker cooperatives, which they have sometimes done. Often the legal instrument of the workers will be a cooperative that manages the plant and equipment, but does not own them, while the workers, the ex-owners and the creditors continue to make claims on the property in court. The provincial legislatures can and do sometimes pass laws allowing a particular failed enterprise to managed by or even owned by its workers, but this must be done on a case by case basis. Therefore workers must rally support, and lobby sympathetic legislators to have these ad hoc laws passed in there favor. The good news is that the provincial legislatures may be more pressurable than the national legislature; the bad news is that the lack of a national policy of handing over nonfunctioning enterprises to the workers creates obstacles for aspiring worker self-managers, and prevents workers’ control from developing beyond the experimental stage into a nationally viable system.

Often the ex-owners, or the crediters, would try to use force to evict the workers, so the owners would either hire private security personnel, or lobby the city, state, or national governments to send police or soldiers. The worker occupied factories, then had to seek support from community people who had been involved in the broader anti-government protests. Zanón, with 470 workers, one of the largest workforces of the recuperated factory movement, emphasizes mutual support with the other sectors of the popular movement. Zanón employees held a rock concert attended by 11,000 people, donate ceramic goods to community groups, and built a local health center. The interconnections have proved crucial. People from the local neighborhood assemblies, other occupied enterprises, and the piqueteros, turned out in force to prevent evictions at Zanón and other recuperated enterprises. Once in 2003 when police treied to dislodge the Zanón workers more than 5,000 supporters from around Nequén turned out to block the eviction. These kinds of mobilizations have not always succeded. Despite a strong neighborhood turm-out the police did beat and tear gas the mostly female Brukman workers into leaving the factory at one point. Unlike in Nicaragua , trade union support was not particularly forthcoming. Some of the leftist unions would support the factory occupations, but the established unions, generally would not. Workers at Hospital Israelita and the Grisinoppoli bakery said the unions sold out the workers, only trying to preserve the jobs of union officials, and actively obstructed efforts to take over the enterprises. The leftist parties and unions have been very supportive, but many workers in the recuperated factories found them sectarian, insistent on leading despite lacking experience or authority in the particular enterprises, and too concerned with long range revolutionary principles to be of much use in the immediate, concrete struggles of the enterprises.

At the Lavalan wool preparation plant, as in many others the workers reported late night semi-clandestine operations to pick up production materials, such as bails of wool, before the ex-owners could grab them. These were quite similar to stories at the El Caracol coffee roasting plant in Nicaragua about racing around town to get to materials that had already been ordered before the ex-owners did. As in Nicaragua the ex-owners would immediately empty the bank accounts, so that and the simple collapse of the old business, usually left the worker occupiers with only a few over looked materials and equipment in need of repair. Workers in recuperated enterprises have sought out the old clients, that had depended on their products, and tried to sell to them again. Sometimes the cooperatives would ask for the client to pay for the materials in advance or ask the supplier to lend the materials. Both client and supplier have an interest in this because they generally have been dependent on the enterprise to provide or purchase the products. Clients and suppliers may find it profitable to offer a little credit to keep their own buyer or supplier afloat, so that they will profit from the purchases or supplies in the future. The buyers and suppliers are sources of financing with which the recuperated enterprise has an existing relationship. They may even see the cooperative enterprise as a better partner because it has in a sense eliminated the middlemen – the managers – that were taking a cut out of the transaction. However, the clients and suppliers, are capitalist businesses, with existing relationships with the former owners, and with a class interest in maintaining a docile labor force, the sanctity of private property, and capitalism in general.

Aside from their material interests in the relationship with the cooperatives, business people may object to the anti-capitalist politics of worker-self-managers. Luis Caro has convinced recuperated enterprise workers who had been more idealist and given to solidarity with the popular movements, to become less challenging of the system. His selling pitch to banks, suppliers, clients, judges and legislators, is that the cooperatives are more like conventional enterprises, that recognizing and supporting them is a way to protect the principle of private ownership. Part of his success is no doubt due because pro-capitalist judges and creditors would rather deal with a pro-capitalist workers’ movement, if they must deal with a workers’ movement at all. Squatting and occupation of land or factories or other forms of property always has this double edged nature. On the one hand the occupying violate the principle of private property when they take hold of property that does not belong to them. On the other, occupiers almost always want legal entitlement to the property they seize. In Nicaragua , Cuba and Argentina , they have taken actions to legitimize themselves, and acquire the strongest legal recognition giving them ownership, or legal right to occupy the property that they can. They do not want a change in political or economic fortunes to take the property away from them. Immediately, as long as possession of the enterprises is in question, it becomes hard for the self-managed workplaces to obtain credit. A broader “solidarity economy” where working people directly control the means of production, with support of a popular government, would be in their interest, and the principle of this has had tremendous resonance with the recuperated enterprise workers. Murúa has sought financial support from President Kirchner up to $5,000 per worker to compensate for the difficulty the recuperated enterprises have had obtaining credit due to unsecure possession.

Finally, the workers’ have had a simple non-ideological motivation, above all others, for taking over the factories – to keep their jobs. Many workers, such as those met at Grisinopolli, have indicated that they are unwilling to sacrifice security over their jobs and workplaces, for the abstract principle of a revolution that has not yet materialized. Yet, in the end, the idea that workers could be capable of managing themselves without bosses, is inherently subversive to the underlying assumptions of either state socialist or capitalist ideology.

Conclusion

A recognizable pattern appears. In socialistic systems undergoing privatization, first pro-capitalist bureaucrats and then actual capitalists try to ally with working people. The main social actor trying to bring about workers’ control will be the workers and peasants themselves. They hope to save jobs and earnings through their own private ownership or collective control over the enterprise, or failing those alternatives, to get behind a strong captain to navigate a frail ship in the stormy seas of globalization. After the capitalist reorganization and economic crash, workers get laid off (thrown overboard), pensions shrivel up and citizens lose social services. Ordinary people are hammered by marketization, so they resist it through old or reformed workplace organizations. Working peoples' allies then become the former orthodox supporters of the socialist system, who by now are usually less orthodox and offer them a measure of workers’ control. In Argentina , the a mirror image of this picture emerged. When the hyper-marketized neoliberal system fell apart, first the more leftist, socialistic elements of Peronism allied with the workers seeking control against the capitalists. After the Peronists won power, rightists, such as Luis Caro, with his associations with the Right Peronist Menem, and the rightwing Aldo Rico, came around to ally with the recuperated factories movement.

Certain commonalities emerge in looking at the making of movements for workers’ control in Nicaragua , Cuba , and Argentina .

1. In all three countries economic crises far more severe than conventional bad times, ripped into standards of living, for poor, and middle income people. In Argentina this resulted in 20 percent unemployment and Nicaragu 50 percent. In Cuba , although few people were formally unemployed, workers were kept on in stalled industries with little real work to do and shrinking real wage levels. As a result, in all three systems, desperate, agitated people feverishly attempted unorthodox ways to keep their jobs and making a living. One way was to take over existing means of production.

2. In all three systems the national economic/political crisis led to a breakdown of management at the enterprise level. In Cuba and Argentina , particularly, the capacity of management to operate production at the enterprise level, disintegrated. In Nicaragua , the old managers moved out and the new ones were not yet established.

3. In all three systems, but especially in Nicaragua and Argentina , sharp conflicts of elites paralyzed the governments. In Cuba there was a conflict of elites as well, and a moment of shaken confidence, in which high and middle level bureaucrats doubted their capacity to govern.

4. The elites never intended to give the workers as much workers’ control as they took for themselves. The Somozas emiserated the peasants and repressed independent unions. The Sandinistas tried to centralize agriculture, muted workers’ control, and restricted strikes. Chamorro fired most state workers and tried to hand state industries over to capitalist owners. The Cuban government set up a centralized agricultural system, but working people during the political and economic crisis pressured the government to allow parcelization of land, cooperativization of state farms, and self-owned micro-businesses. In Argentina , neither the Radicals, nor the Peronists in power showed interest in worker self-management until the population revolted and workers occupied the factories.

5. In all three cases working people took the initiative using direct action to break the law and take over state or privately owned property carrying out more militant actions than the formally organized popular organizations wanted or expected. Yet, in each case, there was some degree of cooperation of grass roots activists taking over property with powerful, established organizations. In all countries the activists on the ground had protectors, although sometimes unenthusiastic ones, at the higher levels.

6. Among the elites, the weaker party usually becomes the best ally of working people, who tend to be weakest of all the major players. Working people, as the weakest actor, usually have to join with the second place player of the moment to balance against the strongest.

7. In Nicaragua and Argentina, governments that are democratic with strong left parties in the political system, and in Cuba, a government that is authoritarian, but popularly based, made concessions to working people who occupied their workplaces. Although all three governments engaged in repression, they have thus far been unwilling to resort to mass terror. In order for working people to use the pervasive, low-key, rule breaking of squatter tactics, factory occupations and black market small enterprise, the Nicaraguan, Cuban, and Argentine officials had to have been willing to play the game.

8. In all three the shift from public to private industries disrupted production, and created questions about legitimate ownership of property. After working people disrupted property relations by taking over the land or the factories, they sought to obtain the strongest legitimacy possible for their claim. First they break down property rights, then they reestablish them. The authorities use the conflict between disruption and legitimation inherent in property seizures, to divide the movement.

9. Although the tactical importance of obtaining secure titles to worker controlled workplaces appears obvious after the fall of a popular government, or the passing of a moment of rebellion, supposedly sympathetic governments have dragged their feet on offering secure titles when they had the chance, and some of the progressive organizations dismiss legal titling as unimportant compared to the social struggle, at best, and too compromised with capitalist conventions at worst. The most important strategic lesson is that secure titles will be crucial, to fend off challenges to workers’ ownership, and to provide assurances to investors and lenders in order to obtain working capital.

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END NOTES

Orlando Nuñez. En Busque de la Revolución Perdida. Managua: CIPRES, 1992; Juan Morales. Interview by author. Managua: August 1992; Roberto Soza and Juan Morales “la sociedad social autogestionaria en Nicaragua.” L’Avispa (Managua), no. 8, 1992 .

René Mendoza. Interview by author at Nitlapán office. Managua 1997; Arturo Grigsby. Interview by author at Nitlapán office. Managua 1990.

Pablo Heller. Fábricas Ocupadas: Argentina 2000-2004. Buenos Aires: Ediciones Rumbos, 2004; Esteban Magnani. El Cambio Silencio: Empresas y fábricas recuperadas por los trabajadores en la Argentina. Buenos Aires: Prometeo Libros, 2003; Julián Rebón. Desobedeciendo al desempleo: La Experiencia de las Empresas Recuperadas. Buenos Aires: Ediciones Picaso/La Rosa Blindada, Colección Cuadernos de Trabajo No. 2, 2004; Lavaca Sin Patrón: Fábricas y empresas recuperadas por sus trabajadores: una historia, una guía. Buenos Aires: Cooperativa de Trabajo Lavaca Ltd., 2004.

Working people is defined as people who create value. Value is conceived in a way similar to Marx’s labor theory of value – producing socially useful goods and services, not bureaucrats, managers, speculators, or people whose primary source of income is unearned income such as interest or capital gains.

In determining whether a significant degree of workers’ control has been established, this study considers seven qualities. 1. Depth – Who is counted as a worker-manager? 2. Breadth - What functions do workers actually control? 3. Balance - How well are different sections and interests of workers represented? 4. Power – Do workers collectively have final say in decisions and in selecting and recalling leaders? 5. Activation – There can be democratic procedures, but if workers do not actively use them they could not be really in control. 6. Fairness – Includes honest vote counting, context setting, discussion procedures, and right to dissent. 7. Coordination – A fair, workable, system of coordination, amongst worker controlled units and other social and economic entities is necessary for workers’ control. The idea of workers’ control has an extended genealogy, from Pierre-Joseph Proudhon, Karl Marx, anarcho-syndicalists such as César De Paepe and the International Workers of the World, the factory committees of the Russian Revolution, the Italian workers’ councils analyzed by Antonio Gramsci, Anton Pannekoek, Paul Mattick, Spanish anarchists, G D. H. Cole’s guild socialism, John Dewey, the Mondragon cooperatives of Spain, the autogestion of the French May 1968 uprising, Ben Bella in Algeria, The Port Huron Statement of Students for a Democratic Society, Sandinista experiments, initiatives by Michael Gorbachev, and cooperatives in Cuba.

Carlos Vilas. The Sandinista Revolution. Translated by Judy Butler. New York: Monthly Review Press. Citing Ministerio de Planificación, Ministry of Planning, MIPLAN in Nicaragua, 1986.

Jaime Wheelock, Interview by author with Marvin Marenco. Managua, May 28, 1997.

CIERA (Centro de Investigaciones y Estudios de la Reforma Agraria), Participatory Democracy in Nicaragua. Managua, 1984.

Wheelock, Op. cit.

CIERA, pp. 103 – 104, Op. cit.

Wheelock, Op. cit.

CIERA, pp. 112 – 116, Op. cit.

Susi Rivas, Interview by author at El Caracol factory. Managua, August, 1992.

Martínez, Oscar (ex-union general secretary) Interview by author at El Caracol factory. Managua, August, 1992.

"El Caso del Caracol," El Tayacán, (Managua) 10, (386): 28 April, 8 1991.

Cesar Aragón. Interview by author at El Caracol factory. Managua, August, 1992.

Aragón, Martinez, Rivas, “El Caso del Caracol.” Op. cit.

“El Caso del Caracol.” Op. cit.

Martinez, “El Caso del Caracol.” Op. cit.

Gutierrez Altamirano, Flor de María (El Caracol worker). Interview by author at El Caracol factory. Managua, August, 1992.

Wheelock. Op. cit.

Cristóbal Kay. “Conflict and Violence in Rural Latin America.” In Working Papers Series no. 312 (February). [website]. Available from
http://adlib.iss.nl/adlib/uploads/wp/wp312.pdf.
Paper delivered at Annual Congress of Asociación de Investigación sobre América Latina, Hamburg, 24-27 Nov. 1999, 35-36. Citing Peter Utting 1992 “The political economy of food Pricing and market reforms in Nicaragua, 1984-1987.” The European Journal of Development Research, 4 (2): 107 – 131, and Laura Enriquez, 1991 Harvesting Change: Labor and Agricultural Reform in Nicaragua , 1979-1990. Chapel Hill and London: North Carolina University Press, 2000. NICA School Report Esteli, Nicaragua September. 2-5. Photocopy, 1989.

Kay. Op. cit.

Enriquez, 1991. Op. cit.

Kay. Op. cit.

“Movimiento Cooperativo” Barricada, July 24, 1989. Cited by Nica School Report. Op. cit.

Nitlapán-Envío team. “All Threads Lead to the Property Tangle.” Envío, no. 189 (April): 6, 1997.

Envío team. “Privatization: Left, Right and Center.” Envío, no. 124 (November): 21-34, 1991.

Julie Cupples. p. 299. “Ownership and Privatization in Post-Revolutionary Nicaragua.” Bulletin of Latin American Research , no. 11 (September 1992.): 295-306. Citing Equipo Envío, "El debate de la propiedad revela la contradicción de fondo." Envío, no. 117 (July 1991), 4.

Jennifer McCoy, " Nicaragua in Transition." Current History, 90 (554): 120, 1991.

“El Caso del Caracol”. Op. cit.

Prado, Marta, 1992 Interview by author at El Caracol factory. Managua, August.

Barricada . 3 October, 1990.

Barricada. 1 October, 1990.

Barricada, 29 September, 1990; “El Caso del Caracol”. Op cit.

"Acuerdos de la Concertación" (complete text of the accords) 1990/91 L'Avispa (Managua) (December/January): 64.

Envío team, 1997. Op. cit.

Acuerdos. Op. cit.

Envío team, 1997. Op. cit.

CST (Central Sandinista de los Trabajadores) Second Congress, April 1992. 25-26. Informe General 1990-1992. Managua, July 1992; Nicaragua Network Educational Fund. n.d. Cites La Prensa, February 3, 1993; Barricada, February 3, 1993; and Barricada, April 2, 1993.

Nicaragua Network. Op. cit.

Spalding, Rose J. Capitalists and Revolution in Nicaragua. Chapel Hill and London: University of North Carolina Press, 1994, p. 140.

Equipo Nitlapán-Envío. “Nicaragua, Noticias del mes, Privatizaciones.” Envío, no. 187 (October): 2, 1997.

Blackburn, Robin. “ Cuba under the hammer.” New Left Review, no. 4 (July-August 2000), 5-36.

Laura Enriquez. 2000 “ Cuba’s New Agricultural Revolution” Food First Development Report, no. 14 (May), 6.

Deere, Carmen Diana, Niurka Perez and Ernel Gonzalez “The View from Below: Cuban Agriculture in the Special Period in Peacetime.” Journal of Peasant Studies, 21(2), (January 1994): 211-212. Mimi Whitefield 1993 “Rapid changes push Cuba into unknown.” Miami Herald, 27 September 1993.

Deere, et al. Op. cit.

Whitefield. Op. cit.

Enriquez, 2000. Deere, et al. Op. cit.

Enriquez, 2000. Op. cit.

Alonso, Antonio “The ‘Conuco.’” In GaciCuba [Website] August 3 2000. [cited 12 July 2005]. Available from http://www.gacicuba.net/conuco.htm.

Arturo Villar, “The Trials and Tribulations of Cuba’s Managers.” Wall Street Journal, 12 February 1999.

Philip Peters. “State Enterprise Reform in Cuba.” In Lexington Institute (July 2001) [Website]. Available from
http://www.lexingtoninstitute.org/cuba/pdf/enterprisereform.pdf.

Although farmers have engaged in protests in Argentina, they sought guaranteed minimum prices and tax abatements not expropriation of land.

Paul Blustein. Originally published in Washington Post August 3, 2003, “Argentina Didn’t Fall on Its Own”, appears in the Global Exchange website, updated April 1, 2005.
http://www.globalexchange.org/campaigns/wbimf/925.html, accessed June 6, 2006.

Ibid.

Sebastian Brett, Human Rights Watch.
www.hrw.org/reports/2001/argentina/argen1201-10.htm

Hector Tobar, Los Angeles Times, March 26,2002 “ Argentina’s currency takes a big fall.” Appears on San Francisco Chronicle website
www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2002/03/26/
BU241016.DTL&type=printable.

Larry Rohter. “Country Looks to New Leader”, New York Times, 25 May, 2003, appears in website of Global Policy Forum, www.globalpolicy.org/nations/launder/regions/2003/0527argentina.htm. Accessed 9 June, 2006.

María Celina Tuozzo. “As You Sow, So Shall You Reap.” (128 – 158) and Michael Snodgrass. “Topics Not Suitable for Propaganda.” (159-188) in Jonathan C. Brown, editor, Workers’ Control in Latin America , 1930 – 1979. Chapel Hill and London: University of North Carolina Press, 1997.

Jose Antonio Gutiérrez“Workers Without Bosses, Workers’ Self-Management in Argentina” in Red and Black Revolution (No. 8, Winter 2004) Workers Solidarity Movement online at
http://struggle.ws/wsm/rbr/rbr8/argentina.html
accessed 24 May, 2006.

Celia Martinez interviewed by Benjamin Dangl. “Worker-Controlled Brukman” on the ZNet website. 30 August, 2005. Accessed 13 January 2006.

Aldo Rico led two armed rebellions of junior military officers who opposed prosecutions for atrocities they and their comrades had committed during the Dirty War.

Marie Trigone. “Recuperated Enterprises in Argentina” in IRC Americas Program Citizen Action in the Americas, No. 19.
http://americas.irc-online.org/am/3158
17 March, 2006. Accessed 13 May, 2006.

index of papers