Socialist Worker

The two sides in the battle

Issue No. 1781

ARGENTINA'S CAPITALIST class is split down the middle on how to deal with the economic impact of the crisis that has brought dire poverty to millions across Argentina. The capitalists know this crisis is behind the uprising that toppled two presidents.

One section, which is linked most closely to the multinationals and the banks, believes that the country's currency has to be tied inextricably to its present value against the dollar. This is because it wants to be guaranteed that its income from profits and dividends will retain its value for use anywhere in the world. For this reason it is pushing strongly to replace the existing local money, the peso, with the US dollar.

It is not worried that the effect can only be to keep the country in its slump condition. Another section of the capitalist class, which owns locally based factories, wants to keep the peso and reduce its value against the dollar. It believes this will enable it to sell goods more cheaply and more easily abroad.

The result is likely to be rising prices at home, but it believes this will hit workers, not its own profits. In the past very high rates of inflation have often resulted in deep cuts in Argentinian workers' living standards. The new government has opted for a middle position that few people think can work.

It has announced it is printing a 'third currency', the argentino, to circulate alongside the peso and the dollar. Paying people with these is supposed to create a million new jobs. Workers and pensioners fear that the argentino will be worth little more than coupons, exchangeable at perhaps half their nominal value against the pesos or dollars needed to buy most things.

This means that the popular anger that exploded on the streets is not likely to disappear. Unfortunately there has not been effective leadership from the trade unions to mobilise this anger.

The unions did call seven highly effective one-day general strikes against the De la Rua government. But they were not centre stage in the demonstrations that overthrew it. This is because Argentina's main union federation, the CGT, is dominated by a powerful bureaucracy intent on bargaining for its share of the perks of power. It has strong links with the regional political bosses who control the Justicialist, or Peronist, party.

There were many tens of thousands of workers in the movement that overthrew De la Rua and Cavallo. Alongside them were very large numbers of the unemployed, whose pickets have blockaded main roads over the last year and, at times, virtually closed down the country.

There were also large numbers of shopkeepers, street traders and small business people whose lives have been devastated by the economic crisis. Finally, there were considerable numbers of the better-off middle classes, who have felt threatened by sudden impoverishment after a government decree restricting how much they could withdraw from their bank accounts.

The 'cross-class' nature of the demonstration found expression in the slogans shouted. These were against corrupt ministers and banks, but not against big business as such. People sang the Argentinian national anthem rather than songs that expressed any clear anti-capitalist feeling.

The new president Rodriguez Saá, had desperately tried to use these confusions to buy time for himself. One of the first things he did was to meet with the top leaders of the Peronist union. He joined with them in singing the Peronist hymn, and said he 'believes in the revolutionary passion of Eva Peron'.

But the support of the union bureaucrats for the president could not stop the new wave of protests. They were brought on by the failure of the new government to persuade the banks to pay out pensions, and by hostility to a key minister notorious for his corrupt past.

The protest culminated in the storming of the Congress building by youths, and President Saá announced his resignation last weekend.


Legacy left by Peron

THE TERM Peronism refers to the political current that has dominated the Argentinian workers' movement since an army officer, Juan Peron, took power in the mid-1940s.

Meat shortages in Europe provided Argentina with massive export earnings. Peron was briefly able to provide Argentinian bosses with high profits and Argentinian workers with high wages. He was also able to set up big new state-owned industries.

Union leaders loyal to his ideas established a strong hold over the working class, and there was a saint-like cult of his first wife, Eva. He was driven from power by the military in the early 1950s. But his movement remained a very powerful force, containing both left wing and near-fascist currents.

The Argentinian ruling class allowed him to return to the presidency in 1973 as the only way to control a massive wave of workers' struggles. He was succeeded in 1974 by his second wife, Isabel. Under the Perons, the right wing and the armed forces began their 'dirty war' against the left, with hundreds of murders.

In 1976 the military staged a coup and the death toll moved up to a figure of around 30,000. Peronism survived to maintain some influence.

This was because the rival capitalist party, the Radicals, proved incapable of offering people better material conditions, and a whole generation of the left had been physically annihilated.


Spectre haunts rulers

'TWO DAYS of demonstrations in the streets brought to an end some 700 days of erratic government which lacked any political support, let alone popular sympathy.

De la Rua was elected by a majority short of 50 percent in October 1999. His programme was full of promises to overturn the structural adjustment policies carried out by the previous administration lead by Carlos Menem. None of the commitments were kept.

In just over two years De la Rua managed to push the country from recession to depression. Unemployment rose from 18 to almost 22 percent. Out of a population of 35 million, 14 million are below the poverty line. Public spending was brutally cut to meet IMF goals.

After years of enduring this neo-liberal recipe, Argentinians took to the streets to put an end to this situation. Whatever party or coalition reaches the presidency will be haunted by this spectre. What has returned to the people is a lost sense of their own power.'

Feliz in Buenos Aires


What we think

Who has power to end crisis?

ARGENTINA IS often referred to as a Third World country because of its geographical location in Latin America. But it is much more an industrial than an agricultural country today, with only 12 percent of the workforce on the land.

The majority of its population are descended from fairly recent immigrants from Italy or Spain, who came to the country because it had a higher living standard than southern Europe.

It also has a long and militant tradition of working class struggle. In recent years there have not only been successive one-day general strikes, but strikes and occupations against redundancies and factory closures. The country also has a long socialist tradition, which was overshadowed for a number of decades by Peronism.

But since the 1970s there have been 'classist' (class struggle) tendencies in unions and key workplaces, and in recent local elections left parties got more than a million votes. That left now has to attempt to provide some leadership for the anger that exploded on the streets.

Millions of people are desperate for a change. Neo-liberalism cannot provide this. But nor can the nationalist doctrines which preach state intervention in the interests of workers and 'patriotic' employers alike. There can be no solution to the crisis facing workers and the impoverished middle classes without an all-out onslaught on big business at home, as well as the banks and the IMF.

That requires a revolutionary socialist strategy of struggling to take over the centres of economic power from below. It means seizing the factories and offices with the aim of replacing the anarchy of the capitalist market by democratic planning.

The key to achieving that is linking the bitterness on the streets and the collective power of workers in the workplaces. Otherwise there is the risk that as successive governments prove incapable of ending the economic crisis, right wing forces will emerge with their own reactionary slogans.


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