Economic collapse in Argentina: Workers must fight for their class interest

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From the 20th of December to early January the economic and social chaos in Argentina was headline news. The economy went into free fall, the population took to the streets and five presidents came and went within as many weeks. These events expressed a spectacular worsening of the economic, social and political crisis in Argentina. This article seeks to analyse the main implications of this situation for the working class.

The Argentinean economy is totally bankrupt: it has been in recession for the last three years, and now the level of debt represents more than half of the GNP. Three quarters of export earnings are eaten up by simply paying the interest of the $150 billion foreign debt; unemployment affects half the active population. Argentina is a country which in the space of ten years has gone from hyperinflation to hyper-debt. After three years of recession and the “salvage” plan of 2000 the IMF refused, last November, to unblock billions of dollars that had been promised. Without this money to service its gigantic debt, the government imposed a “little bank holiday”: people could now only take out a maximum of 1000 pesos a month. Savings and wages were kidnapped by the state itself. After three years of recession, three years of galloping unemployment, poverty, job insecurity, after wages and pensions being cut month after month, people are now faced with their bank accounts being confiscated by the state. Everywhere, economists, experts, all sorts of hacks, are putting forward their analyses of Argentina’s particular misfortunes (seeing the cause in corruption, domination by US capital and similar symptoms). But whatever analysis it puts forward, the bourgeoisie’s “solution” is the same as always: to make the proletariat pay, to exploit it even more. Wherever similar economic disasters have taken place, be it South East Asia, Russia, Turkey or Mexico, such “new plans” have amounted to nothing more than the same old trick.

Argentina is no exception; rather it is a forerunner of what is going to happen throughout large areas of the world.

In Argentina’s case the IMF is doing all it can to avoid it contaminating neighbouring countries and even Europe. The IMF has made it very clear that it would be suicidal to provide the bottomless pit that is Argentina with new loans. Such actions would indeed only spread the disease of hyper-debt. Therefore, the only way to proceed is, as always, to squeeze the workers and non-exploiting classes even more.

At the same time, the IMF, as the representative of the western bourgeoisie, has to put up a wall against its particularly corrupt and arrogant Argentinean counter-parts. If in March 2001 there were three finance ministers within 10 days, now within the space of 15 days there have been 5 presidents one after the other! All of these have used every nuance of Peronism, from the comic populism of Rodriguez Saa who promised “the immediate stoppage of debt payments” this “to be followed by a million jobs”, to the dyed-in-the-wool populist Duhalde who was the Peronist candidate against De La Rua and who now criticises “all the stupid and corrupt who have got us into this mess” referring, amongst others, to his former buddy Menem.

The unpegging of the Peso from the Dollar

Along with the blocking of savings, the new government decided to unpeg the peso from the dollar, which means that two “floating” pesos are worth a dollar. This measure has been presented in a very demagogic way: it is necessary to stop the flight of capital; thus for those who want to buy dollars, 1 peso will still equal 1 dollar. On the other hand, in order to buy foreign goods, it will be necessary to use the “actual” peso, which is worth much less. The result of this for a population where pauperisation is already widespread is price increases for essential necessities. The “miracle worker” Cavallo (former Economics Minister) who invented “dollarisation” ten years ago in order to strangle hyperinflation, was brought back in to strangle hyper-debt. Now the self-same Cavallo can be thanked for the return of inflation and an increase in the cost of living, along with a freeze on wages. However, it is clear that today the situation is even worse. And, what is more important, the entire world economy is now in open recession.

The working class must not allow itself to be drowned by the other social layers

Over the last three years unemployment and insecurity has increased daily for the working class in Argentina. Today the degradation of its living conditions has gone into freefall.

But another aspect of the Argentinean crisis is the pauperisation of what the sociologists call the “middle class”, the pride of the Argentinean “nation”. By this they mean shopkeepers, small business people, the liberal professions (these petty bourgeois layers are often then thrown into the sociological mix with state employees, who are mainly workers). The “little bank holiday” of accounts was a serious blow for the Argentinean petty-bourgeoisie, which was already impoverished, bitter and desperate. The confiscation law has hit them with full force. Nevertheless, they have to be seen for what they are: the “middle class”, not the proletariat. The hunger riots, the looting of supermarkets and lorries transporting basic foodstuffs, the “cacerolazos” (the banging of saucepan lids as a sign of protest by demonstrators) have been clearly marked by the presence of these social layers. Most of these events have been called by their organisations: in Cordoba, the violent demonstrations were organised by the PME. In Buenos Aires, alongside the shopkeepers have been the lawyers who have led the demonstrations against the “corrupt judges” of the Supreme Court.

It’s true that the initial impetus behind the looting of supermarkets often came from the poorest strata in society, which included many proletarians. But in the first place such actions in themselves are not characteristic of the proletarian struggle, since instead of focussing on the collective appropriation of the means of production and distribution, they centre round the individual acquisition of consumer goods. In the second place, both the looting and the subsequent demonstrations came to be heavily dominated by the petty bourgeois elements, so that the workers could not affirm their independent demands and interests. The weight of the middle classes was symbolised in the loud displays of nationalist flag-waving on many of the demonstrations.

The working class in Argentina thus finds itself in a very difficult situation. Faced with an enormous attack on its living standards and a veritable social and political crisis, it has so far been unable to assert its own class interests or its confidence in itself as a distinct social force, and has been swept along by a growing tide of directionless anger.

The proletariat in Argentina is certainly one of the most combative in Latin America. Since 1968 there have been a number of upsurges of militancy. In 1969 workers in Cordoba - the second biggest city - took control of the city for several days. In the 1990’s and even in 2001 there have been general strikes involving hundreds of thousands of workers. And in the last year or so there has been a movement of unemployed workers in Argentina, which has seen assemblies of unemployed workers seeking to organise their struggle. These assemblies have also attracted employed workers. It also appears that prior to the December/January events there had been a growing number of strikes among numerous sectors.

However, despite this combativity the working class in Argentina has been unable to push back the attacks of the bourgeoisie. As well as suffering from the general blows against proletarian self-confidence inflicted by the campaigns against communism and the advancing decomposition of capitalist society, it has also had to battle against more specific ideologies: the democratic illusions inherited from the period of military dictatorship, the populist myths of Peronism, the poison of nationalism (the strength of which was demonstrated by the ability of the hated military junta to mobilise support for the absurd Malvinas adventure in 1982). The unions also have a strong ideological weight in the class. Whilst many workers don’t trust the main union, the CGT, which is run by the Peronist mafia, these state organs are still able to mobilise hundreds of thousands of workers in general strikes. Whilst democratic illusions may have been weakened by experience, with many workers now distrusting all bourgeois politicians, this distrust is being channelled into inter-classist protests about corruption, against the IMF etc.

The very serious nature of the difficulties facing the working class in Argentina is exemplified by a recent event. On Friday the 11th January 600 “piqueteros”, composed of a group of very combative workers and unemployed, gathered in front of the Buenos Aires Central Market to load crates of provisions into lorries in order to take them to workers’ neighbourhoods when they were attacked with sticks by a group of a thousand, underpaid, porters from the Central Market. They were chased into fields where many were beaten and seriously injured. This is not just an anecdote. As an Argentinean newspaper remarked “The confrontation between the exploited and the starving pathetically syntheses the foundations of the Argentinean crisis, the beating up of the “piqueteros”, in order to drive them away from the Central Market by a group of porters”. Here we have a tragic conflict between, on the one hand, the “piqueteros” who have dissipated their combativity in the blocking of roads and other radical actions without any result; and on the on the other hand, the porters manipulated by the Peronist unions as shock troops of Mafiosi politicians.

Today, faced with the situation of poverty which confronts it, the anger of the working class in Argentina is being dissipated amongst a morass of futureless social layers. To claim to help the working class by becoming over-excited about this movement and by uncritically applauding an inter-classist popular revolt, because it appears to be against the interests of the bourgeoisie, is to push the proletariat even further into the arms of the decomposing petty-bourgeoisie. This is precisely the role being played by the leftist groups inside and outside Argentina, particularly the Trotskyists who claim that there is already a revolutionary situation in Argentina (1).

It is only through developing its struggle on its own class terrain, affirming itself as an autonomous class with its own means of struggle - massive strikes and demonstrations around demands common to all the exploited - that it will be able to integrate into its own struggle the other social layers who are victims of poverty and capitalist austerity. And in the longer term, struggling on its own terrain is the only way that will allow the working class to put an end to its misery, through building a balance of force in its struggle that will allow it to overthrow capitalism on a world scale. Only the affirmation of its revolutionary perspective will enable the proletariat to build another society based not on exploitation and profit and the laws of the world market, but on the satisfaction of human need. And it is only in a world communist society that the distribution of the means of consumption will be effectively developed for the whole of humanity.

In this sense, revolutionaries have to be clear; their role is not to console their class, but to insist that it defends its own perspective and its own interests, to put it on guard against the dangers that menace it. In particular, the proletariat cannot allow itself to be lead astray by the inter-classist revolts and democratic illusions.

As we have always made clear, this revolutionary perspective depends essentially upon the development of the struggle of the most concentrated and experienced battalions of the world proletariat, and above all, those in the old Western Europe. Due to their long experience of the traps of the democratic state, of the parliamentary games and union manoeuvres, only the proletariat of the most industrialised countries can open the gates to the international generalisation of struggles and the ultimate overthrow of capitalism. It was in old Europe that capitalism was born and created its own gravedigger. It is in this part of the world that the proletarian giant will deliver the first decisive blows.

To openly acknowledge the difficulties facing our class has nothing to do with ‘Eurocentrism’ or ‘indifference’ towards the workers in the peripheral countries. We cannot hope to succeed against our enemy unless we make an honest appraisal of the strengths and weaknesses on our side of the class barricade.

PN 20.1.02

(1) The leftist and anarchist press has talked about the emergence of “popular assemblies” or “neighbourhood assemblies”, even of assemblies of delegates from these organs. We do not have enough material at our disposal to define the class nature of these organs. Certainly their territorial nature, in the present situation where the working class is finding it so hard to struggle independently, would make them highly vulnerable to the influence of non-proletarian strata, when they are not creations of the leftists pure and simple. But to claim, as the leftists do, that these are embryonic soviets, is to indulge in a false radicalism which serves to prevent the workers from measuring the true scale of the task in front of them.