Buenos Aires, 21 March: Curious onlookers gather in the busy Avenida Callao as a group of men and women begin to pull down the hoardings in front of the giant Bauen Hotel. Two policemen look on from the other side of the road, but do nothing. The 224-room hotel has been closed for over a year, and those clearing the building’s entrances are its former doormen, telephonists, maids and event organisers.
After a year of fighting unsuccessfully in the courts for compensation and the months of salary they are owed, the Bauen’s workers have decided to form a cooperative and reopen the hotel under their own control. On its facade are hung various banners: one says ‘occupy, resist and produce – hotel recovered by its workers’; others belong to the informal neighbourhood assemblies and the National Movement of Recovered Enterprises (MNER). ‘Imagine the quantity of meetings and conferences we could host here,’ says one of the Bauen‘s workers as she walks through its empty corridors.
Seizing the day
Since Argentina’s financial system and economy collapsed in December 2001, such scenes have become quite common. More than 160 factories and other enterprises have been occupied by their workers and are now being run as cooperatives. These form the backbone of a new, emerging social economy: peasants and farmers are producing organic food, charcoal and other goods; while unemployed groups are involved in artisan projects, bread factories and vegetable gardens. Alongside all this productive activity there has also emerged a web of distribution networks, markets and retail centres.
The factories and enterprises occupied include the enormous Zanon ceramics plant in the barren Patagonian province of Santa Cruz, the Brukman textile factory in urban Buenos Aires, the IMPA aluminium plant, various health clinics, pizzerias and restaurants and small workshops producing everything from high-quality books and catalogues to ice cream, mozzarella cheese and biscuits. Some 10,000 people are now working in these cooperatives.
Usually, the occupations come about either as a result of the outright bankruptcy of the companies concerned, or because the firms owe months of salary to their staff or have begun to sell off key parts of equipment as a prelude to shutting themselves down.
Snowed under with a pile of unpaid debts, the management of the Brukman plant left a meeting called to discuss unpaid wages and simply disappeared. Then, just days before the ‘cooking pot revolution’ that led to the resignation of Argentine president Fernando de la Rua on 20 December 2001, Brukman’s almost entirely female workforce decided to camp out in the plant until management showed up again. After two weeks of waiting the workers began telephoning Brukman’s wholesalers to check whether they were still interested in purchasing the plant’s products (mainly men’s suits). Brukman’s machines were soon back in action and sales were supplemented by ‘solidarity buying’ of everything from school uniforms to aprons by Buenos Aires’s neighbourhood assemblies. The 50 workers quickly restored their wages to their 1995 level and paid off the plant’s outstanding electricity debts. A month later, after it had become clear that the factory was doing nicely without them, Brukman’s owners reappeared and attempted to retake control of the plant. They were, not surprisingly, shown the door.
Brukman worker Celia says: ‘The problem for the owners is that we have already tasted the forbidden fruit. We know how much materials cost, how much is sold, how much is earned. We know how to run a factory.’
In accordance with the model outlined above, the occupation of the Zanon factory came after months of unpaid wages and machines running at a fraction of capacity and the lay-off of most of the plant’s staff. Production has since partially recovered, and the plant’s 270 workers are being paid regularly. Zanon has also become the first occupied factory to take on new workers – 20 people from local unemployed organisations.
Fighting the law
While the act of taking over a factory or business can be exhilarating, the associated problems can be daunting. The occupiers often face endless legal challenges from former owners and creditors; of the latter there are as many as 400 in the case of Zanon. Because of Argentina’s complex and often corrupt legal system, this can lead to dawn raids by riot police which can then lead to major stand-offs as the workers mobilise political and legal pressure to overturn occupation orders.
Workers spend so much time fighting off such challenges that they barely have time to work. The experience of living and sleeping within the workplace and the constant fear of invasion have taken a heavy toll psychologically on the Brukman workers, for example. Their attempts to head off eviction have involved mobilising thousands of people on two occasions, and workers chaining themselves to machinery and factory gates.
Legal problems can effectively leave occupied plants in limbo. ‘As we are not legally registered as a company, a lot of big clients won’t buy from us for tax reasons,’ says Kiko from the Zanon plant.
While some worker-occupiers like those at Zanon and Brukman are campaigning for the government to take over their plants (but with ‘worker control’ remaining intact), most have happily formed themselves into cooperatives. Some have managed to get legislation passed that effectively puts them in control of their plants. Article 17 of the Argentine constitution stipulates that the government can expropriate property and transfer it to the cooperatives when it is in the ‘public interest’ to do so. And the MNER is pressing for the introduction of a law that will stipulate that companies that go bankrupt will pass automatically to their workers.
In addition to these legal battles, workers who take over factories hardly ever have any working capital with which to invest in raw materials and maintenance or to pay salaries. At the Bauen Hotel the management took the computers, telephones, curtains and most expensive pieces of furniture before they left. At Zanon the workers need to invest a large amount of money in repairing one of the plant’s main kilns.
On top of this, the slump in Argentina’s economy continues unabated. While the newly occupied businesses save on high salaries and dividends paid to management, there is no guarantee that they will do any better commercially under workers’ control than they did previously.
A new social solidarity
It is here that Argentina’s social economy comes into play. The workers at the Zanon factory are producing special lines of ‘Mapuche’ ceramic tiles. The tiles are named after the indigenous tribe that lives on lands around the surrounding province, and are based on traditional indigenous patterns. Zanon’s sales are now being managed from Buenos Aires by the Madres de la Plaza de Mayo human rights group. The Madres have been campaigning for 20 years for information about relatives who disappeared during Argentina’s military dictatorship of the 1970s and 1980s. They now aim to take advantage of their extensive international contacts to export Zanon ceramics to the world. They also have a team of legal advisers who are trying to lift the various court orders that weigh upon Zanon. In March the Madres scored their first success when they agreed a wholesale deal for Zanon with Argentina’s Easy DIY chain.
‘We have an agreement to sell Easy 140,000 square metres of ceramics that is worth about 1.5 million pesos a month,’ says Sergio Schoklender from Rebellion and Hope – a kind of management consultancy for social enterprises set up by the Madres. ‘Our next aim is to start exporting through the international contacts that the Madres have.’ Another two Zanon product lines, called ‘Stones of the South’ and ‘Factory without Bosses’, have also been launched.
But there are more radical experiments also underway. Towards the back of an occupied pizza restaurant in the run-down neighbourhood of Parque Avellaneda some 30 people sit huddled in a circle. They are members of the Commission for a Social Economy – a coordinating group that brings together delegates from dozens of Buenos Aires neighbourhood assemblies.
Alberto from the Nuñez Saavedra assembly says: ‘What we are attempting to do is identify different links in the productive process that are in the hands of the social movements, and then build bridges between them and create new enterprises to fill the missing links.’
One of the social economy commission’s tasks is to carry out inventories of supplies to occupied factories to determine whether they can be provided by other occupied plants or neighbourhood and unemployed groups. Where alternative supplies cannot be immediately arranged, a feasibility study is carried out to see whether a new cooperative can be formed to produce the goods. Some of the initial projects for new production include a cooperative to make solar panels and a scheme involving previously unemployed workers to refurbish old and broken computers for use in social enterprises.
‘The idea is to articulate the production of the different groups so that instead of buying supplies from a big capitalist company the enterprises can supply themselves through cooperation,’ says Alberto.
Embryonic forms of this kind of organisation can already be seen at work. Peasants from the Mocase peasant organisation in the state of Santiago del Estero provide charcoal and yerba mate (a South American herb) to unemployed groups in the impoverished suburbs of Buenos Aires. These goods are then used in communal kitchens. Mocase receives some money and goods in kind in return. The Brukman factory supplies school uniforms for needy children. The Chilavert press prints newspapers, radical posters and pamphlets for most of the Buenos Aires social movements. An enormous bread factory is being recovered by local assemblies and patients of the crumbling Borda mental asylum. The factory can produce around 25,000 kilogrammes of bread per day – enough to supply most of Buenos Aires’ communal soup kitchens. And a group of neighbourhood assemblies, sympathetic doctors and former staff occupied the Portuguesa Clinic in September 2002 and found nearly all of its equipment (including a fully equipped intensive care unit and operating theatre) intact. The idea is to put the clinic in action again and use it as the basis for a new system of healthcare for workers in the occupied enterprises. These workers are currently without any kind of coverage at all.
The social economy commission intends to take things one step further. It is creating a special solidarity ‘brand’ and logo that will identify goods that have been created by cooperatives and social movements. The brand will testify to the quality of the goods and the decent working conditions in which they were produced.
As well as being distributed through the neighbourhood assemblies and barter, the produce will be sold in occupied supermarkets like the Tigre and Cayetano stores in the industrial city of Rosario and Buenos Aires province, respectively. The commission recently took over a large empty building and passageway in the bustling Palermo neighbourhood of Buenos Aires, and neighbourhood assemblies and unemployed groups are now selling their goods there at a weekend ‘solidarity market’. The commission is also attempting to set up a wholesale market in the capital for organic vegetable producers from the suburbs and surrounding countryside. And it already distributes a ‘solidarity bag’ with food products from a series of different social enterprises.
In addition, the commission has created a sophisticated website that will attempt to provide an online inventory of social enterprises’ output and supply needs in a bid to bring about an ever higher level of integration between the two. More complicated is the search for resources for the new projects that need to be put into action so as to cement the social economy. As many of the participants in the social enterprises have been unemployed or unpaid for months, there is almost no scope for investing even in the minimum of raw materials needed to begin production. This is despite the fact that unused buildings and machinery are widely available. Argentina’s private, foreign-owned banks are unlikely to lend to cooperative enterprises with no commercial or legal history. Local interest rates are prohibitive. And the government demands political favours at election time in return for any loans or grants it may issue.
The social economy commission is currently discussing setting up an investment fund that would guarantee a lower but stable return on investment, and which could plough money into different enterprises according to need. The aim is to attract investment to the fund from sympathetic Argentinians both inside the country and in the large diaspora in Italy and Spain. Clearly, the social movements do not intend to allow their enterprises to become miniature versions of the companies which they have supplanted. Nor do they intend to make decisions on purely market considerations. Indeed, many of the new enterprises make little sense outside of the context of social upheaval and change that led to their formation.
‘It’s the difference between selling fake Nikes or leather shoes made by the unemployed groups,’ says Alberto. ‘All this will only make a difference if it is informed by a profound spirit of transformation.’Or as Jorge Muracciole from the Espacio de Proyectos assembly puts it: ‘There is no point forming a cooperative just so that small groups of people can make money. What we are trying to do is produce new practices, new forms of cooperation, that will allow people to work outside of relationships of dependency.’
Ben Backwell is a freelance journalist based in Buenos Aires
This article first appeared in the Ecologist May 2003
