Get Rid of the Lot of Them! Argentinean Society Stands Against Politics

Horacio Tarcus, translation by Adolfo Olaechea

Vol 1 #25, Winter 2002

The Collapse of an Economic Model

The extraordinary social protests that erupted in Argentina last December were a reaction to the corralito regulations. Corralito literally means fencing and refers to the restrictions imposed by the government on the withdrawal of bank deposits at the beginning of that month. This measure was the last impotent throw of the dice by a bankrupt economic model. This model, blessed by the IMF, was established by the neoliberal economist, Domingo Cavallo, in 1993, under the neo-Peronist regime of Carlos S. Menem. It remained in place during the two years of the Radical government of Fernando de la Rúa, when Cavallo was also the Minister of Finance.

One of the pillars of this model was the so-called ‘convertibility’, which pegged the Argentinean Peso to the US Dollar and established a parity rate of ‘one peso to one dollar’. Following the traumatic hyper-inflationary experiences of the 1989–1991 period, the monetary stability afforded by convertibility conferred long years of legitimacy to the Menem government and his super-minister Cavallo. For the salaried, retired workers and pensioners, incomes (fixed and in pesos) would not continuously erode. For the middle classes, it meant a chance of keeping their savings in dollars, buying imported products at artificially low prices and travelling abroad. For the local bourgeoisie, it signalled an opportunity to undertake spectacular business deals.

Some sectors, however, were driven to the wall: for example, local producers such as the textile manufacturers unable to compete against imported products while the dollar was artificially undervalued, or the traditional farming industries, which saw the value of their exports decline for the same reason. However, a new ‘export/finance’ bourgeoisie did grow at breakneck speed under the wing of political power. The apparent success of stability, the consumer boom and the emergence of the newly rich pushed issues such as the Menem government’s absurd levels of corruption, and the scandalous submission of the judiciary and parliament to the executive, into the background. Even though these were the main political themes for the opposition, they only confronted the government from a democratic institutional and ethical stance, and the Menemists were therefore able to respond with the legitimacy of efficiency. That was sufficient for Menem to get re-elected in 1994, following constitutional reform.

Nevertheless, another hidden iceberg was the asset stripping by the state deemed necessary to pay for its economic model. The Menem/Cavallo regime began an extraordinary process of privatising the patrimony of the state. Thousands of millions of pesos – received from the sale of oil and gas fields, railways, airlines, telephone networks and the metropolitan underground transport systems – silently financed the model, supplying the dollars needed to keep up the ‘one to one’ convertibility. Within the framework of monetary stability and convertibility, Menem’s offer of the state’s industrial and service companies was more than tempting for international investors who did their billing in overvalued pesos and then returned their profits abroad, having exchanged them into dollars. It was a fabulous business indeed. But, at the end of the day, the model was financed by the creation of chronic indebtedness.

Of course, the model had its winners and its losers, the latter consisting mainly of the low-paid and the unemployed. However, it did work for the first five years with the support of the middle classes. Finally, after several years of recession, the system broke down in December 2001, causing the most serious social cost imaginable. Given that it was inevitable, the escape from convertibility to a clearer system could have been achieved in a negotiated, gradual and less traumatic fashion. Also, convertibility could have lasted many more years. This would have required the government to shift the economy from a deficit into a substantial surplus by collecting outstanding taxes, investing productively and promoting exports.

The collapse of convertibility occurred because it became impossible for the state and private sector to obtain any more credit to paper over the ongoing monetary deficit. In permanent expansion, this deficit had three causes: firstly, the public deficit generated by gigantic tax evasion and a state pension system covered by external loans; secondly, the private deficit generated by the incapacity of local industry to compete in the global market; lastly, the accumulation of interest on contracted loans feeding back into the public deficit.

The prohibition on withdrawal of cash from the banks was a side effect of the wave of speculation which started when the masses of depositors realised (several months after the banks that had taught them not to think beyond the parameters of convertibility) that the rate of exchange was unsustainable and that dollar funds were at risk. Efforts to avoid the collapse of the banks led the government to embargo the savings of hundreds of thousands of depositors and caused the collapse of both internal savings and external credit. The collapse of economic activity resulted in a spiral of bankruptcies, wholesale layoffs among the work force, as well as a new drop in salary levels.

Given all this, the collapse of convertibility is a by-product of a type of profit generation and a form of relationship between the state and the private sector, based upon the most parasitic and primal tendencies of capitalism. Companies harvested monopolist rents from the internal market, totally unsupervised by any form of user, or consumer, organisation. These companies subsequently exchanged these profits into dollars sold to them by the state at bargain basement rates. This was an ultra-inefficient role for the state, incapable of planning or using resources to fulfil socially valuable criteria and subjected to the individual demands of companies and economic blocs.[1]

Crisis of the State

In parallel with the economic crisis, an unprecedented crisis of the state has developed. Without doubt, this is also the result of 25 years of persistent neoliberal policies aimed at reducing the state’s capacity to regulate, so as to ‘liberate’, market forces. Left to its own dynamics, the ‘invisible hand’ of the market led to something slightly different from the ‘productive revolution’ promised by Menem in 1989; it led to a truly unproductive revolution. If any doubt remained, today it is clear that there is no place for Argentina in capitalist globalisation. In the space of a few years, one of Latin America’s most prosperous countries had gone from role model to basket case.

The fragility of the state is such that it hardly seems to exist at all; it lacks all substantive attributes and does not perform any of its essential functions. For instance: In the matter of guaranteeing compliance with the law, the De la Rúa government fell when the population challenged the state of siege. In maintaining public security and issuing and supporting its currency, not only the public, but also certain state institutions keep their reserves in dollars abroad. In collecting taxes, the Argentinean system is completely regressive; the Argentinean bourgeoisie does not pay and has never paid their taxes. In safeguarding property, consider the way the property of the bank depositors has been dealt with. In defending the unity of the country, the former Governor of San Luis Province, who was president of the country for a few brief days after the fall of De la Rúa last December, recently began to speak about ‘secession’.

A Rebellion of the Middle Classes?

Having said all this, I would suggest that the classical system of analysis, which holds that ‘an economic crisis gives rise to a sequel of political crisis’, does not address all the nuances of the current scene in Argentina. Moreover, the equation – economic model in crisis + seizure of depositors’ savings = sudden mobilisation of the ‘middle class’ – not only devalues any analysis but, in fact, distorts it.

During the events of 19–20 December, a new social protest movement was born in Argentina. The direct trigger was the run on the banks of 30 November and the economic measures that followed the fencing of bank accounts and fixed-term deposits. This led many observers to point out that it was the middle class that propelled the social protest of December, and hence it was dubbed a ‘French Revolution’ in the mass media and other quarters.

There is no question that the fencing of bank accounts directly affected and maddened the small and medium sized depositors, and that the lack of ready funds did the same to shopkeepers and other traders. However, it also affected, directly or indirectly, all workers as well as the retired and other recipients of state or private pensions. A special characteristic of the social protest was that very diverse types were swept along with it: unemployed workers and youths who had never been employed, ordinary workers and retired workers, small depositors, shopkeepers and other traders.

Did the working class stay away? It was not visible in its classic trade union guise of marching columns. One should say, then, that it was the trade unions that were not present in December. This was particularly true of the two factions into which the Peronist CGT (Confederación General del Trabajo) is divided: the hard-liners and those in favour of the government. The more militant CTA (Central de Trabajadores Argentinos) was also slow to come on board.

The massive demonstrations in the Plaza de Mayo or in the Plaza del Congreso (Parliament Square) lacked the characteristics of traditional mass actions accompanying general strikes, with each worker marching under the banner of his own union, political party or union tendency. There is no doubt that the workers took part in these events, but they did not come out into the streets and squares in organised columns. They came alone, or at most in small groups, and were then amassed by way of some sort of molecular dynamics.

The spontaneous character of the mobilisation and the deliberative role adopted by the groups that swarmed the street corners and squares in the various neighbourhoods were – in that sense – reminiscent of the mass mobilisations of Holy Week, 1987. However, those were mass actions either to support or to put pressure on – according to the different tendencies – the democratic government in the face of a military rebellion. Today, 15 years later, the scene is different. In a country in ruins, a popular uprising has overthrown a government impotent in the face of national and global economic power. Cavallo was the symbol of that economic power, De la Rúa the embodiment of an impotent government.

Social Dynamics of a Political Crisis

On 19 December, within a few hours, the masses that began by demanding the resignation of Cavallo, the Minister, were demanding the resignation of De la Rúa, the President. And, along with the ghostly round of presidential musical chairs that occurred between the end of December and the first days of January, the cry ‘Get rid of the lot of them’ increasingly became the slogan of the different sections involved in the social protest.

According to a Buenos Aires newspaper from early December,[2] the government believed that, by somehow relaxing the bank fencing regulations and by granting a measure of ‘social welfare’, the protest would start to die down. This suggests that the so-called political class believes that, even if a revival of social enthusiasm for politicians cannot be effected, society can at least return to its passive, sceptical state.

The problem is that, while the present political crisis blew up days after the introduction of the bank fencing regulations, it results from a social process with much deeper roots. For example, the elections of 14 October 2001 – with their towering levels of absenteeism and invalid and spoiled ballot papers – had already given expression to a very serious political crisis blowing across the whole of Argentina. These (non)voters were once believers. Aware, now, that they had been defrauded, they had lost faith in politics. Up until the events of Argentina’s ‘hot summer’, their protest was almost individualistic, an impotent expression of political discontent.

Taken together with the secession of a younger generation, brought up in a world in which politics was devalued, these elections could have been used by politicians to give collective and political meaning to individualised discontent, but the political class and the mass media had, for many years, glossed over these phenomena. On polling day, its impact could no longer be ignored. Barely two months later, and ever since, the so-called protest vote has ceased to be something passive and has turned into mass action; it has moved beyond the polling booth and into the streets.

The aspirations of different sectors within this movement converge, with aspirations being partially modified and adopting new meanings in the process. Horizontally, the crisis is cutting across diverse social and political strata. Men and women, old and young, employed and unemployed, pensioners and people in active service, wage earners and bank depositors, union members and non-union workers are all converging into a movement in which the only common denominator appears to be the desire to ‘Get rid of the lot of them!’

The demand has spread like wild fire and is chanted at all public demonstrations. There is no doubt that it is less naïve and more complex than it appears at first sight. It expresses the libertarian protest of society against the state and all its institutions, from parliament to the police, as well as the entire official mass media. It is the protest of the little people, the common men and women, against a political class they now perceive as a parasite preying on society.

Antonio Gramsci defined a political crisis in terms that may be useful today: ‘At a certain moment in their historical development, social groupings divorce themselves from their traditional parties. This means that traditional parties, given the organisational form they embody, with those specific persons who constitute, represent and lead them, are no longer recognised as the appropriate expression of their class or of a section of a class.’ For the Italian thinker, in ‘these situations of contrast between the represented and their representatives’, the political crisis ‘is transmitted to the entire organism of the state’. Gramsci held that such situations could arise ‘when the leading class had failed in some political enterprise for which it had demanded or compelled by force the consent of the wide masses’. He pointed out that these situations could also arise ‘alternatively, because a broad mass of people […] went suddenly from political passivity into a certain activity and proceeded to make demands that in their chaotic whole amounted to a revolution’.[3]

Gramsci’s ideas seem to offer useful angles from which to consider the crisis in Argentina, where the evacuation of content from the political parties was extended to the entire organism of the state. From 1984 to the present, the ruling class of Argentina has repeatedly failed to create its hegemony – a social order that the masses would at least accept. The masses, in turn, moving beyond the protest vote, have extracted themselves from political passivity and gone on to win the streets and the public spaces.

However, we are far from what Gramsci understood by the term ‘revolution’. We are a little bit closer than we were on 18 December 2001, but a protracted process of collective building lies ahead of us. If, as Rosa Luxemburg believed, the crisis is the expression of the fact that the old is dying but not yet dead, and the new is being born but not yet out of the womb, we have crisis ahead for a long time to come.

Today, the state is waiting for a certain erosion to occur from so much social mobilisation, so that it can try to punish all those who violate Article 22 of the National Constitution, which states that ‘The people do not rule or deliberate except by means of their representative’. This is precisely how Senator Raúl Alfonsín (a Radical Party leader, President of Argentina between 1983 and 1989) put it in his speech of 21 February last year in the Senate.

It is a fact that Peronists and Radicals are holding consultations, seeking a legal framework to curtail mobilisations and escarches (impromptu mass protest meetings) so as to return the masses to their jobs and homes. They aim, by means of depoliticising society, to put politics back in the hands of the state. However, President Eduardo Duhalde warned them that, ‘If this ever gets interpreted as a self-serving corporate law, or as a barrier to the democratic freedom to demonstrate, we will be throwing petrol on the flames.’[4]

In other words, it is currently impossible to repress society by declaring it to be in rebellion just because people are holding public discussions and articulating a wish for self-government, while patently repudiating their so-called representatives (‘Get rid of the lot of them!’). Nevertheless, a latent threat to the movimientos piqueteros (picket movement) and the neighbourhood assemblies exists. On 26 June this year, during ferocious police repression of a picket in Avellaneda on the outskirts of Buenos Aires City, two unemployed youths, Darío Santillán and Maximiliano Kosteki, were gunned down.

Picket Movements and Neighbourhood Assemblies

The villas miseria offer a postcard image from the Menem decade; these are the cardboard shacks of the homeless, hardly noticeable when one is driving fast along the highways. However, this view changes when the unemployed climb onto the tarmac to form a ‘picket’, burning tyres and blocking traffic while bellowing out their battle cry of ‘Piqueteros, carajo!’ (The Pickets are here, damn it!)

While it is true that pickets interrupting traffic is something that goes back a long way in the history of Argentina’s workers’ strikes, the characteristic feature of the new pickets is that they are made up of the unemployed. The movement was born in 1996 in Neuquén province, when Menem was still president. There, the sacked workers of YPF, the state oil company, erected a blockade on a key highway. It was born of dire necessity, a desperate measure to directly force the government – bypassing the patronising structures of church or political parties – to give the strikers access to planes trabajar (the state’s monthly unemployment allowance of 150 pesos, around 40 dollars today). Once the planes were granted, the picket was lifted and, from then on, ‘misery became socialised’.

Five years on, the movement has spread like wild fire all over the country, gaining momentum with the tempo of the crisis. The picket movement is not limited to blockading highways; a remarkable solidarity network has grown up alongside it. It is a network that runs communal kitchens, allotments, school supplies, health centres, libraries, etc. Each ‘picket-man’, collecting his 150 pesos, must survive for the whole month on that money, less the three pesos he pays to the movement. That money goes into a common fund for the organisation’s expenses. Moreover, they are obliged to help at the Picket Action Centres for four hours a day from Monday to Friday. The pickets run a horizontal organisation, but, nevertheless, some leading figures do arise. The leaders are members or former members of the leftist movements, but the rank and file has no political formation of any kind. They come to the pickets driven by unemployment and hunger. The most militant and hardline sections are the least inclined to negotiations and the most anti-politics in outlook.

There are three tendencies in the picket movement: The first one is affiliated to the CTA, and one of its leaders, Luis D’Elía, who comes from the militant wing of Peronism and currently leads the Federación Tierra y Vivienda (Land and Housing Federation). Its other leader, Juan Carlos Alderete, is close to the CCC (Corriente Clasista y Combativa) which is linked to the Maoist Party (PCR). A second tendency, the Bloque Piquetero, is an umbrella for the picket groups linked to the left-wing political parties, such as the Polo Obrero, run by the Workers Party (Trotskyist), and the Movimiento Territorial de Liberación, run by the CP. However, the most important current in this bloc, the Movimiento Teresa Rodríguez, led by Roberto Martino, is independent. The third tendency, and perhaps the one most independent and remote from the world of political parties, is the Coordinadora Aníbal Verón. The two picketing youths assassinated by the police on 26 June belonged to this organisation.

While this movement was born prior to the mobilisation of December 2001 and in its aftermath, it began to garner more popular support and to grow spectacularly. At that time, two new movements were also born: firstly, the movement of the bank depositors demanding the return of their funds, and, secondly, the movement of neighbourhood assemblies. The former, while basically limited to the middle classes, has not lowered its banners during nine months of mobilisations. But the latter, without any doubt, is the most novel because of its organisational form and its collective discussions on street corners and in public squares. In this movement, citizens of all ages, walks of life, professions and social extractions, hitherto uninterested in public affairs and hardly ever bothering to vote, are now debating what is to be done about the serious crisis in the neighbourhood hospital or school. They also discuss how to tackle the problems of security – without giving more power to the police. Each assembly, in turn, sends its delegates to an assembly of assemblies, the Interbarrial (Inter-Neighbourhood Assembly).

Just as they do within the picket movement, strong tensions exist between the independents – non-party members who generally have no previous political experience and who are much more ‘horizontal’, more libertarian and more averse to political/institutional ways – and the old left-wing movements seeking to seduce those social strata. A programme of ideas and action for a left that is open to criticism, for a left that is in tune with the era, should, among other things, try to help strengthen pickets and neighbourhood assemblies. It should try to ensure their democratic operation and to enrich their political culture. The left-wing currents that take part in these movements would benefit from this, too, because this type of participation would rebound upon them, raising their own political culture and their internal democracy. There areleft-wing groups that dream of the neighbourhood assemblies playing the role of ‘Soviets in embryo’. Many attempt to sneak in their slogans or boast about how much they exert control over these assemblies. Maybe there are sections of this militant left who are overlooking the libertarian mettle the social protest is demonstrating. The political crisis is affecting left-wing organisations, too, in good measure, along with their leaders, their apparatuses and their instrumental approach to politics.

It is not simply his own weakness in directing the transitional period that has dictated the President’s call for early elections in March 2003. Eduardo Duhalde, who was invested by Congress as President, is precariously supported by a makeshift federation of Peronist governors who, in turn, are involved in serious wrangling amongst themselves. The decision to bring the elections forward was also dictated by a need to diffuse the mobilisations and social protests.

The electoral calendar and the tempo of the social movement are not in tune. The left vacillates between taking part in a process – where it sees the prospect of increasing its vote – and marching alongside the most militant sections of the social movement, those who are rejecting the government’s call for elections.

So what is to be done? ‘Get rid of the lot of them!’ say some. Others respond: And then, what happens? Take part in official politics? Reject all politics? Create a different type of politics? These are the issues being debated today by the social movements and the left-wing groups in Argentina. At the same time, there is talk of rejecting politics and politicising society. The state is rejected, but at the same time there are demands for education, health, security, social policies. There is rejection of paternalism and of the substitution of the self-led actions of the masses by a political leadership, all within a vacuum of political leadership in general. Argentinean society has transformed itself into a great Assembly. There is a willingness to talk and also to listen, to learn and to build. There is no better moment than the present for the birth of a new collective will. A new left.

Footnote 1:

See Ricardo Aronskind, 2002

Footnote 2:

'Talks between Duhaldeism and the UCR seek to avoid attacks on politicians', Clarín, 3 December 2002.

Footnote 3:

Gramsci, 1962, pp. 76-7.

Footnote 4:

Clarín, 3 March 2001.