DIY Argentina

The police still come once a month to empty the illegally occupied hotel, and might have succeeded by now if not for the hundreds of European tourists filling the available rooms to capacity.

In 2001, a victim of a quarter century of neoliberalism, the Hotel Bauen, went bankrupt and closed, firing all of its workers, many of whom went without work for a full year. Today the former lowest ranking staff — cleaning people, dishwashers, and receptionists — run the enterprise democratically, without a management hierarchy and with a nearly flat wage scale.

The cooperative owners took a vacated hotel with no rooms ready for guests, and transformed it, investing over a quarter million pesos in new beds, televisions, and a new restaurant on the ground level. Today, the enterprise employs 50 more people than when the workers opened it, and will continue to need more workers as they finish renovating the remaining 20% of unopened rooms over the next three months.

Hotel Bauen is one of more than 170 companies, ranging from bakeries to auto parts factories, that were once bankrupted and abandoned and have now become thriving worker-run empresas recuperadas, or “recuperated companies.” In a nation where around 1 in 5 are out of work and many remain frustrated and distrustful toward the government, this kind of do-it-yourself movement has gained considerable support.

It used to be that Argentina was considered the prosperous “Europe of Latin America.” But years of brutal dictatorship in the 1970s not only caused the death or “disappearance” of thousands of individuals, but also destroyed the economy. Years after the economic crisis began in 1976, democracy returned and the country began to take on various neoliberal economic policies of the IMF. But then, in 2002, Argentina reached the “inflexion point.” Unemployment reached 21.5 percent. During 2002 and 2003 poverty rates remained over 50 percent. One banker with whom I spoke said about 90 percent of Argentine companies went bankrupt during the crisis, with the failures concentrated in the industrial sector.

Beginning with the dictatorship, a succession of administrations have followed neoliberal economic doctrine, privatizing state services, introducing labor “flexibility” laws, and ending subsidy or tariff programs designed to protect local businesses. When traveling around Buenos Aires to talk to the workers of the cooperative factories, I rode private buses, private subways, and used privately sponsored street signs to find my way. The Argentine state is dead.

Yet daily needs have persisted, and workers across the nation decided that they did not have the option of unemployment, and chose to continue working even if their bosses were no longer handing out paychecks. Over the Argentine winter (that would be summer here) I spoke with workers in eleven cooperatives, including Hotel Bauen.

Most workers are not revolutionaries, yet their participation in this nationwide trend is revolutionizing the politics and economics of the nation, particularly in the Buenos Aires metropolitan area (Gran Buenos Aires), where the vast majority of the empresas recuperadas are located.

The first empresa recuperada in Capital Federal, the capitol of Argentina and the center of Gran Buenos Aires, was the Cooperativa de Trabajo Vieytes, Ltda., also known by the former private company’s name of Ghelco, a sweets company that produces candy, fudge and ice cream. The former owners of Ghelco told the workers the factory was closing as the crisis worsened, then hired new workers at lower wages.

When the veteran Ghelco employees learned that the factory was operating under new, low wage conditions, 43 of them occupied the sidewalks around their former place of employment, preventing the new workers or owners from entering. More than two months later, the owners and creditors abandoned the factory, and in July a judge ruled that the constitutional right to employment allowed the workers to reopen the factory as a cooperative.

On July 14, 2002, the 43 former employees of Ghelco formed the Cooperativa de Trabajo Vieytes, Ltda., and began production with an 800 peso loan from Union y Fuerza, an empresa recuperada from the Province of Buenos Aires. Since the recuperation of the factory, 10 new workers have joined the cooperative as production has grown. Cooperativa Vieytes now has clients in Spain, Brazil, and Uruguay, as well as in Argentina.

Wages have increased along with production, and the workers earn more now and receive better benefits than they did with the private company. They have achieved these successes without management; the old managers left with the owners. Moreover, they have expanded production without the incentives of graduated wage scales; all socios, or members of the cooperative, receive the same pay.

Many Americans have so internalized the virtues of specialization and individualized material incentives that we find it difficult to conceive of any other system. The capitalist organization exists through natural law, we are taught. In Argentina, I found a different set of natural laws that produced radically different results.

Manuel Ruiz, a maintenance worker in Vieytes, told me that he works harder under the cooperative, both because he is an equal part-owner and because of the material rewards. Since the cooperative’s founding, he has bought a house and a car, neither of which he could afford with the private company. Another employee told me his pay is three times higher in the cooperative than in the private company.

Manuel also appreciates the cooperative benefits. If he needs to stay home with a sick child, or if he is sick himself, he still receives full pay for that day. The cooperative provides medical insurance as well. He has 15 days of paid vacation per year. Finally, Vieytes has regular training workshops to train workers in their positions and in other skill areas so that its workers are better prepared for a variety of labor every successive year.

The daily conditions of work have improved as well. When Manuel needs some coffee or te mate, a common tea drunk in Argentina, he is free to make some. When he has finished his maintenance work, he goes and works in other parts of the factory, helping other workers.

While I was talking with Manuel, Jose, the security guard and communications director, was helping on the assembly line. Several Vieytes socios told me that they can produce more when they have flexibility in the factory. When the bosses were here, if they finished their task they would pretend to continue working to avoid appearing lazy. Now they find other workers in the company who need help.

Because all employees learn how to do multiple jobs, there is never a work slowdown or stoppage because somebody is unable to come in to work. The flexibility of daily labor also is a constant training program for all the workers, and represents an investment in human capital that may pay individual dividends should the factory close one day. This departure from the Taylor model of “scientific” labor organization is a humanizing process; every worker plays an integral role in the factory, and could not simply be replaced with a low skilled worker to fulfill a single task on the assembly line.

Given the dignified working conditions and economic security of working at Vieytes, it is not surprising that the socios work harder. One finds evidence of the efficacy of their commitment to the factory in a large new contract with Nestle, which will allow the cooperative to invest in several new machines and continue to expand production.

Socios of Cooperativa de Trabajo B.A.U.E.N. demonstrate the same level of commitment to their enterprise. When 38 former employees first occupied the closed hotel in March of 2003, none of the bedrooms were ready for guests, and half the first floor was closed off. Initially, the cooperative could only rent out the “salons” on the second floor for birthdays and other parties. Using that money, they began to renovate and open the rooms one by one, while architecture students from the University of Buenos Aires built a bar in the formerly closed off portion of the first floor.

By the time I visited Bauen, 80 percent of the rooms were open, the bar was busy all the time, and there was a constant stream of visitors flowing in and out of the hotel. The hotel was so busy that the only time I had the opportunity to speak to most workers was during their lunch break. The socios and socias of Bauen are fiercely proud of their hotel. They have created 80 new positions of employment as they have opened more rooms, and rejuvenated a potent symbol in Capital. Presidents, soccer stars and other notables used to stay in the hotel, and from the workers’ perspective the reopening, renovation, and improvement of Bauen represents broader possibilities of economic recovery for Argentina.

That future is far from certain. These co-ops are largely illegal. Though the government has set up an office to help those who want to reopen closed businesses, legal battles continue between owners and workers. There have been clashes with police over eviction notices at a few factories.

The former owner of Bauen has allies in the city government who have refused to expropriate Hotel Bauen for the workers as they have with dozens of other cooperatives in the city. So the Bauen workers hold demonstrations every few weeks and are working with a variety of leftist and centrist government Diputados (deputies, or legislators) as well as a grassroots collective of cooperative factories to promulgate a law of expropriation that will make it legal for workers to reclaim abandoned factories and continue running them.

If the movement of empresas recuperadas is going to continue to generate secure, dignified employment for Argentina, the regional and national governments will have to become more active in expropriating additional factories and also by instituting credit or subsidy programs. While some cooperatives such as Vieytes and Bauen can self-capitalize, some cannot, and in the absence of loans from banks, the government will have to provide either credit or subsidies to some cooperatives.

While the government of Capital Federal has instituted a subsidy program in coordination with faculty from the University of Buenos Aires, the amount of money is small and is inadequate to capitalize some empresas recuperadas with antiquated machinery. Moreover, some delegates from the city government are aligned with reactionary forces, including the owner of the Hotel Bauen.

If rightist forces recover in upcoming elections, owner seizures of worker-run factories could become a possibility, although the owners are currently poorly organized, with their political power dependent upon personal rather than organizational connections. Thus, today there is not a concerted governmental effort in Capital Federal, much less at the national level, to support the empresas recuperadas, and a reversion to a neoliberal paradigm would pose a grave threat to the cooperatives’ existence.

Finally, until the national government reforms the bankruptcy laws to place workers and creditors on equal standing, future bankruptcies will probably result in abandoned factories rather than functioning sources of work and production.

Regardless of the government response, however, the current success of the cooperatives in generating employment in the face of the worst crisis in Argentine history speaks to the human potential to envision and create a future based on human needs. Rather than accepting the dictates of a dehumanizing economic model, the cooperative workers of Argentina are building an economy based on human necessities, a model from which an increasingly polarized and impoverished American society could learn.

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