Monday, October 26, 2009

When Govenment Attacks a Union

This is exactly what has been done to education.....underfunded for years...then a case is made for failure, and privatization!!! Lisa

Studies have revealed that the Central Light Company

hasn't been funded for years, in preparation to make the

case that it's nonfunctional. A 2005 report showed that

the company had not installed new generating capacity

since 1974.

Privatization of the parastate company lurks behind the

liquidation on October 10. Marchers carried signs that

warned "Today it's us - tomorrow PEMEX [the national oil

and SEP [the education system]," and "No to


-----Original Message-----

Subject: Mexico's Union Bust Reveals Flaws in NAFTA

Mexico's Union Bust Reveals Flaws in NAFTA

Laura Carlsen

Foreign Policy In Focus

October 22, 2009

Fernando Lopez woke up on a Sunday morning out of a job.

For the electrical worker, the feeling was terrifying.

"From one day to the next, they left us with no job -

nothing," Lopez said, as he marched alongside some

200,000 fellow workers and their supporters in downtown

Mexico City on October 15.

On the night of Saturday, October 10, thousands of

soldiers and federal police moved into position in the

darkness. After cutting fences and forcing out the

workers, they occupied over 50 installations of the

state-owned utility company, Central Light and Power

(Luz y Fuerza), awaiting the administrative blow that

would follow. At midnight, President Felipe Calderon

issued an executive decree to liquidate the company and

its union, the Mexican Electrical Workers Union

(Sindicato Mexicano de Electricistas - SME), one of the

strongest and most vocal independent unions in the


The move had been carefully prepared by the government.

Troop movements throughout the central part of the

country serviced by Central Light went unnoticed under

cover of the massive mobilization of security forces

fighting the militarized drug war.

The decree follows a union conflict that the government

fueled and then took advantage of to eliminate the

company and its union. Union elections last June were

contested amid rumors that the federal government was

actively fomenting division. In a warning sign, on

October 5 the Secretary of Labor, Javier Lozano,

rejected registration of the new union leadership

without waiting for a decision from the labor tribunal.

The "Sabadazo," or Saturday Offensive, took place when

the union and the government were still in talks.

NAFTA and the Battle Over Who Will Pay For the Crisis

I talked to Lopez because of the simple poignancy of the

bright green sign he carried: "President Calderon - Your

children eat well. Mine don't."

Similar signs read, "And now what do I do? What will my

family eat?" Marchers revealed that the political issues

of privatization and opposition to the Calderon

government are prominent in the movement but above all,

workers feel that their very survival is under attack.

The ravenous right has set out to prove that it's not

the rich who will pay for the crisis. One of the

arguments for eliminating Central Light and its union

was that it employed too many people, making it

"inefficient." For the Calderon government, offering

decent employment to more than 40,000 families is a

crime in a year when unemployment has doubled and nearly

800,000 Mexican workers have lost jobs due to the


The Mexican economy is at a crossroads as it faces a

multi-billion dollar deficit this year. Due to its heavy

dependency on the U.S. economy under NAFTA, it is the

hardest hit country in Latin America and predicts a 7.5%

drop in GDP for 2009. The number of poor has increased

above pre-NAFTA levels, leaving millions more families

in poverty, while the unemployment rate has doubled.

The congressional leader of Calderon's National Action

Party, Mario Alberto Becerra, estimated that even after

doling out severance pay, the government will save money

through the reduced costs of operating Central Light.

The government plans to use some of that money for hand-

out programs for the poor, a model it considers

preferable to maintaining unionized workers in jobs.

Treasury Secretary Agustin Carstens announced that the

42,000 SME workers will be replaced with 10,000 new

hires. He didn't say any would be hired back; the

message was clear - union members need not apply.

Obama promised a renegotiation of NAFTA to incorporate

the toothless labor side agreement into the text and

integrate core International Labor Organization

principles in defense of workers' rights. At the recent

Summit of North American Leaders he said that the

promise has been placed on the back burner. But that

burner seems to be turned off. At an October 19 meeting

between trade representatives of the three NAFTA

nations, they reaffirmed their commitment to the trade

agreement with no mention of renegotiation.

Unionized workers are not the only ones who suffer.

NAFTA has displaced some two million Mexican small

farmers in the countryside due to competition with U.S.

agricultural imports. A recent ruling of a NAFTA

tribunal delivered a record ruling of $77.3 million to

Cargill Incorporated to compensate the company for a

government program that blocked the use of corn syrup to

save Mexico's sugar industry - an industry heavily

protected in the United States. NAFTA's investment

provisions (known as "Chapter 11") allow corporations to

sue governments under special tribunals as one of the

many privileges offered transnational corporations under

the agreement. This obscene ruling to one of the world's

wealthiest agrobusinesses illustrates the priorities of

NAFTA and the constant erosion of worker's rights and


When NAFTA was being negotiated in the early 90s, many

U.S. unions still considered Mexican workers the enemy

of their members as unfair competition in an

increasingly globalized workforce. That attitude has now


An October 15 declaration of the AFL-CIO states:

On behalf of over 11 million working women and men of

the United States, the AFL-CIO condemns this unilateral

action by the Mexican authorities, which effectively

destroys the SME and the trade union rights of the Luz y

Fuerza workers. Regrettably, the Mexican Government has

employed similar acts of intervention and repression

against the Mexican Miners and Metalworkers Union.

The AFL-CIO supports the following demands of the SME

and of the Luz y Fuerza workers to reverse this

egregious act of union-busting and violation of

internationally recognized standards of freedom of

association and collective bargaining: 1) a revocation

of the government decree unilaterally liquidating the

company; 2) an end to the occupation of the power plants

by the Federal Police; 3) the implementation of good-

faith negotiations between the Mexican Government and

the Union on the relevant financial and administrative


The Road to Privatization

Studies have revealed that the Central Light Company

hasn't been funded for years, in preparation to make the

case that it's nonfunctional. A 2005 report showed that

the company had not installed new generating capacity

since 1974.

Privatization of the parastate company lurks behind the

liquidation on October 10. Marchers carried signs that

warned "Today it's us - tomorrow PEMEX [the national oil

company] and SEP [the education system]," and "No to


The Central Light Company leases over a thousand

kilometers of fiber optic cable in its electrical

network that it planned to offer to consumers in a

"triple play" package. This combined service of

electricity, telephone, internet and cable threatened

existing economic interests and lucrative future

contracts in the private sector.

Although the Calderon administration has said it isn't

privatizing the state-owned enterprise, SME leader

Martin Esparza revealed that two former secretaries of

energy, Fernando Canales Clarion and Ernesto Martens,

have formed a private company to use the publicly funded

LFC fiber-optic network for internet and voice services,

called WL Communications. Esparza reports that the

businessmen have already negotiated government discounts

and subsidies for the lucrative enterprise.

For now, Central Light has been fused with the Federal

Electricity Commission that manages services in the rest

of the country. The suspicion is that the consolidated

state-owned utility, stripped of a feisty union that

rejected both privatization and the erosion of worker

rights, will eventually be privatized. Pressures to

privatize state-owned enterprises, including the oil

company PEMEX and aspects of the education system, have

characterized the Calderon administration and those of

his predecessors from the PAN political party. The

pattern is familiar - the majority of Mexico's

billionaires made their initial fortunes off state

privatizations under scandalous terms during the Salinas

administration and since then they have formed a

powerful lobby for further privatizations, along with

international finance institutions like the World Bank.

SME member Juan Carlos Saucedo notes that the struggle

to regain the company and the union "is just beginning."

But it will be an uphill battle. The union has demanded

a legal review of the measure and insisted that it

violates the Mexican Constitution. It is currently

working with other unions to possibly call a general

strike. Following the mega-march, the federal government

agreed to open up dialogue with the union, but the talks

were broken off on October 19. The government discarded

any future possibility for negotiations on reversing the

presidential decree and the union declared the dialogue

a "farce," since for them preserving their jobs is the

top priority.

As SME member Apolinar Romero stated at the march, the

issue at hand goes beyond income for workers and rests

on "what kind of future we will leave our children." A

unilateral move to eliminate a union and a state-owned

company sets a terrible precedent for union-busting in

the nation.

Interviews in the Mexican press with government

officials reveal that the obliteration of the union was

carefully planned for over six months. The Calderon

government was just looking for the chance. Ironically,

it was the profound economic crisis in Mexico that

provided the Calderon administration with its

opportunity. 76,000 businesses have closed their doors

over the past months. The Mexican daily La Jornada

reports that 2.8 million workers have lost their jobs in

the Calderon administration. For families living on the

edge, the blow against the union places them between a

rock and a hard place.

Members of the National Association of Democratic

Lawyers and the Latin American Association of Labor

Lawyers stated in a press conference on October 18 that

the decree violates 25 clauses of the Mexican

Constitution and urged workers to file injunctions

against the measure instead of accepting severance pay.

But each day that passes with no wages sees more workers

accepting the government's severance offer.

The administration has launched a campaign to malign the

union, implying that the union members had manipulated

cushy jobs at the expense of consumers. Consumers know

the administrative problems of Central Light, with

unexplained charges in light bills and impossible

bureaucracies. These administrative problems could

easily have been solved long ago, but by analyzing

administrative faults and revamping systems - not

liquidating the company and its union. Official

statistics show that union members made an average of

around $500 dollars a month, and 20,000 members earn

below this level, hardly a princely wage. What the union

did manage to achieve for its members in democratic

processes and benefits was an example for Mexican


The real question is who will pay for the crisis. The

Calderon administration tried to force through a tax on

basic foods and medicines in the federal budget -

another move to make the poor pay for the inordinate

wealth and privilege of the elite in a vastly unequal

nation. It was blocked at the last minute.

The U.S. government, instead of helping to provide jobs

and labor protections as Mexico sinks into the deepest

crisis in recent history, has concentrated aid in the

Merida Initiative to corrupt Mexican armed forces and

police through the war on drugs. It also continues to

support NAFTA's skewed terms.

It's time to develop a more integral and humane

binational relationship and renegotiate NAFTA. The long-

term effects of allowing this crisis to erode labor

rights and further impoverish an already stricken nation

will only lead to instability throughout the region.

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