"The gravity of the situations does allow room for mistakes," proclaimed the new President who was former vice- President to Carlos Menem, governor of Buenos Aires and defeated Presidential candidate in election in 1999.
Duhalde and his backers are terrified that the effects of devaluation of the peso and maintain the embargo on withdrawing more than US$250 per month from bank accounts will provoke a "mega-cacerolazo" - mass banging of pots and pans - throughout the country.
Their fears are well justified. The main feature of the crisis in Argentina has been the tremendous power of the masses. The generalized popular uprising that took place on the 19th and 20th of December put the final nail in the coffin of the government headed by De La Rua-Cavallo which had provoked a series of struggles in the last couple of years.
Eight general strikes had taken place since De La Rua was elected in 1999. Mass picketing had blocked the streets; factory occupation and mass "cacerlazos" were the form of struggles used by the masses to unite employed and unemployed workers and other oppressed classes.
Adolfo Rodriguez Saa, elected President by the Legislative Assembly following the overthrow of De La Rua could not keep himself in power for more than one week. His populist rhetoric, his attempt to achieve a "cease fire" and open a dialogue with the mass organization of pickets, the trade union centers and the "Madres de la Plaza de Mayo" together with his promises to re-establish a minimum wage and create one million jobs all came to nothing.
Splits at the top of the regime cause by the mass pressure from below bought down Saa. The initial idea of calling elections in March and attempt to construct a Peronist government re-enforced by an electoral victory was too risky. Who could guarantee the country would quieten down? Who could guarantee that the Peronists would win?
Now the ruling class is trying to take the initiative, cancelled the elections and put Duhalde in power until 2003. The votes of the Peronists (PJ), the UCR and FREPASO, gave Duhalde a majority in the Legislative Assembly.
Duhalde has attempted to put together a "government of national salvation" that will overcome the divisions within the Peronists. (These include splits between De La Sota from Cordoba and other Peronist provincial governors that continue to defend the calling of elections and all other political forces). This is an attempt to find a way out of the dead end in which Argentina finds itself as a result of the economic crisis. Duhalde is attempting to balance between the different political forces in Argentina.
Some sections of the population initially hoped that a government of "national unity" would offer a way out but there is now no hope of this.
The possible capitalist alternative to Duhalde is not clear. The crisis of the Argentinean bourgeois regime has now reached an extremely deep point. With Duhalde in crisis it means that the three main candidates in the elections in 1999 (De La Rua, Cavallo and Duhalde) have been tested and rejected by the people. There are now few alternatives from the bourgeoisie.
The alternative from the "centre -left" such as API (Action for a Republic of Equals) around the Deputy Carrio is gaining more support because of his high profile in opposing corruption. In fact if new elections were held now it is possible that Carrio would win. He remains an "emergency reserve" for an even more desperate situation. Carrio (a dissident of the Radicals) and the ARI continue to defend the calling of fresh elections although he has not openly opposed Duhalde.
The socialist left in Argentina, despite being fragmented, won 1,5 million votes if the votes of the Humanist Party are included in the elections that took place on the 14th of October last year and has grown in support since then.
A unified candidate of the left, possibly headed by the Deputy Luis Zamora (ex-Deputy of the old MAS), would certainly win a big vote. One reason the vote for the left would grow because new elections would take place against the background of further mass mobilizations and the defeat of the government in the streets by the masses.
The poor will pay for the crisis.
The economic plan to be presented by the new Minister of the Economy, Jorge Remes Lenicov, will have a certain impact on the life of thousands of Argentineans. "We are disarming a bomb and any oversight could cost us our lives..," declared one of Lenicov’s team of advisers.
The plan that will be sent to the Congress will end the parity between the peso and the dollar; create a fixed exchange rate for exporters and importers of essential products and another flexible exchange for the rest of society. The government has also raised the prospect of state intervention in bankrupt companies.
The impact of the crisis has forced Dulhalde’s government to abandon "neo-liberal" policies and move back towards a more classical policy of Peronism of state intervention and support for Argentinean capitalism. These policies represent an abandonment of the "neo-liberal" policies of the 1990’s. However, under capitalism they will not solve the crisis or solve the problems facing the working class and other oppressed peoples.
There will be a reduction in purchasing power with the devaluation of the peso and price increases. The return to more measures of state intervention will go hand in hand with further attacks on the living standards of the masses.
With the devaluation of the peso of about 40% to maintain the fixed exchange rate the government will and agree a new pact with the IMF to guarantee a sufficient level of currency reserves.
In order to deal with the threat of an explosion in inflation following the unpegging of the peso to the dollar which will result in a further devaluation, without speaking of a generalized banking crisis, the government will have to maintain the limit on cash withdrawals from bank accounts for a longer period of time.
Although the devaluation of the peso will have a positive effect in stimulating exports, against the background of a world economic recession the perspectives for the Argentine economy are not very favourable. The measures taken will cost the working class and middle class forcing them to pay for the crisis.
Already there exists a situation marked by price increases and the collapse of the country. The most affected are exactly the most downtrodden.
"We do not want more of the same." was the chant of the days of struggle on the 19th and 20th of December. Duhalde represents "the same". The end of currency parity does not change the essence of the economic policy that will try and save the big speculators and punishes the workers. Sooner or later the masses will again return to the streets against the government policies.
A socialist alternative
The Argentinean economic crisis is not caused by the senility of De La Rua or the brutality of Cavallo. The model of "exchange parity" was based on neo-liberal funamendalism, which has completely failed. This failure is a reflection of the structural crisis of capitalism in the most brutal form in the in semi-colonial countries, which have been subjected to a recolonisation by imperialism.
There is no effective way out of the crisis that does not sacrifice the interests of the workers and the mass of the people and at the same time protects the privileges of the bankers, speculators and the rich. The only alternative that offers a way out without the poor paying the price for the crisis is anti-capitalist and socialist. This programme must be based upon:
- Non payment of the foreign debt to the big capitalists. There should be no illusion in the temporary suspension of payment to the foreign creditors. Nationalisation of the banks under workers control. Immediate releasing of resources of small and medium account holders.
- Massive investment in public services including health, education, social security and emergency projects of public housing and agricultural products.
- Re-nationalisation of privatized companies and nationalization of companies that lay off workers. Open the books to inspection and democratic workers control of production.
- Reduction of the working day with no reduction in wages and a decent minimum wage for all.
- A Democratic Socialist Plan of Production based on the nationalization of the major monopolies to be implemented by a workers government.
- The dissatisfaction with the economic situation will provoke new mobilizations. The socialist left must clearly reject and oppose the parliamentary coup that the installation of Duhalde represents and campaign for a continuation in the struggle by the masses.
- The masses need to take to the streets again and the trade unions must call an indefinite general strike to overthrow Duhalde and force the convening of new elections to a Constituent Assembly to transform the economic and political basis of Argentina and establish a workers’ government.
- These demands of the day in Argentina only can be realized with the independent organization of all oppressed layers - workers, unemployed, the youth, pensions and students. Rank and file committees with elected delegates from all workplaces need to be organised to take the struggle forward and distribute food to the hungry from the big super markets on an organised basis.
- A national assembly of workers delegates, public employees, unemployed, and students needs to be elected. All delegates should be subject to recall and not receive any privileges.
2002 began with a revolutionary crisis in an important country like Argentina. This process is deepening in the face of a crisis of capitalism and represents a failure of neo-liberal policies and renewed struggle by the working class.
A new mass workers party must be built with a revolutionary socialist programme to overthrow capitalism and imperialism in Argentina. A new workers government with a socialist programme would be able to appeal to the working class throughout Latin America, the USA and internationally for support and begin the struggle to establish a Socialist Federation of the continent. Only such a programme and perspective will end the misery and poverty that capitalism means for the workers and poor in Argentina today.
The movement in December
Argentina, in the last few weeks has passed through a situation with clear elements of a classical revolutionary crisis. The high point of the mass movement was December 19th. Massive contingents of unemployed, under-employed led assaults on the super markets to take what was necessary to feed their hunger. Hundreds of such raids took place throughout Greater Buenos Aires.
The bourgeoisie immediately attempted to repress this movement. De La Rua declared a State of Siege against the "vandals" and "robbers".
The middle class has been pauperized and have adopted the methods of struggle of the workers and unemployed.
The "cacerolazos" of the 19th of December followed by mass demonstrations of workers, unemployed and sections of middle class forced Cavallo to resign. Very soon the demonstrators were chanting, "All of them must go - not just one".
On the morning of the 20 th of the December the battle of the Plaza de Mayo began. Tens of thousands of demonstrators confronted the police in an attempt to reach the Palacio de Governo. The youth played the key role in this confrontation. Amongst them were the "motoboys" - young motor cyclists who are amongst the most exploited group of young workers. At the end of the day which resulted in nearly thirty deaths and hundreds of injured or taken prisoner, De La Rua resigned and was forced to flee the Casa Rosada by helicopter.
The lack of any leadership from the trade union confederations resulted in an unorganised and dispersed intervention by the working class in this struggle. Both the CGT and the CTA ended up by calling off a general strike and were not present at the most critical stage of the conflict.
At the same time some sections of the leadership of the National Assembly of Pickets were also absent because of a wrong, passive estimation of the movement. The movement also took a big part of the socialist left parties by surprise.
It was at this moment of revolutionary crisis that the oppressed workers were drawing deep political conclusions of their own experiences. The bureaucratic leadership of the CGT was strongly criticised by the activists in the protests. In many localities the poorest sections began to organise themselves autonomously and called the protests themselves.
The pro-longed process of struggle culminated in the "December Days" was based upon the mass actions of the working class - strikes, occupations, mass pickets etc. These powerful demonstrations by the working class drew behind them the middle class and provoked splits amongst the ruling class. It plunged the bourgeois political regime into crisis and created the conditions for a genuinely revolutionary way out of the crisis.
The crucial element necessary to develop this process is the building of a genuinely revolutionary socialist alternative. The building of this alternative is now the key task of all those who do not want to see the death of the "Argentinazo" (Argentine uprising) and ending is virtually nothing.
It is to assist in the building of this socialist alternative that the CWI intervened in the recent protests in Argentina and will mobilise its parties in solidarity with the Argentinean workers.
Argentina - Unprecedented Social Disaster.
Argentina has been in a continual recession since 1998. GNP fell by 4.3% in this period. Between 1949-1974 GNP grew by 127%. Between 1974 and 1998 by 55%
There has been a brutal collapse consumer consumption. Unemployment and under-employment is now over 30% of the population. 37% of the population live below the poverty line.
Every hour of every day 30 more people fall below the official poverty line.
Every 4 minutes 1 person is made redundant. 200 small towns and villages are on the point of disappearing because of the economic and social collapse.
The Elections in October 2001.
At national level 30% Abstained despite voting being compulsory.
The Governing Alliance lost 5.4 million votes and won only 22% of the votes cast.
The opposition Peronists became the largest party but with 1.2 million less votes compared with the elections in 1999.
Blank and "white votes" combined totalled 20% - 5 times the level recorded in 1999. More votes were cast blank or "white" than for the government alliance. Bland and white votes took second place nationally and first place in the Federal Capital.
8% at national level went to different ’Socialist’ and ’Left’ parties electing three deputies to the National Congress.
The combined vote of the all of the left/socialist candidates was just over 1 million and three socialist deputies were elected to the federal parliament.
In Cordoba the ’socialist ’ parties won more than 90,000 votes and 9 deputies were elected to the provincial parliament.
From ‘Socialismo Revolucionario’ Brazilian Section of the CWI.