On Wednesday, ten of thousands of teachers rallied in La Plata, the provincial capital of Buenos Aires province, to reject a government pay offer. The protest marked the 11th day of their walkout.
Argentine teachers have mobilized, carried out work stoppages and school occupations across that nation since the beginning of the month. Since March 5th, teachers’ walkouts took place in 19 of Argentina’s 24 provinces and in the federal capital city of Buenos Aires.
The teachers’ strike was met with police repression in the northeastern province of Misiones on March 5th, as security forces attacked strikers with pepper spray. One teacher had to be hospitalized and there were several arrests. “We marched to this spot,” declared Beatriz Martinez of the Pedagogical Liberation Movement, “and when we attempted to rally, we were attacked by the police.”
This week, job actions continue in Misiones, La Rioja, Chaco, Neuquén, Salta, Jujuy, Corrientes and Chubut.
The Buenos Aires educators are demanding an increase of 35 percent for base salaries and parity with provinces that pay more, such as Córdoba and Santa Fé. At a March 19th rally, teachers also reported that they are not always paid on time and that health benefits continue to deteriorate.
The federal government of President Cristina Fernandez de Kirchner (CFK) initially offered 22 percent and a 2000 peso “attendance” bonus. The latter would only benefit those teachers with good attendance, and could not affect pension formulas. The president asked the provinces and the unions to hold the line. Public education in Argentina consists of provincial systems that depend in part on federal subsidies for the wages of public education workers.
On Tuesday, Buenos Aires governor Daniel Scioli proposed an immediate 21.9 percent increase followed by 9 percent in August. Scioli also threatened to discount teachers for each day that the strike continues and to force the teachers to end their strike through the courts.
The Federation of Buenos Aires Educators rejected the proposal and indicated that under the terms of the decree only one fifth of the teachers would receive the government offer—those teachers at the bottom of the pay scale—while the others would get 21 or 23 percent in two parts.
Conscious that other national negotiations with public and private sector workers are in the pipeline, the CFK administration is attempting to draw a line in the sand, a test case that will set the pattern for this year’s national wage negotiations with unionized workers.
The government initially threatened to impose its will on the teachers by decree, setting an example for the provinces to follow. Those promises that rely less on federal subsidies have already negotiated wage increases of 31.6 for Córdoba and 40 percent for San Juan and Santa Cruz. These raises are all in two parts, significantly weakening their impact given the raging and unpredictable inflation.
This January, the Central Bank, faced with a capital flight in US dollars and the consequent loss of dollar reserves, devaluated the peso by about 20 percent. At the same time, CFK’s Economic Ministry admitted that for the last seven years the official inflation statistics had been “cooked,” grossly underestimating the actual rate.
The devaluation added fuel to the inflation fire. Prices for imported consumer goods from Brazil, China and other nations shot up. In January and February combined, prices rose by 7.2 percent and show no sign of easing. At that rate, even a 30 percent salary increase would lose its buying power in less than 9 months.
The Central Bank continues to lose dollar reserves. Total Central Bank reserves are $27.5 billion, down from $57.5 billion in 2011. On Monday, US rating agency Moody’s lowered Argentina’s debt rating to Caa1, fully in junk bond territory and only one step above its lowest C rating.
The agency estimates that 20 billion dollars in debt payments would come due in 2014 and 2015. The statement declared that Argentina had no option for raising the money—outside of using up Central Bank dollar reserves—suggesting that the government would reach out to the International Monetary Fund for a loan in return for imposing austerity measures.
In addition to the teachers, other unions are making wage demands of between 35 percent (truck drivers, metal workers) and 50 percent (wine grape workers).
The government’s strategy appears to be to hold workers wages under the rate of inflation and to keep interests rates high, to engineer a recession. The resulting growth in unemployment will further reduce wage demands and living standards.
In February, over 4,000 jobs were eliminated in electronic assembly plants, and more than 7,000 layoffs in auto and auto parts plants. Some 1,000 workers also were sacked in meatpacking and it is anticipated that layoffs will continue.
Forcing teachers and workers to accept lower living standards and increasing unemployment inevitably will result in a wave of strikes and protests.
President Kirchner counts on the assistance of the corporatist trade union apparatus. The union bureaucracy has, in the course of the Kirchner administrations, accumulated substantial wealth from the handling of Obras Sociales (Social agencies that provide health and other benefits). The unions are either openly cooperating with the government, such as the CGT Balcarce (part of the General Confederation of Labor), which is most in line with the administration, or more critical of the regime, such as the wing of the CGT led by Hugo Moyano.
Moyano and other CGT leaders have met with business groups and right wing bourgeois establishments, while denouncing the government for ignoring the social cost of inflation. A third federation, the CTA, distanced itself from the Moyano initiative for the moment. It is pushing for a 35 percent wage increase with a quarterly cost of living adjustment. CTA leader Micheli made it clear that the CTA was not breaking with Moyano and may join his round table.