IMF Pulls the Plug
Mass Protests Shake Argentina
Break with Peronism—For a Revolutionary Workers Party!
Reprinted from Workers Vanguard No. 772, 11 January 2002.
JANUARY 7—The collapse of the government of Radical Party president Fernando de la Rúa amid massive street protests on December 19-20 has ushered in a major social crisis in Argentina. As angry demonstrators in Buenos Aires fought off police assaults in the Plaza de Mayo below, de la Rúa staged a panicky escape by helicopter from the roof of his besieged presidential palace. In his wake, three more presidents came and went in less than two weeks, while the popular unrest continued.
Now Eduardo Duhalde of the Peronist party has been appointed to head a self-described “government of national salvation.” The new regime aims to pacify the masses through rhetorical sops and by easing a small portion of the harsh austerity measures mandated by the International Monetary Fund (IMF). The attacks dictated by the imperialists, centrally the U.S., and implemented by the Argentine bourgeoisie have provoked deep anger throughout the population. The Duhalde government has now temporarily stopped payment on Argentina’s $155 billion debt to the international bankers—the largest such default in history. The government also announced a devaluation of the peso as well as measures supposedly aimed at allaying the plight of the poor. But no one pretends that this will put an end to the turmoil. Days before he took office, Duhalde himself warned that the country could spiral into civil war.
Argentina is at an impasse: the people will no longer accept being governed as before, while the rulers can no longer govern as before. Close to half the population ekes out an existence below the poverty line, official unemployment is nearly 20 percent, much of the working class is in desperate straits and the living standards of the petty-bourgeois middle class, once the most prosperous in Latin America, are plummeting. Both major bourgeois parties—the Radicals and the Justicialista Peronists, who themselves served as hardline enforcers for the IMF under the regime of Carlos Menem in the 1990s—are widely reviled among the toiling masses. And lurking in the shadows is the army, whose brutal dictatorship from 1976 to 1983 saw over 30,000 leftists and labor militants assassinated or “disappeared.”
The wave of struggles that brought down the de la Rúa regime began in the provinces with road blockades by unemployed and semi-employed piqueteros (picketers). It then spread to the cities, where hungry masses looted grocery stores and striking workers stoned government offices, leading de la Rúa to proclaim a state of siege. It culminated with the eighth general strike in two years, quickly followed by mass protests of hundreds of thousands, from young workers, students and the unemployed to retired civil servants and housewives banging empty pots. While street bonfires burned throughout Buenos Aires and in other cities, demonstrators chanting “All of them out!” faced down riot police firing tear gas and live ammunition outside the presidential palace and the Peronist-controlled Houses of Congress. At least 30 protesters were killed, many hundreds wounded and thousands imprisoned before the hated president finally fled. Free all the arrested protesters!
The current situation in Argentina has many components of a prerevolutionary crisis. The bourgeoisie is at an impasse, there is sharp dissatisfaction among the petty bourgeoisie and the working class has demonstrated great combativity. Crucially missing, however, is a proletarian revolutionary leadership which can give voice to the aspirations of all the oppressed in a struggle to shatter the rule of the venal Argentine bourgeoisie and the domination of its imperialist masters. The fight for a proletarian vanguard party is therefore the central question facing Argentina today. Critical to this perspective is the struggle for the complete and absolute independence of the working class from all the parties and agencies of bourgeois rule.
The majority of Argentina’s potentially powerful trade unions are directly linked to the bourgeois-nationalist Peronist party. Today, the nationalist trade-union bureaucrats are again working to channel popular discontent into the arms of the Peronists, whose occasional “anti-imperialist” rhetoric serves only to mask their fealty to capitalist imperialism. Living in deathly fear of the accumulated tinder at the base of society, the labor bureaucrats have found it necessary to call repeated general strikes over the past two years. At the same time, they have worked hand in hand with the Argentine rulers to contain discontent.
Only a few months ago, both wings of the Peronist CGT (General Confederation of Labor) signed a pact to control social unrest “in the interests of the country.” Amid the mass protests and street battles of December 19-20, leaders of the mainstream CGT called for “guaranteeing the resolution of this most grave political crisis within the framework of the Constitution” (La Nación, 21 December 2001), while the dissident CGT-rebelde called on the regime to “adopt political solutions to control the social eruptions” (La Nación, 20 December 2001). When de la Rúa fell, they joined with the “independent” bureaucrats of the CTA (Argentine Labor Central) government workers and teachers union federation in calling off a threatened general strike against the state of siege and rushed to a private tête-à-tête with the new (and short-lived) Peronist president, Rodríguez Saá.
For their part, Argentina’s various pseudo-Marxist organizations —including relatively sizable fake-Trotskyist groups, some with parliamentary deputies—have long been little more than left satellites of Peronism. Today, while raising various criticisms of Duhalde and his labor auxiliaries, these groups push deadly illusions that workers and the oppressed can eliminate their immiseration within the framework of bourgeois rule, seeking merely to give it more “democratic” trappings. There is a burning need to forge a genuine Trotskyist nucleus in Argentina that fights to link the present struggles to a program of socialist revolution as the only solution to the country’s crisis. In the present conditions, even a relatively small revolutionary organization could grow explosively and sink roots among the proletariat, thereby opening the road to working-class power.
Such a party can only be forged on the basis of a program of proletarian revolutionary internationalism which seeks to extend the struggles of the Argentine proletariat throughout Latin American and into the imperialist heartlands of the United States and West Europe. In Europe, where many workers are facing mass layoffs and factory closures, there is an identification with, and apprehension over, the plight of the largely European-derived Argentine masses. European newspapers and TVs are filled with images of people in what was once the wealthiest country in Latin America storming the banks, battling the police and looting stores for the basic necessities of daily survival. There is genuine fear that if hunger riots could erupt in Argentina, then a dramatic plunge in living standards could be the future for European workers too. Although the particular mechanisms of class collaboration are different (social-democratic labor reformism in Europe, bourgeois nationalism in Latin America), the fundamental question is the same: unshackling a powerful proletariat from a pro-capitalist leadership.
For their part, the U.S. imperialists have long seen Latin America as their own private preserve for exploitation. The wall-to-wall military dictatorships that dominated South America in the 1960s and ’70s were the product of the “Alliance for Progress” instituted by Democratic Party president and liberal darling John F. Kennedy as part of the “war on Communism.” Today, reflecting the heightened interimperialist rivalries that have come in the wake of the counterrevolutionary destruction of the Soviet Union, the U.S. has sought to extend its NAFTA “free trade” rape of Mexico throughout all of Latin America under the proposed Free Trade Agreement of the Americas (FTAA).
As proletarian revolutionaries in the belly of the U.S. imperialist beast, the Spartacist League/U.S. fights to mobilize the social power of the proletariat to shatter the rule of American imperialism from within. The pro-imperialist AFL-CIO trade-union bureaucrats who for decades have done the bidding of U.S. imperialism in its war on the workers and oppressed of Latin America now push the chauvinist poison of protectionism against these workers. Breaking the chains, forged by the labor tops, that shackle the proletariat in the U.S. to its “own” ruling class is central to a revolutionary perspective throughout the hemisphere. Down with NAFTA and the FTAA! For socialist revolution throughout the Americas!
Argentine Capitalism at a Dead End
Argentina was long one of the most economically and socially advanced countries in the former colonial world. Having substantial natural resources and a highly educated workforce, and free of the leaden weight of pre-capitalist remnants such as a large peasantry, by 1930 it had far outdistanced the rest of Latin America in per capita income and wage levels. The urban working class enjoyed a living standard superior in some respects to that of most workers in continental Europe. By 1945, as it grew wealthy from selling food to the imperialist armies in World War II, Argentina had about the same per capita income as Canada. Now the average Argentinean earns one sixth as much as the average Canadian.
The country’s current prostration provides a vivid illustration of one of the central premises of the theory of permanent revolution elaborated by revolutionary Marxist leader Leon Trotsky: that the bourgeoisies of the dependent capitalist countries are too weak and beholden to imperialism and too fearful of the power of the proletariat to be able to break the yoke of imperialist domination. The forms of bourgeois rule in Argentina have run the gamut: from laissez-faire liberalism (the age of the agrarian bourgeois estancieros and British-dominated export economy in the early 20th century), to bourgeois nationalism and state-sponsored industrial development behind protectionist barriers (Peronism in the 1940s and ’50s), to unbridled imperialist domination under the recent neoliberal regimes. And this has been the case under both the trappings of bourgeois democracy and the jackboot of military rule.
With the destruction of the Soviet Union and the end of the Cold War configurations, the minimal autonomy that the Argentine ruling class thought it possessed—as displayed, for example, during the Malvinas/Falklands War with Britain—has evaporated. There is no way to break out of the cycle of crises, coups and state repression which has been the lot of Argentina since at least the 1930s short of a successful proletarian struggle for state power. The tasks of the proletariat in Argentina cannot be separated from those of the working class in the rest of Latin America. Elaborating on the perspective of permanent revolution in the region, Trotsky wrote:
“The theses of the Fourth International state:
“‘South and Central America will be able to tear themselves out of backwardness and enslavement only by uniting all their states in one powerful federation. But it is not the belated South American bourgeoisie, a thoroughly venal agency of foreign imperialism, who will be called upon to solve this task, but the young South American proletariat, the chosen leader of the oppressed masses. The slogan in the struggle against violence and intrigues of world imperialism and against the bloody work of native comprador cliques is therefore: the Soviet United States of South and Central America’.”
Trotsky continued:
“Only under its own revolutionary direction is the proletariat of the colonies and the semicolonies capable of achieving invincible collaboration with the proletariat of the metropolitan centers, and with the world working class as a whole. Only this collaboration can lead the oppressed peoples to complete and final emancipation, through the overthrow of imperialism the world over.”
— “Imperialist War and the Proletarian World Revolution,” May 1940
IMF Starvation Austerity Enrages Argentine Masses
For more than a decade, Washington and the IMF touted Argentina as a prime example of a “fiscally responsible emerging economy.” In turn, Argentina has been a staunch ally of U.S. imperialism, most recently pledging to send 800 “peacekeeping” troops to aid the U.S. war in Afghanistan. But now the country is bankrupt and in turmoil (and the troops are staying home).
In a 1 January New York Times op-ed piece titled “Crying With Argentina,” columnist Paul Krugman wrote:
“Argentina, more than any other developing country, bought into the promises of U.S.-promoted ‘neoliberalism’ (that’s liberal as in free markets, not as in Ted Kennedy). Tariffs were slashed, state enterprises were privatized, multinational corporations were welcomed, and the peso was pegged to the dollar. Wall Street cheered, and money poured in: for a while, free-market economics seemed vindicated, and its advocates weren’t shy about claiming credit. Then things began to fall apart....
“Now Argentina is in utter chaos—some observers are even likening it to the Weimar Republic. And Latin Americans do not regard the United States as an innocent bystander.”
So tightly tied to the fortunes of the American dollar, the Argentine economy was severely damaged by the U.S. financial/economic boom of the mid-late ’90s. This saw capitalist investors worldwide flood into the Wall Street bull market, causing the value of the dollar to rise sharply in relation to nearly every other currency...except Argentina’s. The Argentine peso—and thus the price of Argentine goods on the world market—also rose sharply compared to almost all other countries, including its main trading partner, Brazil. This made Argentine goods uncompetitive and produced mounting balance-of-trade deficits. The normal capitalist market mechanism to redress this would be currency depreciation, which reduces the world market price of exports and increases the domestic price of imports. But in an attempt to stabilize the economy, the Argentine government and many large businesses had denominated most of their new bond issues in dollars, so any peso devaluation would have proportionately increased Argentina’s debt.
Thus the country slid into a deep recession four years ago, well before the current worldwide slump. Layoffs and plant closures grew by the month. By July of last year, the economy was collapsing at an annual rate of 11 percent and the masses were desperate. But the U.S. made clear that it expected all the loans negotiated by the Menem and de la Rúa regimes to be repaid with interest. In August, Washington put together an “emergency rescue package” through the IMF—not to bail out Argentina, but to bail out the Wall Street banks that hold Argentine government (and private) bonds. As usual, this involved harsh austerity conditions, including a suspension of the social security system. But the workers and poor, together with an increasingly impoverished middle class, were not willing to take any more and took to the streets in protest. The IMF’s response was to freeze $1.3 billion in aid early last month, whereupon the government stole $700 million from the government workers’ pension funds to pay the interest on the debt. All this led to the yet broader protests that brought down the de la Ruá government.
The situation cries out for the repudiation of the foreign debt, which for decades has lined the imperialists’ coffers at the expense of Argentina’s workers. But no capitalist Argentine government would take such a step, since this would bring down unremitting hostility from its imperialist patrons and undermine the whole basis of its rule. IMF spokesmen now claim that whatever the government does, it will take a further cut of 30 percent in real wages, plus another five to ten years of recession, for Argentina to become internationally competitive!
From the bourgeoisie’s class standpoint, it is hard to see any regime short of a military dictatorship being able to enforce such gouging austerity against an already enraged population. Yet any move toward a military coup would be met by immense opposition from a population which remembers vividly the last army dictatorship, whose brutal rule ended only after its ignominious defeat in the 1982 Malvinas/Falklands War.
Since 1977, protesting mothers have been meeting at the Plaza de Mayo every week to memorialize the thousands killed and “disappeared” by the military government, which worked closely with the CIA against leftist insurgencies throughout Latin America. The mothers were in the forefront of the huge December 19-20 anti-government protests, where demonstrators chanted, “Madres de la Plaza, el pueblo las abraza!” (“Mothers of the Plaza, the people embrace you!”).
Peronism: Deadly Trap for the Workers
To try to control the upsurge, the Argentine bourgeoisie has turned, for now, to the Peronists, specifically the wing under Duhalde which has chosen to put on national-populist trappings. This is a transparent attempt to utilize popular nostalgia for the government of General Juan Perón during the late 1940s and early ’50s, which has come to be seen as a golden era when wages were raised, social programs launched and unions organized. Following a 1943 military coup, Perón emerged as Argentina’s strongman. He followed a nationalist-corporatist model of capitalism, in which key sectors of the economy were state-owned, domestic industry was protected by tariffs and import licenses and foreign-exchange transactions were subjected to an array of controls.
While occasionally utilizing anti-Yankee demagogy, the Peronists in the post-World War II period functioned as the local political agents of Wall Street, keeping the proletariat in line through the labor bureaucracy. They periodically slashed wages and depressed living standards to repay Argentina’s debt to U.S. and other foreign banks, usually through the mechanism of accelerated inflation rather than the deflationary measures now favored by the IMF. Workers’ wages would rise, but the prices of food, fuel, clothing and other necessities rose even faster. Perón himself was an open admirer of Franco’s Spain and Mussolini’s Italy. During the “years of the fat cows,” he outlawed the Communist Party, smashed every manifestation of working-class independence and subordinated labor to the state in corporatist fashion.
With the massive rise of industrialization, there was a corresponding explosive growth of the trade unions. Perón proved quite successful both in co-opting dissident union leaders and in organizing corporatist unions directly dependent on the government for their existence. Only those unions which swore allegiance to the Peronist agenda were declared legal, and only legal unions qualified for dues checkoff, subsidies for union buildings and access to social security programs, pension funds, etc. The Peronist regime used nationalist “anti-imperialist” rhetoric in order to further tie the working masses to the Argentine capitalist state.
New president Duhalde, a former vice president under the IMF’s man Menem, now peppers his speeches with paeans to Perón and his wife Eva and cynically blames the plight of the Argentine people on a U.S.-backed “free-market model,” which he calls “immoral.” But this shift to the national-populist rhetoric of yesteryear is simply designed to strengthen the forces of capitalism in Latin America by recementing the ties of the working class to its “own” national bourgeoisie. Huge sections of the population will continue to suffer grinding immiseration under the Duhalde Peronists as the latter attempt to “reconstruct” the country on the backs of the working class and sections of the petty bourgeoisie.
The imperialist chains that bind the Argentine proletariat can only be broken through a struggle for socialist revolution in Argentina, throughout Latin America and beyond. A workers revolution in a country like France or Spain would have profound effects on the struggles of the Argentine working class. Conversely, nothing would be more heartening to the proletariat in South Africa and workers and the oppressed throughout the Third World than a socialist revolution in a country like Argentina. Crucial to this perspective is intransigent opposition to Peronist bourgeois nationalism, which has time and again led the Argentine workers and oppressed to disaster.
Argentine Left Pushes National Reformism
Opposition to bourgeois nationalism is the last thing being offered by the fake-Trotskyist groups that populate the Argentine left. Far from having an independent class perspective against the bourgeoisie, they are mired in national reformism, particularly tailing the Peronists. The main trend of ostensible Trotskyism in Argentina is that of the late Nahuel Moreno, today represented by the Movimiento Socialista de los Trabajadores (MST) and its split-off, the Partido de los Trabajadores por el Socialismo (PTS). In the 1950s, Moreno passed himself off as a “left” Peronist; his newspaper at the time was published as an “Organ of Revolutionary Workers Peronism—Under the Discipline of Gen. Perón and the Peronist High Council”! (See our 1980 Moreno Truth Kit pamphlet for the history of this tendency.)
During the Malvinas/Falklands War, the reformist left in Argentina openly backed the genocidal ruling military in the name of “anti-imperialism.” The Moreno tendency boasted that it stood squarely “in the military camp of the Argentine dictatorship” (Correo Internacional, April 1982). With the backing of the fake left, the generals used the war to head off a general strike, part of burgeoning proletarian struggle against the military regime. In sharp contrast, we fought for proletarian revolutionary opposition to both British imperialism, then ruled by “Iron Lady” Margaret Thatcher, and the Argentine generals, declaring: “Sink Thatcher! Sink the Junta! The Main Enemy Is at Home!”
In 1989, the Morenoites gave backhanded support for the installation of a new Peronist government under Menem. Declaring that “Menem received the majority of votes of the working people,” they asked why he didn’t use that support “to impose the solutions he says he has” (El Cronista Comercial, 31 May 1989). And Menem did just that.
Today, with the Peronists widely discredited, the Argentine left is trying to cloak its nationalist reformism in slightly different rhetoric. The Morenoite MST and the Stalinist Communist Party are the main components of the United Left (Izquierda Unida—IU), an electoralist bloc whose program raises as its maximum demand a call for “an independent political alternative of the workers and people.” In the wake of the mass upsurge which overthrew de la Rúa, the IU joined with another fake-Trotskyist outfit, the Partido Obrero (PO) of Jorge Altamira, and some smaller groups in a December 22 declaration which prominently features the call “For a People’s and Workers Government.” And the more left-posturing PTS pushes the same perspective in its leaflets and statements, writing that “the revolutionaries of the PTS struggle for a workers’ and people’s government” (leaflet of 31 December 2001).
This purposefully confusionist call, which dissolves the proletariat into the mass of the “people,” is the classic facade for a class-collaborationist alliance with a wing of the national bourgeoisie (who are, after all, part of the “people”). All of these groups uphold the disastrous, anti-revolutionary perspective of the “anti-imperialist united front,” which is but a code word for the subordination of the working class to its “own” bourgeoisie. The social turmoil in Argentina today involves many layers of society, from the middle class to students to the unemployed and rural poor. If the proletariat is to emerge as the leading force of the oppressed, fighting for the overthrow of the capitalist order and imperialist domination, it is crucial to draw a clear class line. The MST, PO, PTS et al., in contrast, mix everything together in a “popular” reformist stew.
This is shown as well in the perennial call raised by PO and the PTS for a “constituent assembly” which would, in the words of a 31 December PO leaflet, express “the sovereign will of the workers and unemployed.” The PTS adds its own twist to this demand in a statement calling for both a “national assembly of employed and unemployed workers” and “a sovereign Constituent Assembly, so that the people can discuss democratically and in freedom the way out of the crisis” (“Revolutionary Days,” 22 December 2001). And how is this to be accomplished? “Even to open the road to this kind of democracy,” the PTS writes, “it is necessary to sweep away the current power with a general strike and with a great national uprising that finishes the task initiated during the revolutionary days of December 19 and 20.”
The call for a constituent assembly is, at best, a democratic slogan which at particular times can be used against dictatorial capitalist regimes as a subordinate element in a program for workers revolution. But Argentina currently has a bourgeois-democratic form of capitalist class rule with periodic elections, and this has been the case for nearly two decades now. Under these circumstances, the call for a constituent assembly serves only to foster, not break, bourgeois-democratic illusions among the workers and oppressed. In situations of pre-revolutionary turmoil, genuine Trotskyists would fight to forge organs of dual power—soviets (workers councils), factory committees, etc.—as organizing centers in the fight for proletarian revolution. But for the centrist PTS, the call for a “workers assembly” is just window-dressing for its perspective of a “great national uprising” to win...another bourgeois parliamentary body!
For all their “anti-imperialist” rhetoric, the Argentine reformist and centrist left were as one with the U.S. imperialist rulers in backing the forces of counterrevolution that destroyed the Soviet Union and the deformed workers states of East Europe. As the West German imperialists pushed for the counterrevolutionary annexation of the East German deformed workers state in 1989-90, the Morenoites came out with a program “whose guiding slogan is: German reunification now” (Correo Internacional, January 1990). For its part, the PTS called for “the defense of the right of the German masses to unite however they wish, even if they decide to do so in the framework of capitalism” (Avanzada Socialista, 30 March 1990).
This treachery was repeated when the Morenoites and Altamira’s PO hailed Boris Yeltsin’s pro-imperialist countercoup in Moscow in August 1991. In a 28 August 1991 statement, the Morenoites called it a “Great Revolutionary Victory in the USSR,” while PO proclaimed that “the people’s victory over the coup has a revolutionary scope” (Prensa Obrera, 29 August 1991). These groups bear their own small measure of responsibility for the post-counterrevolutionary devastation that swept the former USSR and East Europe and redounded so negatively against the working people of Latin America. In contrast, the International Communist League fought to the bitter end in defense of the working-class gains that were embodied in these states, despite their Stalinist misrulers. While the rest of the left embraced imperialist “democracy” against Stalinist “totalitarianism,” we fought for proletarian political revolution to oust the Stalinist bureaucrats and restore the program of revolutionary internationalism that animated Lenin and Trotsky’s Bolshevik Party.
For a Genuine Trotskyist Party!
The burning need in Argentina today is the forging of an authentic Leninist-Trotskyist party. Such a party would call for the full independence of the trade unions from the bourgeois state. It would act, in Lenin’s words, as a “tribune of the people,” rallying all those suffering under the capitalist yoke, from the unemployed and impoverished pensioners to the rural poor and small shopkeepers who are being ruined by the austerity crisis. It would emblazon on its banner the fight for women’s liberation, combatting machismo and backward Catholic attitudes and raising demands for the full integration of women in the workforce at equal pay. It would fight for free abortion on demand as part of free, quality health care for all, and for full democratic rights for homosexuals.
Argentine society is saturated with the chauvinism of a ruling class which revels in its supposed “European” superiority over the rest of Latin America and which is riddled with former Nazis. Crucial to any revolutionary perspective is unmitigated opposition to all manifestations of racism, anti-Semitism and hostility to indigenous minorities and immigrants.
Only a program of revolutionary internationalism can offer a road forward for the Argentine working class. Following the 1917 Russian workers revolution, Lenin’s Bolshevik Party canceled the debt amassed by the tsar and the Russian bourgeoisie by simply refusing to pay it. Recognizing that imperialism could not be appeased, they fought to extend the October Revolution worldwide. Today, to liberate themselves from Wall Street debt peonage, the workers and oppressed masses of Argentina and throughout Latin America must be won to the principles and program of proletarian internationalism as represented by Marx, Engels, Lenin and Trotsky. This is the perspective of the ICL: to reforge the Fourth International in order to lead the struggle for new October Revolutions across the planet.