Econ 101: Opportunities After Economic Collapse
Review and commentary on "The Take" a documentary story of worker and community expropriation of factories and service industries after the 2001 economic collapse of Argentina.
Overview and Commentary
In December 2001, the economy of Argentina collapsed resulting in the closure of hundreds of factories and service industries. "The Take", a documentary by Naomi Klein and Avi Lewis, covers three examples of over 250 cases in which workers have occupied and ran factories. The film explores many perspectives from that of a former factory owner challenging the expropriation of a facility by workers, court intervention, worker-initiated legislative actions at the local government level, direct actions involving confrontations with riot police, national electoral politics, and the personal stories of peoples lives.
The economic collapse created the opportunity for workers to expropriate factories after owners abandoned them. "The Take" provides evidence that it's not necessary to have a top-heavy executive management structure to run a sophisticated business like those producing garments, ceramics, tractors, ice cream or health care services. It also shows that doing so is extremely challenging both in practical terms and in the personal emotional toll. Such challenges might be mitigated by advanced preparation.
The anticipation of, and preparation for an economic crisis would seem to improve the chances of success during the post-crisis period. This topic will be explored further in a series of articles entitled "Econ 101" to be published on Indymedia sites. Collectively owned businesses are good examples of people taking steps in that direction. Their collective efforts increase their political and economic independence, making them better prepared for potential future economic dislocation in the United States.
Review of "The Take" by Avi Lewis and Naomi Klein
Argentina is not just another poor country; it was a rich country made poor after former President Menen adopted economic policies of corporate globalization in exchange for loans from the International Monetary Fund (IMF). When the government was unable to make interest payments on the loans, wealthy individuals and corporations anticipated economic deflation; these interests took $40 billion in cash out of the country.
This relatively new ability for capital to easily fly out of countries like Argentina is one of the most controversial aspects of corporate globalization. It even undermines the theoretical economic basis of free trade known as "comparative advantage." The policy free flow of capital is economically destabilizing, because the predictable potential of capital flight increases the likelihood of runs on banks at the slightest hint of bad economic news. The documentary shows this graphically as frustrated middle-class Argentineans pounded on bank doors, smashed bank windows, and destroy ATM machines. During the panic of 2001, president Menen stepped down, and four other presidents cycled through the post in a period of weeks.
Flash forward three years after the collapse, former workers of the "Forja San Martin" are seen inspecting the abandoned forge (forja). We see a grown man cry as memories of the past flood back and he ponders the current fate of his family; this is not the last time the documentary depicts tears of fear, frustration, anger and in some cases relief.
The forge had closed, presumably when the owner took his money out of the Country during the initial panic of 2001. The worker's inspection was sanctioned by a bankruptcy court. If the workers could demonstrate that the owners had sold off any of the assets, they might have a legitimate claim for re-starting the forge on their own. They look across the large factory space pointing to marks on the empty floor showing that machines had been removed. The documentary follows two other factories that had already re-started operations and were being run collectively.
One of these, the Burkman suit factory, is widely considered to be the "first" abandoned factories recovered by workers. Another, the Zanon ceramics works, was shut down because its owners said was not profitable enough. The 300 Zanon workers had a basis of legitimacy for recovering the plant, because Zanon had debts to the wider community, and had received corporate welfare from the bankrupt government.
Naomi Klein interviews the owner of the Forja San Martin, and informs him that the workers now consider the plant to be theirs. He laughs at that, and she asks how he expects to get it back, "The government will give it back to me." The film flashes to a line of Zanon workers practicing the use of sling shots, noting that the plant had been protected six times by workers and the community when authorities tried to evict the workers. This scene drew a laugh from the Red Emma's audience.
Recovering factories is extremely challenging, and the Forja workers are depicted soliciting advice from members of the National Movement of Recovery (NMR). The NMR slogan is "occupy, resist, produce." The NMR members practice tough love, knowing that the Forja workers will only survive if they learn to act and make decisions on their own. This begins with occupying and securing the factory. The sobering implications of this are made very real as the documentary depicts such an instance and workers are shown filing past a large bin of clay marbles to arm themselves.
The tribulations experienced by the Forja workers are also sobering. One worker learns a hard lesson after he created false expectations for his wife that the recovery of the factory would be fairly quick. As the months dragged on, the toll on his family was palpable. The stresses of poverty, contrasted with a varied middle-class lifestyle that afforded annual vacations, weighs heavily, as does the loss of personal dignity and the dangers and uncertainties of taking direct action at the factory.
The workers learned to be very pragmatic. They faced many challenges including basic business concerns, "Will there be a market for what we produce?" "What if we invest great effort in re-establishing the forge, but the courts give the plant back to its owner?" They needed to have a business plan, and they had to cultivate customers. They realized that they would have to work hard, could no longer sneaking breaks, and gained a new appreciation for things like turning out unused lights to save energy.
They also learn that having political support at the local level it can be valuable. The documentary depicts a court-appointed trustee visiting the factory. Although the trustee is supposed to be neutral, the workers don't trust him. The trustee sets up a meeting between the judge and the workers. The documentary includes audio of the meeting with the judge, who says she understands the workers, knowing that they want to get back to work. She cuts them off, saying she understands them, and understands that no assets have been removed by the owners. The worker's, getting a bit desperate, turn to the local legislature to enact an "expropriation law." After a long nail-biting process, they eventually prevail and the tears of relief flow.
But the challenges continue, next at the national level. The documentary portrays the larger movement facing the obstacle of national elections, which threaten to bring back old policies of the establishment politicians. This is highlighted by the eviction of Burkman suit factory workers, who are mostly women, while campaigns for the elections were underway. As the "first" and best-known factory recovery, the Burkman workers receiveed support massive. Soon the streets were flooded with a standoff of people confronting riot police for days. Eventually, the multi-day confrontation boiled over, tear gas was released, and people scattered. In the aftermath, a fashionable older woman gives a monologue about how the Burkman workers paid for her sister's time off for chemo-therapy to battle cancer. "This would not have happened under the old ownership of the factory," she informs us, as her sister weeps.
The return of the establishment policies highlights the importance of organizing a sympathetic political party. The opportunities of economic dislocation are fleeting. This insight was suggested by a person at Red Emma's during the discussion after the screening.
The depiction of the national election, involving former President Menen, and a Democrat-like Kitchner is a bit eerie. Much like the 2004 US election cycle, the process is dominated by superficial mass media messages from leading candidates that are part of the establishment. Unlike the US, however, the Argentinean electoral system is more democratic, requiring a run-off election if no candidate secures 50% of the vote. Although the right-wing Menen wins the most votes in the first 'round, he drops out of the second 'round knowing that he cannot win.
As the documentary closes, we're informed that Kitchner eventually is to sign another agreement with the IMF. We're informed that the City of Buenos Aires intervened in favor of the Burkman workers. We're shown the forge workers producing red-hot steel products.
In the words of Ari Lewis, he and Klein "set out to make a resolutely hopeful film. We wanted to find people constructing real alternatives to corporate capitalism. And we looked all over the world where people were doing interesting things, and it just happened, when we were looking, that in Argentina it was on fire - a laboratory of democracy." It was hopeful, but the brutal challenges that it portrayed were also very sobering.
Many of today's intellectuals, like Gore Vidal, are saying things like, "I put it down to economic collapse may save the United States from its rulers." A lot of people are predicting economic gloom and doom these days, of which I plan to contribute in a series under the lead title, "Econ 101". Anticipating and preparing for a potential US economic crisis is consistent with the lessons of "The Take." Thanks to Klein and Lewis, we have a head start.
Other Takes on "The Take"
Interview with Klein and Lewis (Znet):
DemocracyNow! Interview and Sound Bites:
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