Argentine Workers' Cooperatives: The Successes of Horizontal Organization and What it Means

Last night, I watched The Take (the first of nine parts above), a documentary on Argentinean workers' cooperatives by Avi Lewis and Naomi Klein. The documentary focused on the struggle of workers at the Forja auto plant in their fight for legal recognition and permission to take collective ownership of their plant. It also described the economic collapse of Argentina, which lead to widespread worker control of factories after many companies halted production or laid off their workers. The history of these cooperatives is important to be aware of, especially in the context of today's über-capitalism and its corresponding exaggerated vertical organization structure.

1. Argentina in the 21st Century

As narrated in the first few moments of the film, Carlos Menem, elected president in 1989, had promised to rebuild industry and grow Argentina's economy in his campaign. This trend had begun in the 1950s under Juan Peron, who built Argentina's factory economy and created an extremely strong middle class. Once elected, however, Menem sold many of the country's previously public assets, downsized, and engaged in corporate lending mainly due to prodding from the IMF. Currency markets became deregulated while unemployment soared from 6% to 18% as many companies responded to privatization. Public debt piled up and the IMF continued to lend, as Menem was appeasing their demands and meeting lending conditions. The IMF reported that Argentina would "enter the new century in a very, very solid basis," but in 2001, two years after Menem's term expired, the economy collapsed. Half the country slipped below the poverty line and many were without work. Money was free to travel when Argentina's currency began to drop: $40 billion dollars in cash was taken from Argentina land in the dead of night. In response, the government froze all bank accounts. The rich had saved their fortunes, but the poor were trapped in the downward spiral. Angry Argentines took to the streets and rioted, chanting "Que se vayan todos" ("All of them must go"). The country soon declared bankruptcy and, as Avi Lewis's narration tells, "refus[ed] to pay its debts; banks lock[ed] people out of their own accounts. The basic rules of capitalism were being broken by the system itself." Angry citizens rejected the entire system and took to the streets. While their protesting expressed dissatisfaction with the system, the occupied factories expressed an alternative to it. Hundreds of factories that otherwise would have been shut down were being run by their workers after abandoned by their owners. The two most successful were Zanon, a ceramics factory, and Brukman, a garment factory.

FaSinPat, also known as Zanon, is one of the most
well-known and successful workers' cooperatives in
Argentina. The factory was first taken over by its workers
in October 2001 and remains in worker control today.

Zanon Ceramics, referred to by Lewis as the "granddaddy of the [occupied factories] movement" survived near shut-down when the workers refused to accept the owner's proclamation that the factory was no longer profitable. Workers took over the factory, claiming that it belonged to the public because of its massive debts (despite having received millions in corporate welfare from Menem's regime) and subsidies. The factory operated at the time the documentary was made with 300 workers which formed a decision-making assembly. Each worker had one vote - equal say in the company's management. Workers are paid identical salaries, and the factory has immense support from their community. One man interviewed in the documentary stated that, "[Zanon] works better than under the former owners... At least people are working. The tiles are cheaper and the future is brighter than it was under the owners. All they did was get subsidies from the state - nothing else. And they kept the money for themselves." Brukman, another factory under worker control, operates in a similar fashion. Workers gather and discuss their personal financial situations to decide upon fair salaries for one another. Many other Argentinean businesses - health clinics, private schools, and more - operate under worker control. With community support, the only force threatening the success of these horizontally-managed cooperatives is the state. Zanon, now known as FaSinPat (short for a Spanish phrase which translates to "Factory without a Boss"), won an important legal battle in 2009 stating that the factory legally belongs to the people. The workers of Brukman won their rights to the factory after eviction and police violence in 2003. 

2. What We Can Take from the Argentine Model, and Why a Similar Phenomenon Has Not Occurred Elsewhere

The story of the oppressed worker is all too common in today's economic system. The Argentine workers' cooperatives show that the solution to this problem is not only possible, but also stable, supported, and profitable. While the popular conservative rebuttal to left philosophy is that in practice it hasn't worked, I challenge those of any political affiliation or ideology to find a business model more democratic than that of the occupied factories in Argentina. Not only does the horizontal model work, but it has more support and stability than any traditional Western business structure. As remarked by a member of the Patagonia community in which the Zanon factory operates, the owners of the factory are not stealing anything or killing anymore, as the previous bosses had. Instead, the worker-owners are producing to feed their families and provide for the community. 

This model shows more than the fact that an alternative economic system is realistic, if not more beneficial than the current one. It also sheds light on the conditions necessary for such a system, and a paradoxical issue in community organizing. First, widespread economic catastrophe coupled with the threat of a closing workplace (or worse, the reality of being unemployed for years) is what inspired the groups of workers to organize and take the factories as their own. While not to the same magnitude, the economic crisis of 2008 would have been a prime opportunity for something similar to occur in the United States. Extreme economic conditions are most certainly notorious for inspiring groups to take action, be it through demonstration or, as in Argentina, claiming their workplaces as their own. But what has continued to perplex me is how Americans can face their own extreme instances of injustice and inequality and neglect to react in the same way as those in Argentina, Greece, Spain and elsewhere have reacted to their economic conditions. The reason for this is similar to what caused the protests in the Arab World in 2011: in those countries, the governments would either give the people the illusion of freedoms, or the ability to provide for themselves in terms of food, clothing, and the other bare necessities, in order to keep them complacent. When they failed to provide either of these, the people revolted, and the rest is history. 

I see a similar trade-off occurring in the late-capitalist democracies of the Western world that keeps people complacent and prevents protest and the seizing of the workplace. People wear two hats - they are both workers and consumers. Both the worker and the consumer are given the illusion of being able to organize - either to form labor unions or gather in peaceful protest. The consumer is given the illusion of quality products and freedom of choice in buying (while they really don't), and the workers have the "American Dream" in mind without realizing that they have already hit their glass ceiling - or have come close to it. Furthermore, the people in these Western democracies are kept comfortable and have attitudes that are fundamentally different from those in Argentina, for example, and other developing countries. Because of the history of prosperity and the level of comfort in which we are kept, we are less willing to part with, or lose, what we have. The citizen of a Western democracy is more stubborn and more competitive, as they have been taught in school and the job market. The sense of having some power or say in the government - and being entitled to this - is also a typical characteristic of these systems. The takeover of businesses and factories has not occurred in the United States or elsewhere in the Western world because of these characteristics and the attitude of entitlement and competition possessed by people in these countries. As many testified in The Take, one becomes desensitized to losing in a direct democracy. Furthermore, many of the workers in the Brukman factory felt powerless prior to taking it as their own. While Americans and others are faced with the economic condition of extreme inequality, the collective need to take a stand against management is not felt because of this complacency, and their attitudes otherwise, coupled with the other aforementioned conditions. I could see the workers' cooperatives as an option in the future for a rich late-capitalist democracy if these conditions and attitudes are altered, or if economic hardships become more dire and collapse is imminent.

The National Movement of Recovered Businesses, a federation of recovered factories, operated under the following slogan: Occupy, Resist, and Produce. I hope that this slogan is taken to heart in the near future, regardless of the surrounding conditions, and more create horizontally-structured cooperatives like those in Argentina. Despite the likelihood of this, there is still a lesson to be learned from the successes of these cooperatives.