Multinational Monitor

MAR 2001
VOL 22 No. 3


Fox, Inc. Takes Over Mexico
by John Ross

Labor After the PRI: Will Fox Ride Roughshod Over Mexican Workers?
by Dan La Botz

Hope for a New Dawn in Chiapas
by Subcommandante Marcos


The Democratic Opposition: Challenging Mexico's New Corporate Clan
an interview with
Carlos Heredia


Behind the Lines

Resistance is Not Futile

The Front
Taiwan's Power Struggle - The WTO's Yes Men

The Lawrence Summers Memorial Award

Book Review
The Zapatista War Against Oblivion

Names In the News


Labor After the PRI: Will Fox Ride Roughshod Over Mexican Workers?

by Dan La Botz

Vicente Fox is president of Mexico, the National Action Party (PAN) is in power, and that means that many things will be changing for Mexican workers. Just how they will change is a matter of debate.

Fox promises that both employers and workers will get a fair shake in the new political and economic order. He talks about productivity, but also about ending the old abuses and promoting workers' rights.

There is no question that the old system of labor relations in Mexico, in which workers either went without union representation or were forced into corrupt unions affiliated with the ruling party, the Institutional Revolutionary Party (PRI), is in desperate need of reform. And with the PRI out of power for the first time in 70 years, the virtual monopoly of the PRI-affiliated unions appears set to end.

Whether the new space is filled by democratic unions, company unions or no unions at all remains a question. And how will the PRI-affiliated unions will adapt remains in doubt, as well.

Many Mexican workers fear that Fox, who frequently campaigned in a cowboy hat and while mounted on a horse, is likely to ride roughshod over unions and workers. For much of his life, Fox was an executive for Coca Cola, managed the Fox family boot manufacturing business and ran a ranch. Shortly after his election, a series of news articles revealed that he ran the ranch with child labor. All of his training and experience appear to put him on the side of employers.

Mexico Enters a New Era

Whatever Fox does, it is going to be very different than what came before. For 70 years, the PRI had been virtually identical with the Mexican state, controlling the presidency, the legislature, the courts, the governorships, and even most municipalities. The one-party state also controlled the Congress of Labor (CT) and the Confederation of Mexican Workers (CTM) and the other "official" labor federations (CROC, CROM, etc.).

As Fox and the PAN ran for office, they promised to turn Mexico away from the PRI and its corrupt labor unions. They promised to end the PRI's corrupt "socialist" economy and return the country to the free-market based on the model of Monterrey in the state of Nuevo Leon, where the only unions have been company unions.

Yet where the PAN won mayoralties and governorships in cities and towns in northern Mexico in the 1980s, its candidates promoted big business and soon reached an accommodation with the old PRI-controlled unions. PAN governors and mayors often represented the worst of both worlds, a combination of a more aggressive pro-business politics with the old corrupt PRI unions.

As governor of Guanajuato, say labor rights activists, Fox did nothing for workers.

"We know of no initiative that he has taken to improve the labor rights of the workers of Guanajuato," says Carlos Rodriguez, the director of the Center for Labor Reflection and Action (CEREAL), a Jesuit labor rights organization. "There is a striking contrast between the situation in Guanajuato and the improvements in labor policy in the [Mexico City] Federal District, for example, where there have been efforts to protect the most vulnerable groups such as women and children."

Many observers expect Fox to follow a similar pattern in the presidency, though the balance of power is more uncertain with the PRI out of office.

"Fox will do four apparently contradictory things simultaneously," predicts Hector de la Cueva, the director of the Center for Labor Investigation and Consulting (CILAS), a Mexico-city based group that advises workers and unions. "First, he will continue to work with the old official unions of the CT and the CTM when that serves his interest. Second, he will promote the company union model of northern Mexico. Third, he will do as PAN governors have done - simply ignore the unions. And fourth, he will, when he has to, deal with the independent unions."

Fox indicated his future direction by his choice for Secretary of Labor, Carlos Maria Abascal Carranza. Abascal is the former head of COPARMEX, the Mexican Employers Association, and had previously negotiated a "New Labor Culture" agreement with Fidel Velazquez, the former head of the Confederation of Mexican Workers (CTM). Under that agreement, the unions promised to raise productivity and quality in cooperation with the employers, but workers got nothing in return. In fact, their wages actually fell.

In the last 20 years, multinationals have introduced new technologies and forms of work organization such as team concepts and new payment methods. These have profoundly changed the Mexican workplace. Some of them, like pay-by-hour, violate Mexican labor laws, which require pay by the week or day.

Now Abascal promises to revamp Mexican labor relations in their entirety, by creating a new federal labor law and a new system of industrial relations in line with many of these already established new technologies and work relations.

Within a month of taking office, Abascal had deeply offended some sectors of Mexican society and angered labor union leaders and workers with his combination of piety, parsimony and repression.

First, he shocked many Mexicans when he organized a special mass for the Department of Labor employees, a radical change after 70 years of not only secular but anti-clerical government. Then the Mexican Labor Boards (which no one believes are independent of the executive) declared an almost month-old sugar workers strike to be "non-existent," i.e. illegal.

Next, Fox's head of the Mexican Institute of Social Security, Santiago Levy, denied an increase in benefits to hundreds of thousands of working class retirees, saying that any improvement would jeopardize the system.

Finally, the Fox government's National Council of Minimum Wages (CNSM) handed down an increase in the minimum wage of 6.9 percent, just about the inflation rate, when most unions had demanded 25 percent, equivalent to the workers' loss of purchasing power in the last six-year presidential term. The national minimum affects the pay of millions of Mexican workers, those who earn the minimum but also the much larger number whose wages are pegged as a multiple of the minimum.

Corporatist and Company Unions

Abascal is taking over the Labor Department at a time when Mexico's entire labor system is in a profound crisis. While the CT and CTM have long been in decline, the defeat of the PRI will likely lead to their further disintegration. Without the PRI to defend them, the CT, the CTM and other federations like the CROC and the CROM will offer fewer attractions for either employers or workers. Without economic support from the government, and without backing in the Labor Boards (JFCA), some of the old "official" or "charro" unions could soon collapse altogether.

The crisis in the old "official" unionism can be seen in a variety of manifestations:

  • Last year's rebellion in the Sole Union of Electrical Workers of the Mexican Republic (SUTERM) challenged the leadership of Leonardo Rodriguez Alcaine for the first time in 25 years. Rodriguez also heads the CT and CTM and is the country's most powerful labor official. He defeated the insurgency and won the SUTERM election only through what many believe to have been a corrupt process.
  • Longtime Miners and Metal Workers Union (STMMRM) President Napoleon Gomez Sada was unable to overcome objections to his attempt to install his son Napoleon Gomez Urrutia as the next STMMRM head, leading the union to lose its "juridical personality," or right to legal existence before the Secretary of Labor and the Labor Board.
  • In the Petroleum Workers Union, historically the flagship of the Mexican industrial unions, a variety of dissident opposition groups have challenged the national and local leaders both in local union elections and in public demonstrations.
  • The continued gangster-style leadership of Victor Flores Morales of the Mexican Railroad Workers Union (STFRM) remains a national embarrassment to Mexico's labor movement.

Overall, Mexico's "official" unions are more corrupt, more challenged, and more unstable that at any other time in their 70-year history.

While Fox and the PAN may use their power to support this or that union or official, they are likely neither to prop up the old unions nor create a new system tied to PAN patronage. Rather, Fox will be pragmatic and opportunistic in making ad hoc alliances with union leaders and organizations. Fox has found in Elba Esther Gordillo, a leader of the Mexican Teachers Union (el SNTE), a leader both of the unions and of the PRI who is willing to work with him on both education and political issues. Other union leaders, such as the notoriously corrupt and violent Flores Morales have also indicated their willingness to cooperate with Fox.

Some fear that Fox and Abascal will attempt to pass a reform of the federal labor law (LFT) that will so weaken unions as to make them insignificant, or failing to pass such a law, take practical measures to brush them aside.

Fox and Abascal are also likely to promote company unions (sindicatos blancos or sindicatos patronales) such as those that exist in the city of Monterrey and the state of Nuevo Leon. Company unions - unions organized and supported by the employer - as well as company social welfare programs have long been the northern Mexican elite's preferred alternative to both government unions and genuine independent unions. Organized on a company or plant-by-plant basis, such unions have little or no bargaining power, do little to represent workers and function primarily to block the formation of independent unions.

Public Union Militance

At the same time, Fox and Abascal will have to confront challenges from democratic and militant currents within some "official" unions and the independent labor union movement.

During the last two years, the Mexican Electrical Workers (SME), a politically independent union (though it remains in the CT), organized a broad Front Against Privatization of the Electrical Industry and succeeded in holding off former president Ernesto Zedillo's plan to sell off the government-owned electrical power generating industry. For several months the Electrical Workers Union, other workers, and university students demonstrated and marched against privatization, and even received support from the Zapatistas.

Public employees have also evidenced a newfound militant streak. Organized in the Federation of Unions of Workers at the Service of the State (FSTSE), Mexico's public employees surprised everyone, including themselves, when they carried out a huge national mobilization at the end of 2000 demanding a bonus at the end of the six-year presidential term (called the sexenio). An uneasy coalition of crusty union bureaucrats and feisty rank-and-file workers who came together at the moment of the defeat of the PRI on the basis of opportunism and anxiety led the FSTSE demonstrations and job actions. Whether or not some local union leaders and workers might turn this into an on-going democratic and militant movement remains to be seen.

Meanwhile, a dissident strain of the teachers union has already protested against their union leadership's backing of Fox. Led by teachers from Michoacan, the National Coordinating Committee of the Mexican Teachers Union (el SNTE) and other dissident groups within the teachers union have carried out a series of mobilizations against Elba Esther Gordillo, the power-behind-the-throne of el SNTE. While their immediate demands are the right to hold state union conventions and elect their own state leadership and delegates to the national union, they have also attacked Gordillo for her role as a leader in the PRI, and her link to Fox and the PAN.

The Independent Unions

One manifestation of the crisis of the Mexican labor system has been the rise in recent years of independent labor action. Led by three important unions - the Mexican Telephone Workers (STRM), the National Union of Social Security Workers (SNTSS), and the Union of Workers of the National Autonomous University (STUNAM) - the independent National Union of Workers (UNT) claims 1.5 million members (though some believe that figure to be inflated) and is the major organizational alternative to the PRI-affiliated labor organizations. While the UNT has had a few successes, including a victory in an auto parts plant in Puebla, it has yet to fulfill the hopes of most members and allies.

The Authentic Labor Front (FAT) remains Mexico's most democratic, militant and internationalist labor federation. Despite its small size (less than 50,000), the FAT is an important factor in the UNT, and in linking Mexican labor to civil society and to potential foreign labor allies. The FAT alliance with the U.S.-based United Electrical Workers Union (UE) is the best model of international solidarity between U.S. and Mexican unionists.

Much of the democratic upsurge has taken place outside of the major unions and federations. During the last year, health workers in hospitals around the country engaged in demonstrations, job actions and unofficial strikes both to protest government budget cuts, deteriorating conditions in public hospitals and clinics and to fight for higher wages and better benefits for themselves, scoring some significant local victories. Although ultimately thwarted by the Zedillo administration, many groups of public employees took advantage of a Mexican Supreme Court ruling to attempt to organize independent labor unions in federal workplaces.

Provoked by wage chiseling, on top of long hours, low pay and miserable working and living conditions, the migrant workers in San Quintin, Baja California Norte, periodically erupt in riots, burning packing sheds and police cars. The multinational and national corporations in agribusiness, the state-controlled labor unions, local caciques (political bosses) and police repression have made it impossible for the largely indigenous migrant workers to organize and fight for economic and social justice; any labor federation or political party which succeeds in giving those workers some leadership will harness a tremendous force.

The Gathering Storm

For years now, the Mexican government has suggested that the country has had virtually no strikes, or at least no official strikes, since most are declared illegal by the Mexican labor boards (JFCAs). But even the most casual observers notice hundreds of walkouts, demonstrations and other labor protests each year.

In the last 18 years - since the beginning of a succession of PRI technocratic or neoliberal presidents, Miguel de la Madrid, Carlos Salinas and Ernesto Zedillo - there have been not a few dozen strikes but several thousand, according to a recent study by the Universidad Obrera de Mexico (the Mexican Workers' University or UOM). The UOM reports that under the last three presidents there were 11,382 strikes of all sorts. During Zedillo's term, there were 1,738 strikes, or almost one a day. Public employees carried out a virtual strike wave, involving 74 federal government unions and 32 state unions.

The slow-motion collapse of the PRI labor system is being matched by the rise of a new more independent, more democratic, and more militant labor movement.

While Fox may plan to install a system of company unionism, these new militant unions have no intention of being swept aside.

Dan La Botz is the author of several books on Mexico and editor of Mexican Labor News and Analysis, an electronic newsletter published in conjunction with the UE and the FAT.

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