Cooperatives in Argentina Reduce Hard-Core Unemployment

Marcela Valente

HAVANA TIMES, Aug 3 (IPS) — During the social and economic collapse of 2002-2003, the Argentine state encouraged the formation of workers’ cooperatives, which helped mitigate the worst effects of the crisis, reduced hard-core unemployment, and now as independent, democratic, worker-controlled organizations are providing services to the public and private sectors.

“Business enterprises are only interested in profits,” Cristián Miño, a cooperative movement activist, told IPS. “In contrast, in a cooperative there is comradeship: we are all owners together, and if one of us gets into difficulties, the cooperative is there to help out.”

In 2003, Miño was an unemployed 25-year-old living in Florencio Varela, a densely populated working-class district on the outskirts of Buenos Aires that was selected for a government pilot plan to “seed” cooperatives, that went on to become a success.

Under the pilot program, the centre-left government of the late President Néstor Kirchner (2003-2007) created 50 cooperatives, each with 16 members, to build housing in Florencio Varela as one of several experiments to combat joblessness. At the peak of the crisis, the unemployment rate was over 24 percent, and more than 54 percent of the population was living in poverty.

“A lot of the people involved knew nothing about construction work,” Miño said. Today, 33-year-old Miño is the head of the Florencio Varela Federation of Worker Cooperatives (FECOOTRAUN), which has 600 members belonging to 16 cooperatives.

Nearly all of the cooperatives work in the construction industry, although some grow plants in nurseries, carry out forestation projects, or are involved in producing inputs for the building industry, like pre-moulded fences, furniture, ironwork, windows and doors.

In 2006, FECOOTRAUN had 1,500 members. But working together is not easy, Miño said. “It’s difficult to organize. Not all the cooperatives that were started continue to be active and successful; there is normally a certain attrition rate,” he said.

However, the Florencio Varela cooperatives are currently contracted to build infrastructure for different levels of the government (local, provincial, and national) and for private companies that have been awarded government contracts for public works.

In the San Jorge barrio in Florencio Varela, the federation built an 880-unit housing estate and enlarged the school premises for a private company that had won the contract.

Among members of the cooperatives, “no one earns less than 2,000 pesos (500 dollars) a month,” Miño said. That is nearly twice the pay level for new workers recruited by state-sponsored cooperatives.

The pilot project in Florencio Varela shows that the cooperative movement, even when it is promoted by the state instead of by workers on their own, can be a tool to rescue people from poverty and joblessness.

In 2009, the ministry of social development launched the “Argentina Trabaja” (Argentina Works) program with the goal of creating 100,000 jobs for highly vulnerable people who are unemployed, lack training and have no other income.

The ministry signed agreements with local governments nationwide to promote cooperatives, provide training for those who join them, and carry out infrastructure works.

The cooperatives, with 60 members each, build drains and water mains, community centers and community soup kitchens, refurbish schools and health centers, mend roads, and provide access facilities for the disabled, among other projects.

To participate in the program, would-be beneficiaries must have no income except the universal child benefit, amounting to 220 pesos (55 dollars) a month for each child under 18 who attends school. The allowance is granted by the state to the poorest families.

The new recruits receive work clothes, and are paid 1,200 pesos (300 dollars) a month. They have to register with the social security services to ensure entitlement to health care and, eventually, a pension.

A mid-2010 study by the ministry of social development found that half of the cooperative members participating in the plan are women. Overall, participants belong to the segment of the population suffering from hard-core unemployment.

The study reported that 79 percent of participants had not completed the 13 years of primary and secondary education that are compulsory in Argentina, and 77.6 percent had no trade or profession when they entered the program.

In the last few months, training has been incorporated for program applicants; it is provided by trade unions, other cooperatives or municipalities themselves.

Fabián Repetto, the head of the social protection program at the Centre for the Implementation of Public Policies Promoting Equity and Growth (CIPPEC) – a private, non-profit organization working for justice and democracy in Argentina – talked to IPS about how well this experiment has worked.

“CIPPEC was asked by the local governments in Morón and Esteban Echeverría (districts in Greater Buenos Aires) to improve the administration and financial accountability of their programs,” he said.

In Morón, the goal was to monitor transparency and financial reporting, and in Esteban Echeverría it was to improve selection procedures for the program’s intended beneficiaries, he said.

But Repetto said that the program lacks an operational manual with shared criteria across the board, and that its results are very uneven, depending greatly on the efficiency of individual municipalities.

In Repetto’s view, the programs focus too much on public works and neglect other areas. “There is enormous demand in the field of care for the elderly, and with good training that could be a window of opportunity, especially for women,” he said.

The income-generation initiatives that mushroomed in Argentina in response to the severe 2002-2003 crisis have come together in the National Confederation of Worker Cooperatives (CNCT).

Among the various models that sprang up, in addition to the state-promoted cooperatives, are businesses whose owners declared bankruptcy and often fled, and that were recovered, and are now managed, by the employees themselves.

José Sancha, the head of CNCT, told IPS that the cooperative federation is working with the ministry of social development to offer training courses for workers new to the cooperative movement who are entering the Argentina Works program.

He also highlighted that many of the 3,000 cooperative groups that were created under state protection between 2003 and 2006 “are established now, and are part of the cooperative movement.”

In Sancha’s view, it is a good thing for the state to channel orders for goods and services towards cooperatives capable of building public works, but he said much more needs to be done to strengthen the cooperatives.


2 thoughts on “Cooperatives in Argentina Reduce Hard-Core Unemployment

  • This a heartening report. There’s no question that worker-owned cooperatives can exist under a capitalist regime and be very beneficial for worker owners. The spectacularly successful worker-owned industrial coops in the Basque region of Spain began and flourished under the hostile regime of the butcher Franco.

    The problem with the Argentinian coops is the same problem with the Mondragon coops. They exist under a capitalist political state, and a monopoly capitalist economic mode of production, and therefore can never–by themselves, no matter how successful–achieve a socialist political state and socialist transformation. Ultimately, without political leadership on the left striving to establish a socialist cooperative republic, they will help preserve the capitalist mode of production and the capitalist state.

    What is needed in Argentina is exactly what is needed in Spain, Cuba, Venezuela, Canada and the US: a socialist political movement that recognizes that a cooperative mode of production is the only form of socialism that can work and transform the world, plus a theoretical recognition that the socialist state need not own 100% of everything productive. The instruments of production should be owned primarily by cooperative workers and small business enterprise. The socialist state should “co-own” productive enterprise silently and let those who do the work run enterprise democratically and prosperously.

    This fine article is not published in the Spanish-language HT. Here is a computer translation of the above comment that might be of interest to cooperative-minded socialists in Cuba:

    Este informe un alentador. No hay duda de que las cooperativas de propiedad de los trabajadores puede existir bajo un régimen capitalista y ser muy beneficioso para los propietarios de los trabajadores. El espectacular éxito de las cooperativas de propiedad de los trabajadores industriales en la región vasca de España comenzó y floreció durante el régimen hostil de los Franco carnicero.

    El problema con las cooperativas de Argentina es el mismo problema con las cooperativas de Mondragón. Ellos existen en un estado capitalista político, y un monopolio modo capitalista de producción económica, y por lo tanto no pueden-por, no importa qué tan exitoso, lograr un estado político socialista y las transformaciones socialistas. En última instancia, sin un liderazgo político de la izquierda tratando de establecer una república cooperativa socialista, que ayudará a preservar el modo de producción capitalista y el Estado capitalista.

    Lo que se necesita en Argentina es exactamente lo que se necesita en España, Cuba, Venezuela, Canadá y los EE.UU.: un movimiento político socialista, que reconoce que un modo cooperativo de la producción es la única forma de socialismo que puede trabajar y transformar el mundo, además de un reconocimiento teórico de que el Estado socialista no necesita poseer el 100% de todo lo productivo. Los instrumentos de producción deben ser propiedad principalmente por trabajadores de las cooperativas y la pequeña empresa. El Estado socialista debe “co-propietarios” de empresas productivas en silencio y dejar que los que hacen funcionar la empresa funcionan de forma democrática y próspera.

  • this is something that should be expanded to other sectors of the society/economy and also opened up to people who exist above the poverty line. it could be something that creates a rising tide for the whole of argentinian society, combing the best aspects of the free market with the best of socialism, as well as providing opportunities for more direct participation in the free market place and a more democratic economy.

Leave a Reply

Your email address will not be published. Required fields are marked *