[PEN-L:4544] NAFTA, Social Dumping, and Multinational Collective Bargaining

["Charles Brown" <CharlesB@xxxxxxxxxxxxxxxxxxxxx>]

NAFTA, Social Dumping, and Multinational Collective Bargaining

by Hal Sutton, UAW Local 1268

Introduction

The recent controversy over Congress' failure to enact "fast track" authority for President Clinton to engage in negotiations to extend the North American Free Trade Agreement (NAFTA) to nations in the Southern Hemisphere highlights concerns about the nature and impact of NAFTA, itself. The dependency approach of Santos (1993, pp.194-5) describes a world economy in which relations between dominant and subordinate, or dependent nations are uneven and combined. Development occurs in the dominant nations at the expense of the subordinate ones -- financial relations are based on loans and export of capital to dependent nations, with interest and profits flowing back to the dominant ones.

Dependent nations experience the loss of control over their productive resources, and generate large surpluses, based not upon the use of higher technology, but rather the superexploitation of labor power; monopolistic control of markets leads to the transfer of surplus from the dependent nations to the dominant ones.

However, the flip side of these relations is a process known as "social dumping." In a discussion of the Single European Act of 1986, Klein (1991, p. 419) describes social dumping as the practice of multinational enterprises of transferring "their facilities from countries with high labor wages to Greece, Portugal, or Spain, where wage rates and other social costs are significantly lower." Klein (1991, pp. 421-2) mentions that the practice of consulting with labor officials about major corporate decisions; the establishment of Pan-European labor standards on critical issues, such as minimum wage and maximum hours; and the facilitation of multinational social dialogue are all measures that have been discussed as approaches that could ameliorate social dumping within the European Union. However, Klein (1991, p.422) considers the establishment of a system of multinational collective bargaining to be the optimal approach, as it would "best balance the competing interests of employ!
ees and multinational enterprises."

According to Klein (1991, p.426), multinational collective bargaining would enable labor and management to "tailor the social dialogue to the particular needs of the employees," and reach agreement "in a less intrusive manner" than the other alternatives. He (1991, p.427) lists the following obstacles, none of which he considers to be insurmountable: "varying laws and practices, management opposition, union reluctance and lack of coordination, lack of employee solidarity, and differing national priorities."

Within the context of the NAFTA partners, where the dependency relations are much sharper than within the European Union, the obstacles mentioned by Klein are greatly magnified, as is the extent (potential, as well as the level already realized) of social dumping. This paper will explore the potential for multinational collective bargaining, and attempt to identify the requisite conditions necessary to establish the practice. With a focus upon the socio-economic and political relations among the NAFTA partner nations, the paper will examine the nature of the NAFTA pact, the nature of Mexico's maquiladora industry, the relationship between the Mexican state and its labor movement, the activity of dissident movements within Mexico's labor unions, and existing collaborative efforts among the labor movements of the NAFTA partners.

An Assessment of NAFTA

The Government of Canada (hereinafter Canadian report) (1992, p. i) states that when the trade ministers of Canada, the U.S. and Mexico opened negotiations for NAFTA , on June 12, 1991, it was an historic occasion, because "for the first time ever, a developing country agreed to sit down with two industrialized countries to craft an agreement that would open its economy to full competition with the other two countries." The Canadian report (1992, p. i) continues, stating that when the three minsters met again the following year to finalize their work, they achieved an agreement that "provides a new set of rules to cover investment and more than $300 billion in annual three-way trade" that will"open the door to a vast new potential in trade and investment relations among the three countries" within which "private entrepreneurs can seek to expand their market and investment activities."

Furthermore, the Canadian report (1992, p. i) states that since the end of World War II, such trade liberalization measures as the General Agreement on Tariffs and Trade (GATT) have led to a global economy in which trade in goods has grown twice as fast as production, to the point where about three trillion dollars in goods are now exchanged throughout the world, every year. The Canadian report (1992, p. i) adds that "the most impressive increase has been in intra-industry trade, and thus consumers around the world have benefitted from increased specialization and choice."

However, Grinspun (1993, p.14) contends that the economic integration promoted by NAFTA provides for "profound transformations in state-civil relations as well as in the economic and social structures of each country." Grinspun (1993, p.14) adds that the "major impact is on the smaller economies in the arrangement," and "adjustment costs in labor markets fall inordinately on disadvantaged groups in society." Grinspun (1993, p. 14) further contends that the greater economic inequality causes deteriorating social conditions and a political process that becomes further dominated by "the power of large national and international capital."

Grinspun (1993, p.16) also asserts that NAFTA conforms to the current strategic requirements of North American corporate capital, which is facing a major competitive challenge from the European Union and Japan, whom it plans to confront by "bringing together Canadian natural resources, U.S. technology and capital, and inexpensive, but productive, Mexican labor." Grinspun further contends that NAFTA entrenches: "a bill of corporate economic rights for big national and transnational capital. Corporations gain the ability to restructure and 'rationalize' their operations on a continental basis. Their new continental status is expressed in measures such as 'national treatment' for foreign capital; dismantling controls on foreign investment; increased capital mobility; intellectual property laws; deregulation and privatization; and financial deregulation."

Ranney (1993, pp. 2-3) contends that NAFTA is a product of "transnational capital's evolving social agenda," following the collapse, in the early seventies, of the Bretton Woods Agreement that had defined economic relations among the nations of the Free World, since the end of World War II. According to Ranney (1993, p. 3), a key element of this emerging agenda has been an effort to reduce production costs "in order to halt falling profit rates and meet the claims on the value of global production." By way of illustration, Ranney (1993, p. 3) quotes Jacques de Larosiere, who was chairman of the International Monetary Fund in 1984:

"'Over the past four years (1980-83) ... a clear pattern (has emerged) of substantial and progressive long term decline in rates of return to capital. There may be many reasons for this. But there is no doubt that an important contributing factor is to be found in the significant increase over the past 20 years or so in the share of income being absorbed by employees.... this points to the need for a gradual reduction in the rate of increase in real wages over the medium term if we are to restore adequate investment incentives.'"

According to Ranney (1993, p. 3), another element in the corporate agenda is the use of capital mobility to depress the cost of production, and destroy "claims on value, " which "include wages, social services, and a clean and safe workplace and environment." Ranney (1993, pp. 3-4) further contends that capital mobility tends to destroy claims on value by not only depressing wages, but also through the use of free trade agreements that seek to eliminate "non-tariff barriers" (NTB) to trade and investment flows. Ranney (1993, p. 4) explains that "health care, welfare and subsidized housing programs; and environmental regulations can be (and have been) viewed as barriers to trade in that they raise the cost of production and investment."

The dire contentions of Grinspun as well as Ranney about the true nature of NAFTA are, in fact, confirmed by AFL-CIO Secretary-Treasurer Richard Trumka, who, on June 3, 1997, testified before the Senate Committee on Finance:

"NAFTA has also failed to deliver prosperity and stability to Mexico. Instead, it exacerbated the Mexican economic crisis, limiting the government's ability to address the crisis, and deepening income polarization and social divisions. Since January 1, 1994, when NAFTA took effect, Mexico has undergone an economic depression, widespread guerilla uprisings, political turmoil, increased environmental damage, and growing poverty. Rather than enjoying automatic prosperity as a result of trade liberalization, as NAFTA's proponents had predicted, average Mexicans have seen their debts skyrocket and their wages fall since NAFTA took effect. In dollar terms, according to the Bureau of Labor Statistics, the average hourly compensation for a Mexican production worker in manufacturing has fallen 36 percent since 1993, from $2.40 to $1.51. Canada has seen significant erosion of its social safety net since the passage of NAFTA."

As a further illustration of the Grinspun and Ranney NAFTA model, the June 26, 1996 Semi-Annual Report to Congress by the Secretary of the Treasury Pursuant to the Mexican Debt Disclosure Act of 1995 contains the following passages:

"The Mexican government has embarked on a broad array of initiatives to open certain sectors to private and foreign investment and to prepare state-owned enterprises for privatization. Privatization and structural reforms are designed to increase productivity, attract foreign investment, raise government revenue, and kindle private-sector initiative. During 1995, the government focused on establishing the legislative and regulatory framework for privatization, with initial concessions awarded for port operations and for long-distance telecommunications services. In 1996, concessions and sales have occurred or are planned in the transportation, energy, petrochemical and telecommunications sectors. Mexico has also moved forward in creating the enabling environment for private pensions.

"...II. Changes in Wage, Price and Credit Controls. The "Alliance for Economic Recovery" (ARE), negotiated and signed late last year by the Mexican Government, the Bank of Mexico and representatives of the labor, rural and business sectors, sets forth objectives for sustainable growth and firm fiscal and monetary policies in 1996. A provision in the ARE provides for increases of the minimum wage, the only wage control in Mexico. The minimum wage increase was targeted to be in line with the projected inflation target for 1996 of 20.5%. In the first half of this year, the ARE called for a 10% increase to take place in April. The government subsequently decided to raise the minimum wage instead by 12.2%, effective April 1, 1996. The Mexican Government has also incrementally increased the prices of publicly provided goods and services. Gasoline and electricity prices have been increased by 1.2% per month since the beginning of 1996, except for April when they were raised by 6%, as!
 set forth in the ARE. In an effort to increase efficiency and to hold firm fiscal policies, the government also increased prices of subsidized foods, not encompassed in the ARE plan, on April 1, 1996. Tortilla prices were raised by 27% and milk by 50%."

NAFTA has often been described as the maquiladorization of the entire nation of Mexico. The following section will discuss the development of Mexico's maquiladora industry.

The Maquiladora Industry in Mexico

Cobos (1993, p. 91) reports that the maquiladora industry in Mexico began in 1965, in response to the economic crisis that developed in the northern Mexican border states, as a result of the cancellation by the U.S. of its "bracero" program that had regulated the legal flow of labor into that nation. A report released by the International Confederation of Free Trade Unions (hereinafter ICFTU report) describes the maquiladoras as an example of an "export processing zone" (EPZ). According to the ICFTU report, EPZs were originally established to facilitate the importation of materials for the addition of labor value, with the subsequent duty-free re-exportation of the finished products. The ICFTU report further contends that EPZs were considered "a cheap way of creating jobs without spending scarce taxpayers' money and avoiding a bureaucratic system of reimbursing import taxes on goods intended for export." The ICFTU report adds that as EPZs were established throughout the world,!
 "governments found that they had to add further incentives to attract foot-loose investors to their enclave: subsidized factory buildings, telecommunications links, energy supplies, and most worrying of all, guarantees that the labor force would stay cheap and uncomplaining."

The ICFTU report also asserts that global economic experts widely perceive that EPZs tend to distort the international market place by encouraging a "'slash and burn' pattern of development rather than sound long term investment and the transfer of technology, " and further warns that EPZ host nations often "become trapped at the wrong end of a long international chain of production dependent on some of the world's most vicious employers competing in a cut-throat business for the bottom end of the global market." However, while all of these allegations are characteristic of much of Mexico's maquiladora industry, other historic forces have been at work.

Cobos (1993, p.91) contends that while the maquiladoras had originated as a regional solution, the adoption by the Mexican government of neoliberal and "structural adjustment" policies in 1988 caused the industry to become a key element of economic restructuring policies for the entire nation. According to Cobos (1993, p.91), in the mid-1980s, the emphasis for the maquiladoras changed from labor-intensive operations to more technologically advanced production by large companies, which also led to greater flexibility in labor relations. Cobos (1993, pp.91-2) also reports that from 1975 to 1990, the number of maquiladora plants had increased from 454 to 2,033, while the labor force grew from 67,214 to 465,800, and that from 1985-1990, 88 percent of the growth in Mexico's industrial employment occurred within this sector. The ICFTU report states that by June, 1995, 2,747 enterprises employed 676,518 workers (2.25 percent of a national workforce of 30 million) in Mexico's maquilad!
oras.

At a meeting in 1994, of an organization lobbying for the construction of a superhighway linking Toronto with Laredo, Texas, Reynolds stated:

"Opportunities for joint production are enormous. Mexico is long on unskilled labor but short on technology and skills. It makes sense for Mexico to specialize for a while in rudimentary assembly tasks that require a lot of man hours to add relatively little value to products mainly produced north of the border.

"GE & Whirlpool assemble appliances in Mexico, but with an 85% U.S. content. Haggar has pre-cut U.S. fabric sewn into slacks, with U.S. thread, buttons and zippers. The resulting slacks not only compete effectively with Asian apparel in all three North American markets, but are also exported to Europe, where they compete with Italian fashions sewn in Turkey. U.S. furniture companies have precut products assembled in Mexico. North of the border, many Canadian cars rely on U.S. parts, and vice-versa. These sorts of partnerships, with each country specializing in part of the production process, can be quite effective in keeping total costs extremely competitive in both the North American markets, and for exporting to Europe, Latin America and Asia."

Thus, it is actually less costly to fabricate products in one shop in the U.S., and ship them hundreds, or even thousands, of miles to another shop in Mexico for final assembly or finishing, than to perform the finishing operations only hundreds of feet away, within the same shop! Such a practice is downright grotesque from an industrial or process engineering standpoint, but perfectly rational within the context of a globalized economy that fosters social dumping.

Cobos (1993, p.94) describes the superexploitation of the maquiladora workers:

"Examining wages in dollar equivalents, a maquiladora industry worker's wages dropped from $1.00 in 1976 to $0.82 in 1986, while the U.S. worker's wage rose from $4.81 to $9.75; the relation between the two went from 1 to 4.81, to 1 to 11.1; companies were able to save 79.2 percent in 1976, and 84.8 percent in 1986, of their labor costs compared to production in the U.S. The fall in real salaries (measured in $U.S. terms) has continued since 1986, although at a more moderate rate."

Cobos (1993, p.94-5) adds that the wage differential is intensified by the longer Mexican work week, as well as the greater proportion of Mexican workers who earn minimum wage, the high turnover (about 10-15 percent per month) among workers in the maquiladoras, and the inferior benefits received by Mexican workers.

The ICFTU report asserts that in order to establish the minimum wage in Mexico, the Ministry of Labor has created a Minimum Wage Commission, which estimates the cost of living in each region, in order to "coordinate meetings of employers' and workers' representatives." The ICFTU report also cites an International Labor Organization (ILO) document entitled "The Maquiladora Industry in Mexico:"

"'The (minimum wage) levels established were in reality the outcome of a political game in which the CTM (Mexican Workers' Confederation, see Appendix II) plays the role of a monolithic organization, which for more than 40 years has exerted such control over the labor movement that it actually inhibits workers' genuine demands. There are more and more independent trade unions, however, and even factions within the CTM that support workers' demands, even if it means opposing the view of the leadership. Naturally, their fight is not an easy one."

According to Cobos (1993, p.94-5), the maquiladora industry is still dominated by labor-intensive parts assembly operations and garment manufacturing, and employs a work force that is "unskilled, young (16 to 25 years), largely female, without family commitments and with little union awareness or experience." Cobos (1993, p.94 -5) adds that the more technologically advanced operations, such as large automobile assembly plants, with a higher proportion of skilled workers and technicians, attempt to retain such employees by paying higher salaries, and that labor shortages are common in times of economic expansion.

Cobos (1993, pp.97-8) also reports that virtually "all materials for the maquiladora industry come from foreign sources 98.2 percent nationwide, and 99.0 percent in the border states in 1991," and that subsidized pricing provides lower costs to the industry for goods and services purchased in Mexico:

"Raw materials, water, electricity, industrial gas and other sources of energy; general conditions for production and circulation of merchandise such as communications, roads, ports, and transport by trucking or rail; adequate streets (50 times less than in the U.S. and 25 times less than in Hong Kong), construction of factories and offices (3.5 and 2.5 times cheaper, respectively) and rental of buildings. The oversupply of available sites and equipped factories accentuates these benefits."

According to Cobos (1993, p.99), virtually all of the maquiladora plants are owned by transnational corporations, because of special legislation that has permitted foreign companies to control them "as 'subsidiaries' holding 100 per cent of the stocks of the 100 largest maquiladora factories, and of the majority of the small and medium-size maquiladoras as well."

Furthermore, the author (1993, p.99) contends that recent Mexican legislation has opened up all of Mexican economic activity to such concentrated foreign investment. Cobos (1993, p.99) adds that while most of the maquiladora factories are owned by U.S. corporations, ownership by Japanese companies, as well as other Asian concerns and European corporations has grown, and that NAFTA could provide such foreign concerns with an opportunity to evade U.S. protectionism, which would encourage further investment from such sources.

Cobos (1993, p.102) also reports that the maquiladoras have facilitated the demographic integration of the Mexican border states into the U.S. economy, as "next to every Mexican city a twin U.S. city develops, or vice versa." However, the author (1993, p.102-3) contends that the territorial and economic units tend to develop different areas of specialization: "the Mexican city contains the maquiladora factories and the precarious housing of the workers, while on the U.S. side there are commercial centers, centers for transportation and commercialization and the offices of the companies which own the maquiladora industries." Moreover, Cobos (1993, p.105) alleges that the northern border area is becoming economically and demographically assimilated by the southern U.S., creating north-south industrial corridors "joining the Mexican maquiladora cities to the U.S. industrial and market centers." Meanwhile, according to Cobos (1993, p.105), "territorial, economic and cultural integ!
ration of the Mexican border areas into the rest of (Mexico) is not advancing."

Furthermore, Cobos (1993, p.100) asserts that the failure of the maquiladora cities to become integrated into the rest of the nation has lead to extreme poverty and squalid living conditions among their inhabitants. The author (1993, p.100) attributes this phenomenon to rapid demographic growth, low wages of the maquiladora workers, unemployment among other sections of the local labor force, and "lack of affiliation with the Social Security and Housing Systems, impeding workers' ability to claim their rights or to receive credit from social service sectors or the public or private institutions which produce housing." Other contributing factors mentioned by Cobos (1993, p.100) are a low priority for government spending for housing, infrastructure and social services, as well as indifference among private contractors toward the housing needs of impoverished workers. As a result, Cobos (1993, p.100) alleges that "this has given rise to a great scarcity of housing and services, ob!
liging the majority of workers to build their own precarious homes, without infrastructure or services, on inadequate terrain." Cobos (1993, p.103) further argues that the degradation of the environment on the Mexican side of the border has intensified with the expansion of the maquiladoras, and that: "relocation to the Third World of highly polluting industries in order to avoid environmental controls in the country of origin is a very common company policy in the internationalization of capital."

Cobos (1993, p.102) also contends:

"The low wages of maquiladora industry workers, their appalling living conditions, including the infrastructure and social services available to them, would make the cost paid by society to support maquiladora capital seem truly exorbitant, especially if we consider the scant benefits obtained. Transnational capital should cover these costs, which are a source of extraordinary private profits. Otherwise, the costs continue to be transferred to society, socializing private costs whose benefits are reaped by agents of foreign capital rather than by society. This is yet another way in which wealth is transferred from poor countries to rich countries."

Faced with the immediate prospect of widespread social dumping following the implementation of NAFTA, the labor movements in Canada and the U.S. have responded by forging links with organizations in Mexico that are striving to organize independent unions. The front lines of this battle are presently located in the Maquiladora industry. The following section will scrutinize this developing conflict between the workers of the NAFTA partners and the multinational corporations that, apparently, wish to continue their unfettered superexploitation of the Mexican workers, and ultimately impose such conditions upon the workers of the U.S. and Canada.

The Struggle to Organize the Workers in the Maquiladoras To Strengthen Mexico's Labor Movement

Appendix II provides a detailed description of the history of the Mexican labor movement. It is readily apparent that Mexico has as rich a labor history as any Third World nation; in fact, as rich a labor history as many developed countries. Thus, the Mexican working class has a vast body of experience to build upon, and also to overcome, in the struggle to pave the way for multi-national collective bargaining among the NAFTA partners. As described in Appendix II, corporatist collaboration with government, and especially, political institutions has been a part of the experience of the Mexican labor movement from its earliest beginnings. Here, it must be emphasized that the Mexican labor movement emerged as an integral part of the Mexican Revolution of 1910-1917 (or, arguably, 1910-20). Thus, as Mexico's government and governing institutions (the PRI and its predecessors) were erected upon the foundation of the Revolution of 1910-17, the Mexican labor movement, as a concurrent !
product of the revolution, has always been intimately connected with the institutions of Mexican government and politics.

Therefore and furthermore, the Mexican labor movement has followed a path of historical development that closely parallels the evolution of the state and political institutions of the present Mexican regime (see Appendix I and Appendix II). And, the point is worth making that the Mexican Constitution of 1917 has been one of history's most durable constitutions -- even many developed nations with a longstanding history of democratic state institutions, such as France (the French Third Republic lasted from 1871-1940), have been unable to match it, in this respect. As shown in Appendix I, following the consummation of the Mexican Revolution by the establishment of the Obregon regime in 1920 (Carranza's Constitution of 1917 was not overthrown, although his regime was), every succession of governments in Mexico has taken place in an orderly manner, under the process specified in the Constitution of 1917.

However, Cook (1996, p.11) mentions that, while prior to the 1970s, most scholars had viewed the Mexican regime as a "'developing'" or "'one-party'" democracy; in recent decades, the prevailing consensus among scholars has been to classify the Mexican regime as "authoritarian," because of: "the fact that electoral competition was suppressed through the use of electoral fraud, restrictions on opposition party electoral participation, and control of the electoral process by the PRI; that the state limited both political pluralism and political mobilization outside of the corporatist structure of the party; and that repression (as well as coercion and cooptation [This curious term was widely used in the U.S. during the protest movement of the sixties. Here, the author probably refers to a process similar to Bismarck's appropriation of socialist reforms in late nineteenth-century Germany - ed.]) were used by the state against challengers to the party's hegemony and to the establis!
hed leaderships of mass organizations allied with the party."

Camin and Meyer (1993, p.202) characterize the indiscriminate massacre of student protestors that took place in Tlatelolco, on Oct.2, 1968, as "the numbed responses of the past to a movement that captured the heartbeat of the future, that constituted itself into the embryonic presence of another country and another society, and whose fluctuations would be increasingly difficult to manage with the old devices of manipulation and control."

While Cook never mentions the Tlatelolco Massacre as having contributed to the different scholarly perception of the Mexican regime, it bears mention that this terrible event probably has had much to do with it.

Cook (1996, pp.11-12) adds that the heavy concentration of Mexico's state power in the executive branch, "including the president's power to name his successor," as well as "the lack of clear separation between the ruling party and the government, which takes on special significance during elections," also tend to sway scholarly perception of the Mexican regime toward classifying it as authoritarian albeit a softer variety than most.

However, in recent years, the PRI regime has implemented electoral reforms designed to democratize the nation's electoral process. The U.S. State Department report on human rights in Mexico states:

"Mexico is a federal republic with an elected president, a bicameral legislature, and a constitutionally mandated independent judiciary. The Institutional Revolutionary Party (PRI) has won every presidential election since the party's founding in 1929, many of which involved credible allegations of fraudulent practices. Most national and international observers, however, regarded the August 1994 presidential elections as free and honest. The success of these elections carried over in 1995 into most state elections, with only one state election marred by allegations of serious fraud. In 1996 most state elections were fair and orderly. A few, such as the municipal race in Huejotzingo, Puebla, provoked serious postelectoral conflicts, most of which have been resolved. In November, the Congress approved a package of further electoral reforms, including full autonomy for the Federal Electoral Institute and elections for Mexico City's local government. Due to disagreements on a numb!
er of issues, especially campaign spending limits and rules governing coalitions, however, the main opposition parties' legislators voted against the law. Despite opposition criticism of the PRI's decision to press for adoption of certain provisions on campaign financing in the reform package, the law includes the basic elements that had been agreed upon by the opposition."

Thus, given the parallel development of Mexico's state institutions and labor movement described in Appendix I and Appendix II, it would certainly be reasonable to expect that increased competition within the nation's electoral system should facilitate greater competition within a labor movement that, as described above, is characterized by a more competitive environment than the labor movement in the U.S. and Canada, which only have unions that are politically independent. And, the rise of independent unions in the maquiladoras, as described above, should facilitate their development in Mexico proper.

However, it must be emphasized that since the crash in world oil prices that occurred in 1981, the Mexican economy has been mired in a nearly unabated depression, punctuated with brief periods of relative recovery (see Appendix I). This extended economic catastrophe has caused the massive flow of emigration into the U.S. that strained relations between the two nations' governments throughout much of the eighties, and has provided the backdrop under which NAFTA was negotiated and has been implemented. The extended economic crisis has also tended to severely depress the wages of Mexican workers, in spite of a powerful and vibrant labor movement that has seldom been docile and quiescent, in spite of the close ties of its dominant confederations to the ruling PRI (see Appendix II).

For example, according to Cook (1996, inter alia), during the late seventies, and throughout the eighties, a powerful dissident movement developed and grew within the National Union of Education Workers (SNTE). This movement, led by the National Coordinating Committee of Education Workers (CNTE), was able hold the official leadership of the SNTE in the states of Chiapas and Oaxaca throughout much of the eighties, in the face of government repression and insidious maneuvers by the national leadership of the SNTE (Cook, 1996, inter alia). Cook (1996, inter alia) contends that the dissident movement has been successful because it has constantly, and rigorously sought to maintain democratic processes within its formal structure, enabling it to mobilize massive numbers of supporters to conduct powerful actions that are often quasi-legal, at best. Cook (1996, pp.317-19) also reports that massive nationwide mobilizations in Mexico City in March, 1982, as well as April, 1989, played a!
 critical role in achieving, as well as sustaining, the significant gains that the dissident movement has accomplished. As an historical process that could be instructive for the purpose of this paper, the dissident movement among Mexico's teachers bears closer scrutiny.

The Dissident Movement of Mexico's Teachers

Cook (1996, p.2) describes the SNTE as the "largest single trade union" in Latin America. However, Cook (1996, p. 80) explains that as a union of public workers, its government regulation is contained in a different section of Article 123 (which covers labor law) of Mexico's constitution than is the regulation of labor organizations for workers in the nation's private sector. Thus, SNTE members are burdened by more stringent constraints on their right to strike, and other collective bargaining activities, than are workers in Mexico's private sector. In fact, according to Cook (1996, p.81), Mexico's federal law "stipulates that each government department, ministry, or agency establish General Conditions of Employment for its employees in 'consultation' with the respective union," rather than through negotiation of collective bargaining agreements.

Moreover, Cook (1996, p.82)contends that Mexican law stipulating that "only one union of government ministry employees could be recognized by the government" imposes further constraints upon the organization of dissident movements among public employees, especially given the close corporate relations between the recognized unions and the PRI. Cook (1996, pp.78-9) also asserts that the SNTE has usually dominated the selection of administrative personnel within the federal educational bureaucracy among Mexico's several states, providing the union leadership with much control over teachers' opportunities for career advancement, as well as their conditions of everyday life on the job, and leading to many instances of abuse of power among corrupt union leaders who are derisively referred to as "charros."

However, in spite of all the constraints mentioned above, a powerful dissident movement among Mexico's teachers developed, flourished, and has persevered. According to Cook (1996, pp. 82-3), the origins of the discontent among Mexico's teachers lay in the austerity measures imposed upon public workers by the Portillo government following Mexico's balance of payments crisis of 1976, with the result that the long-term drop in real wages among Mexico's teachers can actually be traced all the way back to that period. Cook (1996, pp.101-4) further explains that friction and cleavages between the SNTE leadership and the Mexican government stemming from the implementation of a policy of decentralization of education administration in the late seventies and early eighties, in the midst of the oil boom that aroused much hope for Mexico's future during that period, provided a crucial opening for the formation and growth of the dissident movement, as dissident leaders were able to play t!
he feuding parties against one another. Cook (1996, p.82) describes the form that most dissident mass action took: "wildcat strikes, or work stoppages (paros), sit-ins, encampments, marches, building occupations, rallies and hunger strikes."

Cook (1996, pp. 168-73) explains that while the dissident movement and its loose blanket organization, the CNTE, were national in scope, and developed in response to conditions that prevailed across Mexico, it was unevenly organized along regional lines, according to the conditions and conflicts prevailing in each region, and with autonomous regional leadership. Cook (1996, pp. 169-73) further explains that the various regional movements achieved a varying degree of success, based upon the following factors:

"Cautious adoption of political (versus economic) demands;" "successful maintenance of a broad, inclusionary dissident coalition;" "ability to sustain a mass base of support within the movement;" "limited use of confrontational tactics; acceptance of institutionality;" "weak local vangardista (Vanguardia Revolucionaria, the ruling faction within the SNTE) presence and limited use of violence;" and "timing in the cycle of protest."

As mentioned above, Cook (1996, pp. 212-15) contends that the dissident teachers' movement achieved its greatest success in the states of Oaxaca and Chiapas, where the regional movements successfully pursued a legal strategy of seeking election to the regional leadership of the SNTE, rather than forming parallel organizations and seeking to unseat the SNTE as the official representative of teachers, which almost always required illegal activity. However, Cook (1996, p. 213-14) also explains that assuming regional leadership positions within a national union that was "oligarchic and centralized," and "whose leaders were hostile to the movement," presented significant hazards and obstacles to the growth, indeed to the very survival, of the movement in these two states. As functioning union leaders, the dissidents had to meet their normal responsibilities and obligations to their membership, which required establishing a working relationship with education ministry officials. How!
ever, the establishment of such a relationship also provided an opportunity for absorption into the same bureaucracy that the movement was confronting; a temptation to which some leaders inevitably succumbed. Furthermore, Cook (1996, pp.213-15) reports that dissident leaders occupying official leadership positions within the SNTE also faced the necessity of sustaining the mass support of their movement, while maintaining a functional relationship with administrators.

As mentioned above, Cook (1996, pp. 262-3) contends that a constant struggle for internal democracy within the dissident movement was the most important strategic measure taken by movement leaders in their struggle to sustain and expand the movement, throughout the depression years of the eighties. Cook (1996, p.271) further reports that the dissident teachers were rewarded for their perseverence with a massive nationwide upsurge of teachers in April, 1989, that led to the downfall of SNTE secretary-general Refugio Araujo del Angel and Vanguardia Revolucionaria strongman Carlos Jonguitud Barrios. Cook (1996, pp. 266-7) reports that the teachers' upsurge emerged as part of a general popular dissatisfaction with the outcome of the 1988 presidential election in Mexico -- a result that was widely perceived as fraudulent in

Conclusion

The information above provides a clear description of the conditions that Mexican workers face, as with the aid of a growing movement within U.S. and Canadian labor organizations, they struggle against the twin assaults of economic crisis and transnational capital, facilitated by NAFTA. Also, as reported above, Klein considers "union reluctance and lack of coordination," as well as "lack of employee solidarity" to be among the main obstacles to the establishment of multi-national collective bargaining. Furthermore, Wallerstein (1993, p.225) questions, "Why has not the reality of international workers' solidarity been greater?" Recalling the courageous example of German soldiers who fraternized with enemy troops on the Western Front on Christmas Eve, 1914, as well as on the Eastern Front, during the spring of 1917, it is easy to agree with the view that the leadership of the working class is primarily responsible. However, it does little good to lament the past, when the presen!
t holds such promise, in this regard. What is developing before us is a substantive internationalism, rather than the principled internationalism that proved so hollow, when the time came to wield it in practice, as a weapon of peace. One can only hope that the new internationalism that is now on the rise can be more effective. And, every effort must be made to ensure that it is.

References

1. Bacon, David. 1997. "Maquiladora Workers Elect Their First Independent Union," Campaign for Labor Rights (http://www.compugraph.com/clr/alerts/david_bacon.html).

2. Camin, Aguilar, Lorenzo Meyer, In the Shadow of the Mexican Revolution, Austin, University of Texas Press, 1993.

3. Campaign for Labor Rights. 1997. "General Motors Dismisses 23 Workers in Retaliation for work Stoppage!" (http://www.compugraph.com/clr/alerts/clraltso.html).

4. Cobos, Emilio Pradilla. 1993. "The Limits of the Mexican Maquiladora Industry," Review of Radical Political Economics 25(4):91-108.

5. Cook, Maria Lorena, Organizing Dissent -- Unions, the State, and the Democratic Teachers' Movement in Mexico, University Park, PA, Pennsylvania State University Press, 1996.

6. Cusick, John. 1996. "Response to NAFTA U.S. and Mexican Telecom Unions Build North American Labor Solidarity, CWA News, (CWA on the Web, Internet, 1996).

7. CWA Media Advisory. 1997. "'Global Outlaw' Sprint Must Be Stopped Union Leaders Protest Anti-Worker Tactic of Telecom Firms," CWA News (Internet: CWA on the Web).

8. CWA on the Web. 1996. "CWA Filing Brings Victory for Maxi-Switch Workers Mexico Recognizes Independent Union," CWA News, (Internet: http://www.cwa-union.org/art6.html).

9. Dillon, Sam. 1997. "Union Vote in Mexico Illustrates Abuses," New York Times, Oct.13, 1997. Campaign for Labor Rights (http://www.compugraph.com/clr/alerts/nyt_article.html).

10. Government of Canada. 1992. North American Free Trade Agreement An Overview and Description.

11. Grinspun, Ricardo 1993. "NAFTA and Neoconservative Transformation: the Impact on Canada and Mexico." Review of Radical Political Economics 25(4)14-29.

12. International Confederation of Free Trade Unions. 1996. "Behind the Wire: Anti-union Repression in the Export Processing Zones," (Internet:http://www.icftu.org/english/tucs/etnexpzo.html).

13. Klein, Marc H. 1991. "The Single European Act and Social dumping: A New Appeal for Multinational Collective Bargaining." University of Pennsylvania Journal of International Business Law 12(3):411-431.

14. Ranney, David C. 1993. "NAFTA and the New Transnational Corporate Agenda." Review of Radical Political Economics 25(4)1-13.

15. Reynolds, Alan. 1994. "A Surface Transportation Bottleneck to North American Trade," Report to the Mid-Continent Highway Coalition Conference in Memphis, 1994. Hudson Institute: Indianapolis.

16. Santos, Theotonio dos 1993. "The Structure of Dependence." In Development & Underdevelopment, ed. Mitchell A. Seligson and John T. Passe-Smith. Boulder and London: Lynne Rienner.

17. Stephens, Maria. 1996. "Union, SI! Mexican Workers are Fighting to Organize at GM, Ford, Lear Seating and Elsewhere," Solidarity Magazine March, 1996 (http://www.uaw.org).

18. Trumka, Richard. 1996. "Remarks by Richard Trumka, Secretary-Treasurer of the AFL-CIO to the Labor and the Global Economy Conference," Berkeley, California, November 21, 1996 (News & Views Library, Labornet Forum@xxxxxxxxxxxxxx).

19. Trumka, Richard R. 1997. "Testimony of Richard L. Trumka, Secretary-Treasurer, American Federation of Labor and Congress of Industrial Organizations Before the Senate Committee on Finance on Renewal of Fast Track Trade Negotiation Authority. June 3, 1997," S. Doc. #97-09 (News & Views Library, Labornet Forum@xxxxxxxxxxxxxx).

20. U.S. Department of the Treasury. 1996. "Semi-Annual Report to Congress by the Secretary of the Treasury, Pursuant to the Mexican Debt Disclosure Act of 1995." (http://www.ustreas.gov/treasury/mexico/semi626.html).

21. U.S. Department of State. 1997. "Mexico Country Report on Human Rights Practices for 1996," U.S. Department of State Outreach(Internet:http://www.state.gov/www/global/human_rights/1996_hrp_report/mexico.html).

22. Wallerstein, Immanuel 1993. "The Present State of the Debate on World Inequality." In Development & Underdevelopment, ed. Mitchell A. Seligson and John T. Passe-Smith. Boulder and London: Lynne Rienner.

Appendix I

Mexican History Since 1910

Camin and Meyer (1993, p.2) report that under the authoritarian regime of Porfirio Diaz, Mexico had undergone unprecedented development, with an annual economic growth rate of 2.7 percent between 1877 and 1911. However, Camin and Meyer (1993, p.1) also describe a nation which, by the turn of the century, "had adopted more innovations than could be assimilated by a society such as Mexico's." Camin and Meyer (1993, pp.1-2) continue:

"Federalism had taken the operational form of cacique (political boss) domination; democracy, the face of dictatorship; equality, the route of social immobility; progress, the shape of railroads and foreign investment; industriousness, the form of speculation, the appropriation of goods that increased private fortunes without contributing to the nation's accumulation."

According to Camin and Meyer (1993, pp.15-8), Francisco I. Madero, an activist in dissident politics, conducted an unsuccessful campaign to unseat Diaz in the presidential election of 1910, which led to his arrest. Camin and Meyer (1993, p. 18) further relate that upon obtaining his release, Madero, who came from a wealthy landowning family, fled the country, and, from San Antonio, Texas, issued a call for a general insurrection against the Diaz regime, on Nov. 20, 1910. Thus began a period of catastrophic revolution and civil war that lasted until 1917, when following successful military campaigns against the revolutionary peasant armies of Francisco (Pancho) Villa in the North, and Emiliano Zapata in the South, Venustiano Carranza, a liberal constitutionalist, was able to establish a stable regime that instituted the present Mexican constitution. In 1920, one additional rebellion would topple Carranza, in favor of Alvaro Obregon (Camin and Meyer 1993, pp.70).

While the upheavals that almost continuously rocked Mexico for nearly a decade were primarily fought by peasant armies, the Mexican labor movement played an active role in the events. The Industrial Workers of the World (IWW, or Wobblies) had organized a branch in Mexico known as the House of the Workers of the World (COM). Camin and Meyer (1993, pp.59-66) report that while Carranza had originally collaborated with this organization of revolutionary anarcho-syndicalists, he was ruthless in suppressing it, once his victory over Villa had been ensured. However, Camin and Meyer (1993, pp. 59-60) also contend that the pact that established the terms of collaboration between the revolutionary syndicalists and Carranza's revolutionary state "created the mold into which all of the alliances between the state and Mexican unions in the following seventy years would fit, with slight variations."

Camin and Meyer (1993, p. 80) report that during the period of continuous revolutionary warfare, the United States conducted military incursions into Mexico on two occasions and contacts with the major European nations deteriorated until stability was reasonably restored in 1920. According to the above authors, citizens of the U.S., Great Britain, France and Spain had "enormous claims against Mexico for damages inflicted during ten years of civil war, and by the lack of payment of the significant external debt that had been accumulated during" the Diaz regime and was increased by the regimes of Madero and Huerta (the military dictator who deposed Madero, and was subsequently defeated by Villa and Zapata).

Furthermore, Camin and Meyer (1993, p. 80) assert that the "1917 Constitution in particular, Article 27, was hanging like a sword over the agricultural and oil properties of foreigners, because it opened up the possibilities of their being expropriated or nationalized." In fact, the authors (1993, p. 80) further contend that the Carranza regime fell as he was attempting to resolve "some of the most visible disputes with foreign governments." And, Camin and Meyer (1993, pp. 80-1) add that as a result of Carranza's demise, the U.S. government severed relations with Mexico, prompting virtually the entire international community to follow suit. The authors (1993, p. 81) describe the conditions demanded by the U.S. for the restoration of relations: "the project included guarantees against nationalization, a ban on the retroactive application of the measures established in the 1917 constitution, recognition of the mining and oil rights acquired by U.S. citizens according to the laws!
 of 1884, 1892, and 1909, as well as the payment of retribution for all U.S. properties taken over after 1910."

According to Camin and Meyer (1993, p.82), the "Bucareli Conferences" that were held in 1923 yielded an accord whereby Mexico agreed to pay cash for "all agrarian expropriations greater than 4,335 acres that affected U.S. citizens, to refrain from acting against "the oil properties from which foreign companies could demonstrate that they had begun to extract crude oil before 1917," and to explore a settlement of claims on all damage done to U.S. properties after 1868. As a result of the agreement, formal relations between the U.S. and Mexico were restored, and Mexico's isolation from the international community was ended.

Camin and Meyer (1993, pp. 95-6)further report that, in 1927, under pressure from the U.S. government, the Mexican Supreme Court stuck down the oil law that had been enacted in 1925, and that the following year, new oil legislation was enacted that had received extensive input from Dwight Morrow, the U.S. ambassador to Mexico, who was also a member of the J.P. Morgan and Company banking firm. Morrow would subsequently serve as intermediary between the Vatican and the Mexican government during a bitter armed conflict between rural Catholics and the Mexican government, and facilitate the sale of U.S. arms to the Mexican government, as well as the provision of intelligence information, during a political rebellion that occurred in 1929 (Camin and Meyer 1993, p. 96). Camin and Meyer (1993, pp.103-4) add that while the Mexican government made repeated efforts to satisfy the nation's massive external debt, it was often unable to meet its obligations, and with the onset of the world !
crisis that led to the Great Depression, simply abandoned any serious efforts in this regard -- a situation that, during the 1930's, was hardly unique to Mexico.

While the 1920's were marked with a succession of increasingly conservative Mexican governments, the world crisis of the 1930's brought about a renewed upsurge in radical and leftist forces that was reflected at the very top levels of state power in Mexico, with theascendance of the government led by Gen. Lazaro Cardenas. Camin and Meyer (1993, pp. 129-33) report that Cardenas assumed power through established organizational channels, and quickly disposed of the conservative wing, led by former president Plutarco Elias Calles, who had also been known as "Jefe Maximo," or the "Maximato." Camin and Meyer (1993, pp. 129-33) assert that, while Cardenas rose to power within the state apparatus and the political machine that had been established with the founding of the National Revolutionary Party (PNR) in 1929, he turned toward the masses, and their independent organizations, to consolidate his power, and depose the conservatives.

Camin and Meyer (1993, p. 149) also report that during heady days surrounding the nationalization of Mexico's oil industry, Cardenas reorganized the PNR into the Party of the Mexican Revolution (PRM). Cardenas' reworked ruling party was based on a coalition of peasant organizations, labor unions, government bureaucrats and the armed forces. According to Camin and Meyer, under the administration of Cardenas' successor, Avilo Camacho, the military sector of the PRM was eliminated. The authors (1993, p. 163) further report that the Institutional Revolutionary Party (PRI) was founded in 1946, under the administration of Camacho's successor, Miguel Aleman, who was also Mexico's first post-revolutionary civilian president.

In the period between the fall of the Diaz regime and the beginning of World War II, Mexico was at odds with the great industrial powers on a nearly continuous basis. However, Camin and Meyer (1993, p. 164) assert that by its entry into World War II on the side of the allies, Mexico suddenly had an opportunity to resolve many of the greatest problems that had plagued its relations with its neighbor to the north, which also happened to be the most powerful nation on earth. By the end of the war, Mexico had become firmly entrenched in the U.S. sphere of influence, with its aspirations for economic independence severely muted. Europe no longer offered a serious alternative for Mexico's foreign trade; since the war, the U.S. has consistently been either the source or the destination of between 60 and 70 percent of Mexico's foreign trade. Most of Mexico's exports of raw materials have gone to the U.S., while most of the capital goods required for Mexico's import substitution indust!
ry have also come from that nation Camin and Meyer 1993, pp. 164-5).

According to Camin and Meyer (1993, p. 167), the Aleman government made a fundamental break with the policy agenda that had prevailed under Cardenas: the "dominant preoccupation" of laying the "bases for a more just society" gave way to a concern "first to create wealth by means of industrial substitution of traditional imports, and then to distribute it according to the demands of social justice"-- with the latter priority rapidly fading as the accumulation of capital became the sole objective. Camin and Meyer (1993, p. 167) report that Mexico's industrial sector grew at an annual average of 10.2 percent between 1940 and 1945, as it exported textiles, chemicals, food and other products to belligerent powers. Under a policy of jealous protectionism, industrial growth declined to 5.9 percent between 1945-50, and subsequently rose to a robust 7.3 percent throughout the fifties.

However, the authors (1993, p.167) contend that protectionist policies ultimately hindered Mexico's development of "a truly modern and independent" industrial sector. Furthermore, while a policy of "stabilizing development," based on imposing "political discipline" upon the labor movement, was effective at stabilizing foreign exchange rates and curbing inflation from 1954 to 1973, "when the convergence of a domestic and international crisis put an end to it," Camin and Meyer (1993, pp. 168-9) assert: "the era of devaluations returned in 1976, and the earnest search for an alternative model started. The discovery of vast oil fields in the Southeast in the mid-1970s provided a temporary solution to the country's economic problems: to become again an exporter of oil."

Moreover, Camin and Meyer (1993, pp. 170-4) contend that while the discovery of vast oil fields provided the solution to the economic crisis that led to the devaluation of the peso in 1976, serious problems remained for the Mexican economy: "in spite of its industrialization, Mexico continued to be an exporter of raw materials, vulnerable to external forces, and unable to compete in the international industrial markets," and "Mexico had to relive the cycle of imbalance, indebtedness, inflation, corruption, and depletion of resources that until then had characterized so many oil producing nations." According to the authors (1993, p.209), in 1979 and 1980, Mexico's economy achieved annual growth rates surpassing 8 percent, which were among the highest in the world, and the government of Jose Luis Portillo had appeared to possess a magic bullet that would enable the nation "to overcome the stagnation and renew the economic development process with limitless possibilities."

However, Camin and Meyer (1993, pp.211-12) contend that the Portillo government's stubborn adherence to expenditure patterns, as well as its failure to modify the foreign exchange rate, in the face of the crash in the world oil market that occurred in mid-1981, led to a massive flight of capital from Mexico, in 1982. The authors (1993, pp. 212-16) assert that in response, Portillo reluctantly devalued the peso by 70 percent, in February, 1982; and on September 10, 1982, he floated the peso and nationalized Mexico's banks. As a result of the crisis, the newly elected government of Miguel de la Madrid assumed office on Dec. 2, 1982, with inflation raging at an annual rate of nearly 100 percent (Camin and Meyer 1993, p.218).

Camin and Meyer (1993, p. 220) report that the new government fully expected a social explosion to occur before it could respond to the raging economic crisis with policies of its own making. The authors (1993, p.220) describe the kind of government envisioned by de la Madrid:

"The new Mexico of which the new government was thinking was not a centralized country, but decentralized; not populist or corporative, but liberal and democratic; not patrimonial and corrupt, but morally renewed; not inefficient and disarticulated, but rational and nationally planned. And it was not the large, lax, subsidizing, and feudalized state that had administered thus far the historical pact of the 1910-1917 Revolution, but rather a small, lean state, with clear limits on its interventionist faculties, economically realistic and not deficit-spending, and administratively modern." Whatever its vision, during the de la Madrid government, Mexico experienced an economic growth rate of zero from 1982 to 1987; as inflation raged at 80 percent in 1983, grew to 100 percent by 1986, and ballooned to 150 percent in 1987 (Camin and Meyer 1993, pp. 221-8).

According to Camin and Meyer (1993, pp.228-9), during the crisis of 1982 - 1987, the number of people below the poverty level (with a monthly family income below two minimum wages) increased from 40 percent of Mexico's population to 60 percent, while the average wage, measured in 1970 pesos, fell from 51 pesos per day in 1985 to 35 pesos per day in 1987; and "in order to satisfy their basic needs, workers earning the minimum wage had to work 50 hours per week in 1982; but to buy the same basket of goods, people had to work 85 hours in 1986." Meanwhile, unemployment in Mexico City was listed at 24 percent in 1983, and 34 percent in 1985. Thus, Camin and Meyer (1993, p.232) contend that: "the adjustment of the Mexican development model, with the shrinking of the state, the end of the subsidized economy, and the expansion of the external market, at the expense of a strong decline in the internal demand and consumption, had a concentrating effect in the upper class, and an effect !
of absolute and relative impoverishment even on the successful middle class." In other words, by 1988, Mexico was a very attractive trading partner for corporate interests in search of a social dumping ground.

Camin and Meyer (1993, pp. 264-5) also contend that the acute economic crisis in Mexico, coupled with the aggressive Central American policy of the Reagan administration caused severe strains in Mexico's relations with the United States: "As the main creditors of Mexico are U. S. commercial banks, the health of the entire U.S. financial system seemed to be threatened by Mexico's insolvency, as well as by its inability to repay its external debt of 82 billion dollars (now 105 billion dollars). The illegal entry of Mexicans in search of jobs to the United States increased by more than 40 percent, and the majority of U.S. citizens seemed to be convinced that this was the beginning of a new wave of permanent Mexican immigration. Theend of the extended Mexican 'economic miracle' (sustained growth with low inflation) created great skepticism in the United States with regard to the capacity of the Mexican economy to absorb the current and future generations of Mexican workers, and to!
 offer them productive employment that would represent a viable alternative to the search for jobs in the United States, despite the discovery of huge oil reserves in Mexico."

Appendix II

The History of the Mexican Labor Movement Since the 1910-17 Revolution

As mentioned above, during his rise to power, Carranza had forged an alliance with the revolutionary trade unionists in the COM, and then suppressed the organization following the consolidation of his regime. Next, according to Camin and Meyer (1993, pp.120-1), Carranza sponsored a socialist labor federation know as the Regional Confederation of Mexican Labor(CROM). Led by Luis N. Morones and a small nucleus of leaders, the CROM, in turn, supported Alvaro Obregon, in his successful drive to oust the Carranza regime, and thus, became the dominant labor federation in Mexico for the next decade. Morones would subsequently command considerable political power, serving as secretary of industry, commerce, and labor from 1925-1928 (Camin and Meyer 1993, pp. 121-4). Camin and Meyer (1993, p. 124) describe the fruits of CROM's collaboration with the Obregon regime:

"Beginning in 1922, the number of strikes began to decline, and they reached their lowest point precisely when the CROM occupied -- through Morones -- the Ministry of Industry, Commerce, and Labor, between the end of 1924 and mid-1928. Responsibility and competition: the CROM not only directly controlled its members, but on occasion prevented or sabotaged movements by opposing unions or federations."

Camin and Meyer contend that the political downfall of Obregon, at the hands of Calles, also led to the rapid decline of the CROM. By late 1933, the General Confederation of Workers and Peasants of Mexico (CGOCM) was established by Vicente Lombardo Toledano, to fill the void left by the decline of the CROM. The CGOCM immediately began promoting strikes to demonstrate its virility, as well as cement an alliance with Cardenas. The CGOCM formed the core of the National Proletarian Defense Committee, which organized massive demonstrations in support of Cardenas' candidacy in the 1934 presidential election. Once Cardenas had consolidated his power, he moved to accelerate the process of labor unification, culminating in the founding of the Confederation of Mexican Workers (CTM), under the leadership of Lombardo Toledano (Camin and Meyer 1993, pp.126-40).

As mentioned above, following the formation of the CTM, a wave of strikes ensued that was openly supported, if not encouraged, by the Cardenas government. Camin and Meyer (1993, p.140) report that whereas 202 strikes occurred in Mexico during 1934, there were 642 in 1935, and 674 in 1936, in which 114,000 workers participated. Also, as mentioned above, in 1936, a railroad strike prompted Cardenas to nationalize the railroads, and a strike of agricultural workers brought about the expropriation of the large estates within the entire La Laguna region; all of which was followed by the nationalization of the entire Mexican oil industry, following a bitterly contested strike in 1937.

Camin and Meyer (1993, pp.184-5) contend that for most of the two decades following the Cardenas regime, stability reigned within the Mexican labor movement, broken only by dissident stirrings within the National Railroad Workers Trade Union in 1954-1955. However, the authors (1993, p.185) report that while this rebellion was easily crushed, when the rebellion re-emerged in 1958, during a change in government between Presidents Ruiz Cortines and Lopez Mateos, the force was irresistable, and spread throughout the entire public sector. The dissidents, led by Demetrio Vallejo, and Valentin Campa, a Communist Party militant, organized a crippling rail strike that enabled them to unseat the union's ossified executive committee, which was led by Samuel Ortega. However, while the government reluctantly permitted Vallejo to prevail in the union election, it ruthlessly suppressed, with the aid of the CTM, a nationwide rail strike in 1959, that, as mentioned above, spread throughout Mex!
ico's entire public sector. As a result, Vallejo and Campa spent many years in jail, new union leadership was appointed, and official control over Mexico's labor movement was restored (Camin and Meyer 1993, pp.185-6).

Camin and Meyer report that the economic crisis at the beginning of the 1970s led to another wave of strikes in 1974, that ultimately received the backing of the Echeverria government, resulting in a 35 percent wage increase for Mexico's workers. In defiance of the anti-inflation program of the Echeverria government, the Fidel Velasquez leadership of the CNT had led the labor movement's wage offensive, and thereby strengthened its grip upon Mexico's unions. Echeverria's support of the strike was largely brought about by business' antagonism to his left-talking government, following the fall of Allende in Chile, in 1973. Thus, Echeverria was able to chastise the business sector, and further cement his government's ties with the CNT.

These developments also enabled the CNT leadership to turn back a powerful challenge by Rafael Galvan, who led a dissident movement within the Union of Electricians of the Mexican Republic (SUTERM) (Camin and Meyer. 1993, pp.205-6).

Appendix III

U.S. Department of State

Mexico Country Report on Human Rights Practices for 1996

Released by the Bureau of Democracy, Human Rights, and Labor, January 30, 1997.

Section 6 Worker Rights



a. The Right of Association

The Constitution and the Federal Labor Law (LFT) provide workers with the right to form and join trade unions of their choice. About 30 percent of the total work force is unionized, mostly in the formal sector, where about one-half the labor force is employed. This implies a formal sector unionization rate nearly twice that high.

No prior approval is needed to form unions, but they must register with the Federal Labor Secretariat (STPS) or state labor boards (JLCA) to obtain legal status in order to function. Registration requirements are not onerous. There are credible allegations, however, that the STPS or JLCA occasionally withhold or delay registration of unions hostile to government policies, employers, or established unions or register extortionists or labor racketeers falsely claiming to represent workers. To remedy this latter problem, STPS officials require evidence that unions are genuine and representative before registering them.

Like the Federal Labor Board (JFCA), the JLCA are tripartite. Although trade union presence on the boards is a generally positive feature, it can lead to unfair partiality in representation disputes; the member from an established union may work to dissuade a JLCA from recognizing a rival organization. The matter of trade union registration was the subject of followup activities in 1996, pursuant to a 1995 agreement reached in ministerial consultations under the North American Agreement on Labor Cooperation (NAALC), the side agreement on labor to the North American Free Trade Agreement (NAFTA).

Unions form federations and confederations freely without government approval. Most unions belong to such bodies. They too must register to have legal status. The largest trade union central is the Confederation of Mexican Workers (CTM), traditionally a sector of the ruling PRI, but affiliation is individual, and this is to be emphasized in new reforms, both within the PRI and in legislation under consideration in the Congress. The Federal Employee Union Federation (FSTSE), the Revolutionary Worker and Peasant Confederation, and most of the 35 separate national unions, smaller confederations, and federations in the Labor Congress (CT) are also allied with the PRI. However, several are not, including the large teachers' union, which severed its PRI ties several years ago, freeing its minority factions to cooperate openly with other parties, particularly the PRD. Rivalries within and between PRI-allied centrals are strong. There also are a few small labor federations and indepen!
dent unions outside the CT which are not allied to the PRI. One is the small, left-of-center Authentic Labor Federation (FAT). Most FAT members sympathize with the PRD, but the FAT is independent and not formally tied to the PRD.

Union officers help select, run as, and campaign for, PRI candidates in federal and state elections and support PRI government policies at crucial moments. This gives unions considerable influence on government policies but limits their freedom of action to defend member interests in other ways, particularly when this might harm the Government or PRI. The CT, especially the CTM, is well represented in the PRI senatorial and congressional delegations.

The International Labor Organization (ILO) Conference Committee of Experts (COE) has found that certain restrictions in federal employee labor law, adopted at FSTSE request, violate ILO Convention 87 on freedom of association, which Mexico has ratified. These provisions allow only one union per jurisdiction, forbid union members to quit the union, and prohibit reelection of union officials. Again in 1996, the COE and the ILO Committee on Application of Standards (CAS) reiterated their criticism and asked the Government to amend these provisions. A Supreme Court decision invalidated similar restrictions in the laws of two states, but the decision applied only in the specific instances challenged.

There were developments regarding union representation in the new Environment Secretariat, an issue raised again in the CAS debate and in a submission under the NAALC. This Secretariat, formed late in 1994, merged the small former Fisheries Secretariat with much larger sections from the Agricultural and Social Development Secretariats. In early 1995, the Fisheries Union applied to the Federal Employee Labor Tribunal (TFCA) to change its name to union of the new secretariat. The TFCA denied the request. The TFCA is bipartite, with FSTSE as well as government members. Following the TFCA decision, the FSTSE, applying its statutes, convoked a convention, with delegates elected by secret ballot, to form a new union and elect its officers. The TFCA recognized the new union and withdrew recognition from the old. The new union thus benefited from the contractual relationship giving union delegates time off with pay for union work. The dissolved union appealed to a court, which upheld !
the appeal and returned the matter to the TFCA. The TFCA restored the Fisheries Union's registration and revoked that of the new union (again upholding the legal provision allowing registration of only one union per entity, violating ILO Convention 87). The unregistered union continued benefiting from time off and dues. The TFCA held a representation election ("recount"--see Section 6.b.) for employees to choose by secret ballot between the two unions. The Fisheries Union lost by a wide margin and challenged the validity of the election, charging irregularities, but the TFCA confirmed the election results.

In April the Federal District municipal government reached agreement with the jailed leaders of the SUTAUR-100 union of the bankrupt former public municipal bus company Ruta-100. The Government agreed to concede and allow the union to operate two of the new private bus companies to replace Ruta-100. The Government also agreed to appeal to the courts to release the leaders from jail while SUTAUR reached a settlement with the former members who had sued it to recover money from the union pension and other funds. The union leaders were released on bail in July and the first of the two union enterprises began operating at the end of August.

The Constitution and the LFT provide for the right to strike. The law requires 6 to 10 days' advance strike notice, followed by brief government mediation. If federal or state authorities rule a strike "nonexistent" or "illicit," employees must remain at work, return to work within 24 hours, or face dismissal. If they rule the strike legal, the company or unit must shut down totally, management officials may not enter the premises until the strike is over, and the company may not hire striker replacements. Provisions for maintaining essential services are not onerous. The law makes filing a strike notice an effective, commonly used threat, but few strikes actually occur, usually to protect a failing company's assets from creditors and courts until an agreement is reached on severance pay. On the other hand, informal stoppages are a fairly common tactic, but are uncounted in statistics and seldom last long enough to be recognized or ruled out of order.

The law permits public sector strikes, but formal public sector strikes are rare. Informal ones are more frequent. Informal stoppages by dissident factions of the national teacher union shut down many schools in several states and the Federal District in late May and June, and demonstrations disrupted traffic in the capital, until settlements were reached which included pay for strike days and unpaid overtime to make up lost work and complete the school year.

During the first 11 months of 1996, the JFCA reported that 7,690 strike notices were filed and 51 legal strikes occurred in federal jurisdiction, involving 54,394 workers and the loss of 653,020 work days. Although there were fewer legal strikes than during the same period in 1995, they involved more workers and resulted in more lost workdays. There were no reports that federal or state labor authorities stretched legal requirements to rule strikes nonexistent or illicit, or used delays to prevent damaging strikes and force settlements.

The Constitution and the LFT protect labor organizations from government interference in their internal affairs, including strike decisions. This can protect undemocratic or corrupt union leaders. The law permits closed shop and exclusion clauses, allowing union leaders to vet and veto new hires and force dismissal of anyone the union expels. Such clauses are common in collective bargaining agreements.

In 1995 employer organizations abandoned earlier efforts to push for labor law reform to limit union leaders' power and give employers a free hand. In effect, Government, employers, and unions had negotiated reforms through tripartite national agreements and collective bargaining at the enterprise level, and through cooperation in programs to increase, and compensate for, productivity. With government blessing, after nearly a year of negotiation, national labor and employer organizations agreed in August on a joint effort to build a new labor culture of mutual respect and cooperation to boost productivity, wages, and competitiveness. Unions are free to affiliate with, and are often active in, trade union internationals.

b. The Right to Organize and Bargain Collectively

The Constitution and the LFT strongly uphold the right to organize and bargain collectively. Interest by a few employees, or a union strike notice, compels an employer to recognize a union and negotiate, or ask the federal or state labor board to hold a union recognition election. LFT prounion provisions led some employers to seek out or create independent "white" or company unions as an alternative to mainstream national or local unions. Representation elections are traditionally open, not secret, although this seems to be changing. Traditionally, management and union officials are present with the presiding labor board official when workers openly declare their votes, one by one. Such open recounts are prevailing practice but are not required by law or regulation. Secret ballots are held when all parties agree.

As the economic crisis deepened in 1995, the Government, at union insistence, agreed to end the system of annual national pacts negotiated by the Government and major trade union, employer, and rural organizations, which had voluntarily limited free collective bargaining for the past decade. Wage restraints no longer exist, except for those caused by the economic recession and difficult situation of most employers. The Government and major employer and union organizations continue to meet occasionally to reaffirm the 1995 "Alliance for Economic Recovery" (in October they signed an "Alliance for Growth") and agree on new tax breaksor minimum wage increases, but the Government has kept its commitment to free collective bargaining without guidelines or government interference. Wages in most union contracts appeared to keep pace with inflation in 1996, after losing ground in 1995.

Mexico's record in internal union democracy and transparency is mixed. Some unions are democratic, but corruption or authoritarian and strong-arm tactics are common in others. The few protests alleging such practices this year included the hospital local of the Mexico City public sector municipal employees' union. The election seemed to have been conducted reasonably fairly, but the losers protested the results, seized union offices until driven out, and demonstrated in the streets, drawing blood from themselves to protest inadequate hospital supplies. Another protest involved factory committee leaders trying to improve conditions at a U.S.-owned maquila factory in Sonora. The committee leaders were fired with the complicity of an allegedly-CTM "leader" who had a protection contract. The telephone union, representing the fired former factory committee leaders, the Union of Goods and Services, and the Communications Workers of America filed a submission for review by the U.S. N!
ational Administrative Office, under provisions of the NAALC.

The public sector is almost totally organized. Industrial areas are heavily organized. Even states with little industry have transport and public employee unions, and rural peasant organizations are omnipresent. The law protects workers from antiunion discrimination, but enforcement is uneven in the few states with low unionization.

Unionization and wage levels in the in-bond export sector vary by area. Wages have been lower in this sector than in most of industry, especially in low technology facilities and in the west, but the gap has narrowed and may now be minimal. Some observers allege poor working conditions, inadequate wages, and employer and government efforts to discourage unionization in this sector. There is no evidence that the Federal Government opposes unionization of the plants, which tend to be under state jurisdiction, but some state and local governments in the west are said to help some employers discourage unions.



c. Prohibition of Forced or Compulsory Labor

The Constitution prohibits forced labor. There have been no credible reports of forced labor for many years, with the exception of abuses of refugees and illegal immigrants in Chiapas (see Section 2.d.).

d. Minimum Age for Employment of Children

The law bans child labor and sets the minimum legal work age at 14 years. The activities of those 14 and 15 years of age are so restricted as to be uneconomic (no night or hazardous work and limited hours). The ILO reported that 18 percent of children 12 to 14 years of age work, often for parents or relatives. Enforcement is reasonably good at large and medium-sized companies, especially in export industries and those under federal jurisdiction. Enforcement is inadequate at the many small companies and in agriculture. It is nearly absent in the informal sector, despite government efforts. Most child labor is in the informal sector (including myriad underage street vendors) or in agriculture and rural areas. The CTM agricultural union's success years earlier in obtaining free transport for migrant seasonal workers from southern states to fields in the north inadvertently led to a significant increase in child labor. The union and employers were unable to convince indigenous far!
m workers to leave their families at home, and many have settled near worksites in the north. The union has had some limited success in negotiating with employers to finance bilingual education near worksites and in obtaining social security child care centers, but it has had difficulty in persuading member families not to bring their children into the fields. Riots over pay delays in the San Quintin valley in Baja California drew media attention to the child labor and other problems of indigenous worker families there and spurred the state government to pledge action to end child labor and other social ills.

The Federal Government increased the number of obligatory school years from 6 to 9 in 1992 and made parents legally liable for their children's attendance, as part of a reform to upgrade labor force skills and long-term efforts to continue increasing educational opportunities for and participation by youth. It has a cooperative program with UNICEF.

e. Acceptable Conditions of Work

The Constitution and the LFT provide for a daily minimum wage. The Tripartite National Minimum Wage Commission (government, labor, and employers) usually sets minimum wage rates each December, effective January 1, for the whole year, but any of the three parties can ask that the board reconvene during the year to consider a changed situation. As part of the Alliance, (see Section 6.b.) labor, employers, and the Government agreed in 1995 to ask their representatives on the Commission to increase the minimum wage 10 percent on December 1, 1995, instead of the usual January 1 increase, and another 10 percent on April 1, 1996. They later agreed to make the April increase 12 percent. In December the Wage Commission adopted a 17 percent increase, based in part on the Government's projection of a 15 percent annual inflation rate for 1997. Organized labor's unhappiness with the 17 percent increase (some labor organizations had demanded an increase of at least 25 percent) produced some!
 suggestions that the official increase be challenged in court because it does not meet the constitutional requirement to be adequate to cover basic costs of living, including recreation. By year's end, however, no legal action of this sort had been filed.

In Mexico City and nearby industrial areas, Acapulco, southeast Veracruz state's refining and petrochemical zone, and most border areas, the minimum daily wage after April 1 was $3.01 (22.60 new pesos). However, employers actually paid minimum wage earners $3.42 (25.76 new pesos) due to a supplemental 14 percent fiscal subsidy (negative income tax or tax credit, which the Government refunds to employers). These income supplements to the minimum wage, agreed in annual tripartite pacts, are for all incomes less than four times the minimum wage, decreasing as wages and benefits rise. In Guadalajara, Monterrey, and other advanced industrialized areas, the minimum daily wage (before the fiscal subsidy) was $2.79 (20.95 new pesos). In other areas, it was $2.54 (19.05 new pesos). There are higher minimums for some occupations, such as building trades.

Few workers (only 14 to 18 percent of the workers covered by social security) earn only the minimum wage. Industrial workers average three to four times the minimum wage, earning more at bigger, more advanced and prosperous enterprises.

The law and contract arrangements provide workers with extensive additional benefits. Legally required benefits include free social security medical treatment and pensions, individual worker housing and retirement accounts, substantial Christmas bonuses, paid vacations, and profit-sharing. Employer costs for these benefits add from about 27 percent of payroll at marginal enterprises to over 100 percent at major firms with good union contracts.

The LFT sets 48 hours as the legal workweek, although with pay for 56 hours. Workers asked to exceed 3 hours of overtime per day or required to work overtime on 3 consecutive days must be paid triple the normal wage. For most industrial workers, especially under union contract, the true workweek is 42 hours, although they are paid for 7 full 8-hour days. This is why unions jealously defend the legal ban on hourly wages.

The law requires employers to observe occupational safety and health regulations issued jointly by STPS and the social security institute (IMSS), and to pay contributions that vary according to their workplace safety and health experience ratings. LFT-mandated joint management and labor committees set standards and are responsible for workplace enforcement in plants and offices. These meet at least monthly to consider workplace needs and file copies of their minutes with federal labor inspectors, who assumed jurisdiction for all such inspections in 1987, supplanting state inspectors and considerably strengthening inspection. The inspectors schedule visits largely in response to these workplace committees.

Individual employees or unions may also complain directly to inspectors or safety and health officials. Workers may remove themselves from hazardous situations without jeopardizing their employment. Plaintiffs may bring complaints before the Federal Labor Board at no cost to themselves.

STPS and IMSS officials report that compliance is reasonably good at most large companies. Federal inspectors are stretched too thin for effective enforcement if companies do not comply voluntarily and fulfill their legal obligation to train workers in occupational health and safety matters, although the number of inspectors was increased in 1995. There are special problems in construction, where unskilled, untrained, poorly educated, transient labor is common, especially at many small sites and companies. Many unions, particularly in construction, are not organized effectively to provide training, to encourage members to work safely and healthily, to participate in the joint committees, or to insist on their rights. The STSP completed work in 1996 on a comprehensive reform of regulations and procedures (resulting from extensive consultations through NAFTA cooperative mechanisms) concerning workplace health and safety.