The government repression of the electrical
workers’ strike in July 1976 fit with cold logic
into the overall panorama of economic and
political crisis in Mexico. In only ten years, the
country’s foreign debt had grown tenfold to a
staggering $28 billion. Mexico’s trade deficit was
$4.5 billion in 1975, and in that same year the
rate of economic growth dipped below four
percent, representing an absolute stagnation in
per capita production.’
As a result of the economic recession,
underemployment now tops 40 percent, and real
wages at the end of 1975 were below 1972
levels. 2 These factors, as we have seen, sparked
Peasants, farm workers and squatter communities have stood behind the
electrical workers movement.
Sept./Oct. 1977 3940
NACLA Report
the most militant wave of labor insurgency to
rock Mexico since the 1930’s.
International capital and important sectors of
the Mexican bourgeoisie grew increasingly
anxious as Echeverria’s efforts to overcome the
economic crisis without intensifying the class
conflict seemed to produce nothing more than
increased government spending, inflation and
more political unrest. By 1974, both the IMF and
the World Bank were pressuring Mexico to
devalue the peso as an initial step in correcting
the negative balance of payments, and to
implement tight wage “controls to counter infla-
tion and boost profits. 3 Echeverria resisted such
unpopular moves for a time, for fear of splitting
the thinly worn fabric of social control which
tenuously held the country together.
In retrospect it appears that Echeverria finally
agreed to accept the proposed devaluation and
austerity program sometime in early 1976. But
first the groundwork had to be laid; the potential
core of opposition had to be silenced. Thus the
repression of the Democratic Tendency in July
1976, as well as of another half dozen important
strikes in July and August. Thus the government-
backed take-over of Mexico’s leading liberal
daily, Excelsior, an increasingly vocal opponent
of the government’s changing policies.
Finally, in August and September, the peso
devaluation was announced: a 100 percent
plunge in value vis-a-vis the dollar. The devalua-
tion was theoretically intended to cut the
balance of payments deficit by making imports
more expensive and exports more competitive on
the international market. In fact, the main effect
of the devaluation was an immediate increase of
prices; basic consumer goods jumped by 40
percent in the weeks after the devaluation. Wage
increases on the other hand were held at 23
percent and then only for unionized workers, less
than 25 percent of the work force.
IMF-IMPOSED AUSTERITY
Shortly after the devaluation, the Interna-
tional Monetary Fund (IMF) announced a $1.2
billion emergency loan to Mexico, accompanied
by numerous restrictions on government eco-
nomic policy, including the following: (1)
government spending must be reduced and
restricted to investments in “productive” enter-
prises – i.e., social spending on housing, educa-
tion, welfare, etc. are to be cut back in favor of
increased subsidies to the private sector; (2)
employment in the public sector cannot be
allowed to increase by more than two percent in
1977, severely undercutting the government’s
ability to curb unemployment; and (3) wage
increases must be kept to a minimum while prices
are free to rise.
The new President, Jose Lopez Portillo,
initiated his regime in December 1976 with the
announcement of the IMF loan. He also signed an
agreement with Mexico’s major industrialists to
hold down wages in exchange for their “coopera-
tion” in his price controls program. Meanwhile, Lopez Portillo has offered political reforms, in
the form of promised legal registration of several
left parties, in the hopes of undercutting the
unpopularity of the core of his new policies: an
all-out assault on the trade unions.
Having already dealt a serious setback to the
Democratic Tendency of the Electrical workers,
as we have seen, the government moved against
another major center of union activity in July of
this year: the STUNAM, Workers Union of the
National Autonomous University of Mexico.
With 12,000 armed police, the government
moved against the striking leftist union, arresting
nearly a thousand people and ransacking the
University.
AND NORTH OF THE BORDER?
The IMF, as well as the Carter and Lopez
Portillo administrations, are well aware that the
austerity program they have jointly imposed on
the Mexican working people will not be easily
implemented. In addition to the organized
resistance of the Mexican labor movement, the
guardians of international capital must face the
implications such a program holds for the United
States. As unemployment and political repres-
sion in Mexico increase, millions of Mexican
workers will continue to move north across the
border in search of jobs. Thus Carter’s recently
announced policy on immigrant workers (see
Update) is the “domestic” half of international
capital’s program to “rehabilitate” the Mexican
economy. Carter’s immigration policy is de-
signed to assure that workers north and south of
the border remain unorganized, vulnerable, divided, and most importantly controlled.
Increased immigration from Mexico and
Carter’s new policy place new pressures on the
North American people to counter the racist and
40 NACLA ReportSept/Oct. 1977
41
chauvinist scapegoating which portrays the Mexi-
can immigrant worker as the cause of unemploy-
ment and low wages in the United States. The
AFL-CIO leadership has fostered racist divisions
among workers in the United States with
statements like the following from one of the
AFL-CIO’s directors, Andrew Biemiller:
As we have pointed out time after time,
illegal immigrants have for years been
taking jobs from American citizens and
legal immigrants in increasing numbers,
often work for substandard wages and
accept substandard working and living
conditions, are easy targets for blackmail
and intimidation by unscrupulous em-
ployers, and are all too frequently a drain
on the welfare resources of the communi-
ties where they live. 7
If the trade unions in this country are ever
going to protect workers from “substandard
wages and working conditions” and “intimida-
tion by unscrupulous employers,” racism and
national chauvinism must be combatted, and
replaced by a clear understanding of the objec-
tive forces which demand international solidarity
among working people. The cause of growing
unemployment and declining wages in both the
United States and Mexico is the crisis of the
international capitalist system of which both
countries are a part – not immigrant workers. We
North Americans can respond to the current
attacks on Mexican working people by opposing
the IMF austerity program and Carter’s immigra-
tion policy, and by supporting the organizing
efforts of all workers on both sides of the border.
A leader of a current strike of electrical
workers in Mexicali on the California-Mexico
border recently told NACLA that the workers
there have been actively seeking the support of
unions and other workers’ organizations north of
the border,
because to find a solution to our problems here, we will have to find support from workers in the United States. The pro- capitalist labor bosses are radicalizing the labor movement in both countries and
pushing us toward a common alliance. A revolution in Mexico will mean a struggle against capitalism in the United States as well.
PERSPECTIVES
1. Punto Critico 1/31/77.
2. Ibid.
3. Excelsior, 5/2/77 and 1975 World Bank report
on Mexico.
6. For more on STUN AM strike, see Dateline article
in NACLA’s Latin America & Empire Report, July-
August 1977.
7. San Francisco Examiner, 9/11/77.
