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.
